5 steps to achieving integrated financial planning for your company

Transcription

1 Today s Webcast Presentation 5 steps to achieving integrated financial planning for your company Presented by Financial Executives International (FEI) Sponsored by Prophix Software will begin shortly

2 Learning Objectives After attending this webinar, you will be able to: Understand how best-in-class companies connect disparate planning processes Learn the 5 steps to transform your planning process, and how to drive value beyond the office of finance Discover specific examples of companies that leverage integrated financial planning to increase operational effectiveness and longterm growth Discover best practices and common pitfalls in financial, operational, and strategic planning

3 Event Notes Link to today s presentation and the recording of this webinar will be sent out to all attendees within 48 hours. Those who would like CPE credits (through NASBA) will need to answer all poll questions during the webinar, as well as indicating their interest in receiving CPE credits in the exit-survey. For any questions on CPE credits, please send an to academy@prophix.com. Please ask questions on today s topic via the Questions box in your GoToWebinar control panel at any time. We will do our best to get to your questions during the Q&A discussion at the end of the webinar. You will be asked to take a short survey when exiting today s event. We would greatly appreciate your feedback as we strive to improve the ROI we offer to you and future attendees for yours and their valuable time.

4 Welcome to Mission The education of senior level financial executives To provide knowledge and insight that enable informed decision-making by senior-level financial executives and their organizations. The Research Unique, timely, relevant, practical and objective For over 70 years, FERF research investigates the evolving role of seniorlevel financial executives, practices of financial management and techniques to improve its effectiveness

5 Top Business Priorities Needing Technology Support Q03/4. Please select the top priorities in your organization that currently need improved technology support/ needs the most improvement in technology support. n=210 Need improved technology support Needs the MOST improvement in technology support Facilitating analysis and decision making 13% 62% Ongoing monitoring of business performance 10% 57% Measuring product and customer profitability 8% 50% Creating an effective environment for sharing relevant information 10% 49% Quality of the data used for business decisions 10% 46% Reducing enterprise operating costs Creating/maintaining an enterprise-wide view of business relationships: customers, products, vendors Developing business plans and budgets 3% 7% 13% 35% 46% 43% Managing business risk/controls to ensure accuracy in compliance 6% 34% Ensuring consistency between transactional data and analyticals 2% 34% Integrating the financial function with the overall enterprise Understanding and managing the drivers of profitability or cost of service delivery Other None 7% 6% 3% 5% 1% 1% 28% 27% Multiple responses allowed

6 Most Important Technology Investment Now- Top 10 Q05. Which three technology enabled capabilities are the most important areas of investment to your organization today in order of importance? n=210 Ranked 1st Ranked 2nd Ranked 3rd SUM Enterprise business applications 23% 15% 9% 47% Business analytics 14% 12% 7% 33% IT Security 8% 10% 13% 31% Governance, Risk and Compliance 6% 7% 6% 19% Enhanced business reporting 3% 6% 10% 19% Business process management 6% 7% 4% 18% E-commerce 6% 4% 8% 18% Product cost analytics 5% 5% 6% 16% Cloud business 5% 6% 3% 14% Big Data / Data science 6% 5% 3% 13%

7 Business Analytics That Need Updating Q11. Which of the following business analytics technologies is your organization currently upgrading or enhancing? n=199 Performance measurement/scorecard/dashboard Financial reporting and consolidation Budgeting, planning & forecasting 48% 52% 50% Customer and product profitability 40% Data warehouse 30% Statistical analysis Predictive modeling Big Data 18% 17% 21% Other None 5% 7% Multiple responses allowed

8 5 Steps to achieving Integrated Financial Planning for your company Nicole Diceman Product Marketing Manager Prophix Software Inc.

