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    Compendium English Compendium English Document Transcript

    • Next Generation Controlling Next Generation Controlling Prof. Dr. Edgar Ernst/Hartmut Reinhard/Dr. Hendrik Vater Tr a n s f o r m i n g t h e C o n t ro l l i n g O r g a n i z a t i o n o f D e u t s c h e P o s t Wo r l d N e t i n t o a n “ A d v a n c e d N a v i g a t o r ” P ro f . D r. E d g a r E r n s t /H a r t m u t R e i n h a rd / D r. H e n d r i k Va t e r
    • Contents 1. The Controlling department of Deutsche Post World Net is taking up the current challenges 4 2. The Next Generation Controlling approach 7 3. Key points of the status quo analysis 10 4. Six levels for optimizing Controlling 14 4.1. Controlling Mission, Role and Tasks 14 4.2. Key Controlling Processes 15 4.3. Controlling Systems and Tools 17 4.4. Methodological Aspects 18 4.5. Governance and Organization 19 4.6. “Soft Factors” 20 5. IMPACT – The Controlling organization of Deutsche Post World Net on its way to becoming an “Advanced Navigator” 22 5.1. Initiative 1: Capability and Role Building 22 5.2. Initiative 2: SLA Methodologies and Processes 23 5.3. Initiative 3: Investment and Project Controlling 24 5.4. Initiative 4: Reporting to Business Needs 24 5.5. Initiative 5: Planning/Forecasting Process and Tool 25 5.6. Initiative 6: NFO Calibration 26 5.7. Initiative 7: Functional Planning and Monitoring vs. Controlling 26 5.8. Initiative 8: Costing Capabilities and Capacity Management 27 5.9. Initiative 9: Freight Controlling 27 5.10. Initiative 10: Aviation Costing and Transfer Pricing 27 5.11. Initiative 11: IT Controlling 27 6. Outlook 29 3
    • 1. The Controlling department of Deutsche Post World Net is taking up the current challenges The speed of innovation of products and services has con- duction of the New Finance Organization (NFO) in tinually increased in recent years. In this environment, November 2003, which ensured overall responsibility for Controlling must also adapt in a very versatile and dynam- the Chief Financial Officer. For greater transparency and ic manner. The pressure to adapt and change is intensified faster decision-making, the financial organizations of the by legislative developments, such as the internationaliza- MAIL, EXPRESS, LOGISTICS and FINANCIAL SER- tion of reporting standards (IFRS), the Sarbanes-Oxley Act VICES Corporate Divisions were linked directly to the and first-time establishment of an enforcement organiza- Chief Financial Officer. In addition to the launch of the tion for auditing. In addition, the increasing professionali- NFO, other reference projects are worth highlighting: zation of analysts and investors requires various changes in the internal control of companies with value-based CREST (Common REporting SysTem), which intro- management. Primarily, it is the large, listed, multinational duced a globally uniform system for the reporting of companies that must rise to these challenges. financial indicators Furthermore, the pressure is increasing on the part of capi- DASHboard, which standardizes systems and tal markets, which today evaluate not only the reports of methods for accounting achieved results, but also corporate strategies. For that purpose they require a forward-looking description of the The Cost of Finance (CoF) project, which aims to business segments. This must take place by including a sustainably reduce costs in the financial area multitude of different internal and external influencing factors such as future areas of activity, customer groups, Figure 1 shows the background from Deutsche Post geographical market expansion and technical possibilities. World Net’s view: In the past few years, the evolution to Investors need information that permits them to draw a leading global service provider for LOGISTICS was conclusions about the future success of a company. driven last but not least by acquisitions, whose integra- tion posed a huge challenge for Controlling (in particular In the past, the core task of controlling was primarily to the “3D integration” of Danzas, DHL and Deutsche Post “monitor the achievement of objectives,” but today more Euro Express in Europe). Now that the financial integra- than ever an “early warning function” or “navigator func- tion, various reorganizations and Group-wide harmoni- tion” for management is in the foreground. This change zation of Controlling have been largely completed, new determines the general conditions for the future orienta- challenges are arising for the future. In addition to sup- tion of controlling in particular, and of finance and porting further operational growth, the focus in the fu- accounting in general. Active and timely provision of this ture will be on increasing efficiency and on strengthening information on current results as well as on the medium- Controlling’s orientation toward operational business. term and long-term strategy or corporate development is This is where the Next Generation Controlling project vital. In addition, this entails the necessity to link internal started, to further spur the development of Controlling. planning, control and monitoring data with financial and accounting indicators to be provided externally. This document describes the Next Generation Control- ling project (Section 2), whose goal was to reorient Con- Deutsche Post World Net has already made these describ- trolling based on a methodically solid analysis of current ed changes: The most visible adaptation was the intro- performance (Section 3). This project also took into 4
    • Controlling Evolution Levels Integration and sophistication 3D Integration Further large-scale of Division-specific Controlling Various reorganizations acquisition(s) (e.g. Exel) systems, methods, etc. New finance systems Cost of Finance Group view – Controlling effectiveness Controlling harmonization time Launch Next Generation Controlling Figure 1: Next Generation Controlling comes at the right time account the aforementioned adaptation of the financial steering committee made up of all heads of corporate organization and of the finance projects. Based on the departments and divisional board members of the Finance results, potential for optimization was identified in six Board Department. Program progress is coordinated and key areas of controlling (Section 4). These were used as a controlled operationally by a dedicated program office. foundation for the IMPACT program in 2006 (Section 5), which is intended to help improve Controlling based All in all, it can be noted that the Controlling of Deutsche on eleven dedicated initiatives. Post World Net has risen up to the challenge to change, coming from legislative, capital market and internal The IMPACT program aims to achieve visible improve- requirements, but also further changes are necessary. ments in Controlling already in 2006, and intends to First and foremost, the understanding of the Controllers’ demonstrate the achievements at the Second Annual role should change: While Controllers have viewed them- Finance Conference of Deutsche Post World Net in selves more as “number crunchers,” administrators or November 2006. Subsequently, further steps in develop- overseers and have also been viewed in this way by their ment for Controlling shall be stimulated. IMPACT is Users and Peers, both sides want a changed perceptual assigned as part of the overall responsibility of the image and higher acceptance from the business in the Group CFO (Chief Financial Officer) and is directed by a future (see also Figure 2): 5
    • In this sense, Controllers should be perceived as partners, consultants, as well as challengers and support- ers of the company’s activities. This vision can best be described with the metaphor of the “Advanced Navigator” who stands at management’s side in a supportive role, operates in a forward- looking manner and is also aware of the external environment. Results-orientation and integrity and last but not least compentency in understanding the processes of the operational business are additional keys Controller as ”Advanced Navigator” At least … Be the “right hand” of the ship’s captain Supportive (e.g. helping the company to succeed) Identify “icebergs” and opportunities early Forward Looking (e.g. projected customer losses/gains, price erosion/increase) … Put the ship’s position into perspective Externally Aware (e.g. comparison with competitors) Provide options to direct the ship Results Focused (e.g. reduce “waste” to concentrate … and ideally on key business issues) With Integrity Discuss “icebergs” openly (e.g. performance issues or opportunities) Not only know “navigation” but also the Competent ship and the waters it is operating in (e.g. know the business and industry) Figure 2: “Advanced Navigator” as the vision of Controlling 6
