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Financial Planning
               Best Practices

                      04/14/2011

                   www.senturus.com


    Helping Companies Learn From the Past, Manage the
1                        Present and Shape the Future
Agenda

    • Introductions
    • 12 Elements of Financial Planning Best
      Practices
    • TM1 Demo
    • Planning Solution Case Studies
    • Q&A


2
This slide deck is part of a recorded webinar.
    To view the FREE recording of this entire presentation and
                   download the slide deck, go to
                      www.senturus.com/recorded-webinars.php

     You will find this—and many other recorded webinars-- under the “IBM Cognos
                             Enterprise Planning and TM1”




3
Welcome and Introduction
    • Senturus
      – Greg Herrera, Co-Founder, CEO


      – Steve Chapman, Management
        Consultant


      – Chris Fargo, Office of Finance
        Account Manager


    • IBM Cognos
      – Michael Mackevicius, Technical
        Manager

4
Who is Senturus ?
    •   Consulting firm specializing in Corporate
        Performance Management
         – Business Intelligence and Enterprise Planning
           & Budgeting
         – Platform-independent
         – San Francisco Business Times Hall of Fame --
           Four consecutive years in Fast 100 list of
           fastest-growing private companies in the Bay
           Area

    • Experience
         – 10-year focus on performance management
         – More than 1,000 projects for 450+ clients

    • People
         – Business depth combined with technical
           expertise. Former CFOs, CIOs, Controllers,
           Directors...

5
A few of our 450+ Clients




6
The Best Financial Performers:
                            “Value Integrators”
              High
                                               32%                    23%




 Finance
Efficiency                                     33%                    12%




               Low
                          Low                                         High
                                       Business Insight




Source: IBM Institute for Business Value, The Global CFO Study 2010



7
Their Financial Results
                          Efficiency + Business Insight Contributes to Outperformance
                                                                                                                           Value Integrators
                                                          > 20x                       49%                       30%
                                                          more           14.0%        more                      more       All other enterprises
                                                                                                   12.1%
                                         11.3%

                                                                                  9.4%                      9.3%




                                                     0.5%

                                            EBITDA                        Revenue                      ROIC
                                    5-year CAGR, 2004-2008            5-year CAGR, 2004-2008   5-year average, 2004-2008

                                                                                 Value Integrators also have an almost
                                                                                 20% better operating efficiency ratio than
                                                                                 all other companies examined.
Source: IBM Institute for Business Value, The Global CFO Study 2010



8
What do Value Integrators do differently?
                                                                                                                              % More
    Data and           Streamlined information delivery                                                                        32%
    Analytics
                       Electronic data capture at the source                                                                      35%

                       Systematic data cleansing and auditing                                                                     31%
                       Business Risks in Performance Reporting                                                                    22%
    Process            Employed Functional Best Practices                                                                         31%
                       Utilized automated workflow tools                                                                          25%
                       Measurement & monitoring of processes                                                                      41%
    Technology         Common reporting platform                                                                                  31%

                       Common planning platform                                                                                   22%

                                                                      0%       20%          40%        60%         80%     100%
                                                                                             Percent Adopted
                                                                           Disciplined Operators       Value Integrators
                                                                           Constrained Advisors        Scorekeepers


Source: IBM Institute for Business Value, The Global CFO Study 2010



9
1. Use one planning process for periodic,
     rolling plans / forecasts
     • Don’t: Use one, long annual “budgeting” process; and a
       different, infrequent (or no) reforecasting process . . .
     • Do: Use one, efficient rolling reforecast process

     • BENEFITS:
        – One process for managers to learn (and remember)
        – An efficient planning process should complete in a few days at
          most
        – More accurate projections due to frequent reviews and updates
        – Continual management actions are based on better trend
          information and accurate, timely actual-to-plan variances



10
1. Planning for Employees




11
This slide deck is part of a recorded webinar.
     To view the FREE recording of this entire presentation and
                    download the slide deck, go to
                       www.senturus.com/recorded-webinars.php

      You will find this—and many other recorded webinars-- under the “IBM Cognos
                              Enterprise Planning and TM1”