9 Learning Objectives What Why How Understand how best-in-class companies connect disparate planning processes Learn the 5 ways to transform your planning process, and how to drive value beyond the office of finance Discover specific examples of companies that leverage integrated financial planning to increase operational effectiveness and long-term growth - Interstates Companies Discover best practices and common pitfalls in financial, operational, and strategic planning Questions and Answers

10 Integrated Financial Planning Without taking a look at the business from all angles it would be impossible to create a fully informed plan, budget or forecast. (Aberdeen Research, January 2015)

11 Integrated Financial Planning Make Without taking a look Informed at the business from all Decision: angles it would be impossible to create a strategic, fully informed financial plan, budget and operational or forecast. (Aberdeen that continuously Research, January 2015) drive the business forward

12 Integrated Financial Planning What is it? A complete model where the company links strategic, operational and financial planning Combination of technology and processes

13 Example of IFP - Plan Data Flow Production Model Personnel Model Sales Model Financial Model Financial Model

14 Objectives Integrated Financial Planning 1 Generating a holistic understanding of performance drivers 5 Balancing sales and operations planning for profitability 2 Providing an integrated planning platform across operations, finance and the executive team 6 Quantifying financial risk 3 Quantifying the financial impact and interdependencies across planning alternatives 7 Increasing business flexibility 4 Optimizing strategic planning and resource allocation 8 Answering what-if scenarios

15 Better Decision Making Integrated Financial Planning IFP improves decision making when attempting to grow the business, this is why collaborative organizations have seen greater increase in productivity and revenue.

16 Why It Matters Integrated Financial Planning Better Communication Better Decision Making Empowered Employees Meeting Company Objectives Competitive Advantage

17 Polling Question (1 OF 3)

18 5 Easy Steps Process Readiness Audit the Process Can you answer key questions User Readiness IT readiness Re-examine the technology tools you are using Do you have a vision? Do you have a documented process set up? Collaboration Is your team ready to become the strategic office of finance?

19 5 Steps to achieving Integrated Financial Planning for your company Nicole Diceman Product Marketing Manager Prophix Software Inc.

20 Financial Planning, Lean Operations, and Strategic Decision Making: Bringing it all together Stephanie Baccam, CPA Accounting Supervisor, Interstates Companies

21 AGENDA Introduction to Interstates Challenges Symptoms Challenges What we were looking for The deciding factor Solution Roll-out First 100 days Measurable results Key Learnings Symptoms to watch for How to get ready for the solution How to get the most of the solution

22 ABOUT THE INTERSTATES COMPANIES Interstates was founded in 1953 with HQ out of Sioux Center, Iowa With over 600 employees contributing to over $100M in Annual Revenue We are a single-source, design-build electrical engineering, automation and construction company Hundreds of happy customers across the nation, working in diverse markets including feed, seed & grain, renewable fuels, food & beverage, pet food, milling, and power industries

23 ABOUT THE INTERSTATES COMPANIES Proud recipient of 3 prestigious construction awards from Associated Builders and Contractors of Iowa in Our Philosophy is: Understanding Needs Delivering Results To learn more about us, visit

24 MY ROLE AT INTERSTATES As the Accounting Supervisor, 3 of my major priorities include: Managing the Budget & Financial Reporting Processes Includes the budget & forecasts for 7 companies and 50+ departments Annual budgeting Monthly reforecasting Cash Flow Projections 1,000 + receivables from 200+ customers 1,000 + vendor payments per month Providing data and analysis to be used to make strategic recommendations and decisions

25 SYMPTOMS Inefficient. Frustrated. Errors. Reliance on Excel spreadsheets to manually conduct financial processes (on tight deadlines) Requirement to track inputs, reconfigure broken formulas, and accommodate changes Consolidate financials & budgets from 7 companies, each having separate divisions No time for reforecasts or cash projections

26 UNDERLYING CHALLENGES With our companies projected growth we simply didn t have a tool to perform the basic tasks required Nor did we have a tool that would help us bring our company to the next level

27 POLL QUESTION (2 of 3)

28 WHAT WE WERE LOOKING FOR Secure & locked system To help eliminate errors and access to confidential information System to streamline our budgeting and financial process From entry to consolidation Easily configurable to meet our unique requirements Our companies each have unique needs A canned product wasn t going to work for us Affordable We aren t a huge company so we needed something that we could afford Simple to use We wanted to be able to manage the system within accounting without a lot of IT support

