Your Future Success. depends on Your Today s Enterprise Performance Management Strategies

Transcription

1 Your Future Success depends on Your Today s Enterprise Performance Strategies

2 Creating Enterprise s Sustainable Performance with Core Executive Development Programs (Value-Based ) and Success Proved Professional Consulting Services (Enterprise Performance )

3 Enterprise Performance Enterprise Performance encompasses all the processes, information, and systems used by managers to set strategy, develop plans, monitor execution, forecast performance and report results with view to achieving sustainable success no matter how success maybe defined

4 Enterprise Performance Process Controls Governance principles and ethical values Strategic and KPI boundaries Risk management (senior management challenges planning hypotheses and risks) Actual results, KPI reports, trends, league tables, and rolling forecasts Process inputs Organization/BU vision BU strategic direction and customer value proposition High level, mediumterm HO/BU goals and baseline expectations Small high-level KPI set Rewards policy Performance Review Process Review performance outlook and assess gap Review and reset high-level goals Review strategy and key value drivers Agree, prioritize, and fund action plans Coordinate plans across the business Review KPI targets and controls Process outputs Agreed strategy Agreed execution list of action plans KPI set Revised rolling forecasts (showing impact of action plans on profit and cash flow projections) Process Resources Support from senior managers and centers of expertise Tools (e.g., Balanced Scorecards and shareholder value models) Information on computers, market intelligence, and economic indicators

5 Enterprise Performance Controls Input Process Resources Out put Process inputs Organization/BU vision BU strategic direction and customer value proposition High level, medium-term HO/BU goals and baseline expectations Small high-level KPI set Rewards policy

6 Enterprise Performance Controls Input Process Resources Out put Performance Review Process Review performance outlook and assess gap Review and reset high-level goals Review strategy and key value drivers Agree, prioritize, and fund action plans Coordinate plans across the business Review KPI targets and controls

7 Enterprise Performance Controls Input Process Resources Out put Process Controls Governance principles and ethical values Strategic and KPI boundaries Risk management (senior management challenges planning hypotheses and risks) Actual results, KPI reports, trends, league tables, and rolling forecasts

8 Enterprise Performance Controls Input Process Resources Out put Process Resources Support from senior managers and centers of expertise Tools (e.g., Balanced Scorecards and shareholder value models) Information on computers, market intelligence, and economic indicators

9 Enterprise Performance Controls Input Process Resources Out put Process outputs Agreed strategy Agreed execution list of action plans KPI set Revised rolling forecasts (showing impact of action plans on profit and cash flow projections)

10 Value-Based System Excellence Competency -Based Professional Managemen t System Accounting &Finance for Executives Budgeting for Planning and Control Enterprise Resources Planning (ERP): BI & Business Process Focus Performance System (PMS) Risk Strategic Thinking, Planning and Leadership for Executive Executives Development Business Knowledge Tools & Tech. World Class Experiences Best Practices Effectiveness Efficiency Excellence Operational Excellence Wealth Maximization Human Capital Team Efforts Operations: Process/Info/System Value-Based Success = E 2 Sustainable Success Stakeholders Accounting Information System (AIS) Corporate Finance- Liquidity Best Practices in Accounts Receivable Best Practices in Inventory Strategic Cost Capital Budgeting and Investment Advanced Financial Analysis Controllerships CFO s Operational Excellence

11 Skill Types Needed

12 Relative Amount of Time That Managers Spend on the Four Managerial Functions

13 Business Operations : Key Processes Allocation of Funds Acquisition of Funds Operations Investments Sources of Funds Sales/Revenues (S) Cost of sales/cogs Gross Profit SG & A Operating Profit Interest Expenses Profit Before taxes Income Taxes Net Profit (NP) Current Assets Cash Accounts Receivable Inventories Non Current Assets LT Investments Fixed Assets Total Assets(TTA) Current Liabilities Notes Payable/Bank Loans Accounts Payable Accruals Non Current Liabilities Shareholders Equity (SE) Paid Up Capital Retained Earnings Total Liabilities & SE (TLE) Dividends Operating Activities Investing Activities Financing Activities KPI: %NP/S X S/TTA X TTA/SE = %ROE %ROA

14 Sales of Services or Goods Ending Inventory Budget Work in Process and Finished Goods Production Budget Ending Inventory Budget Direct Materials Direct Materials Budget Direct Labor Budget Overhead Budget Selling and Administrative Budget Budgeted Statement of Cash Flows Cash Budget Budgeted Balance Sheet Budgeted Income Statement

15 Flexible Budgets May be prepared for any activity level in the relevant range. Show costs that should have been incurred at the actual level of activity, enabling apples to apples cost comparisons. Reveal variances related to cost control. Improve performance evaluation. Let s look at CheeseCo.

16 Static Budgets and Performance Reports CheeseCo Since cost variances are favorable, have we done a good job controlling costs?

17 Limitations of Financial Statement Analysis Industry trends Technological changes Changes within the company Consumer tastes Economic factors Analysts should look beyond the ratios.

18 The Enterprise Resource Planning (ERP) Model Marketing Human Resources, Manufacturing, Financial, Plant Maintenance, and Capacity Planning Cost Accounting Aggregate Plan Master Production Schedule Material Requirements Planning Assembly and Purchase Plans Customer Orders Bill of Material Inventory Files Supplier Relationship Customer Relationship System-Wide planning System-Wide Database and Servers Distribution Planning MRP MRP II Collaborative Planning and Integration with Suppliers, Customers ERP

19 Three Steps in Planning

20 Strategic Model

21 SWOT Analysis Diagram

22 Model of Grand Strategy Clusters

23 The BCG Growth-Share Matrix

24 EBI: Dashboards and Scorecards Personalized dashboards and scorecards provide a powerful way to manage andmonitor key metrics

25 EBI: Dashboards and Scorecards Sales and marketing management can see an immediate improvement in performance when using dashboards to monitor customer activity and behavior

26 EPM Consulting Services o Objectives o Scope of work o Deliverables o Project Team Structure o Customer s Responsibilities o Duration & Consulting Fee o Benefits to ABC o Appendix Consultants Profile Activity plan and scheduling

27 Enterprise Performance Financial Consolidation & Reporting Activity-Based Business Planning HYPERION Enterprise STRATEGIC Performance PLATFORM Strategic Planning Performance Measurement Improves operational efficiency Optimizes the deployment of enterprise resources Communicates strategic goals Compares performance to peers and best practice companies Manages profitability Profitability Benchmarking