12
1. Planning for Cap Ex




13
1. Planning for Expense Line Items




14
1. Expense Summary




15
2. Provide bottoms-up and top-down
     planning capabilities in the same model

     • Don’t: Limit planning managers to only a bottoms-up
       planning model . . .
     • Do: Provide top-down change and adjustment
       capability

     • BENEFITS:
        – Goal and target setting can be done very efficiently at the
          company, division, department or account levels using
          “spread” or “breakback” techniques
        – Only forecast (non-actual) months and open (“unheld”)
          accounts are adjusted to achieve the target amount


16
2. Top-down planning / forecasting example




17
2. Top-down planning / forecasting example




18
2. Top-down planning / forecasting example




19
2. Top-down planning / forecasting example




20
3. Maintain central control over drivers,
     assumptions, parameters, and versions

     • Don’t: Assume that distributed Excel workbooks will use
       the correct drivers . . .
     • Do: Use drivers wherever possible and secure drivers,
       conversion factors, and versions centrally

     • BENEFITS:
        – All planning managers, executives and reports will refer to the
          “live” scenario / version
        – No confusion about what version is active
        – Up-to-date global and department drivers / assumptions


21
3. Planning drivers example




22
3. Planning drivers example




23
This slide deck is part of a recorded webinar.
     To view the FREE recording of this entire presentation and
                    download the slide deck, go to
                       www.senturus.com/recorded-webinars.php

      You will find this—and many other recorded webinars-- under the “IBM Cognos
                              Enterprise Planning and TM1”




24
4. Integrate planning solution security with
     company security systems

     • Don’t: Assume that data in the distributed Excel
       workbooks will be secure . . .
     • Do: Use company Active Directory and LDAP to
       integrate security, preferably with single sign-on

     • BENEFITS:
        – Secure company confidential data
        – Minimize redundant maintenance of security files
        – Aid end user solution adoption by eliminating separate sign-on’s
          for transaction vs. planning vs. reporting systems

        (Note: Combined, comprehensive web portals are even better!)


25
4. Integrated security example




26
5. Use a centralized planning data base for
     consolidation and workflow management

     • Don’t: Waste time manually tracking distributed Excel
       workbooks and manually consolidating them . . .
     • Do: Manage plan submittals and their reviews with real-time
       status and consolidate results with no latency
        (CFO study corollary: “automated workflow tools”)


     • BENEFITS:
        – Better accountability and adherence to planning timetables
        – Frequent and accurate roll-ups and reports on evolving plans
          and forecasts leads to early feedback and adjustments


27
5. Workflow status example




28
5. Workflow status example




29
6. Leverage planning solutions and integrate
 planning data across multiple business areas

     • Don’t: Build planning silos or only install planning
       solutions in finance or a few functional areas . . .
     • Do: Leverage your industrial-strength planning solution
       with its centralized data base across the enterprise,
       replacing Excel-based processes, and sharing plans
        (CFO study corollary: “common planning platform”)


     • BENEFITS:
        – Integrated and timely plans between sales, marketing,
          production, inventory planning, finance, tax and H/R


30
6. Planning solution examples




31
7. Use the centralized planning data base for
     uniform, timely updating of actual data
      • Don’t: Distribute actual data extract files or dozens of Excel
        workbooks . . .
      • Do: Leverage the centralized planning data base and
        distribute actual updates often and instantly to all users in a
        structure that matches the planning models and after any
        necessary mappings and reclassifications

      • BENEFITS:
         – Integrated and timely actual updates, enterprise-wide with
           centrally controlled, consistently applied organizational changes
           and historical restatements
         – “Single version of the truth” / “Common reporting platform”



32
7. Remapping / reclassification examples




33
7. Remapping / reclassification examples




34
8. Distribute monthly pre-close reports for
     feedback on accruals and variances
     • Don’t: Close the month without line management input, nor
       blind-side them with untimely variances . . .
     • Do: Leverage real-time reporting capabilities to seek input on
       needed accruals and to support variance research
        (CFO study corollary: “common reporting platform”)


     • BENEFITS:
        – Shorter, more accurate financial closes
        – Line management is prepared for timely, knowledgeable
          executive review of results



