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Fssa conference 2014 cfo group unified financial performance management

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Fssa conference 2014 cfo group unified financial performance management

  1. 1. Unified Financial Performance Management in the Financial Services Sector GEOFF NOBLE CFO GROUP
  2. 2. AGENDA • What we mean by Financial Performance Management • Financial Performance Management needs in Financial Services • Financial Performance Management systems and the pitfalls • A unified approach to Financial Performance Management • Benefits of a unified approach • Some case studies • Possible next steps and Q&A 2014 The Year of Opportunity
  3. 3. What we mean by Financial Performance Management
  4. 4. FINANCIAL PERFORMANCE MANAGEMENT PROCESSES Planning Group / Corporate Budgeting Forecasting Closing Consolidation Management Reporting Statutory Disclosure Regulatory Reporting Scenario Modeling Opera-ons / Divisions 2014 The Year of Opportunity
  5. 5. Financial Performance Management needs in Financial Services
  6. 6. WHAT CFOS IN FINANCIAL SERVICES HAVE TOLD US General themes about the finance function: - Drive to become business partner / advisor / catalyst / strategist - proactively bring opportunities to the business - Reduction in cost of finance - streamline processes and off-shore mundane - achieve or beat the top performer benchmarks for costs % revenue - Increase regulatory attention - Improve the quality and timeliness of information …and automa*ng Financial Performance Management supports all above 2014 The Year of Opportunity
  7. 7. WHAT CFOS IN FINANCIAL SERVICES TOLD US Specific needs for Financial Performance Management: - Group / Corporate consolidation of plans, budgets, forecasts, and actuals - consistent reporting and analysis at the group / corporate level - management, statutory and regulatory reporting and disclosure - Operational planning, budgeting, forecasting, and reporting - branch, region, product, customer segment - Contract level detail to drive out revenue budget/forecast for existing portfolio - each individual loan/deposit/policy - Driver based budgeting and forecasting for new portfolio and costs - Payroll, opex, capex and ICT budgeting - Cost allocations and profitability analysis by product 2014 The Year of Opportunity
  8. 8. Financial Performance Management systems and pitfalls
  9. 9. FINANANCIAL PERFORMANCE MANAGEMENT SOFTWARE The software industry calls it xPM FPM CPM BPM 2014 The Year of Opportunity Large so5ware vendors PM EPM
  10. 10. MANY SOFTWARE VENDORS HAVE BOUGHT MULTIPLE PRODUCTS Planning Budgeting Disclosure Forecasting Management tools Closing Consolidation Consolida-on tools Planning tools Management Reporting Closing tools Data Integra-on tools Statutory Disclosure Regulatory Reporting Scenario Modeling 2014 The Year of Opportunity Strategy Management tools Business Intelligence tools Data Warehouse tools
  11. 11. PITFALLS OF MULTIPLE PRODUCTS Multiple specialists Too many cooks Cost é Time é Complexity é Value ê 2014 The Year of Opportunity
  12. 12. A unified approach to Financial Performance Management
  13. 13. 2014 The Year of Opportunity
  14. 14. 2014 The Year of Opportunity
  15. 15. HOW TO SIMPLIFY FINANCIAL PERFORANCE MANAGEMENT • Put the right people on the job • Ex-CFOs and technically-savvy accountants • Talk finance, business and technology • Have a passion for financial performance management • Use unified software platforms • One product is better than many • Must be functional (for financial services) and scalable • Finance friendly and not require extensive IT involvement • Apply an outcome focused methodology • Top-down from vision and goals to staged implementation and use • One solution architect (and not too many cooks) 2014 The Year of Opportunity
  16. 16. 2014 The Year of Opportunity
  17. 17. Vision: Provide a unified system for financial performance management across the organisation Data Model: Processes: Goals: Outputs: Data Sources: Business logic and financial rules • Less effort and pain to produce the information • More relevant information • More accurate and consistent information • Transparent rules and assumptions • More timely delivery of information • Less costs to own, maintain, run and use • Flexible platform to meet future needs Management -­‐Group/Corporate -­‐Ops/Divs Statutory and Regulatory Scenarios and Analyses Ad Hoc and other outputs Dimensions: • Periods • Scenarios • Categories • Currencies • Accounts • En--es • Products • Customers • Other 2014 The Year of Opportunity Financial systems/ GL Other sources Manual Input Opera-onal systems Management Actuals Plans Budgets Scenario Modeling Plans, Budgets and Forecasts Dimensions and calculations to support outputs Statutory Actuals Forecasts Exis-ng porMolio
  18. 18. Benefits of a unified approach
  19. 19. BENEFITS OF A UNIFIED APPROACH • Successful implementations - on time, on budget, happy users • Get the consistent numbers out faster to the people that need them • With less pain and effort • Reduce costs • Increase staff satisfaction in both Finance and in the business • Provide far more time for analysis… Become the business partner introducing business opportunities 2014 The Year of Opportunity
  20. 20. Some case studies
  21. 21. Results/Benefits: • Single chart of accounts to manage • Improved auditability and decreased risk • Integrated disclosure management • Easy expansion to additional processes • Competence center and lower TCO • Shorter closing cycle The Group • Revenues €40 billion • Global 500 #154 • Largest bank in Central-Eastern Europe System Scope: • Financial consolidation and regulatory 2014 The Year of Opportunity reporting • Statutory and management reporting • Budgeting and forecasting • Segment reporting • KPIs and executive dashboards • Disclosure management • Reporting for Chief Risk Officer Financial Performance Management system Size: • 3,800 users • 800 fully consolidated entities • 9 sub-consolidation sites • 300 participants in disclosure management
  22. 22. From close to disclosure in Financial Services > Intercompany reconciliation > Journals and adjustments > Controls and validations > Segment reporting 2014 The Year of Opportunity CLOSE > Local close > Consolidation > Financial reporting > Management reporting > GAAP, IFRS, XBRL > Board books DISCLOSURE
  23. 23. Planning, budgeting and forecasting in Financial Services > Bank-wide/Insurance company-wide budgeting by company / operation / region / product / customer segment > Existing portfolio projections at the individual loan/policy/contract level > New business portfolio projection > Driver based payroll, opex, & capex > IT cost budget > Cost allocations > Budget consolidation > Actual vs. budget reconciliation 2014 The Year of Opportunity
  24. 24. Q&A and Possible Next Steps
  25. 25. NEXT STEP TOWARDS UNIFYING FINANCIAL PERFORMANCE MANAGEMENT AND BRINGING OPPORTUNITIES TO THE BUSINESS? • Apply some of the methods covered today back at the office • Informal meeting with us to discuss your situation • Formal Financial Performance Management review • Copies of Case Studies…email me for copies • Opinion Leader Lunch Series…email me for details • Q&A 2014 The Year of Opportunity
  26. 26. THANK YOU GEOFF@CFOGRP.COM

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