    • 2. The Next Generation Controlling approach To transform the Controlling organization of Deutsche understood as a management support function and must Post World Net into an “Advanced Navigator”, a compre- therefore allow itself to be measured by management. All hensive improvement program called “Next Generation regions were included in the investigation, above all to Controlling” was set up (cf. Figure 3). In the first phase, discover the need for changes in the countries and not which was launched in 2005, the current performance of just the status quo at headquarters. Controlling was thoroughly analyzed in the context of an extensive investigation and, based on the results, detailed Figure 4 shows the extensive basis of the investigation. At improvement options were identified. Subsequently, the first, 38 interviews were conducted with top managers of IMPACT program was started in the second phase. In the the Groups as well as 65 interviews with other stakehold- course of this program, concrete initiatives were defined ers from all Corporate Divisions across all regions. that pursue the identified potential improvements in order to advance further development efficiently. In addition, the opinions of 436 people were ascertained in a Web survey using a detailed questionnaire. Figure 5 The goal of the extensive investigation of Controlling clearly shows that the survey represents a broad spec- performance in 2005 was to create a solid starting basis trum. A total of 268 Controllers and 168 Users and Peers for target-oriented improvements. For this reason, the of Controlling participated, representing all Corporate scope deliberately included not only employees, but also Divisions, geographical regions and organizational levels. Users and Peers of Controlling. After all, Controlling is PHASE 1 PHASE 2 Analysis of Status Quo Levels of Improvement IMPACT Controlling Mission, Role, Tasks Initiative 1 Controlling Performance Key Controlling Processes Achievements Initiative 2 Controlling Systems and Tools Controlling Self-Assessment Methodologies Initiative ... Customer Satisfaction Governance and Organization Gap Analysis Initiative 11 “Soft Factors” Figure 3: Two phases of the Next Generation Controlling project 7
    • Interviews … with top management … and with key stakeholders in countries 38 interviews 65 interviews in 13 countries across all regions – 5 with Group Board Members – Cross-functional – 15 with Controllers – Cross Divisional – 18 with other top mgt. stakeholders Web Survey Selected Benchmarks 436 responses Competitors Other – 268 Controllers (outside-in) Multinationals – 168 Users/Peers – Covering 5 continents and all Divisions Figure 4: Basis of the investigation In addition to the interviews and the survey, internation- Key Controlling Processes deals specifically with al benchmarks were also examined, whereby both lead- process-oriented aspects, above all in the areas of ing competitors and companies outside the industry reporting, planning/forecasting as well as investment, were included. Supplementally, the current trends in project and risk Controlling. Controlling from an academic view were included. In the category of Controlling Systems and Tools, the comprehensive CREST reporting system recently The goal of the study in the first step was to survey the introduced successfully throughout the Group is general satisfaction with the performance of Controlling. especially in the foreground. The results show that regardless of all successes and qual- The area of Methodologies refers to important indi- ities, satisfaction does not meet internal requirements in vidual topics of Controlling such as product costing, all areas. These findings are explained in detail in Section 3. freight controlling, service level agreements, air net- work transfer pricing and IT controlling. Based on the results of the survey, six key levels for In the category of Governance and Organization, the improving Controlling were worked out in the second focus is on aspects of the New Finance Organization, stage. These are described in detail in Section 4: which among other things has significantly strength- The area of Controlling Mission, Role and Tasks ened the role and independence of Controllers by refers to the basic way Controlling sees itself. means of direct reporting lines. 8
    • Position of Respondents Divisions Others MAIL Controlling 25 (6%) 47 (11%) Users and Peers Corporate Center 168 (39%) Services 106 (24%) Controllers EXPRESS FINANCIAL 268 (61%) 159 (37%) SERVICES 19 (4%) Σ 436 LOGISTICS Σ 436 80 (18%) Geography Organizational Level Not Available Europe Below country Corporate 47 (11%) 144 (33%) 42 (10%) 83 (19%) EMA 9 (2%) Country/ Americas Cluster Divisional/ 41 (9%) 143 (33%) Global Asia/Pacific 88 (20%) 45 (10%) Germany Regional/ Σ 436 150 (34%) Business Unit Σ 436 80 (18%) Figure 5: Representativeness of the survey The last category of Soft Factors deals with the devel- different initiatives were worked out in the six identified opment aspects of Controllers, in particular the satis- levels of optimization. Some deal with cross-divisional faction with their work and the perceived opportuni- topics, others focus on important individual topics with- ties for development. in a specific area. The goal of IMPACT is to clearly improve the efficiency and effectiveness of the Control- The IMPACT program was launched in 2006 to actively ling organization even in 2006. The initiatives are address the improvement needs. For this purpose, eleven described in more detail in Section 5. 9
    • 3. Key points of the status quo analysis The Controlling organization of Deutsche Post World ascertained both in general and at the Corporate, Corpo- Net has successfully mastered the challenges in recent rate Division, Regional and Country levels. years. The Controllers and top managers have explicitly acknowledged and shown their appreciation in the sur- The results clearly show not only that further improve- vey; Controlling and Business work particularly well ments must be made, but also that the “self perception” of together in the countries. Accordingly, Controlling not the Controllers is apparently better than the “outside only accompanied the enormous growth of Deutsche perception” of the Users and Peers of Controlling. Post World Net due in part to the roughly 120 acquisi- Although at least 41% of the surveyed Controllers tions, but also actively participated. For example, the (of 268) are very satisfied to satisfied with the perfor- establishment of a powerful global finance organization, mance of Controlling, “only” 25% of the surveyed the support of Postbank’s IPO and the roll-out of new Users and Peers (of 168) indicated the same levels of financial systems (e.g., CREST) are worth mentioning. satisfaction. Nevertheless, the Controlling organization has not yet Clearly, the level of dissatisfaction with the Controlling fully reached its goal. As the survey shows (Figure 6), the areas increases – both among the Controllers and among level of satisfaction with the performance of Controlling the Users and Peers – the higher these areas are located in still does not meet expectations. The satisfaction was the corporate hierarchy, or the further away from the How satisfied are you with the performance of Controlling at the following levels? As viewed by Controllers As viewed by Controlling Users/Peers Controlling Overall 1% 40% 32% 22% 5% 2% 23% 37% 29% 9% Corporate Controlling 2% 27% 37% 24% 10% 2% 22% 28% 35% 13% Divisional Controlling 2% 43% 28% 25% 4% 4% 27% 32% 28% 9% Regional/BU Controlling 4% 44% 35% 15% 3% 2% 37% 31% 23% 7% Country/Cluster Controlling 7% 44% 32% 15% 3% 7% 32% 31% 23% 7% Σ 268 Σ 168 Very satisfied Satisfied Neither/nor Dissatisfied Very dissatisfied Figure 6: Level of satisfaction with the performance of Controlling 10
