Framework: what are the characteristics of a High-Performance Finance Function?

Reason for research

A High Performance organization is an organization that achieves significantly better results than comparable organizations, over a period of at least five years, by focusing in a disciplined way on what really matters to the organization. HPO organizations are simultaneously working on 5 HPO factors:

The 5 strands of success
  • The management is of a high quality and combines integrity and coaching leadership with fast decision-making.
  • The culture of an HPO involves everyone intensively through an open culture and dialogue aimed at actions for better performance.
  • The long-term focus of an HPO applies to customers, suppliers and cooperative organizations, but especially to management and employees. New management is complemented by promotions from within.
  • An HPO knows its distinguishing feature in the market and allows all employees to continuously contribute to improving and renewing its processes, services and products.
  • The employees of an HPO are diverse, complementary and can work well together. They are flexible and resilient at the service of the result

When asked what the HPO factors and HPO characteristics mean for a finance function (what is a high performance finance function anyway?”), we defined the research question for a supporting business unit as the finance function.

Research question

“Which factors determine the performance of the finance function and how are these factors of the finance function related to the HPO factors?”


In our research we wanted to relate the eleven movements that we had identified in previous research (see book “How to build an HPFF”?) to the performance of the finance function on the one hand and to the HPO factors on the other. However, we did not find a questionnaire for this in the literature. That is why, in a number of brainstorming sessions, we designed a questionnaire ourselves by converting the movements into HPFF statements with which respondents could assess their own financial function. These questions were then assessed for relevance and validity by a number of experts in the financial field. Ultimately, the eleven ideas were converted into 34 statements. In addition, we designed a number of propositions to measure the performance of the finance function. The HPFF, HPO and performance counts were included in a questionnaire. This questionnaire was sent to our financial relations. These were mainly CFOs and managers in the financial function of Belgian and Dutch profit and non-profit organisations. They were asked to distribute the questionnaire to as many professionals as possible working in their financial position.


HPO Factors Positively Influencing Finance Function Performance:

  • Of the HPO factors, three appear to have a direct positive influence on the performance of the finance function: Continuous Improvement and Innovation, Long-Term Orientation and Management Quality. This outcome means that the finance function will in any case benefit if the organization as a whole decides to initiate a transformation to HPO.
  • This is to be expected from the HPO factor of Continuous Improvement and Renewal: continuous improvement is an important activity in the financial function in order to perform its own financial processes and reports efficiently and to be able to do it even more effectively through innovation.
  • HPO factor Long-term orientation is important for the finance function to keep the continuity of the organization in mind and to maintain stable relationships with both internal and external customers (after all, they are the ‘stakeholders’ of the finance function;
  • High quality management (an important HPO factor) is always necessary to create and maintain a smooth running organization and thus also to ensure a smooth running finance function.
  • HPO factor Openness and Action Orientation mainly concerns the relationship between (individual) managers and employees and applies to all people in the organization, not specifically to the financial function, so there is no direct effect on the financial function performance.
  • The HPO factor Employee quality has no direct effect. This is because this factor mainly influences the quality of the finance staff through HPFF factors Personal Development and Role Clarity (which in turn have a direct impact on the performance of the finance function).
HPO- and HPFF-factors that have a positive influence on the performance of the Finance Function

HPFF Factors Positively Affecting Finance Function Performance

  • The HPFF factor Strategic Role appears to have the strongest positive relationship with the performance of the finance function. It can be argued that successfully performing one of the most important activities of a staff function such as the finance function – namely, providing the best possible support to the operation and its management – ​​is seen as a measure of a successful finance function. In particular, the performance characteristics ‘the internal customer is very satisfied with the finance function’ and ‘the finance function always has an important voice in decision-making in the organization’ will be positively influenced. The strategic role of the finance function is mainly experienced by the internal customer in the organization. If this customer is satisfied, is well served and is even involved in the further development of the finance function, then the strategic role of the finance function is well fulfilled.
  • The increasing role of HPFF factor IT in the organization and therefore also in the finance function is also apparent from our research: the better the IT architecture and the knowledge about IT, the better the finance function performs. This is important, after all, an organization that invests in applications with which data can be collected and processed efficiently and effectively, has time for other points of interest.
  • HPFF factor Financial Function Improvement by definition has a positive influence on the performance of the financial function: an improvement of processes in the financial function – think of integrating operational purchasing processes and administration – always has a positive effect on the daily practice and activities of that department.
  • HPFF Factor Role Clarity also has a direct, albeit weaker, direct impact on the performance of the finance function. This means that it is important for a well-functioning financial function to actually distinguish between the different roles and to match them with the financial employees. This puts ‘the right person in the right place’, i.e. the best person for a specific role and associated activities is enabled to excel.
  • The HPFF Personal Development factor contributes to the development of financial employees, but does not in itself improve the financial function. This is because ‘the proof of the pudding is in the eating’ applies: someone may have followed a good course or training, but if this person does not put what has been learned into practice (or cannot put it into practice due to organizational circumstances) then there will be no effect. acting in favor of the quality of the finance function. In addition, following a course or training, especially if it is for personal development, usually only has a beneficial effect in the long run: an employee needs time to put what has been learned into practice.

Relationship between HPO and HPFF factors

The relationship between HPO- and HPFF-factors

The relationships viewed from the perspective of the HPO factors:

  • Openness and action orientation. As finance employees come into contact with the operational departments more and more, because of their strategic role, they must have good communication and dialogue skills, skills that can already be ‘trained’ within the finance department itself between manager and employee and between employees among themselves. In addition, financial employees must ensure that they have sufficient business and IT knowledge that they can also be involved in all important business processes; knowledge that they can then take back to their own finance function to use in improving the function.
  • Employee quality. Employees of an HPFF want to be held accountable for their results and they want to excel. They therefore play an important role in improving the finance function, both in carrying out improvement activities and acquiring IT knowledge. In addition, they take responsibility for their own personal development and role clarity.
  • Long-term orientation. For an HPO, continuity and sustainability of the organization are very important, which is reflected in the focus on the long term instead of the short term and the attention for customers and stakeholders. It is therefore no wonder that this factor is related to all HPFF factors, because the latter all serve the continuity of the financial function (among other things by improving it) and the internal (the business managers) and the external (the stakeholders) customers.
  • Continuous Improvement and Innovation. HPOs are constantly improving and renewing their processes, products and services. This mindset will help the finance function to continuously improve its own function. IT will play a major role in this improvement and innovation, so a lot of IT knowledge and focus is required within the financial function. The mindset of continuous improvement will also help financial employees to (continue to) develop themselves.
  • Management quality. HPO managers are responsible for creating the conditions in which their employees can excel. In the case of the finance function, managers must ensure that finance employees know what is expected of them in their role and further encourage and coach them to gain IT knowledge and actively participate in improving the finance function. They themselves will fulfill an important strategic role towards the business managers, often as part of or as an advisor to the management team.

The framework for a finance function on the way to high performance as it emerged from the research:

Simplified HPFF framework

The high performance financial function supports the organization in becoming and remaining a high performance organization (HPO), by always keeping the quality of its employees (behaviour of managers and employees), processes and systems (IT) as high as possible.

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