Analytics-Based Enterprise Performance Management

Overview:

Many organizations are far from where they want and need to be with improving performance, and they apply intuition, rather than hard data, when making decisions. Enterprise performance management (EPM) is now viewed as the seamless integration of managerial methods such as strategy execution with a strategy map and its companion balanced scorecard (KPIs) and operational dashboards (PIs); enterprise risk management (ERM); capacity-sensitive driver-based budgets and rolling financial forecasts; product / service / channel / customer profitability analysis (using activity-based costing [ABC] principles);  lean and Six Sigma quality management for operational improvement; and resource capacity spending planning. Each method should be embedded with business analytics of all flavors, such as correlation, segmentation and regression analysis, and especially predictive analytics as a bridge to prescriptive analytics to yield the best (ideally optimal) decisions. 

This presentation will describe how to complete the full vision of analytics-based enterprise performance management.

Why you should Attend:

• Many organizations struggle answering these types of questions:
• How well do our managers and employees understand our executive team’s strategy?
• Are we measuring the right metrics?
• If we are measuring key performance indicators (KPIs), are they “balanced” between financial outcomes and the non-financial measures related to customer loyalty, process improvement, employee learning & growth, and innovation?
• Are we measuring too many strategic KPIs where many are arguably operational performance indicators (PIs)?
• Are our product and service-line costs accurate? Or are our accountants mis-allocating indirect expenses (i.e., overhead support)?
• Do we measure non-product channel and customer costs to report profit or loss by each customer?
• How effective is our annual budgeting process? Does its benefit exceed the costs to produce it?
• Is the budget out of date within a few months after it is published?
• Do experienced managers “pad” their department’s budgets?
• Is consolidating cost center budgets bottom-up cumbersome?
• Do we understand incremental / marginal expense analysis classifying the behaviour of our resource capacity expenses as sunk, fixed, step-fixed, or variable based on the planning time horizon?
• Are many of our decisions based on intuition or experience rather than on fact-based data?
• How much competency does our organization have with analytics?
• How much resistance to change does our organization have that is slowing our adoption rate of progressive managerial methods?

Areas Covered in the Session:

• What the pressures are compelling organizations to adopt EPM (e.g., greater volatility, uncertainty, insights for problem solving).
• Why business analytics, with emphasis on predictive analytics and pro-active decision making, is becoming a competitive advantage differentiator and an enabler for trade-off analysis. 
• How strategy maps and their companion balanced scorecards communicate strategic objectives with target-setting to help cross-functional employee teams align their behavior to the strategy and better collaborate.
• How all levels of management can quickly see and assess how they are doing on what is important using key performance indicators (KPIs).
• How activity-based cost management (ABC/M) provides not only accurately traced calculated costs (relative to arbitrary broad-averaged cost allocations), but more importantly provides cost transparency back to the work processes and consumed resources, and to what drivers cause work activities.
• Why measures of channel and customer profitability and customer value now supersede profit and service-line measures - and shifting from product to customer-focused organizations including future potential value – customer lifetime value. 
• How managerial accounting enables internal chargeback invoices of shared services (e.g., information technology services). 
• How analytics-based enterprise performance management solves the problem of poor budgeting
• How three types of project-related costs are included in the budget: capital, risk mitigation, and strategy execution projects
• How improvements to the managerial accounting system not only provides accuracy and visibility to costs, but they enable predicting required future resource capacity expense requirements
• The increasing need for probabilistic financial projections.
• The increasing need for “what if scenarios”
• How effective planning increases productivity from processes and reduces costs
• How to overcome implementation barriers such as behavioral resistance to change and fear of being held accountable.

 Who Will Benefit:

• CxOs
• CFOs
• Financial officers and controllers
• Managerial and cost accountants
• Financial and business analysts
• Budget Managers
• Strategic planners
• Marketing and sales managers
• Supply chain analysts
• Risk managers
• CIO and Information technology staff
• Board of Directors