Job descriptions provide information about the role in writing. It does not tell you whether or not the person in this role is able to create a 3-statement model, question a business case or explain a variance to a non-finance stakeholder. A finance skills matrix closes that distance by mapping required capabilities against real, evidenced proficiency, turning a vague finance skills gap into something a manager can measure, prioritise and act on.

 

 

What Is a Finance Skills Matrix?

 

A finance skills matrix is a clear format that matches 5 elements side by side: The skills the role needs, the current level of proficiency in each by the employee, the level of proficiency the role needs, the gap, and the development action that will fill the gap. It is presented in a grid format, turning a set of impressions about “who is good at what?” into a document that can be read, compared and amended.

 

A skills matrix can be confused with tools adjacent to it. A job description does not outline levels of proficiency; it outlines duties and responsibilities. While a competency framework establishes the behaviours of an organisation in general, it does not necessarily go to the level of detail required to assert that one particular analyst can create a leveraged buyout model. A performance review is more of a “how did you do” assessment rather than a “will you be able to” assessment. A training needs analysis is not the same as the output of a skills matrix, but rather it is a next step.

 

No one size fits all for finance functions. The matrix would vary based on the size of the company, the structure of the finance team, types of roles, industry, the technology stack being used and the strategic direction of the company. Capital allocation, stakeholder influence and risk judgement will be the focus of a CFO’s matrix. Forecasting, modelling and business partnering will be given more value in an FP&A matrix by an analyst. A financial controller’s matrix should be focused on the rigour and process of technical accounting, and a finance business partner’s matrix should have a focus on commercial insight and communication. One of the more typical ways that the exercise loses its value is to construct one matrix and apply all roles through this matrix.

 

Why Do Finance Teams Need a Skills Matrix?

 

So it’s no surprise most of the finance leaders already recognise that there is a finance skills gap somewhere in their team (see our previous post on finance team skill gaps for the bigger picture). The power the matrix provides is precision; the general knowledge becomes a detailed record, employee-by-employee, role-by-role, of where and what the gaps are and how big they are. 

 

Identify Capability Gaps

 

When this is done, and it is known that the requirements are met, the comparison does the rest. If the job necessitates the FP&A analyst to be more advanced in their forecasting, they may be at an intermediate level in forecasting, which may be the case if the business has adopted rolling forecasts and scenario planning. That gap is no longer a manager’s perception; it’s a documented, one-level gap that can be discussed, budgeted for and monitored to closure.

 

Support Succession Planning

 

When considered as a team, a matrix can reveal the mix of employees who are qualified to take on greater responsibility, the focus on team skills in one individual and where that focus poses a true business threat. It also raises future leaders earlier than they would be required to be developmentally prepared during a performance review cycle, and it identifies areas of under-development that are required for the business in the near future.

 

Improve Workforce Planning

 

Not all holes need to be filled in the same manner. A matrix provides the evidence for the finance leader to use to determine, by capability, which option is more appropriate: to develop it in-house, to recruit it externally, to augment it with technology, outsource, or share it as a centre of excellence capability throughout the broader finance team? 

 

Prioritise Training Investment

 

It is not cost-effective or even needed to train all employees in all skills. A matrix allows leaders to focus on business impact, the importance of the capability to the job, current level of competence, the level of urgency, and direction of the business strategy. It’s that prioritisation that keeps a training budget on track and not spread thin.

 

Which Finance Skills Should You Assess?

 

Finance team skills span technical, analytical, digital, commercial and interpersonal capability, and the exact list should reflect your finance operating model rather than a generic checklist. Most of the finance functions can be shortened or lengthened depending on the role and are covered in the 8 areas listed below. 

 

Financial Modelling

 

Evaluate if an employee can create an integrated three-statement model; develop assumptions that are expressed clearly enough to be understood by someone else; develop the ability to perform scenario and sensitivity analysis; model investment decisions; and interpret the output of the model in terms of the business. The beginner may be able to update the input of an existing model; the intermediate employee may be able to create a simple model using a template; the advanced employee may be able to create a complex model from scratch and stress test it.

