Corporate performance management can help your business deliver its strategy and drive required results. Discover what it is and how it can support business excellence?
What is Corporate performance management
Corporate performance management has as many different names as definitions, but in short it is the communication hub linking strategy with operations.
It is sometimes confused with business intelligence because of the graphical presentation of the information, but the purpose of corporate performance management is to allow the assessment of the current position against set indicators. This enables the optimum course to be plotted to achieve a desired future end state.
Gartner define the main application components of a corporate performance management suite as;
- Budgeting, planning and forecasting
- Profitability modeling and optimization
- Scorecard applications
- Financial consolidation
- Statutory and financial reporting
Budgeting, planning and forecasting
The ability to assess performance requires comparators. The purpose of budgets, plans and forecasts is to calculate those comparators and communicate them to stakeholders.
Whether dealing with high level long range plans or detailed short term forecasts, at company, function, project or product level the process should be the same, a simple conversion of base data with assumptions to arrive at relevant comparators.
Business excellence is further supported with the ability to maintain flexible schedules, multiple data sources, updated actuals, and secure access for involved parties. This recent blog focusing on 10 Ways to improve your budgeting & forecasting sets out some good advice.
Profitability modelling and optimization
Profitability is the result of efficient and effective management of the costs of revenue. Modeling these costs in terms of the processes required and the performance indicators set is key to highlighting which decisions to make to drive optimization.
The best corporate performance management suites deliver clear visuals of a company’s performance against chosen processes and indicators, thereby creating a scorecard at each level of the organization.
Business excellence is supported by corporate performance management by providing the visualization of actual performance relative to defined criteria. Digitally and dynamically establishing a connected and communicated business model and allowing for scenario play including integrated risk and opportunity analysis.
Consolidation and reporting
Whether consolidating for internal purposes such as the addition of certain projects, BU’s or products, or for external purposes such as entity consolidation and eliminations under GAAP, IFRS or SoX, the consolidation process should be flexible and easy to use.
The resulting data needs to be available for reporting in a number of formats to suit the recipients, including dynamic charting and traditional accounting statements.
OK I’m interested, where do I start?
At IFS we provide solutions and expertise which can help your organization deliver business excellence through corporate performance management, improve the probability of desired results, and allow for the reporting of these results to stakeholders.
|I welcome comments on this or any other topic concerning Finance, HCM, CSR & business strategy
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IFS website: www.ifsworld.com
IFS develops and delivers enterprise software for customers around the world who manufacture and distribute goods, maintain assets, and manage service-focused operations. The industry expertise of our people and solutions, together with commitment to our customers, has made us a recognized leader and the most recommended supplier in our sector. Our team of 3,300 employees supports more than one million users worldwide from a network of local offices and through our growing ecosystem of partners. For more information, visit: www.ifsworld.com