    • operative business they sit. While Controlling achieves rate Controlling, only 12% (Regions/Business Units), relatively high satisfaction values at the Country level, the 27% (Countries) and 28% (Divisions) of the subordina- level of dissatisfaction with Corporate Controlling is par- ted units gave the same evaluation. ticularly high. Therefore, further optimization is neces- sary in particular on the Corporate and Divisional levels. An analysis of the root causes of dissatisfaction among Users and Peers (Figure 8) shows that only 39% of the If the level of satisfaction with Controlling is considered respondents agreed that Controlling provides service and for each individual Corporate Division, the results show support that meets their expectations. In particular, that reorganizations and integration tasks have clearly respondents felt there is room for improvement in the negatively influenced the performance of Controlling. challenging of plans and decisions of management in the sense of a “challenger”, thus a sort of experienced “spar- In the context of satisfaction, however, the survey also ring partner.” Over half of Users and Peers feel that the asked the respondents how the different levels of Con- necessary conditions for this are not yet adequate: Con- trolling evaluate each other internally (see Figure 7). trollers’ understanding of operative business and its suc- These results support the finding of the “impaired” con- cess factors. In view of this background, 32% of the nection between Corporate and the hierarchically subor- respondents felt that Controlling was more a burden dinated divisions: While 53% of the Corporate Control- than a support. lers are very satisfied to satisfied with the work of Corpo- How satisfied are you with the controlling performance? with Corporate Regional/ Country/ Business Unit Controlling controller Business Area Country-Cluster Satisfaction controller controller n The largest discrepancies exist between corporate and Corporate 53% 36% 22% 31% regional/BU controlling Controller Business Unit n Countries are critical of 28% 49% 49% 42% controller corporate and Business Unit controlling Regional/ Business Area 12% 41% 59% 52% controller n Adequate satisfaction on regional/Business Area Country/ level and below Country-Cluster 27% 37% 46% 58% controller Percentage of answers “satisfied” or “very satisfied” Figure 7: Satisfaction of the different levels of Controlling with each other 11
    • Controlling ... As viewed by Controlling Users/Peers … is more of a support than a burden to 13% 24% 31% 28% 4% management n A key element in being able to challenge the management is … provides management with the service 2% 37% 22% 28% 11% first to have a clear and support they expect understanding of the business … has a clear understanding of the business 8% 31% 14% 30% 17% and its underlying drivers/success factors n However, almost 50% of Users do … helps management to understand the 5% 33% 18% 34% 11% not agree that root causes of performance gaps Controllers currently have this business … adequately challenges the 3% 26% 28% 34% 10% know-how business/management Σ 168 Strongly agree Agree Neither/nor Disagree Strongly disagree Figure 8: Desired support by Controlling as viewed by Users and Peers If Controlling does not succeed in developing a clear key business decisions. As a result, its understanding of understanding of the business so that it can really sup- the business decreases further. Ultimately, such Control- port management adequately as an “Advanced Naviga- ling is even less able to offer the kind of support that tor,” there is a danger that the business will establish management expects and needs – a classic vicious “shadow Controlling.” The various Business Units will circle (Figure 9)! then install shadow Controllers who deliver what the Units, Regions or even Divisions need to do their work The fatal aspect of such a vicious circle is that in this way, from their own point of view. These shadow Controllers two sets of figures or data sources ultimately come into emerge especially from the classical budget coordinators existence. The Business Units then frequently use the or operation controllers. Controlling department that is closer to the business – normally the set of figures that is created by “their” In the end, this process threatens to marginalize the offi- shadow Controllers. cial Controlling department, because it is not involved in 12
    • Controlling does not provide the support that business expects Business builds up “shadow staff” to fill the vacuum of information/ support Controlling does not gain the insight and business know-how required “Shadow staff” imple- ments its own Controlling systems, tools and informa- Controlling becomes more tion channels marginalized and left out of key management decisions Figure 9: Vicious circle of shadow Controlling 13
    • 4. Six levels for optimizing Controlling The general analysis of the satisfaction with the perfor- view the future role of Controlling as one of a sparring mance of Controlling has clearly shown that despite all partner or consultant. This means that both the Control- successes achieved, there is still need to optimize. Numer- lers and their Users and Peers perceive a significantly ous starting points can be derived from the detailed anal- more sophisticated functional description for Control- ysis of the survey results, and they can be assigned to six ling in the future. levels for optimizing Controlling (Figure 10). These are described briefly below. The future expanded function of Controlling can be accurately described using the vision of a “navigator”, 4.1. Controlling Mission, Role and Tasks who is a partner and consultant to management. The The first level for optimizing “Controlling mission, role image of the navigator from sailors’ jargon figuratively and tasks,” provides the thrust for further development of reflects the requirements and challenges for the Control- Controlling. The role of the “Advanced Navigator” forms lers (see also Figure 2). the general model (to a certain extent). On a ship, the captain is responsible for selecting the cour- Figure 11 illustrates the current and future understand- se correctly, i.e., avoiding icebergs or storms if necessary ing of the role as viewed by Controllers (left side) and as and heading directly toward sunny profitable goals. For the viewed by Users and Peers of Controlling (right side). captain to perform this task optimally, he works closely Today, both groups classify Controllers as “number crunch- with his navigator, who draws his attention to possible ers”, administrators or police officers. In contrast, they decisions and also to the associated consequences. Controlling Mission, n Clearly define and articulate Controlling ambition level and development direction Role, Tasks n Become “advanced navigators” to the “captains” of the “Deutsche Post World Net“ ship(s) n Get the basics right but move to more value-adding tasks Key Controlling n Especially in Budgeting/Forecasting and Reporting Processes n “Less is more” to allow more focus on the business issues n Improve investment, risk, and project Controlling Controlling Systems n Incrementally improve the existing systems (e.g. quality, business support) n Move from a financially focused group perspective … and Tools n … to providing vital cross-functional steering information for the operative management n Fix/improve where the lack of doing so would lead to wrong business decisions Methodologies n e.g. IT, Network transfer pricing, Freight Controlling, Express product costing, SLAs Governance and n Take selective corrective actions, e.g. NFO CFO role, balance Division vs. Corporate n Improve governance/role splits (Corporate vs. Divisions and by organization level) Organization n Prepare for upcoming challenges, e.g. Exel integration n Fine-tune career development and capability-building to support the role vision “Soft Factors” n Gauge staff job satisfaction quarterly to allow corrective action earlier on Figure 10: Six levels for optimizing Controlling 14
