Financials 2013 – the first, “Major” for 2013 is about to begin

From: David Williams, Head of Product Marketing, EPM Solutions, SAP

If like golf or tennis, we had “majors” in terms of events pertaining to SAP’s solutions for Enterprise Performance Management (EPM), “SAPinsider Financials” would be one of them – our spring opener on the circuit held where else but Las Vegas (March 19-22) . And like years prior, this year will not disappoint with a packed agenda covering EPM and financial applications topics. You can find a list of sessions here as well as read a good overview of the keynote/some of the sessions on CFOKnowledge.

From an EPM perspective, content will span managing financial performance (strategy management; planning, budgeting and forecasting; and profitability optimization) as well as accelerating the financial close to disclose (close, consolidations and disclosure management). In fact, two Pre-conference Workshops on March 18 will cover these areas in more depth: A step-by-step guide to execute a faster financial close and disclose process and I’ll personally be co-presenting The 2013 guide to SAP functionality for planning and financial performance.

There will also be deep dive sessions and customer presentations on key solution/product areas such as SAP Business Planning and Consolidation, version for SAP NetWeaver, powered by SAP HANA, SAP Strategy Management, SAP Profitability and Cost Management, SAP Financial Consolidation and SAP Disclosure Management. One thing I want to highlight in particular is new SAP Business Planning and Consolidation, version for SAP NetWeaver, powered by SAP HANA exercises that will be featured in the SAP EPM Solution Lab at the event. These new exercises will walk business users through loading data into the system, creating dimension member formulas that will be calculated by the SAP HANAMDX engine later this year, and a guided tour for technical folks. Based on first-hand customer experience, we’ll also compare the time it takes to perform these activities using SAP HANA versus a traditional relational database to help articulate the business value of running SAP Business Planning and Consolidation, version for SAP NetWeaver on SAP HANA.

There will be a number of subject matter experts at the event so don’t hesitate to come down and visit us at the SAP stations in the vendor showcase area/or in the SAP EPM Solution Lab. You’ll also be able to catch vBlog highlights from each day and make sure to follow the conversation on @SAPEPM, @daveswilliams and @BusinessObjects twitter handles as well as #Financials2013 hashtag for real-time updates on what’s happening at the event.

Looking forward to seeing you in Las Vegas!

Improving reporting performance at Coca-Cola Enterprises

With Big Data being such a big topic I’d been wondering when we might start to see more customer stories about how software is helping them address their pressing business requirements. This story, which can be found on the SAPBPC channel on You Tube, concerns Coca-Cola Enterprises, and how their use of SAP Business Planning and Consolidation, powered by SAP HANA, is able to handle the huge amounts of data required for their planning and forecasting processes, helping them to experience 7 to 25 times performance improvement in the speed of reporting, when running the same reports as they would have done in their existing environment.

Finance at Atos Origin quantifies its savings from SAP

Despite everyone talking about the need for software implementations to deliver a quantified return, in my experience very few quantified assessments are actually done. Well if they are, they are certainly not made available to us vendors to use in reference studies. For the most part I can understand our clients’ reluctance as often software implementations result in somewhere being let go or deployed elsewhere.

But given the current economy the focus is clearly on process improvement initiatives that improve productivity, drive down costs and protect margins – something that Gartner’s recent IT spending webinar suggested was  responsible for most of the recovery in IT spending which is back at +6% level from a dismal -2.7% back in 2009. The Finance function is no different and it was good to see new customer success story drop into my email box that shows what can be achieved with some judicious investment. The client is IT services provider Atos Origin who after a spate of acquisitions were faced with the challenge of  consolidating financial data from a myriad of diverse systems, reporting by contract and service line and generating practice wide reforecasts.  The fact that highly trained financial analysts spent a quarter of their time generating spreadsheets shows the challenges they were having.

As they were already an SAP client, they chose to implement  SAP BusinessObjects Planning and Consolidation Version for NetWeaver and some business intelligence solutions so partners and managers across their 40 country network had easy access to data.   CFO Stephen Horrocks estimates they have saved 700 hours in the finance department at their Paris head office resulting in annual savings of Euro 800k (see table right) and as if that’s not enough, they made further savings from retiring their legacy systems.  Read the complete study here.       

SAP BusinessObjects Planning and Consolidation for Banking

In the current economic climate, banks face unprecedented challenges and extreme financial pressure. Issues such as margin compression, credit risk, liquidity risk, and profitability threaten to undermine overall bank performance. To address these challenges, the banking experts at SAP and Glenture worked together to develop a comprehensive performance management solution based on SAP BusinessObjects Planning and Consolidations that integrates strategic planning, budgeting and forecasting, and profitability measurement processes.

Their goal was to identify best practice and leverage the functionality of the application to help banks achieve it quickly and cost-effectively. They recognized that producing more-accurate budgets and forecasts requires informative metrics that include both financial and operational measures, such as loan growth and efficiency ratio targets; that superior performance management requires budgeting approaches that incorporate your bank’s business model – for example, allowing for cash flow– based planning at the business unit, division, regional, and even branch or  loan center level. Know these approaches are critical to creating accurate net interest income projections they incorporated them into the packaged solution in order to increase the precision of projected yields and interest and support rate scenario modeling that can help budget administrators focus on controllable elements of the balance sheet rather than rote computational tasks.

