An extract of how to enable Performance Measurement systems and provide actionable analytics by creating a profitability database.

1. Integrated Performance Management
Keys to Superior Financial Performance
Michael Tait

2. Traditional financial analysis often utilizes macro trends to forecast business unit or product
profitability. That high level profitability information is then used to inform most business
decisions. While this approach is valuable, it does not influence the daily decisions that drive
ongoing profitability.
A holistic Performance Management
framework integrates financial
reporting, client management, risk
management, and pricing models for
more cohesive and efficient business
processes. This framework creates
value by informing the ongoing
decisions that truly determine
operating profitability.
Profitability and Performance Management

3. Most organizations operate Financial Reporting, Client Relationship
Management, and Pricing Models independently. Further, business
managers are sometimes supported by three or four different support
organizations.
This type of fragmented and siloed approach leads to disconnected and
confusing management reporting, misleading analytics, and ultimately
suboptimal financial performance.
Common Obstacles

4. Integrated Performance Management
Integrating these critical processes, leads to more effective and
cohesive client and product management.
More importantly, an integrated framework informs ongoing
pricing decisions, which truly drives superior financial
performance.
While some assume this is too complicated to accomplish,
integration simply requires a vision and modest system
coordination.

5. A Performance Management framework starts with the calculation of historical account level profitability. This
dataset is the foundation of integrated client, segment, product, geographic, and behavioral analytics. Those
processes then inform critical ongoing business decisions including, product pricing, client pricing, and
relationship management incentives.
Historical
Profitability
Product
Analytics
Segment
Analytics
Client
Planning
Pricing
Model
New Product Pricing
Relationship Management
RM Incentives
Portfolio Management
Client Segmentation
Client Lifetime Value
Performance Management Foundation

6. Michael Tait
As an experienced leader in Profitability Analytics and Business
Intelligence, I understand how operational data can be transformed and
leveraged to drive superior financial performance.
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