 

Financial Analysis

 

This includes Financial Statement Analysis, Profitability, Ratio Analysis, Variance Analysis, Performance Analysis and being able to read the trend and give its reasons. The journey from a simple reporting of what was happening historically to one that generates insight that drives a decision change is a journey that matters more to the business than accuracy. 

 

Forecasting

 

Evaluate the ability to create a forecast, make defensible assumptions, perform variance analysis with actuals, maintain an updated forecast, conduct scenario analysis and, most importantly, communicate to management the reasons a forecast has changed since the previous period. 

 

Excel

 

It is not helpful to evaluate one’s “Knows Excel” skills. Decompose into formulas and functions, PivotTables, data cleaning, lookup functions, financial modelling techniques, dashboard building, scenario analysis and automation, and compare and contrast each to the employee’s job. Both management accountants and FP&A analysts can be “advanced” Excel users, but with very different mixes of these sub-skills.

 

Data Analytics

 

Measure the skills to prepare and interpret data, to create a dashboard and visualisation, to identify a meaningful trend among huge amounts of data, and to feel comfortable using business intelligence tools to make decisions as opposed to just reporting data. 

 

Business Partnering

 

Evaluate the working relationship with non-finance departments, interpret what really moves the commercial aspect of the business, question assumptions in a constructive manner, provide clarity on the financial impact of a decision, and provide a financial ‘call to action’ based on financial information. 

 

Communication

 

All skills in presentation, financial storytelling, clarity in writing, stakeholder communication, and the ability to explain a complex concept simply exist here. Great technical finance skills often don’t translate to great communication — the two are very often thought of as the same thing, and they aren’t.

 

Strategic Finance

 

Evaluate strategic planning, capital allocation judgement, investment analysis, business case development, and risk analysis and scenario planning at an enterprise level for more senior positions. It takes on greater importance than it ever did over a broader range of roles as finance is transitioning from reporting to decision support. 

 

How to Create a Finance Skills Matrix

 

The following steps can be sufficient to create a functional finance skills matrix from scratch. Each one builds on the previous one; it’s best to not jump to the spreadsheet. 

 

Step 1: Define Required Capabilities

 

Don’t begin with what the employees already know; start from a business strategy and the finance operating model. For every finance position, define the technical skills, analytical skills, digital, commercial, leadership and communication needs. The prelims help to keep the matrix focused around what the role requires, rather than those skills that are

 

Step 2: Assess Current Capabilities

 

Apply the same level of ability to all roles to make comparisons. In practice, a four-level scale is appropriate:

 

Level	Description
Beginner	Can perform basic tasks with guidance.
Intermediate	Can independently perform standard tasks and solve common problems.
Advanced	Can handle complex problems, improve processes, and support others.
Expert	Can lead the capability, develop frameworks, coach others, and make high-level decisions.

 

Assessment should be based on evidence, but not just on employee self-assessment, which can sometimes go both ways, with confident employees overstating their level of proficiency and conscientious employees understating it. Work samples, financial models created by employees, Work reports, Presentations, Manager observation, Performance data, Structured practical assessment and Training records are useful evidence.

 

Step 3: Identify Gaps

 

The difference is between the required and current level of proficiency. There are gaps of various sizes throughout a team, and it’s nice to have a side-by-side view before deciding what to do about any one gap:

 

Skill	Required	Current	Gap
Financial Modelling	Advanced	Intermediate	1 level
Forecasting	Advanced	Intermediate	1 level
Excel	Advanced	Intermediate	1 level
Business Partnering	Intermediate	Beginner	1 level

 

Not all gaps are created equal. Once sorted into critical, moderate and lower-priority bands, treating a one-level gap in a skill the role doesn’t depend on every day the same way as treating a one-level gap in a skill the role depends on every day will avoid treating a lesser skill as a greater skill.

