ima_webinar_ppt_22jun16_final_2

Transform Your Spreadsheets to
Deliver Smarter Planning,
Budgeting, and Forecasting
Tony Levy
Sherri Liao
June 22, 2016

© 2016 Institute of Management Accountants. Inside Talk Webinar Series. All rights reserved.
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#InsideTalk
Adam Larson, DES
Senior Manager of
Educational Technology Enablement
IMA
Moderator
6

#InsideTalk
Featured Presenter
Tony Levy
Business Unit Executive
Business Analytics
IBM Software Group
7

#InsideTalk
Featured Presenter
Sherri Liao
Performance Management & Business
Intelligence Advisory Practice Lead
The Hackett Group
8

#InsideTalk
Learning Objectives
Upon completing this webinar, you will be able to:
1. Explain best practices in enterprise performance
management
2. Understand how technology can embrace spreadsheets
to overcome limitations in traditional processes
3. Describe the next steps for moving forward
9

#InsideTalk
Sherri Liao
The Hackett Group
Trending in Enterprise Performance
Management (EPM)
© 2015 The Hackett Group, Inc. All rights reserved. Reproduction of this document or any portion
thereof without prior written consent is prohibited
10

#InsideTalk
2016 Hackett Key Issues Study
Finance is focused on enterprise information, cost structure, and focus on strategy
11
Minor Moderate MajorImportance for 2016:
Focus Areas for Finance
Source: 2016 Hackett Key Issues Study
Building agility into the organization
Optimizing capital structure
Dealing with increased regulation
Identifying M&A opportunities
Building crisis management capabilities
Formulating strategy with business
Improving decision-making
Ensuring effective governance
Improving cash flow and balance sheet
Managing enterprise risk
Supporting innovation across the business
Achieving and maintaining a competitive cost structure
Integrating enterprise information

#InsideTalk
12
2016 Hackett Key Issues Study
Transformation targeted on planning & performance management / business
analysis continues to be the #1 area of transformation investment
Level of transformation activity planned in 2016
Source: 2016 Hackett Key Issues Study
Time Reporting & Payroll
General Accounting & External Reporting
Compliance Management
Revenue Cycle
Cash Disbursements
Treasury Management
Tax Management
Service, Process Improvement &
Function Management
Planning & Performance
Management/Business Analysis

#InsideTalk
13
Top Performance in EPM
Less costly EPM function and
service delivery
30% Average days to complete a
financial forecast post month
end close
<8 days
Average performance gap
between forecast accuracy
(sales, earnings, cash) of Top
Performers and Peers
1.6x Percent of Planning / Controlling
time spent analyzing data to
provide business insight
58%
Source: Hackett EPM Top Performance Study

#InsideTalk
Companies that are highly automated or have rationalized
their applications yield higher benefits and return
14
Overall, high automation led to more time on business strategy;
nearly 3X that of peers
On-Line Budgeting
 month less to
complete the plan
On-line
Reporting
Distribution
almost 20% less
compilation &
collection
88
120
High All Others
47%
56%
High All Others
Finance Cost as a % of Revenue
Rationalized Finance Applications
Low High
1.80%
.82%
Total finance
costs
< 50%
Source: Hackett Finance Benchmark Database

#InsideTalk
Polling Question 1
a) Fully implemented
b) Implemented at corporate level to consolidate divisional /
business unit / regional budgets; staff at divisional /
business unit / regional level load spreadsheet templates
into the system
c) Implemented at corporate level only; no interaction with
the system at divisional / business unit / regional level
To what degree does each part of your finance
organization involved in financial planning and
forecasting use the primary technology platform?
15

#InsideTalk
Polling Question 1 Results (Placeholder)
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#InsideTalk
Top Performers are 4x more likely to have fully implemented
their primary platform fully for Financial Planning & Forecasting
17
19%
67%
14%
78%
22%
Fully implemented Implemented at Corporate level to consolidate Divisional /
Business Unit / Regional budgets; staff at Divisional /
Business Unit / Regional level load spreadsheet templates
into the system
Implemented at Corporate level only; no interaction with the
system at Divisional / Business Unit / Regional level
Peer Top Performer
Primary Technology Platform: Financial Planning And Forecasting
Q2.13 To what degree does each part of your finance organization involved in financial planning and forecasting use the primary technology platform?