35
Integrated Information = Integrated Business Process Dimensional Models
                                            “Single Version                     Planning                                                          Planning Solutions
                                             of the Truth”                      Data




                                                                                                                     Solutions
                                                                                                                     Planning
                                                                          Actual
                                                                          Data

                                                                                                                                                Self-service Reporting




                                                                                                                    Querying
                            ERP Data                             Data Warehouse




                                                                                                                     Ad hoc
                                                                                                                                                      & Analysis
Source Systems of Record




                                                                                                                    Slicing &
                                                                                                                     Dicing
                             G/L Data                                                                                                                         Standard
                                                                                                                                                               Reports




                                                                                           Data Abstraction Model


                                                                                                                    Dashboard
                                                                                                                    Authoring
                                             Data Integration




                                                                                                                                   Web Portal
                                                                                                                                                     Dashboards/
                                                                                                                                                      Scorecards

                            Labor Data                             Conforming




                                                                                                                    Authoring
                                                                                                                     Report
                                                                 Business Process
                                                                Dimensional Models                                                                 Threshold-based
                                                                                                                                                        Alerts

                                                                                                                           Information Security
                           Other Sources


                                           Corollary: “common reporting platform”
 36
This slide deck is part of a recorded webinar.
     To view the FREE recording of this entire presentation and
                    download the slide deck, go to
                       www.senturus.com/recorded-webinars.php

      You will find this—and many other recorded webinars-- under the “IBM Cognos
                              Enterprise Planning and TM1”




37
9. Distribute month-end Budget vs. Actual
     reports the day after close (and close a few days after
     period-end)


      • Don’t: Take a week or two to close each financial period
      • Do: Leverage timely report distribution capabilities


      • BENEFITS:
          – Actionable, timely BvA reports in the hands of line management

          [ There is clearly bottom-line impact to timely management
             reporting followed by timely actions. ]




38
9. Distribute month-end Budget vs. Actual
     reports the day after close (and close a few days after
     period-end)




39
10. Automatically update planning model
     structures from source systems

     • Don’t: Allow planning dimensions to get out of date; and
       don’t waste time manually updating lists of accounts,
       departments, products or their hierarchies.
     • Do: Leverage automatic links and scheduled processes to
       ERP tables, Systems of Record (SOR’s), and/or data
       warehouse / mart data for dimension updates


     • BENEFITS:
        – Less data management and more analysis time for FP&A staff
        – Uniformly accurate structures across all planning models and
          planners


40
10. Automatically update planning model
     structures from source systems




41
10. Automatically update planning model
     structures from source systems




42
11. Centrally control planning model formulas
     and methods
     • Don’t: Allow distributed Excel workbooks to introduce errors
       to the methods and calculations used in planning
     • Do: Leverage a centrally controlled planning model and data
       base
        (CFO study corollary: “common planning platform” / “common reporting
           platform” and data base)


     • BENEFITS:
        – Guaranteed adherence to and consistent interpretation of
          company financial policies and definitions (e.g., Exactly what
          accounts define Gross Margin and Net Margin? Consistently how
          are key metrics calculated?)



43
11. Centrally control planning model formulas
     and methods




44
12. Use all appropriate company business
         dimensions for planning models
     •    Don’t: Limit planning models and methods to only the segments
          available in the General Ledger’s Chart of Accounts
     •    Do: Build planning processes to utilize all the business dimensions
          needed to model each business area
           For example, where appropriate:
           – Plan sales and revenue by region, by product, by sales rep, and by customer
           – Plan inventory by product and by store
           – Plan factory capacity by material category and by construction type
           – Plan capital expenditures by asset class
           – Plan marketing by program and/or brand
           – Plan travel by country, by region and/or by trip

     •    BENEFITS:
           – More accurate plans
           – Better alignment between finance and business operations
           – Better integration between planning and enterprise data and reporting