 

Step 4: Prioritise Gaps

 

There’s a better way to score than on instinct alone. Consider the four elements of business impact, urgency, number of employees impacted and difficulty to develop capability and score them in each relevant area to determine the high, medium or low priority for the capability gap. 

 

Gap	Business Impact	Urgency	Employees Affected	Priority
Advanced Financial Modelling	High — feeds a major investment decision	High	3 analysts	High
Business Partnering	Medium — affects stakeholder trust	Medium	6 team members	Medium
Advanced PivotTables	Low — used occasionally	Low	2 employees	Low

 

The PivotTable gap is not outranked in this example, however, by advanced financial modelling since both are considered “one-level” gaps and the former is on the critical path of an investment decision. You’re not looking to list gaps of course, you’re looking to score them according to their priority, which is based on the business consequence, not the size of the number on the matrix. 

 

Step 5: Build Development Plans

 

You’ve only done half of it if you are just identifying gaps. There should be a specific development action in each gap – this could be classroom training, in-house training, e-learning, workshops, mentoring, coaching, job rotation, project-based learning, external courses or peer learning; all are acceptable, and the type of development action will depend on the size of the gap and the type of employee.

 

But training is not the solution for all of the gaps. Some capability gaps are better addressed by recruiting someone with the ability to do the work, redesigning a process so that the skill is not important, adding technology to the process that eliminates the manual work requirement or retasking a position so that it doesn’t rely on a skill that the team doesn’t possess. If they have not prioritised, then the matrix is likely to recommend training for everything.

 

Example Finance Skills Matrix

 

A working example, created for an individual FP&A analyst, appears like this. Current level is the level of the student’s skill, and required is the level required for the job.

 

Skill	Beginner	Intermediate	Advanced	Required
Financial Modelling	✓			Advanced
Forecasting		✓		Advanced
Excel		✓		Advanced
Business Partnering	✓			Intermediate
Financial Analysis		✓		Advanced
Data Analytics	✓			Intermediate
Communication		✓		Advanced
Strategic Finance	✓			Intermediate

 

The same set-up can be used to zoom in or zoom out, depending on the desired view. A matrix developed by one staff member facilitates a staff development conversation. It is a multi-level structure that identifies the overall lack of skills for an entire role family. It is constructed throughout the finance team and turns into a workforce planning tool. It is constructed proactively, facing the direction that the business is moving in, and hence can be used to plan for skills that may not be needed now but will be needed soon.

 

How Can Finance Training Close Skills Gaps?

 

After the matrix is created, the logical order is assessment – action: Skills matrix, Gap analysis, Priority skills, Training needs, Development programme, Reassessment. It’s the matrix’s value that it provides you with not only the training needed, but which training, what capability level, and which employees.

 

Closing a Financial Modelling Gap

 

If analysts are assessed at an intermediate level, but the job calls for advanced skill, the training must be specific: advanced financial modelling technique, scenario analysis, valuation modelling, integrated financial statement construction, and training through case studies, not general, but similar to the business’s own deal or planning context. 

 

Closing an Excel Gap

 

Once employees are able to perform basic spreadsheet tasks and find themselves in a rut when the analysis becomes more complex, it’s often one of the more advanced Excel functions, structured data analysis techniques, financial modelling practice, or dashboard construction and automation — but not the introductory Excel training the employee has probably already completed once.

 

Closing a Business Partnering Gap

 

If the gap is commercial rather than technical, training should be centred around skills and techniques in stakeholder communication, commercial thinking, financial storytelling, decision support techniques, and presenting insight to a non-finance audience — skills that classroom training often falls short of teaching alone, especially if no real work or feedback is applied.

 

Whichever gap is being addressed, finance team skills should be reassessed against the same matrix after training is complete. That’s a re-evaluation that proves that the gap did actually shrink, not just that a course was taken. 

 

How Often Should a Finance Skills Matrix Be Updated?

