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Enterprise Performance Management Event for Financial Service Industries Gain Competitive Advantages through successful Enterprise Performance Management
Moscow, 14.3.2012 Jann Tadorian| Managing Partner Mobile: +41763915015 E-mail: [email protected]
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Key Take Aways of Event
What is Enterprise Performance Management and what are its key components
How can Oracle/Hyperion Software support EPM
How can you execute your strategy in a pragmatic way with the Balanced Scorecard methodology
Hyperion Strategic Finance for Strategic Financial
Loan Management with Oracle and Hyperion Strategic Finance
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Agenda Part I
Introduction to Inplenion
Overview Enterprise Performance Management (EPM)
The Enterprise Performance Management Framework
Q&A
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Introduction to Inplenion
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Jann Tadorian
CO-Founder and Managing Partner Inplenion Business Consulting Intl.
Master of Business Administration; Master of Information Management
15+ years professional experience in the field of performance management
Various positions in both consultancy and software companies
Experienced project manager and - coach
Course instructor „Automating the Balanced Scorecard “ at University
Industries: Financial Service Industry, Telecommunication and Life Science
Experience
Position
Education
Skills
Advisory, Coaching, Project Management and Management Training
Conception and implementation of EPM solutions
Strategy Management, Corporate Finance and Risk Management
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Inplenion Business Consulting International
International consulting company headquartered in Switzerland and main offices in Zurich, Geneva, Frankfurt , Vienna, Dubai and Jeddah
Over 90 management years of experience in the field of Enterprise Performance Management (EPM) & Business Intelligence (BI)
Bridging Business & IT and transforming client’s EPM/BI initiatives into reality
Over 60 new clients in Consulting and Solution implementation in the past 4 years
Complete EPM/BI Services Portfolio (Consulting, Implementation, Training and Support)
Selected as the Oracle partner of choice for Hyperion Modules across EMEA
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Competences
Controlling & performance management solutions — Consolidation and financial reporting
— Analysis / planning & forecasting / operational reporting
— Value based management and Balanced Scorecard
Conceptional work & project management — Analysis of business needs and requirements
— Design of EPM solutions
— Project lead and coaching
Implementation of Oracle EPM/BI products — Oracle/Hyperion Financial Management
— Oracle/Hyperion Planning /Essbase
— Oracle BI / Hyperion FDQM / DRM
— Oracle/Hyperion Strategic Finance
— Oracle Strategy and Scorecard Management
Education Services and change management
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Customers
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Excerpt Financial Services Customer
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Enterprise Performance Management
Overview
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Enterprise Performance Management is used to describe the methodologies, metrics, processes and systems used to monitor and manage the performance of an entire organization.
Management Processes
Strategy Formulation
Budgeting and Forecasting
Target Setting
Business Activity Monitoring
Management by Objective
… EPM Methodologies
Balanced Scorecard
Value Based Management
Risk Management
Total Quality Management
Intangible Asset Management
Metrics
Financial and Non financial
Short-term and Long-term
Qualitative and Quantitative
Lagging and Leading
Aligned
Applications
EPM Suites
Business Intelligence
Data Warehousing
Dashboards, Cockpits
and Scorecards
Adapted from Gartner
Enterprise Performance Management
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Why Enterprise Performance Management
The pressure on companies is stronger to day than ever. Following drivers are the cause:
Regulatory pressures (Basel III and Solvency II)
Cost pressure (need to control time, money and resources spent in the business)
Measurement pressures (the need to improve metrics from mountains of data trapped in systems)
Economic pressures (the continued soft economy requires implementation of tighter internal controls)
Strategic pressures (the emergence of real-time enterprise requires the removal of delays in planning and control cycles)
This requires from companies to:
Achieve sustainable performance improvement
Establish transparency on the company’s performance
Set up a consistent and integrated process from strategy development to strategy implementation and operations
Establish integrated controlling- and management systems
Excel in “time competence” as main competitive advantage (Real-time Enterprise)
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Real-time Enterprise
Processes
Process-Cycles:
Management-Cycles:
Strategy-Cycles:
Business Units
Group
Purchase-Payment
Requirements-Resources
Demand-Services
Development-Market
Deviation-Insights
Objective-Employees
Actions/Initiatives
Ressources
Strategy Stimulus
“Real-time Enterprise” is a new management focus which requires sustainable and
comprehensive efforts to reduce the duration of “end to end” processes
Different Time Competencies
to be managed with in an integrated
Enterprise Performance Management
Platform!