45
12. Use all appropriate company business
     dimensions for planning models




46
Summary of Do’s
     1.  Use one planning process . . . and reforecast frequently
     2.  Provide bottoms-up and top-down capabilities in planning models
     3.  Maintain central control over drivers, assumptions, and versions
     4.  Secure planning data by integrating security systems
     5.  Use a central planning data base for instant consolidation
     6.  Leverage and integrate planning across business areas
     7.  Provide timely actual data to all planners
     8.  Distribute pre-close reports to improve accruals, shorten close
             cycles and explain variances
     9. Distribute actionable, final BvA reports within days of month-end
     10. Automatically link account, department and product structure
             changes to planning models (via ERP’s, SOR’s or DW’s)
     11. Centrally control all formulas and models used for planning
     12. Utilize all appropriate business dimensions in planning models



47
Summary of Don’ts
     1.  Use only one, annual, lengthy budgeting process
     2.  Provide only a bottoms-up planning method or model
     3.  Distribute Excel workbooks and loose control over driver values,
            financial assumption values, and plan versions
     4. Risk unauthorized access to planning data due to insecure files
     5. Waste time chasing and consolidating distributed Excel workbooks
     6. Risk silos of planning data
     7. Take days or weeks to distribute actual data to planning models
     8. Close financial periods without line management input
     9. Wait two or three weeks to distribute final BvA reports to line
            management
     10. Rely on manual maintenance of planning solution structures
     11. Loose control of distributed formulas and planning models
     12. Limit planning model dimensions to General Ledger segments



48
Recommended Next Steps
     1. Nail the basics . . .
            by re-engineering the financial planning processes using
            most if not all of the 12 best practices and a common
            planning platform with a centralized data base.
     2. Expand performance management’s reach . . .
            by going beyond basic financial data, statements and
            BvA reports to ad hoc user analytics that look at
            operational measures that are integrated with financial
            information using a common reporting platform and an
            enterprise data warehouse*.

     Top priority target: product and customer profitability !

                    * Incrementally-built


49
Effectiveness across the full CFO
                                agenda
                                                                                                                      Value Integrators
                                  Scorekeepers Disciplined                   Constrained       Value                  Constrained Advisors
                                   (Baseline)   Operators                     Advisors      Integrators               Disciplined Operators
                                      0%       19% Better                    33% Better     59% Better                Scorekeepers

     Driving integration of information
     across the enterprise
     Measuring / monitoring business
     performance
     Developing your people in the Finance
     organization
     Providing inputs into enterprise strategy
     Executing continuous Finance process
     improvements
     Supporting / managing / mitigating
     enterprise risk
     Driving Finance function cost reduction

     Driving enterprise cost reduction
     Strengthening compliance programs
     and internal controls

                                                     0%               20%     40%          60%      80%      100%          120%           140%
                                                                               Percent more effective than baseline


 Source: IBM Institute for Business Value, The Global CFO Study 2008, 2010




50
This slide deck is part of a recorded webinar.
     To view the FREE recording of this entire presentation and
                    download the slide deck, go to
                       www.senturus.com/recorded-webinars.php

      You will find this—and many other recorded webinars-- under the “IBM Cognos
                              Enterprise Planning and TM1”




51
Contact Senturus

                Senturus, Inc
             www.senturus.com
            sales@senturus.com
                888-601-6010




52
53
53        53

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Financial Planning Best Practices and IBM Cognos TM1 Demonstration

