Can Finance Really Become a Strategic Partner to the Business?

Sanwal, Anand (2007): Can Finance Really Become a Strategic Partner to the Business? Published in: Corporate Portfolio Management Association Newsletter (21. May 2007)

Abstract

Much has been written about how finance organizations can become strategic partners with the businesses they support. While purported experts point to a variety of frameworks, scorecards and key performance indicators, etc. as the keys to bridging the gap between finance and business, these trite 'solutions' have done little to make finance the strategic business partner it seeks to be. Worse yet, pursuing these ideas has put finance organizations on a treadmill where they expend energy and resources (e.g., money and time) ultimately to get nowhere while the issue persists. So if you are still looking for a silver bullet or quick fix to this seemingly incurable problem, stop reading now.

Paradoxically, the link between finance and the business has been under finance's proverbial nose for some time - resource allocation. A serious concerted effort to optimize an organization's resource allocation ultimately enables finance to develop the bridge between finance and strategy. This discipline known as corporate portfolio management works to actively manage the company's resource allocation as a portfolio of discretionary investments leveraging modern portfolio theory while considering organizational behavior.

• Item Type: MPRA Paper
• Additional Information: Anand Sanwal is the Vice President, Investment Optimization and Strategic Business Analysis, at American Express where he is responsible for managing the company's corporate portfolio management effort - widely recognized as the most ambitious corporate portfolio management undertaking to date. In his role, he also oversees the CFO's strategic planning group. He is also the co-founder of the Corporate Portfolio Management Association (http://www.corporateportfoliomanagement.org). He is the author of the book Optimizing Corporate Portfolio Management: Aligning Investment Proposals with Organizational Strategy (Wiley, April 2007) and is a recognized thought leader on corporate portfolio management speaking frequently to companies and research organizations including the Beyond Budgeting Round Table, CFO Executive Board, Enterprise Portfolio Management Council, and Gartner amongst others. He is also the holder of a portfolio management patent.
• Institution: Corporate Portfolio Management Association
• Language: English
• Keywords: corporate portfolio management; modern portfolio theory; resource allocation
• Subjects: M - Business Administration and Business Economics; Marketing; Accounting > M2 - Business Economics > M20 - General; M - Business Administration and Business Economics; Marketing; Accounting > M2 - Business Economics

References

Sanwal, Anand. "Optimizing Corporate Portfolio Management: Aligning Investment Proposals with Organizational Strategy" (Wiley Publishing, April 2007)