Deliverables include a detailed data model, structured support for business processes, preconfigured models, and over 20 prebuilt reports. The general data flow and key features include:

• Data imports
• A data model that supports both income statement and balance sheet planning sourced from the general ledger (GL)
• Global assumptions using an integrated data model that enables forward-looking projections of growth adjustments and patterns to be made across multiple scenarios with automatic flow-through to balance sheet and income statement.
• Department-level and consolidated planning
• Budget administration and management reporting
• A central set of planning assumptions
• A metrics framework supporting improved performance monitoring, plan comparisons, and historical trends.
• Collaborative multidimensional balance sheet and margin planning
• Balance sheet planning at the account level
• Analysis of the net contribution of each center
• Global drivers (such as key rates) for creating what-if scenarios
• Planning on the product or hierarchical level
• Top-down and bottom-up planning

 All designed to get you up and running quickly and easily without reinventing the wheel. To find out more either read the solution brief SAP_BusinessObjects_Planning_and_Consolidation_for_Banking-Solution or click through to Glenture

SAP and Deloitte launch starter kit for Liquidity Planning

In recent weeks, I’ve been talking with some customers, partners and colleagues about what they see as important trends in performance management for the next 5 years or so. There’s a lot of interesting stuff comes out of this. For the most part, we’re fairly well aligned on the priorities, but there’s still some stuff that we think vitally important that the clients doesn’t give a monkeys about – and other stuff that clients consider to be top priorities that we think is lower in the pecking order.

One topic that we both agree on is ‘content’ – shipping model structure, templates and standard reports that reflect best practice for a particular process or a specific industry. In some parts of the world, this is not just a nice to have, but an absolute essential to move licenses with clients astounded that a company that ships ERP software that has all the business processes already configured should not do the same with performance management.

Well we’ve been doing a lot of this -starter kits for IFRS, capital planning, budgeting in banking and healthcare to mention the first four that spring to mind – and we’ve just launched another with partners Deloitte, this time for liquidity planning in SAP BusinessObjects Planning and Consolidation.

It enables customers to gain visibility into cash-flow and liquidity data, then model different scenarios and prepare forecasts on that information. It’s designed to address the more stringent credit risk-management requirements and since it’s integrated with SAP NetWeaver Business Warehouse, finance professionals can access prior transactions. Combining committed transactions with forecasted financial data gives customers the insight they need to avoid inaccurate forecasts of future exposures.

The starter kit comes with pre-defined templates and tools for maintaining cash-calculation rules and currency-conversion rates, automating reporting, simulating liquidity strategies and importing aggregated liquidity data from SAP NetWeaver BW into SAP BusinessObjects Planning and Consolidation. Customers also have the ability to create executive dashboards with SAP BusinessObjects Xcelsius Enterprise software, providing them with insight into working capital and cashflow.

Besides new implementations, it can also be incorporated into existing installments of SAP BusinessObjects Planning and Consolidation, version for SAP NetWeaver – exactly the type of thing clients want.

There is more information in Friday’s press release.

Rock Bottom – drinking the success of financial excellence

Before we became part of SAP, I used visit our US office based in  Buckhead, Atlanta regularly and would always drop into Rock Bottom for dinner and a beer or two. It was clearly a company that had got a good business model with the economies of scale of being a big chain while still retaining something of the artisan skills of small scale brewing. And frankly, although the beer is not quite up there with my favourite British brews such as Timothy Taylors (the beer Madonna called the ‘champagne of ales), it comes damn close.    

So I was naturally drawn to an article in this quarter’s Insider Profiles on how Rock Bottom is well on the way to achieving financial excellence, by driving efficiencies that free their finance  folk from the heavy lifting of doing the numbers that allows them to work alongside the business and add value. They’re clearly a forward thinking company with CFO Brian Armstrong having the dual role of SVP of Corporate Performance Management – always a sign of change happening when finance have titles with the word ‘performance’ in them to my mind. But they were still struggling with spreadsheet based planning and budgeting for their 145 owned and franchised chain of restaurants and this took up most of their time from September throught to December and sometimes beyond. By implementing SAP BusinessObjects Planning and Consolidation, which went live in August 2009, they certainly found some efficiencies that enabled the desired transformation: 

• Reduced the number of budgeting templates from more than 300 to “low double-digits
• Replaced a 15-minute template-updating process to an instantaneous one, saving 500 hours of “hourglass watching” each year
• Cut the month-end package creation process from several days to as little as four hours
• Reduced the budgeting process from four plus months to about two-and-a-half months in the first year of use

The net result is they are now producing higher-quality work with fewer people - a great acheivement in anyone’s book. But financial excellence is not a goal; it’s a never ending journey and Brian clearly recognize this when he says, ”You can’t just focus on what you’re doing at your desk. You have to understand the impact that your job has on the performance of the business. And once you make that connection, you can change your workload so it’s not just a task, but it’s a value-add.”  

What can I do, but raise my glass to such sentiments!

Cheaper and faster forecasting

Few organizations ever try to put a cost against the time and effort they expend in planning and budgeting, but it’s clearly immense and some would say wasted. The uncertainty of the past couple of years have also put companies into a bit of a double blind wanting to reforecast more frequently in order to try and keep in step with fluctuating demand  – yet knowing that their reforecasting is labor intensive and consequently costly to do.

So it’s good to hear of someone being successful at resolving this quandary. Toshiba TEC Germany Imaging Systems GmbH, who sell and service printers and copiers, were struggling with sales and supply chain planning across Europe. One of their key goals was to improve their planning so that inventory levels and consequently working capital could be reduced, which would significantly improve their financial perfromance. Toshiba opted for SAP BusinessObjects Planning Consolidation because it fitted into their IT landscape and was easy and intuitive for end users resulting in rapid adoption. They gained many benefits including quicker and easier access to sales forecasts that were up to date and more accurate than previously. But unlike many successful implementations, Toshiba took the time to quantify the financial benefits of their implementation. In a word, they are impressive. 

• 50% reduction in inventory (boy wouldn’t many other distributors like to be able to claim that?)
• Savings of Euro 5k per user every time they are asked to create a demand forecast

Read about their success for yourself.