  • 1. Financial Planning Best Practices 04/14/2011 www.senturus.com Helping Companies Learn From the Past, Manage the 1 Present and Shape the Future
  • 2. Agenda • Introductions • 12 Elements of Financial Planning Best Practices • TM1 Demo • Planning Solution Case Studies • Q&A 2
  • 3. This slide deck is part of a recorded webinar. To view the FREE recording of this entire presentation and download the slide deck, go to www.senturus.com/recorded-webinars.php You will find this—and many other recorded webinars-- under the “IBM Cognos Enterprise Planning and TM1” 3
  • 4. Welcome and Introduction • Senturus – Greg Herrera, Co-Founder, CEO – Steve Chapman, Management Consultant – Chris Fargo, Office of Finance Account Manager • IBM Cognos – Michael Mackevicius, Technical Manager 4
  • 5. Who is Senturus ? • Consulting firm specializing in Corporate Performance Management – Business Intelligence and Enterprise Planning & Budgeting – Platform-independent – San Francisco Business Times Hall of Fame -- Four consecutive years in Fast 100 list of fastest-growing private companies in the Bay Area • Experience – 10-year focus on performance management – More than 1,000 projects for 450+ clients • People – Business depth combined with technical expertise. Former CFOs, CIOs, Controllers, Directors... 5
  • 6. A few of our 450+ Clients 6
  • 7. The Best Financial Performers: “Value Integrators” High 32% 23% Finance Efficiency 33% 12% Low Low High Business Insight Source: IBM Institute for Business Value, The Global CFO Study 2010 7
  • 8. Their Financial Results Efficiency + Business Insight Contributes to Outperformance Value Integrators > 20x 49% 30% more 14.0% more more All other enterprises 12.1% 11.3% 9.4% 9.3% 0.5% EBITDA Revenue ROIC 5-year CAGR, 2004-2008 5-year CAGR, 2004-2008 5-year average, 2004-2008 Value Integrators also have an almost 20% better operating efficiency ratio than all other companies examined. Source: IBM Institute for Business Value, The Global CFO Study 2010 8
  • 9. What do Value Integrators do differently? % More Data and Streamlined information delivery 32% Analytics Electronic data capture at the source 35% Systematic data cleansing and auditing 31% Business Risks in Performance Reporting 22% Process Employed Functional Best Practices 31% Utilized automated workflow tools 25% Measurement & monitoring of processes 41% Technology Common reporting platform 31% Common planning platform 22% 0% 20% 40% 60% 80% 100% Percent Adopted Disciplined Operators Value Integrators Constrained Advisors Scorekeepers Source: IBM Institute for Business Value, The Global CFO Study 2010 9
  • 10. 1. Use one planning process for periodic, rolling plans / forecasts • Don’t: Use one, long annual “budgeting” process; and a different, infrequent (or no) reforecasting process . . . • Do: Use one, efficient rolling reforecast process • BENEFITS: – One process for managers to learn (and remember) – An efficient planning process should complete in a few days at most – More accurate projections due to frequent reviews and updates – Continual management actions are based on better trend information and accurate, timely actual-to-plan variances 10
  • 11. 1. Planning for Employees 11
  • 12. This slide deck is part of a recorded webinar. To view the FREE recording of this entire presentation and download the slide deck, go to www.senturus.com/recorded-webinars.php You will find this—and many other recorded webinars-- under the “IBM Cognos Enterprise Planning and TM1” 12
  • 13. 1. Planning for Cap Ex 13
  • 14. 1. Planning for Expense Line Items 14
  • 16. 2. Provide bottoms-up and top-down planning capabilities in the same model • Don’t: Limit planning managers to only a bottoms-up planning model . . . • Do: Provide top-down change and adjustment capability • BENEFITS: – Goal and target setting can be done very efficiently at the company, division, department or account levels using “spread” or “breakback” techniques – Only forecast (non-actual) months and open (“unheld”) accounts are adjusted to achieve the target amount 16
  • 17. 2. Top-down planning / forecasting example 17
  • 18. 2. Top-down planning / forecasting example 18
  • 19. 2. Top-down planning / forecasting example 19
  • 20. 2. Top-down planning / forecasting example 20
  • 21. 3. Maintain central control over drivers, assumptions, parameters, and versions • Don’t: Assume that distributed Excel workbooks will use the correct drivers . . . • Do: Use drivers wherever possible and secure drivers, conversion factors, and versions centrally • BENEFITS: – All planning managers, executives and reports will refer to the “live” scenario / version – No confusion about what version is active – Up-to-date global and department drivers / assumptions 21
  • 22. 3. Planning drivers example 22
  • 23. 3. Planning drivers example 23
  • 24. This slide deck is part of a recorded webinar. To view the FREE recording of this entire presentation and download the slide deck, go to www.senturus.com/recorded-webinars.php You will find this—and many other recorded webinars-- under the “IBM Cognos Enterprise Planning and TM1” 24