    • Which of the following phrases best describes the primary role of Controlling in Deutsche Post World Net? Controlling Staff Controlling Users and Peers Number Cruncher Administrator Policeman Partner Challenger Consultant Architect Interventionist Activist Other 0 50 100 150 200 250 0 50 100 150 200 Today Future Σ 268 Σ 168 Figure 11: Current and future understanding of the Controlling role As the understanding of the role goes beyond a purely ion of the respondents: While Controllers exchange observational, reactive navigator function, the image is information several times a week with 88% of their col- completed by speaking of an “Advanced Navigator.” leagues within the department, this figure drops to 61% Such a Controller helps “his captain” not only to travel and 64% respectively with other Controllers and col- around icebergs, but also to discover opportunities early leagues from other financial areas, and to only 42% and on so that he can try to steer the ship in a promising direction. 52% with business managers and representatives from other functional areas. The transformed understanding of the Controller’s role as an “Advanced Navigator” is also clearly confirmed by 4.2. Key Controlling Processes scholars and CFOs of benchmark companies from the A prerequisite for the navigational function of Control- logistics industry and beyond (see Figure 12). ling is an optimal definition of the key processes repor- ting, planning/forecast as well as investment, project and In order for a Controller to perform such a function at risk controlling. According to the survey, 100% of the all, a regular and intensive exchange with management expectations of Users and Peers are not yet fulfilled in and with the internal and external environment is cru- these areas. cial (Figure 13). The acceptance of the business for this is indispensable. So far, this has not taken place internally Today, 68% of the Users of Controlling reports outside or externally to a sufficient degree according to the opin- of finance feel they are not sufficiently involved in the 15
    • “On any given team, I want the “The accountants thought “I consciously think of myself Finance person to know more about the big the job was done when the numbers were put as wearing two hats. I am responsible for picture – what’s going on outside of FedEx and together. But once that is done, the real work traditional issues: cash flow, capital and cost elsewhere within FedEx – so they can bring in begins. So every month we analyze the data. structures. But my role is increasingly linked that needed knowledge and perspective” It requires interaction and a critical distance with strategy and operations” from the operating units” “When we look for a candi- Prof. Dr. Weber: “Enterprise Prof. Dr. Berken: “Increased date for CFO, one attribute is customer focus. growth can lead to complex governance struc- focus, simplification and waste reduction (elimi- To what extent does one understand the basis tures. These face increasing pressures to nation of non value adding time) can bring of competition? Another one is teamwork, change… Controllers appear in this context as about an enormous increase in process speed which is critical as the most important task innovators and management consultants, and and quality. To achieve this, enterprises need to is collaboration with other parts of J&J” no longer have much in common with a tradi- navigate with a simple operational value driver tional bean-counter” hierarchy and very few KPIs“ “The key recurring question a CFO “I look at the Finance function “The model from day one in GE is that should be asking himself is, “What is the right as an aider and abettor of making change hap- the CFO is broadly involved in the business. business decision?” The technical tail should pen. You have to have the Finance function sup- That does not mean that you are running never wag the strategic dog” porting the vision of leadership” the operations, but you are opining on them, involved in them at every stage, and monitoring the execution” Figure 12: Statements on the changed role of the Controller definition of reporting and therefore feel their require- With regard to planning and forecasting, the respon- ments are not fully taken into account (Figure 14). The dents largely agree that the level of detail and the quality Business Units partly criticize that they do not receive all of the data are satisfactory. What is criticized is the pro- data relevant to planning, monitoring and control. The cess, which is judged as too complex and time-consum- level of detail is rated differently; some would like more ing at this time. Better coordination and a shortening of details, others fewer details. In addition, some feel the the planning process could remedy this. quality of the commentary could be expanded: Instead of a report and summary of the numbers, Controlling Improvements are also expected in investment, project should provide a more in-depth analysis of the root causes and risk controlling. While the processes leading up to of deviations from the plan. Furthermore, some Users the approval of a project or investment are clearly defined, and Peers of Controlling wish for a greater frequency, so too little importance is currently attached to the processes that the reports can be used optimally to steer the busi- after approval. For example, investment controlling could ness locally. In that context, it has to be clarified if provid- be optimized with respect to sanction mechanisms for ing certain data on a daily or weekly basis is really a exceeding expenditure, for missing previously defined per- Controlling task, or whether this should be conducted by formance goals or a specified time period. operations, marketing or sales instead. 16
    • How often do you speak with the following individuals? As viewed by Controllers Once a week or less Other Controllers in your department 69% 7% 12% 4% 5% 1% 1% Controllers in other departments/entities/countries 20% 13% 28% 16% 4% 12% 6% With other Finance staff 26% 12% 26% 16% 7% 7% 6% With heads of the business 12% 13% 17% 16% 5% 10% 26% With representatives from other functions 17% 10% 25% 18% 6% 10% 14% External stakeholders 2% 2% 7% 7% 4% 11% 67% Σ 268 Several times About once Several times About once About once About once Less often a day a day a week a week every 2 weeks a month or never Figure 13: Exchange between Controllers and other areas Similar statements were also made about pure project 4.3. Controlling Systems and Tools controlling. While a project may remain within the bud- At the level of “Controlling Systems and Tools,” the get, various qualitative and/or quantitative target values CREST (Common REporting SysTem) system recently are missed without it being mandatory to make this up. introduced globally, was given particular attention. The In this context, the question arises whether project con- respondents appreciate that a uniform database and trolling should be carried out by the actual project manag- language for financial indicators were created through er and his team and/or by an independent Controller. CREST and thus the foundation for internal and external reporting and management reviews. The system has Risk controlling is positioned very well with regard to made enormous progress with respect to the transparen- the financial risks at Deutsche Post World Net. However, cy and consistency of the data, especially across the vari- other aspects such as operational risks or environmental ous reporting levels. risks could be considered in a more integrated manner – especially in the context of a stronger linkage of risk con- trolling with the periodic forecast and medium-term planning. 17