#InsideTalk
Excel spreadsheets remain the most important tool used in
annual planning / budgeting
18
Systems / Tools Used for Annual Planning / Budgeting
Best
Practice
Best
Practice

#InsideTalk
Where is World Class Moving Towards?
19
1Moving Beyond Finance
2Focusing on Master Data Management
3Mobile / Cloud Based Information Sharing
4Embracing a Rolling Forecast

#InsideTalk
Polling Question 2
a) Financial statement views only
b) Financial statement views with some linkages to
operations (i.e. supply chain, sales, marketing, etc.)
c) Financial statement views with integrated views to
operations (i.e. supply chain, sales, marketing, etc.)
What types of information does your Finance
organization provide today to support performance
reporting?
20

#InsideTalk
21

#InsideTalk
Moving Beyond Finance
Emerging Views of Performance Reporting
22
Effective reporting is moving beyond just Finance and becoming of
cross-functional importance within organizations
Pipeline
Analysis
Triangulated
Forecasting
Sales Team
Effectiveness
Up-sell /
Cross-sell
Cycle Time
Analysis
Lead
Conversion
Sales
Campaign
Scorecard
Response
Rates
Product
Propensity
Loyalty and
Attrition
Market Basket
Analysis
Campaign ROI
Marketing
Order
Linearity
Orders
vs. Available
Inventory
Cycle Time
Analysis
Backlog
Analysis
Fulfillment
Status
Customer
Receivables
Order Mgmt
& Fulfillment
Supplier
Performance
Spend
Analysis
Procurement
Cycle Times
Inventory
Availability
Employee
Expenses
BOM Analysis
Supply Chain
A/R & A/P
Analysis
GL / Balance
Sheet Analysis
Customer
& Product
Profitability
P&L Analysis
Expense
Management
Cash Flow
Analysis
Financials
Churn
Propensity
Customer
Satisfaction
Resolution
Rates
Service Rep
Effectiveness
Service Cost
Analysis
Service
Trends
Service &
Contact Center
Employee
Productivity
Compensation
Analysis
HR Compliance
Reporting
Workforce
Profile
Turnover
Trends
Return on
Human Capital
Human
Resources

#InsideTalk
23
Focusing on Master Data Management
Addressing foundational building blocks for information strategy
Roles & Joint
Stewardship
Technology
Process

#InsideTalk
24
Mobile / Cloud Based Information Sharing
Delivering decision support faster, real-time
SECURE MOBILE ANALYTICS
TABLET BASED DASHBOARDING
CLOUD BASED DEPLOYMENT
REAL-TIME DATA REFRESH

#InsideTalk
Software as a Service Deployment Plans
(next 2-3 years):
25
Source: Hackett SaaS
Quick Poll
61% 65%
86% 89%
17% 18%
7%6% 6%
28%
12% 14% 11%
Financial Management and
Accounting
Supply Chain Management BI / Analytics / Reporting Manufacturing and
Operations
No SaaS deployment plans
Replace existing applications with SaaS alternative from different vendor
Migrate existing applications to a SaaS version of the same application
Implementation of SaaS applications for new requirements
22%
35%
44%
56%
44%
24% 22%
6%6%
12% 11%
6%
28%
41%
17%
28%
Human Capital Management Customer Relationship
Management
Procurement eCommerce

#InsideTalk
26
Embracing a Rolling Forecast
Abandoning the “old way” of planning
Abandoning traditional budgeting: At the core of most organizations’ planning process is the
budget – an annual and fixed target that’s typically irrelevant by the time it’s approved. As a result,
more organizations are moving toward a continuous rolling process and abandoning the annual budget.
RIP
“too detailed,
takes too long
and adds little
value”
RIP
“drains time
and energy
from the
team”
RIP
“provides the
illusion of
control”
RIP
“reporting is
subject to
spin and
manipulation”