  • 25. 4. Integrate planning solution security with company security systems • Don’t: Assume that data in the distributed Excel workbooks will be secure . . . • Do: Use company Active Directory and LDAP to integrate security, preferably with single sign-on • BENEFITS: – Secure company confidential data – Minimize redundant maintenance of security files – Aid end user solution adoption by eliminating separate sign-on’s for transaction vs. planning vs. reporting systems (Note: Combined, comprehensive web portals are even better!) 25
  • 27. 5. Use a centralized planning data base for consolidation and workflow management • Don’t: Waste time manually tracking distributed Excel workbooks and manually consolidating them . . . • Do: Manage plan submittals and their reviews with real-time status and consolidate results with no latency (CFO study corollary: “automated workflow tools”) • BENEFITS: – Better accountability and adherence to planning timetables – Frequent and accurate roll-ups and reports on evolving plans and forecasts leads to early feedback and adjustments 27
  • 28. 5. Workflow status example 28
  • 29. 5. Workflow status example 29
  • 30. 6. Leverage planning solutions and integrate planning data across multiple business areas • Don’t: Build planning silos or only install planning solutions in finance or a few functional areas . . . • Do: Leverage your industrial-strength planning solution with its centralized data base across the enterprise, replacing Excel-based processes, and sharing plans (CFO study corollary: “common planning platform”) • BENEFITS: – Integrated and timely plans between sales, marketing, production, inventory planning, finance, tax and H/R 30
  • 31. 6. Planning solution examples 31
  • 32. 7. Use the centralized planning data base for uniform, timely updating of actual data • Don’t: Distribute actual data extract files or dozens of Excel workbooks . . . • Do: Leverage the centralized planning data base and distribute actual updates often and instantly to all users in a structure that matches the planning models and after any necessary mappings and reclassifications • BENEFITS: – Integrated and timely actual updates, enterprise-wide with centrally controlled, consistently applied organizational changes and historical restatements – “Single version of the truth” / “Common reporting platform” 32
  • 33. 7. Remapping / reclassification examples 33
  • 34. 7. Remapping / reclassification examples 34
  • 35. 8. Distribute monthly pre-close reports for feedback on accruals and variances • Don’t: Close the month without line management input, nor blind-side them with untimely variances . . . • Do: Leverage real-time reporting capabilities to seek input on needed accruals and to support variance research (CFO study corollary: “common reporting platform”) • BENEFITS: – Shorter, more accurate financial closes – Line management is prepared for timely, knowledgeable executive review of results 35
  • 36. Integrated Information = Integrated Business Process Dimensional Models “Single Version Planning Planning Solutions of the Truth” Data Solutions Planning Actual Data Self-service Reporting Querying ERP Data Data Warehouse Ad hoc & Analysis Source Systems of Record Slicing & Dicing G/L Data Standard Reports Data Abstraction Model Dashboard Authoring Data Integration Web Portal Dashboards/ Scorecards Labor Data Conforming Authoring Report Business Process Dimensional Models Threshold-based Alerts Information Security Other Sources Corollary: “common reporting platform” 36
  • 37. This slide deck is part of a recorded webinar. To view the FREE recording of this entire presentation and download the slide deck, go to www.senturus.com/recorded-webinars.php You will find this—and many other recorded webinars-- under the “IBM Cognos Enterprise Planning and TM1” 37
  • 38. 9. Distribute month-end Budget vs. Actual reports the day after close (and close a few days after period-end) • Don’t: Take a week or two to close each financial period • Do: Leverage timely report distribution capabilities • BENEFITS: – Actionable, timely BvA reports in the hands of line management [ There is clearly bottom-line impact to timely management reporting followed by timely actions. ] 38
  • 39. 9. Distribute month-end Budget vs. Actual reports the day after close (and close a few days after period-end) 39
  • 40. 10. Automatically update planning model structures from source systems • Don’t: Allow planning dimensions to get out of date; and don’t waste time manually updating lists of accounts, departments, products or their hierarchies. • Do: Leverage automatic links and scheduled processes to ERP tables, Systems of Record (SOR’s), and/or data warehouse / mart data for dimension updates • BENEFITS: – Less data management and more analysis time for FP&A staff – Uniformly accurate structures across all planning models and planners 40
  • 41. 10. Automatically update planning model structures from source systems 41