    • Main Issues with Management Reports n Close to 41% of the business managers believe the quality of the commentary needs to improve Commentary n They expect an analysis of the root causes of the problems, not a summary of the numbers 68% of n Parts of the business (esp. Freight, Marketing & Sales) do not Non-Finance Relevance of get the data they need … reporting Users the data n … so managers spend time on preparing their own reports or rarely or never give these tasks to the “Shadow Controllers” get involved in the definition n Only 20–30% of respondents are satisfied with the amount of detail of reporting n Yet there is no clear tendency regarding the level of detail – Level of detail requirements/ nearly the same amount of people requested less or more methodologies detailed analyses n To steer the business locally, managers need data more frequently Frequency than just monthly reports of reports n Managers at country level through all Divisions request weekly or even daily information on a defined set of KPIs Figure 14: The main issues with reporting It should not be overlooked, however, that CREST is a Costing at EXPRESS in Europe can be methodically reporting instrument rather for Corporate, and less an refined, especially with respect to product, customer or instrument for local management. However, CREST is not trade lane analyses (cost unit analysis of trade routes supposed to perform this function anyway, since this acti- between several locations). Even more detailed contri- vity is covered by the detailed local systems and instru- bution analyses could support management in decisi- ments. The survey (result) also shows that CREST is not a on-making. Refinements are also possible in the context substitute for a local budgeting tool. With its main functi- of international business. on as a data collection and consolidation tool, it cannot meet the demands for simulating scenarios. In the area of Freight Controlling, it is noted that the significance of this business unit would justify the 4.4. Methodological Aspects expansion of an independent Controlling organization In the context of the “Controlling methodologies” level, five as well as of BU-specific reporting and analyses. key areas were identified where the respondents see poten- tial for improvement: 18
    • The area of Service Level Agreements (SLA) (agree- Finally, in IT Controlling, the Controlling organiza- ment between performer and demander of the ser- tion must understand the restructuring of IT in the vices about product, quantity, price and quality) has sense of a separate supply (IT supply) and demand gained special attention since the creation of the new side (IT demand). The IT budget process and the Corporate Division SERVICES as of January 1st 2006, transparency of the allocated actual costs can be which includes amongst others Global Business improved on the whole. Services. Hence, there is interest in further differen- tiated transparency with respect to the cause and allo- 4.5. Governance and Organization cation of the costs for internal service providers and The Deutsche Post World Net’s finance organization has horizontal functions. In addition, more opportunities recently gone through two significant organizational for influencing service quality are desired. changes. Firstly, from now on the Controllers of the Divi- sions report directly within the financial organization, In the area of Aviation/Network Transfer Pricing, which significantly increases standardization and super- the methods for standardized costing could be vision. Secondly, the accounting and Controlling areas improved further by updating transfer prices as soon are clearly distinguished from each other to separate the as possible and allocating costs more fairly based on more process-oriented and centralizable part of account- causation. ing from Controlling “in the broader sense” and to achieve efficiency gains in the future by setting up Shared Please state your level of agreement with the following statements. As viewed by all respondents Additional comments Responsibilities and tasks n Even 60% of Accountants lack are clearly defined between 8% 29% 15% 31% 17% clear differentiation between Accounting and Controlling Controlling and Accounting } 48% n Responsibilities between organizational levels are Responsibilities are clearly defined not clear for nearly half of Controllers at Corporate between Corporate, Division, 4% 33% 21% 27% 15% level (48%) and Regional/ BU/Regional and Country level BU level (46%) } 42% Interviews indicate this confusion has led to a decrease in quality and an increase in costs Σ 436 Strongly agree Agree Neither/nor Disagree Strongly disagree Figure 15: Roles and responsibilities of Controlling and Accounting 19
    • Service Centers. The internal recharging between these accounting department has been transferred to the new Shared Service Centers and the several Divisions is con- Global Business Services Corporate Division, there is ducted by predefined SLAs. now a need to calibrate with respect to the New Finance Organization. The survey shows that both Controllers and the Users and Peers clearly welcome the new reporting lines. About 60% of the respondents confirm improved implementa- 4.6. “Soft Factors” tion of standards, and 53% think that application across The Soft Factors level deals with personal satisfaction the entire Group has been increased. According to 48%, and development prospects for Controlling employees. the role of Controlling vis-à-vis management has been After all, only satisfied employees can perform optimally. strengthened. In addition, for a vision of Controlling as an “Advanced Navigator” it is crucial that an exchange take place be- However, some Controllers and Users feel that the divi- tween the Business Units and Controlling to strengthen sion of responsibilities between Accounting and Control- mutual understanding. ling has not yet been implemented clearly in all details after the reorganization, as the survey results shown in The survey focused particularly on job satisfaction: Over Figure 15 illustrate. two-thirds of the surveyed Controllers are satisfied with their jobs in Controlling. However, in this regard there Nearly half of the respondents do not yet perceive a clear are also differences, since the satisfaction is highest at the division of tasks and of responsibilities between Account- Country level and lowest at the regional level. Likewise, ing and Controlling. Interestingly, 60% of all surveyed two-thirds of the respondents are proud to work at Accountants even indicate that a precise differentiation Deutsche Post World Net. All in all, employees have a between Controlling and Accounting does not exist. A positive attitude toward their own work. similar problem arises in the division of responsibilities between the Corporate Division, Business Unit, Region A key factor for satisfaction is the career development and Country levels. In this case, over 40% of the respond- opportunities. As Figure 16 shows, over 50% of Control- ents (even over 46% of Controllers) feel that a clear ling employees perceive good opportunities to further differentiation is lacking. develop to the management level even outside of Financ- e. Interestingly, the Users and Peers of Controlling are The unsatisfactory results can probably be ascribed to the currently actively searching for candidates with business fact that the survey took place at a time when the New and Controlling experience for management functions in Finance Organization had just been rolled out. At this their area. The results show that 73% of Controllers are time, not all structures had been converted yet, and the also particularly interested in job rotation to gain expe- relevant information was not yet fully disseminated; the rience in other areas and to return later to their original results show the typical insecurities in the course of a area. This is supported by centrally directed personnel change process. In the interim, however, implementation development, since the Controllers’ business understand- has been successfully completed. Because the transactional ing is improved in this way. 20
    • Career Opportunities Career Development – Job Rotation Controlling prepares for Controllers that would a good career path be interested to rotate … … outside Finance … in the Finance community and come back Staff 73% … in functions outside at a later stage Finance User … to another country 69% Controllers can become and come back at business leaders in a later stage Deutsche Post World Net Strongly agree Agree Neither/ Nor Disagree Strongly disagree There is an overwhelming interest in career models More than half of all respondents are sure that Con- involving job rotation to an assignment outside trollers can become business leaders in Deutsche Post Finance – especially to World Net 1. General Management, Interviews revealed that Managing Directors actively 2. Other Finance look for candidates with business and Controlling 3. Marketing & Sales, Accounting, Operations experience for jobs in their area of responsibility Commitment to work abroad of over 2/3 in all Divisi- ons, except for MAIL – here, only 42% would do so Figure 16: Perceived career prospects of the Controllers 21
