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Implementing a CPM Solution

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This presentation aims to explore the concepts of Financial Planning and Corporate Performance Management as well as the integration between both, making these the structure to address the stages of a CPM tool implementation.

Implementing a CPM Solution

  1. 1. Copyright  BIMaven Consulting, Lda. Este conteúdo são propriedade intelectual da BIMaven Consulting (MAVEN), protegida nos termos do Decreto-lei Nº 63/85, de 14 de Março – Código do Direito de Autor e dos Direitos Conexos. A divulgação, transcrição ou rerodução deste conteúdo não é permitida sem prévia autorização, por escrito, da MAVEN. O conteúdo é confidencial e de circulação restrita a quem a mesma se destina, que terá o direito de a utilizar apenas para os fins acordados com a MAVEN. Corporate Performance Management Alberto Zenkner
  2. 2. Agenda
  3. 3. 12-12-2014 3 Agenda Corporate Performance Management Budgeting, Forecasting and Financial Modelling CPM Solution for FP&A Implementation Metodology
  4. 4. Corporate Performance Management
  5. 5. 12-12-2014 5 Corporate Performance Management Corporate Performance Management is a methodology to execute a business process aligned to the business strategy to maximize shareholder return.
  6. 6. 12-12-2014 6 Corporate Performance Management Financial Planning & Analysis is a subset component of CPM and it supports the linkage of financial plans to operational plans. These capabilities demand a strong ability to integrate with existing systems outside of the CPM solution.
  7. 7. 12-12-2014 7 Corporate Performance Management CPM supports development of annual budgets and longer- term plans, including workflow technology to manage formulation of budgeting processes, and the ability to model scenario and “what-if” analysis.
  8. 8. 12-12-2014 8 Corporate Performance Management CPM supports techniques such as activity-based costing and activity-based management, including the ability to model the impacts of different resource allocation strategies on performance.
  9. 9. 12-12-2014 9 Corporate Performance Management CPM products include tools such as dashboards, cockpits, and scorecards designed to quickly and easily communicate key performance data to users. Further, CPM products have tools for modeling the relationships between performance criteria in order to arrive at an organizational performance model.
  10. 10. 12-12-2014 10 Corporate Performance Management Planning Monitoring Reporting CPM Modeling Analyzing
  11. 11. 12-12-2014 11 Corporate Performance Management
  12. 12. Budgeting, Forecasting and Financial Modeling
  13. 13. 12-12-2014 13 Budgeting, Forecasting and Financial Modeling Strategy What businesses are we in? How will we compete? Which choices will make us more money? Planning How will we align resources with our strategy? How will we measure our progress?
  14. 14. 12-12-2014 14 Budgeting, Forecasting and Financial Modeling Budgeting How will we ensure accountability and encourage behaviors needed to execute the strategy? Forecasting How will we adjust to reflect changing conditions?
  15. 15. 12-12-2014 15 A business model will become a virtual reality representation of how a real business opportunity will develop. Budgeting, Forecasting and Financial Modeling
  16. 16. 12-12-2014 16 To enable this virtual world to be as realistic as possible it needs to be logically constructed from a set of assumptions that covers each influencing factor. Budgeting, Forecasting and Financial Modeling
  17. 17. 12-12-2014 17 These factors include both the business environment (for example, inflation, potential customers and taxes) and the organization (for example, product prices, staff numbers and product volumes). Budgeting, Forecasting and Financial Modeling
  18. 18. 12-12-2014 18 The most comprehensive means of financial budgeting and forecasting is to develop a series of projected financial statements with the support of well defined business rules. Budgeting, Forecasting and Financial Modeling
  19. 19. 12-12-2014 19 Based on the projected statements, the firm is able to estimate its future level of receivables, inventory, payables, and other corporate accounts as well as its anticipated profits and borrowing requirements. Budgeting, Forecasting and Financial Modeling
  20. 20. 12-12-2014 21 Budgeting, Forecasting and Financial Modeling
  21. 21. 12-12-2014 22 A financial model helps managers to explore complex choices, using sets of assumptions to represent alternative scenarios, whether they are for budgeting, forecasting or strategic planning Budgeting, Forecasting and Financial Modeling
  22. 22. Business Analysis & CPM Solution for FP&A Implementation Metodology
  23. 23. 12-12-2014 24 BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION The process of implementing a CPM solution can be divided into eight phases that are comprised of three stages AS-IS ANALYSIS
  24. 24. 12-12-2014 25 BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION In the first stage, will be evaluated technological issues and the status of the budget process AS-IS ANALYSIS
  25. 25. Phase 1 12-12-2014 26 BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS •Identify the state of infrastructure hardware •Identify the level of maturity of the planning model •Identify the project main sponsor
  26. 26. Phase 1 12-12-2014 27 BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS •Identify how many employees are involved in the budgeting cycle •Identify how long this cycle takes •Determine the scope of the project
  27. 27. 12-12-2014 28 BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS The second stage will be defined the managers requirements and specified of the business rules to meet these outputs
  28. 28. Phase 2 12-12-2014 29 Definition of the structure of financial statements, KPIs and other outputs required by managers: •Income Statement •Balance Sheet •Cash Flow BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS
  29. 29. Phase 3 12-12-2014 30 Make the transition from Financial Accounting for Management Accounting by converting the chart of accounts of the company for the new defined structure; BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS
  30. 30. Phase 3 12-12-2014 31 This phase involves only actual data that will performed at first to test the outputs and subsequently used to compare actual x planned results BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS
  31. 31. Phase 4 12-12-2014 32 Defining templates for inputs of planned data BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS
  32. 32. Phase 5 12-12-2014 33 Development of financial modeling in accordance with the business rules defined by managers and accounting staff BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS
  33. 33. 12-12-2014 34 BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS Only in a third stage, with well-defined business rules, and a stable model, starts the implementation of technological CPM solution.
  34. 34. Phase 6 12-12-2014 35 Software Installation; Load of Dimensions; Development of formulas, input forms and reports; Workflow preparation. BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS
  35. 35. Phase 7 12-12-2014 36 Testing and Validation BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS
  36. 36. Phase 8 12-12-2014 37 Training of end users BA & Implementation Metodology BUSINESS ANALYSIS SOLUTION IMPLEMENTATION AS-IS ANALYSIS

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