  • 42. 10. Automatically update planning model structures from source systems 42
  • 43. 11. Centrally control planning model formulas and methods • Don’t: Allow distributed Excel workbooks to introduce errors to the methods and calculations used in planning • Do: Leverage a centrally controlled planning model and data base (CFO study corollary: “common planning platform” / “common reporting platform” and data base) • BENEFITS: – Guaranteed adherence to and consistent interpretation of company financial policies and definitions (e.g., Exactly what accounts define Gross Margin and Net Margin? Consistently how are key metrics calculated?) 43
  • 44. 11. Centrally control planning model formulas and methods 44
  • 45. 12. Use all appropriate company business dimensions for planning models • Don’t: Limit planning models and methods to only the segments available in the General Ledger’s Chart of Accounts • Do: Build planning processes to utilize all the business dimensions needed to model each business area For example, where appropriate: – Plan sales and revenue by region, by product, by sales rep, and by customer – Plan inventory by product and by store – Plan factory capacity by material category and by construction type – Plan capital expenditures by asset class – Plan marketing by program and/or brand – Plan travel by country, by region and/or by trip • BENEFITS: – More accurate plans – Better alignment between finance and business operations – Better integration between planning and enterprise data and reporting 45
  • 46. 12. Use all appropriate company business dimensions for planning models 46
  • 47. Summary of Do’s 1. Use one planning process . . . and reforecast frequently 2. Provide bottoms-up and top-down capabilities in planning models 3. Maintain central control over drivers, assumptions, and versions 4. Secure planning data by integrating security systems 5. Use a central planning data base for instant consolidation 6. Leverage and integrate planning across business areas 7. Provide timely actual data to all planners 8. Distribute pre-close reports to improve accruals, shorten close cycles and explain variances 9. Distribute actionable, final BvA reports within days of month-end 10. Automatically link account, department and product structure changes to planning models (via ERP’s, SOR’s or DW’s) 11. Centrally control all formulas and models used for planning 12. Utilize all appropriate business dimensions in planning models 47
  • 48. Summary of Don’ts 1. Use only one, annual, lengthy budgeting process 2. Provide only a bottoms-up planning method or model 3. Distribute Excel workbooks and loose control over driver values, financial assumption values, and plan versions 4. Risk unauthorized access to planning data due to insecure files 5. Waste time chasing and consolidating distributed Excel workbooks 6. Risk silos of planning data 7. Take days or weeks to distribute actual data to planning models 8. Close financial periods without line management input 9. Wait two or three weeks to distribute final BvA reports to line management 10. Rely on manual maintenance of planning solution structures 11. Loose control of distributed formulas and planning models 12. Limit planning model dimensions to General Ledger segments 48
  • 49. Recommended Next Steps 1. Nail the basics . . . by re-engineering the financial planning processes using most if not all of the 12 best practices and a common planning platform with a centralized data base. 2. Expand performance management’s reach . . . by going beyond basic financial data, statements and BvA reports to ad hoc user analytics that look at operational measures that are integrated with financial information using a common reporting platform and an enterprise data warehouse*. Top priority target: product and customer profitability ! * Incrementally-built 49
  • 50. Effectiveness across the full CFO agenda Value Integrators Scorekeepers Disciplined Constrained Value Constrained Advisors (Baseline) Operators Advisors Integrators Disciplined Operators 0% 19% Better 33% Better 59% Better Scorekeepers Driving integration of information across the enterprise Measuring / monitoring business performance Developing your people in the Finance organization Providing inputs into enterprise strategy Executing continuous Finance process improvements Supporting / managing / mitigating enterprise risk Driving Finance function cost reduction Driving enterprise cost reduction Strengthening compliance programs and internal controls 0% 20% 40% 60% 80% 100% 120% 140% Percent more effective than baseline Source: IBM Institute for Business Value, The Global CFO Study 2008, 2010 50
  • 51. This slide deck is part of a recorded webinar. To view the FREE recording of this entire presentation and download the slide deck, go to www.senturus.com/recorded-webinars.php You will find this—and many other recorded webinars-- under the “IBM Cognos Enterprise Planning and TM1” 51
  • 52. Contact Senturus Senturus, Inc www.senturus.com sales@senturus.com 888-601-6010 52
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