29 THE DECIDING FACTOR Rich functionality that goes beyond just automation of the budget, forecasts, and reports Ability to create unlimited number of multi-dimensional business models Detailed planning and what-if scenarios Drill across data allowing us to pinpoint allocation of job costs to answer a wide range of questions Fast and robust system No complex skills or coding to learn Easily customizable to meet our unique requirements Flexible and at competitive pricing (even more so than canned solutions), No locked-contracts or subscription fees

30 ROLL-OUT Started with the basics Budgets Financials During Implementation we were excited to learn that the solution we picked was going to be able to do so much more than what we had first thought

31 FIRST 100 DAYS From Day 1 we were already seeing improvements Time Money Reliability Flexibility

32 EXAMPLE: BUDGETING Completed 7 budget cycles already using CPM 6 employees x 3 weeks 1 employee x 2 hours That s an extra 718 hours of time-savings per budget cycle! Significantly more time for analysis and scenarios: What if: we add more employees, utilization rates change, billable rates are altered, costs erode, etc. We have the same headcount in accounting that we did before we used any type of CPM solution, despite a steady increase in annual revenue from $40 to $100 million.

33 EXAMPLE: PLANNING & FORECASTING Down to the details! Personnel and CapEx: Name, salary/wage, bonus, division, depart., health insurance Equipment, tools, computers, office furniture, renovations Cash flow forecasting Forward looking for better decision making Utilization of employees across multiple companies Time planning, employee benchmarks, and revenue projections I typically focus on time savings, which relate to our corporate strategy of always wanting to operate leaner. The cost savings based on adoption are also exceptional.

34 MEASURABLE RESULTS Automation of annual budgeting process Dramatic reduction in time requirements from accounting staff Accurate planning (personnel, CapEx, revenue, cash flow) Ability to deliver unique insights to business leaders Pinpoint true cost of jobs and projects to maximize returns and minimize resource allocations Winning new business, creating accurate sales projections and ensuring Interstates profitability Reporting automation for short and long-term analysis and strategic 5- and 10-year plans

35 KEY LEARNINGS From one finance professional to another

36 SYMPTOMS TO WATCH FOR Ask yourselves these things: Do your processes feel too manual? Are you seeing reoccurring errors? Are you missing deadlines? Do you have multiple systems to extract data from? Do you lack an audit trail? How is your security?

37 HOW TO GET READY FOR THE SOLUTION So what do you do next? Set expectations with users and leaders Prepare to document processes Prepare for change

38 HOW TO GET THE MOST OUT OF IT Lessons learned: Document the process for end users Involve others in the initial set-up Keep the solution simple Broaden solution across the organization Let the software automate your processes, so you can focus on analysis and other important things (like your weekends!)

39 Thank You. Find a tool that allows you to not focus on the tool.

40 Poll Question (3 of 3)

41 Q&A Nicole Diceman, MBA Product Marketing Manager, Prophix Software Stephanie Baccam, CPA Accounting Supervisor, Interstates Companies

42 Looking for financial insights through unbiased research? FERF can help! Celebrating its 70 th anniversary last year, Financial Executives Research Foundation (FERF) is the research affiliate of FEI. As part of its mission, FERF provides knowledge and insight to members and the broader financial community. All publications are free to members and are available in a downloadable PDF format.

43 PUBLICATIONS & E-COMMUNICATIONS Published quarterly, Financial Executive, the award-winning flagship magazine of FEI, provides both the U.S. and global points of view and highlights best practices, developments and individuals from the international business scene. FEI Daily delivers financial, business, and management news, and trends and strategies to help you work better, faster, and smarter. Our team of expert contributors offer analysis, tips, and insights into best practices and the changing regulatory landscape. IOU Insights, Observations and Updates is a quarterly e-newsletter offering members insight, observations and updates from K Street to Wall Street.

44 Thank you for your participation Sponsored by: