Organizations depend on a healthy relationship between the sales and finance departments. In some companies, these departments fail to effectively collaborate, which can hinder operations and the budgeting process. It is crucial that managers and leaders work to cultivate close coordination between these two departments, or they risk slowing a company’s growth and profitability.
Conflicts between sales and finance are typically based on how money is spent. A sales department may complain about the expectations to increase revenue and bring in new accounts on a limited budget. The finance department may complain that the sales department spends too much money to achieve those increases. Issues between sales and finance departments arise if the departments establish performance targets that fail to consider the other department. But in the end, sales and finance ultimately want the same thing: growth, revenue generation, and success.
PE executives play a pivotal role in fostering cooperation and collaboration between these two seemingly opposed departments. Verbal cooperation and team-working activities are an important first step, but there are additional measures that executives can take. Investing the time and energy to make this happen is worth the effort. Aligning goals between sales and finance has doubled growth in some middle-market companies by ensuring profitable customers aren’t just entering the business but staying there.
Executives can spearhead this transformation through three different levers of value creation: (1) streamlining process management; (2) technology and system improvements; and (3) bolstering collaboration between departments.
Consolidating Process Management
Even though sales and finance share the same end goal, the...