En
terp
ris
e
Vir
tua
l E
nte
rpri
se
Investment-Return
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Enterprise Performance Management
Framework
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Management Challenges
Today’s Reality: Management
Processes Are Fragmented
Lack of business alignment
Low predictability in performance
Inconsistency in business decisions
ECONOMIC VALUE ADDED
(EVA)
ANALYZE
PERFORMANCE
GOAL
SETTING
SCORECARDS FINANCIAL
REPORTING
FINANCIAL
MODELING
VARIANCE
ANALYSIS
ROLLING
FORECAST
OPERATIONAL
PLANNING
MONITOR
RESULTS
$ € £ ¥
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EPM Framework*
Struktur - und Prozessperspektive
Struktur - und Prozessperspektive
optimiert werden, um
zufrieden zu stellen?”
optimiert werden, um
zufrieden zu stellen?”
Struktur - und Prozessperspektive
Develop The Strategy
optimiert werden, um
zufrieden zu stellen?”
• Missions, Values, Vision
• Strategic Analysis
• Formulated Strategy
Struktur - und Prozessperspektive
Struktur - und Prozessperspektive
optimiert werden, um
zufrieden zu stellen?”
optimiert werden, um
zufrieden zu stellen?”
Struktur - und Prozessperspektive
Translate The Strategy
optimiert werden, um
zufrieden zu stellen?”
• Priorities
• Strategy Maps
• KPIs/Targets
•Initiatives/Action Plans
Struktur - und Prozessperspektive
Struktur - und Prozessperspektive
optimiert werden, um
zufrieden zu stellen?”
optimiert werden, um
zufrieden zu stellen?”
Struktur - und Prozessperspektive
Align The Organization
optimiert werden, um
zufrieden zu stellen?”
• Business Units
• Support Units
• Employess
• Board Members
Struktur - und Prozessperspektive
Struktur - und Prozessperspektive
optimiert werden, um
zufrieden zu stellen?”
optimiert werden, um
zufrieden zu stellen?”
Struktur - und Prozessperspektive Plan Operations
optimiert werden, um
zufrieden zu stellen?”
• Budgeting
• Sales Planning
• Resource Capacity Plan
• Process Improvement
Struktur - und Prozessperspektive
Struktur - und Prozessperspektive
optimiert werden, um
zufrieden zu stellen?”
optimiert werden, um
zufrieden zu stellen?”
Struktur - und Prozessperspektive Test and Adapt
optimiert werden, um
zufrieden zu stellen?”
• Profitability Analysis
• Strategy Correlations
• Emerging Strategies
• Stress Testing
Struktur - und Prozessperspektive
Struktur - und Prozessperspektive
optimiert werden, um
zufrieden zu stellen?”
optimiert werden, um
zufrieden zu stellen?”
Struktur - und Prozessperspektive
Monitor and Report
optimiert werden, um
zufrieden zu stellen?”
• Strategy Reviews
• Operating Reviews
• Regulatory Reporting
• Sustainability Reporting
Execution Business Processes
Projects/Initiatives
Operating Plan
Strategic Plan
• Strategy Map
• Balanced Scorecard
• Stratex
• Budgets
• Forecasts
• Reports
Business Calendar
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3
4
5
6
(*Adapted from Prof. Dr. Kaplan)
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1. Develop the Strategy
1. What business are we in, and why? (Clarify mission, values and vision) 2. What are the key issues/Risks? (Conduct strategic analysis / PESTEL and SWOT) 3. What is Optimal Investment Mix/Portfolio (Conduct Investment Value Analysis) 4. What is our Strategic Plan? (Target Setting/ Stretch Targets)
Outcomes
1. Mission Statement 2. SWOT Analysis 3. Investment Portfolio 4. Strategy Formulation 5. Strategic Plan/ Strategic Financial Plan
Questions
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Hyperion Strategic Finance
Integrated financial statements
Shareholder value
Run unlimited scenarios
Consolidate multiple business combinations
Evaluate strategic projects
Simulate effects of M&A
Debt Scheduling
Optimize capital structure
Target Setting
Account Integrity and Financial Modeling Speed
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Crystal Ball From single point estimates to ranges
Crystal Ball is an Uncertainty Management tool for Uncertain times.
