Strategic Finance is the core function of any business.
The Modern Finance Function
Strategic Finance involves the conversion of operational finance data from various departments of a business into valuable real-time financial insights.
Historically, the Finance team typically did cash forecasting and FP&A. However, as business has grown faster and capital has gotten more scarce, Finance is now responsible for making data-driven decisions to deliver key business outcomes. The Start Fin function will now be a critical thought partner in decisions that include "value generation" and "cash expense".
Example 1: In the past, the Marketing team would present Finance with a budget, and Finance would say yes or no. Today, the Strat Fin team will work with marketing to build a thorough model that drives the marketing spend decision, and this model will be connected to the rest of the business to ensure decisions and sensitivity are seamless.
Data and Forward-Looking Insights
Data analysis and infrastructure are essential to a successful Strat Fin team. We all know the importance of data in driving decisions, so we want to prepare our students on exactly how to harness the power of data. From understanding how data warehouses work to pulling the right data together, SFC will teach you the methods of delivering insights that accelerate business decisions.
Example 2: Historically, a Finance function would focus on historical data to deliver ex-ante reports. The modern Start Fin function should now focus on real-time data and use that to drive forward-looking insights.
Cross Functional Partnerships
The Strat Fin function must be comfortable working closely with all business functions as a trusted thought partner. This means the Strat Fin professional must understand the inner workings of other business functions, whether it be Marketing or Product.
From Analyst to Senior Manager, your responsibility will be to partner with other business functions to translate complex datasets into thoughtful analysis and learnings for the business to leverage.
Example 3: Your company is realizing a lot of their users are churning, which is impacting the average LTV of the user. As a result, the Product team want to test and launch a new product feature. This will require headcount and time, and will require reprioritization of capital. The Strat Fin team must have an expert understanding of how all these factors play ito each other to optimize for success.
Board and Investor Facing Materials
The Strat Fin function will need to balance the needs of the Board and Investors with the optimal needs of the business. The team will be responsible for creating a variety of materials and analysis to show the Board, from budget forecasts to monthly updates.
The Strat Fin function is also an essential partner for fundraising. In today's world, path to profitability is top of mind for all investors. The Strat Fin function will need to prove to investors that their capital will be deployed effectively and what their return will look like.
Nucleus of The Business
Overall, the Strat Fin function is the nucleus of the business. The Strat Fin team will be at the heart of every business decision, driving the discussion and being a thought leader in the direction of the company.
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