 

Creating a skills matrix isn’t a one-off HR initiative that gets pushed to the back of the HR file drawer after the initial construction phase. It should be revisited whenever there is a change in business strategy, when new technology is implemented in the finance function, when there are role changes, when employees are changing roles, when new regulation affects the way finance operates, when a major transformation project starts and as a matter of course during annual workforce planning. A practical rhythm is a full, formal review every year with targeted updates between the annual reviews if any of the trigger events occur between the annual reviews.

 

How Can Companies Turn a Skills Matrix Into a Finance Workforce Strategy?

 

Real value is added to individual matrices when they are aggregated. They are all rolled up into the finance function to reveal areas in which the team has the strongest capabilities, areas with repeated gaps (not single individuals), areas that require a single person to possess, areas that require future hires and places where training investments are best spent, areas where succession risk is focused (not just one individual) and areas of new capabilities that the team is not yet developing.

 

With the view of aggregation like this, a matrix can provide the answers to questions that one person’s evaluation cannot: Do we have the advanced modelling capacity to be able to support the pipeline of investment decisions that are coming up for us? But we are too reliant on one Excel specialist who is also the only person who knows a key model? Is the finance team ready to play its part in the business’s journey towards becoming a digital organisation as it is today? Are managers across the team credible with operations, as a result of their business-partnering abilities? What are the skills and attributes that should be nurtured in-house, and what should be bought in?

 

Common Mistakes When Building a Finance Skills Matrix

 

Assessing Too Many Skills

 

Attempts to include dozens of loosely related competencies in a matrix soon get too cumbersome to sustain and are dropped as soon as the first cycle is over. A short list of carefully selected skills, which relate to actual job needs, is more effective than a long list that is never updated. 

 

Relying Only on Self-Assessment

 

The rating of employees is subject to a positive or negative bias. The matrix is based on the practitioners’ level of confidence rather than evidence (work samples, manager observation, practical assessment). 

 

Using the Same Matrix for Every Role

 

Financial controller and FP&A analyst are not an exact match. One generic matrix doesn’t account for the holes and doesn’t cover them.

 

Focusing Only on Technical Skills

 

Most modern finance careers require communication, business partnering and strategic thinking just as much as modelling, or Excel expertise – and most matrices that don’t include such competencies miss most of what’s really holding people back. 

 

Creating the Matrix but Taking No Action

 

If there is no outcome and only a document, the matrix was completed without training, hiring, a process change or a technology decision. This exercise will only pay off if it changes the subsequent action.

 

Never Updating the Matrix

 

Finance skills evolve alongside technology, business model and strategic objectives. The same matrix is being used to describe a team that is no longer in existence in the same shape as it was two years ago. 

 

Finance Skills Matrix Template: What Should It Include?

 

A practical template brings assessment into action, and as a result of the completion of the matrix, a development plan is created rather than a scorecard. At least, it should have the following columns:

 

Employee/Role	Skill	Current Level	Required Level	Gap	Priority	Development Action	Target Date
FP&A Analyst	Financial Modelling	Intermediate	Advanced	1	High	Advanced training	Q2
Finance Manager	Business Partnering	Beginner	Intermediate	1	High	Coaching + workshop	Q2
Accountant	Data Analytics	Beginner	Intermediate	1	Medium	Analytics training	Q3

 

This approach to the finance skills matrix is not a one-and-done report but a real-time plan: each row provides a clear view of who needs what, the urgency of the need and what actions are being taken — this structure makes it easy to review progress in each of the four quarterly or annual check-ins. 

 

Conclusion

 

When used and constructed correctly, a finance skills matrix will be more valuable than a list of employee skills. It maps essential capabilities to existing skills, translates this mapping into specific, measurable gaps, ranks the gaps by business impact, assigns an actual development action for each gap and re-evaluates the gap once the action is done. 

 

This matrix can be built and maintained in this fashion to provide a practical way for finance leaders to match finance team talents to the business’ current situation and future direction. Defining a finance skills gap is just the beginning – the real benefit is to develop the specific skills, identify workforce planning needs and, when the need exists, create a structured finance program around the identified skills gaps.