#InsideTalk
Top Performers are better Business Partners, use shared
services, standardize and automate information production
27
Business
Value
Information
Service
Placement
Process
Sourcing
Process
Design
Enabling
Technology
Skills &
Talent
Governance &
Organization
Less effort in producing more valuable information
for more strategic Business Partnering
Rationalize activities with
greater usage of shared
services and centers of
excellence
Limited outsourcing
Clear process purpose
Better defined, integrated, less
iterative, processes
Replace spreadsheets with
more scalable, specialized
integrated technology
Smaller, higher impact
Controlling/ FP&A
communities
Higher level of process
governance for
producing information

28© 2016 The Hackett Group, Inc. All rights reserved. Reproduction of this document or any portion thereof without prior written consent is prohibited.
Statement of Confidentiality and Usage Restrictions
This document contains trade secrets and information that is sensitive, proprietary, and confidential to The Hackett Group the disclosure of
which would provide a competitive advantage to others. As a result, the information contained herein, including, information relating to
The Hackett Group’s data, equipment, apparatus, programs, software, security keys, specifications, drawings, business information, pricing,
tools, taxonomy, questionnaires, deliverables, including without limitation any benchmark reports, and the data and calculations contained
therein, may not be duplicated or otherwise distributed without The Hackett Group Inc.’s express written approval.
www.thehackettgroup.com

#InsideTalk
Smarter Planning, Budgeting,
and Forecasting
Tony Levy
IBM Software Group
29

#InsideTalk
Replace the spreadsheet in the middle
30
© 2015 IBM Corporation
MarketWatch Nov. 9, 2005
SAN FRANCISCO
(MarketWatch) - The hefty
$11 million severance
error was traced to a
faulty spreadsheet....

#InsideTalk
Speed | Integrated Excel user interface
31
• Explore and analyze
data from a variety
of different
sources—including
ERP/GL, OLAP,
and BI
• Perform flexible
analysis and solve
business problems
using familiar
spreadsheet tools
and techniques

#InsideTalk
Speed | Cloud delivers instant, self-service workspace
Revenue Plan
Planning
Analytics Book
Profitability
Blueprint
Planning
Analytics Book
Revenue by
Product
Planning
Analytics View
Revenue by
Region
Top 10 Product
Lines
Planning Analytics
View
Planning
Analytics View
Hi Christopher, Welcome!
Looking for a quick way to get
started with Planning Analytics?
Model
Model your business for
planning and analysis
Explore and
Predict
Ask questions, discover
patterns and find insights
Report
Build dashboards and
distribute results
Refine
Refine and enrich your
data
32

#InsideTalk
Agility | Engage users, drive alignment and execution
33

#InsideTalk
Agility | In-memory, multi-dimensional planning and analytic engine
Fast Data
Loading
Multi-
Dimensional
Analysis
Flexible
Model
Definitions
Performance
Real Time
Forms Based
Interface Design
Platform for managing
volatility, providing
real-time responses to
complex questions.
• High volume contribution
• What-if analysis
• Meta-data changes
• Data refresh
34

#InsideTalk
Agility | Continuously align financial plans with corporate
objectives linked to operating plans and market events
 Demand Planning
 Stock-outs
 Throughput analysis
SALES & MKTG HR IT OPERATIONS
F I N A N C I A L
O P E R A T I O N A L
 Sales Forecasting
 Qualification/close
 Promotions planning
 Headcount Planning
 Attrition rate
 Resource effectiveness
analysis
 IT Portfolio Planning
 ROI/TCO Analysis
 Shared Services
Planning
Strategic
Planning
Target
Setting
Operational
Planning
Financial
Planning
Reporting Forecasting
 Corporate Planning
 EPS, market share,
quality, growth…
 Corporate Reporting
and Analysis
Weather data, social media,
econometric data, IoT, etc.
Predictive
Analytics
35

#InsideTalk
Foresight | Predictive insights automatically from data
Predictive analysis
and discovery
Collaborate and share
Tell a story
Natural language and
guided discovery
Easy access to external data
36