Failure to include the impact of uncertainty and risk in your analyses can derail your financial plans
Crystal Ball is an easy to use tool that allows you to: — quantify the uncertainty in your inputs
— see how these see the impact your KPI’s
— understand what are the biggest risk drivers.
The result is better quality decisions and increased confidence in your numbers
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2. Translate the Strategy
Questions
Outcomes
1. Strategy Maps/strategic Objectives 2. KPIs and target values 3. Strategic initiatives and projects 4. Initiative budgeting 5. Accountabilities
1. How do we describe our strategy? (Strategy maps) 2. How do we measure our plan? (Select measures and define targets) 3. What action programs does our strategy need? (Choose strategic initiatives) 4. How do we fund our initiatives? (Establish Stratex) 5.Who will lead the execution of the strategy? (Create strategy execution teams)
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2. Translate the Strategy- BSC
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3. Align the Organization
Questions
Outcomes
1. Company/Business Unit Scorecards 2. Support Units scorecards 3. Employee Scorecards / Incentive System
1. How do we ensure that all organizational units are on the same page? (Align business units) 2. How do we align support units with business unit and corporate strategies? (Align support units) 3. How do we motivate employees to help us execute strategy? (Align employees)
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Oracle Scorecard and Strategy Management
Measure, Monitor and Communicate your Strategy
Strategic Management Tool
Visualization of Strategic Goals
Efficient Maintenance of Strategic Elements
Ease of Use
Action Planning
Annotations
Leverage with Planning, Essbase and OBI
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4. Plan Operations
Questions
Outcomes
1. Financial planning and budgeting, operational and functional planning 2. Process Improvement Initiatives
1. How do we link strategy with operating plans and budgets? (Sales Forecast, Resource Capacity Plan, Operating and Capital Budgets) 2. Which business process improvements are most critical for executing the strategy? (Improve key processes such as demand-supply alignment, product allocation, and integrated revenue planning) 3. How do you align functional/operational LOB plan with financial plans 4. How do you capture your detailed operational drivers
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Hyperion Planning
Accelerate the Planning & Forecast Process
Centralized System
Align top-down and bottom-up
Consistent assumptions
Common allocations & calcs
Powerful workflow and process management for budgeting and forecasting
Leverage Essbase- powerful reporting and analysis
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5. Monitor and Report
Questions
Outcomes
1. Performance Reports and Dasboards 2. Balanced Scorecard Reports and Dashboards 3. Financial Reporting and Financial Closing 4. Sustainability Reporting
1. Are our operations under control? (Hold operational review meetings / weekly operational dashboards or reports) 2. Are we executing our strategy well? (Hold strategy review meetings / monthly BSC reports) 3. Do you have a fast close process established? 4. How is your regulatory reporting process 5. Do you report on societal and environmental performance
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Hyperion Financial Management
Patented financial consolidation and reporting features
Complete audit trails, workflow and validations
“Smart Dimensionality”
Flexible “what if” scenario management features
Powerful, reporting and analysis tools
Full integration with ERP and other transaction systems
Easy to customize and extend
Web-architected
Accelerate Reporting Cycles and Reduces Costs of Compliance
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6. Test and Adapt
1. Updated strategy 2. Profitability analysis 3. Updated portfolio 4. Updated strategic priorities / long-term goals
1. Is our strategy working? (Strategy testing and adaptation) 2. Do we still have the right portfolio? (Investment Portfolio Mix) 3. Are our cause and effect assumptions valid? (Balanced Scorecard strategy maps)
Questions
Outcomes
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Oracle Business Intelligence
Analysis, Reporting and Interactive Dashboards
Rich interactive visualization
Extended set of chart types
OLAP analysis capabilities
Integrates Relational and multidimensional data sources
MS Office Integration
Pixel perfect documents
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The Management Calendar within one year
Q1 Q2
Strategy Update: CEO and executive team clarify strategy. Balanced Scorecard team facilitates development of corporate and strategy map.
Business lines and support units align their units with strategy Balanced Scorecard team facilitates development of corporate and strategy map
Q3
Planning and budgeting process by CFO
Personal goal setting by HR
Office of Strategy Management
oversees alignment of all management
processes with strategy
Q4
Weekly Operational Review Meetings
Monthly Strategy Review Meetings