    • 5. IMPACT – The Controlling organization of Deutsche Post World Net on its way to becoming an “Advanced Navigator” The previous sections described how Controlling of The following sections will briefly describe each of the Deutsche Post World Net has successfully mastered the eleven IMPACT initiatives. huge challenges in the past and the areas in which there is still potential for further optimization. The IMPACT 5.1. Initiative 1: Capability and Role Building program, whose eleven individual initiatives are to The interviews have shown that the understanding of implement the identified potential improvements by the the Controller’s role must be stated more precisely and next Finance Conference in November 2006, was started communicated, and that the capabilities of the Control- in view of this background. In this respect, the IMPACT lers with regard to their business expertise can be im- program is about implementing the vision defined by the proved. These subjects are handled by the first IMPACT Next Generation Controlling project. initiative, “Capability and Role Building“ Figure 17 shows the eleven initiatives of IMPACT in con- The understanding of the role is clarified by the vision of text. While over half are cross-divisional projects, five of the the “Advanced Navigator” in principle. To ensure that a eleven projects focus on individual Corporate Divisions. better understanding of the role emerges both within Finance and for the Users of Controlling, it will be stated Figure 18 illustrates the connection between the poten- even more precisely, and a strategy for communication tial improvements and the individual initiatives. will be developed. The global and high claim of the IMPACT program is Two sub-projects are distinguished with respect to the emphasized by the program organization shown in Fig- training and continuing education of Controllers and ure 19. In addition, this ensures that all Corporate Divi- their capabilities, referred to as capability building. sions involved are represented to a sufficient degree and On the one hand, this concept involves the develop- that results can be implemented quickly in the areas con- ment of a project fair, through which Controllers can cerned. be more closely introduced to business. As long as Con- trollers, project managers and the current superior of In addition, coordinateds intensive communication en- the respective Controller agree, Controllers can apply sures that the entire Controlling community and other for a temporary part-time or full-time assignment on interested parties are informed promptly and completely. business projects that offer them a changed functional A broad range of communications tools are used for this job environment. Controllers can improve their busi- purpose, such as a special IMPACT video, articles in ness expertise and thus expand their capabilities as various company newspapers and brochures, as well as Controllers through such involvement in business presentations at conferences. In addition, a separate projects. On the other hand, the initiative will work on IMPACT Bulletin is published every month. This electronic a training and continuing education program designed information is sent regularly to over 2,500 employees of especially for Controllers (training and education). Deutsche Post World Net and informs them about the progress of the program and individual initiatives. To These two sub-projects will be implemented in the con- emphasize the common framework, all communications text of the House of Finance personnel development and take place under the umbrella of a logo developed continuing education program started for the Finance specially for IMPACT. Board Department. The House of Finance program 22
    • CROSS-DIVISIONAL PROJECTS 1 Capability and Role Building 4 Reporting to Business Needs Step-up Controlling vision and role understanding, career Establish customer orientation in reporting models, training, etc. 5 Planning/Forecasting Process & Tool 2 SLA Methodologies & Processes Streamline and improve Planning/Forecasting processes and Enable establishing cross-BU Service Level Agreements for tool support (incl. risk controlling) internal services 6 NFO Calibration (Input to NFO Team) 3 Investment and Project Controlling Calibrate and finalize New Finance Organization – clarify Enhance instruments for investment and project monitoring CFO role and controlling MAIL EXPRESS LOGISTICS FINANCIAL SERVICES SERVICES 7 Functional 8 Costing Capabilities 11 IT Controlling Planning and Improve costing in Support establish- Express Network, esp. ing of financial Monitoring vs. cross border processes for the Controlling 9 Freight Controlling new IT structure Clarify interface of Establish Controlling for functional business freight business ... Initiatives in 2006 IMPACT Program planning vs. Controlling (Numbering does not reflect priority) (e.g. Marketing & Sales, 10 Aviation Costing & Selected topics based on the improvement potential Operations) Transfer Pricing identified by the Next Generation Controlling Project Upgrade Aviation/Net- work Controlling Figure 17: The eleven initiatives of IMPACT addresses the continuing education of Controllers on ments (SLAs) between the service providers and their four different levels: personal skills, specialist subjects of Users so that the performance of exchange can be reflect- wide interest in Finance, Corporate Department-specific ed properly. and business area-specific subjects, as well as subjects for managers. The continuing education of Controllers with Two goals in particular are worth emphasizing in this a view toward their future role as an “Advanced Navigator” context: first, increasing the transparency with respect to represents a common element of the Controlling Busi- calculating and allocating costs of internal services based ness Units of the House of Finance. on prices agreed upon in advance and quantities actually consumed. Second, reducing costs for internal services 5.2. Initiative 2: SLA Methodologies by introducing market-oriented allocation rates. In this and Processes case, market prices per unit of quantity are determined The second initiative, “SLA Methodologies and Proces- using external and internal benchmarks. This control via ses,“ primarily deals with Global Business Services, the market mechanisms should ultimately also facilitate the internal services that have been bundled in the new Cor- matching of resources of the service providers to the porate Division SERVICES as of January 1st 2006. The actual need. initiative supports the definition of Service Level Agree- 23
    • 6 NFO Calibration (Input to NFO Team) 5 Planning/Forecasting Process & Tool 3 Investment and Project Controlling 10 Aviation Costing & Transfer Pricing l Direct Impact 2 SLA Methodologies & Processes l Indirect Impact 4 Reporting to Business Needs 1 Capability and Role Building Monitoring vs. Controlling 7 Functional Planning and (incl. Risk Controlling) 8 Costing Capabilities 9 Freight Controlling 11 IT Controlling Controlling Mission, Role, Tasks Key Controlling Processes Controlling Systems and Tools Methodologies Governance and Organization “Soft Factors” Figure 18: Connection between initiatives and optimization areas The service relationships between the various Business showed that the instruments and processes are clearly Units and the internal service providers will be shaped in defined up to the time the investments and projects are three dimensions: approved, but the subsequent tracking procedure is par- The first dimension is the service orientation of the ser- tially unclear. The main focus of this initiative is thus to vices, whereby the transparency of the service relation- improve the processes and tools for monitoring the tar- ships should be established using the definitions of individ- gets, costs, and schedules defined in the approval process. ual services within a product catalog and the cost allo- cation