#InsideTalk
Polling Question 3
a) Currently no
b) Currently no, but plan to
c) Yes, to a limited extent
d) Yes, to a significant extent
To what extent do you use statistical modeling techniques
to improve planning & forecasting?
37

#InsideTalk
38

#InsideTalk
Foresight | Examples > insight from data
Analyze customer data to identify
which customers are likely to leave
and why and predicts the effect on
revenue. Justin can then determine
which customer investments will lead
to more profitable growth.
Analyze accounts receivables to
create a predictive profile of
customers—from least likely to most
likely to pay. Prioritize outreach and
communication based on these
profiles for more efficient collections.
39

#InsideTalk
IBM Planning Analytics
Fast, easy, flexible and complete planning and analytics cloud solution
Drive
efficiency
Deliver
foresight
Dynamically
align and
adapt
Speed Agility
•Start instantly and grow
quickly
•Get ease of use without
complexity
•Automate plans, analyses
and reports
•Quickly align financial
plans, corporate
objectives, operational
tactics and market events
•Easily adapt systems to
changing business
strategies and realities
•Make analytics easy for
everyone to infer trends,
explore drivers, model
scenarios and visualize
impact
•Leverage external data to
anticipate the future
Foresight
40

#InsideTalk
IBM Planning Analytics
Fast, easy, flexible and complete planning and analytics cloud solution
Drive
efficiency
Deliver
foresight
Dynamically
align and
adapt
Speed Agility
•Start instantly and grow
quickly
•Get ease of use without
complexity
•Automate plans, analyses
and reports
•Quickly align financial
plans, corporate
objectives, operational
tactics and market events
•Easily adapt systems to
changing business
strategies and realities
•Make analytics easy for
everyone to infer trends,
explore drivers, model
scenarios and visualize
impact
•Leverage external data to
anticipate the future
Foresight
41
• Cloud workspace for
production reporting,
analysis, and planning
• Excel as window to data
• Agility of business
structures and
relationships
• Finance & operations,
strategy & execution
• Solution catalog
• Predictive analysis
• Internal data,
external data
• Structured data,
unstructured data

#InsideTalk
Free Trial – Try it!
ibm.com/planning
42

#InsideTalk
Polling Question 4
43
a) Initiative already underway
b) Improve our process
c) Redesign process and software
d) Nothing
Based on what you have heard what do you believe that
your organization should now do?

#InsideTalk
44

#InsideTalk
Important notes
45
© Copyright IBM Corporation 2016
IBM Corporation
Insert Division Name
Route 100
Somers, NY 10589
Produced in the United States of America
Month year
IBM, the IBM logo, ibm.com, are trademarks of International Business Machines Corp., registered in many jurisdictions worldwide.
Other product and service names might be trademarks of IBM or other companies. A current list of IBM trademarks is available on the
Web at “Copyright and trademark information” at www.ibm.com/legal/copytrade.shtml
This document is current as of the initial date of publication and may be changed by IBM at any time. Not all offerings are available
in every country in which IBM operates.
THE INFORMATION IN THIS DOCUMENT IS PROVIDED “AS IS” WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED,
INCLUDING WITHOUT ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND ANY
WARRANTY OR CONDITION OF NON-INFRINGEMENT. IBM products are warranted according to the terms and conditions of the
agreements under
which they are provided.

#InsideTalk
Questions & Answers
Use the Q & A Panel to send your questions to our panelists.
Tony Levy
Business Analytics
IBM Software Group
Sherri Liao
Performance Management
& Business Intelligence
Advisory Practice Lead
The Hackett Group
Adam Larson, DES
Senior Manager of
Educational Technology
Enablement
IMA
46

#InsideTalk
Thank You to Our Presenters!
Tony Levy
Business Analytics
IBM Software Group
Sherri Liao
Performance Management & Business
Intelligence Advisory Practice Lead
The Hackett Group
47

#InsideTalk
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Final Reminders
48

#InsideTalk
Next Webinar:
• How IBCS® Notation Standards Help Understand Reports
 Tuesday, June 28, 2016, 7 a.m. Eastern Daylight Time
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