based on quantities and unit prices. The second A core element of the initiative is regular project repor- dimension is the charging method. While today several ting to decision bodies such as investment committees different methods are in use, a harmonized charging during the project lifecycle, enhanced by a review after system via legal invoices should be applied in the midterm. project closure. Another element is project monitoring The pricing (third dimension) is also carried out in very by means of a uniform IT tool (“Pro Rep”), whereby the different ways today (e.g. by target costs, market prices, or projects of all Corporate Divisions are considered cost-plus pricing). Accordingly, a harmonized approach throughout their entire duration. In addition, the topic for all services should be developed in the medium term. of corporate investment guidelines shall be reviewed. The initiative does not cover project management as such or 5.3. Initiative 3: Investment and Mergers & Acquisition projects. Project Controlling The third initiative, “Investment and Project Control- 5.4. Initiative 4: Reporting to Business Needs ling,“ serves to improve the instruments and processes The starting point of the fourth initiative, “Reporting to for Controlling large investments and projects. The survey Business Needs,“, is that 68% of the Users of Controlling 24
    • indicated in the survey that they are not sufficiently 5.5. Initiative 5: Planning/Forecasting Process involved in designing the content of Controlling reports. and Tool Therefore, the initiative aims to improve the quality of The fifth initiative, “Planning/Forecasting Process and reporting by taking the suggested topics from the Business Tool,“, is intended to improve the processes and instru- Units more strongly into account in the design of reports. ments in the context of budget and midterm planning, forecasting and strategic planning, as well as to mesh In particular, the subject of accounts receivable manage- these processes with each other. ment was underrepresented in the reporting to date, and should therefore receive greater emphasis regular monthly The main focus in the area of budget and midterm plan- reporting in the future. The Corporate Guidelines on ning is on improving the coordination of the numerous accounts receivable management should be developed processes, and on validating the relevance of planning further. In addition to a uniform definition of the DSO requirements for the respective management. In particu- (Days Sales Outstanding) and their measurement, the lar, the budget planning of the services, especially the initiative aims to anchor the defined goals and objectives Global Business Services, needs to be synchronized with and follow up on them in the organization. the planning of the business units. In addition, the plan- Program owner Program Sponsor IMPACT Program Office Funding or co-funding for CFO DPWN Director Strategy LOGISTICS (Lead) - Selected initiatives Prof. Dr. Ernst Chief of Staff Finance (Co-Lead) - Program Office Finance Communication Manager Team Inhouse Consulting Ultimate decision body for the Program Top-level milestone/status review of all IMPACT Steering Committee Head: Prof. Dr. Ernst Support program set-up and 11 initiatives in summary communications More detailed content review of CFO LOGISTICS CFO Postbank Coordinator 1-3 initiatives per meeting as required CFO EXPRESS EU Retail Outlets Highlight/manage Driving development, alignment, content CFO EXPRESS RoW EVP Corp. Accounting/ interdependencies discussion of initiatives CFO EXPRESS GER Reporting Top-level milestones/status CFO MAIL Director report of all 11 initiatives CFO Gl. Busi. Services Corporate Controlling in summary 1. Capability 2. SLA 3. Invest. 4. Reportings 5. Planning 6. NFO Cal. CFO EXP EU CFO GBS CFO EXP DE CFO EXP RoW Dir. Corp. Contr. CFO CFO PB RO CFO PB RO Dir. Corp. CFO EXP EU LOGISTICS Contr. CFO MAIL EVP Corp.Acc. 7. Functional 8. Costing 9. Freight 10. Aviation 11. IT Contr. CFO MAIL CFO EXP EU CFO EXP EU CFO EXP RoW CFO GBS CFO EXP RoW CFO EXP DE CFO EXP EU CFO EXP DE Initiatives report to IMPACT Steering and Development Committee Each initiative led by one Divisional/BU Controller and supported by 1–2 others Initiatives setup program and recruit cross-functional team Teams to detail specific objectives, scope, approach, deliverables, timelines, milestones, etc. Figure 19: Structure of the IMPACT program for 2006 25
    • ning processes should be shortened, and the communica- are extremely important in the context of the New tion of requirements should be improved, e.g. through Finance Organization. In addition to the clarification of targeted planning workshops and a Web-based, modular individual questions, the role of the Controller at the planning manual. country level above all requires sharpened and intensified communication that emphasizes the continued essential In the area of strategic planning, it is important to significance of this function. After all, the Controller is improve the validity of the ”financials” that are compiled still the main contact at the country level for all finance- in that context. In particular, a better interaction between related questions. Given this background, the introduc- business strategy and financial strategic planning in the tion of the designation CFO (Chief Financial Officer) for course of strategic dialog is intended. In addition, the Controllers was also proposed. This new management business strategy should be completed earlier and conse- structure in Finance will be implemented further in 2006. quently before strategic financial planning in the future, so that the effects of strategies and measures can be 5.7. Initiative 7: Functional Planning and incorporated into the financial planning. Furthermore, Monitoring vs. Controlling the interfaces between strategic planning and budget and The “Functional Planning and Monitoring vs. Controlling” midterm planning should be reviewed. initiative is devoted to the issue of shadow Control- lers: It must be recognized that financial Controlling can- In the context of the forecasting process, the forecasting not efficiently provide all details on indicators that are intervals should be adjusted to the external capital mar- needed in different business units. Therefore, this initia- ket communication as well as the planning processes. In tive is devoted in particular to structured and complete addition, it is important to align the level of detail and task coordination between Controlling and the so-called the requirements of the forecast to the respective recip- operation and sales control, for which the guidelines ients or management levels. To increase the data validity should be specified so clearly that there is no room in- for the forecast, certain instruments should be defined. between for shadow Controlling. To what extent can an Besides, the gearing between forecasting and risk control- individual unit take over planning and control of its pro- ling should be further optimized. cesses itself in the sense of functional support, and where does the actual Controlling function start? The answer to 5.6. Initiative 6: NFO Calibration this question of coexistence and of the development of The financial organization has gone through two central precisely defined guidelines will be worked out by taking organizational changes related to the keyword New the MAIL Division as an example. The experiences Finance Organization (NFO): On the one hand, Account- gained there should also subsequently benefit other ing and Controlling were clearly separated from each Divisions. other, and on the other, the local Controllers now report directly to the Finance organization. Directly after its The Business Units’ requirements for Controlling will be implementation, there were still some uncertainties surveyed via interviews and a questionnaire campaign, about the tasks and definition of Controlling as well as and a common understanding between Business Units the task distribution at the regional and national level, as and Controlling will be developed based on the results. the Next Generation Controlling survey has shown. The This common understanding should then be implemen- sixth initiative, “NFO Calibration,“, was started in view of ted by means of appropriate modifications in the reports this background. and in the systems. The model is the defined understand- The clear definition and the understanding of the roles ing of the “Advanced Navigator’s” role, which should be and distinctions between Accounting and Controlling activated further by this initiative. 26
    • 5.8. Initiative 8: Costing Capabilities and In the course of this, the organizational setup of Freight Capacity Management Controlling should also be reviewed. As an example, The eighth initiative, “Costing Capabilities and Capacity dedicated Freight Controlling units as they are in place Management,“, is closely related to the tenth initiative, today in Germany could also be a viable option for other “Aviation Costing and Transfer Pricing.” While the air European countries. In addition to the structures, this network costs as one large block of the cost basis of also includes the responsibilities and interfaces to other EXPRESS are handled separately in initiative ten, initiative Finance areas, as well as to the Business Units. Further- eight deals with the comprehensive costing system for the more, it should be clarified which data are needed to global EXPRESS network. direct the Freight business and these must be provided accordingly by Controlling. Reporting and system The goal of a functionally structured profit and loss modifications if necessary can then be made based on statement is overall to improve the cost accounting and these requirements. contribution margin system, which provides manage- ment with decision information in a suitable structure. 5.10.Initiative 10: Aviation Costing and Contribution margin information should be provided at Transfer Pricing any time and with the appropriate level of detail for the The tenth initiative, “Aviation Costing and Transfer Pric- product, customer, trade lane and branch elements, ing”, takes up the costs of the EXPRESS Business Line because ultimately the success of business is influenced that are not covered by the eighth initiative. This portion via these dimensions. The main focus will be the devel- of the costs includes the so-called air network costs. Due opment of systematized product, trade lane and custo- to the great complexity of this subject, it was set up as a mer analyses. separate initiative. The goal is to develop a comprehen- sive cost allocation model for the air network. In that context, the cost-related recording and allocation of all elements of the network should be further opti- The allocation of the air network costs should be stand- mized. This includes the area of pickup and delivery as ardized internationally and follow the same rules to much as the terminals and hubs and land transport. increase transparency and comparability. Nevertheless, Complete international standardization cannot suffi- regional characteristics should also be taken into account. ciently take the local conditions into account, which is In addition, the allocation rates should be updated more why a global framework that provides the necessary local frequently. The aim is to optimize control of the business flexibility at the same time should be developed. by breaking down the resulting cost rates by product, region and/or customer. Regular reports with financial 5.9. Initiative 9: Freight Controlling and performance-related indicators should support this. The ninth initiative, “Freight Controlling,“, is devoted to optimizing the design of Controlling for freight busi- 5.11. Initiative 11: IT Controlling ness. Freight is a large product line in the EXPRESS Cor- The eleventh initiative, “IT Controlling,“ redefines the porate Division, whereas previously it was part of the incurrence of IT costs and their distribution or alloca- LOGISTICS Division. The business models and thus the tion in view of the reorganization of the IT area. The controlling contents are different in the network business clear separation of IT supply and demand at the regional (EXPRESS) and the forwarding business (Freight). A and local levels also determines the universe of action in number of steering and controlling instruments must be this case, and must be incorporated by Controlling, geared to these specific requirements. requiring modifications in systems and processes. 27
    • The new organizational structure establishes a customer- This process should also be setup accordingly for budgeting contractor relationship in the IT area. Accordingly, Service IT costs. In addition, forecasting of the IT costs should be Level Agreements (SLAs) should be drawn up and agreed reviewed. The initiative is not limited only to the Corporate upon between IT supply and demand. They should clearly level, rather the concept should also be rolled out at the describe the services to be performed in the product cata- Country level. log and specify their prices and quantities. The subsequent allocation should take place via an issued invoice as with an external business partner. 28
    • 6. Outlook In the context of the “Next Generation Controlling” proj- performance of Controlling at Deutsche Post World Net. ect, the Controlling organization has evaluated itself and Other initiatives will have achieved only some milestones allowed itself to be evaluated by outside parties. As a due to the complexity of their subjects, and will still result, potential improvements were identified at six require further steps. These initiatives will then be trans- levels that will be implemented in the IMPACT program ferred to the responsibility of the line organization to to be completed by December 2006. The results of continually improve Controlling even beyond 2006. In IMPACT will be presented at the Second Annual DPWN this way, the Controlling organization of Deutsche Post Finance Conference. According to current plans, many of World Net is making progress in transforming itself into the initiatives should have been completed successfully an “Advanced Navigator.” by then and resulted in significant improvements in the 29
    • The Authors Ernst, Edgar, Prof. Dr., studied mathematics and business administration at Cologne University and earned a doctorate at the RWTH Aachen University. After holding posi- tions as a management consultant at McKinsey & Company and as director for corpo- rate development at Gustav Schickedanz KG, he moved to Deutsche Bundespost POST- DIENST in 1990, where he was appointed to the board of management in 1992. Since 1995 he has been a member of the Board of Management of Deutsche Post AG (CFO). In addition, Prof. Dr. Ernst is represented on the supervisory boards of well-known companies. In January 2006 he was appointed as an honorary professor of WHU Otto Beisheim Graduate School of Management, Vallendar. Reinhard, Hartmut, studied business administration with a special focus on auditing and trust (Treuhandwesen), business taxation and tax law at Cologne University. After positions as management consultant and tax consultant at Dr. Herfort, van Kerkom, Hower, Streit, as well as Coopers & Lybrandt, he moved as divisional director account- ing, controlling and IT to the Nedlloyd Districenters GmbH in 1991. In 1998 he took the divisional control of the Nedlloyd Unitrans GmbH (future Danzas). In 2001 he moved to the corporate headquarters of Deutsche Post World Net as Department Manager Logistic Controlling as well as Department Manager Strategy and Controlling of the Corporate Division MAIL. Since 2005 he has been Director Strategy LOGISTICS. Vater, Hendrik, Dr., studied business administration with a special focus on auditing and controlling, the theory of business taxation and business Spanish at the University of Passau in Germany and the Universidad Complutense de Madrid in Spain. Upon graduation he transferred to the University of St. Gallen (HSG) as a research associate, where he earned a doctorate under Prof. Dr. Giorgio Behr, Chair for Accounting & Cor- porate Finance, with a dissertation on value-based executive incentive compensation. Upon completion of his doctorate, he began his professional career as an assistant to the Board of Management in the Finance Board Department of Deutsche Post AG. Since early 2006 Dr. Vater has managed the staff unit of the Chief Financial Officer of Deutsche Post AG as a director. 30