Enterprise Perance Management Pressure To Per.PPT

EnterprisePerformanceManagementPressureToPerform Agenda AccentureOverviewOurPointofViewonEnterprisePerformanceManagementImplementationframeworkHowtogetstarted IntroductiontoAccenture AccentureOverview Globalmanagementandtechnologyconsultingorganisation withrevenuesof 13 7bninFY2004Morethan100 000peopleworkingin48countriesOperatesasaglobalorganisationservicingclientsinfiveindustrybasedgroups FinancialServices CommunicationsandHi tech Products ResourcesandGovernmentGloballyserves87oftheFortuneGlobal100andmorethantwo thirdsoftheFortuneGlobal500 Accenturecredentials OurpositioninFinancialServicesandourspecialist ServiceLines AccentureOverview Agenda AccentureOverviewOurPointofViewonEnterprisePerformanceManagementImplementationframeworkHowtogetstarted EnterprisePerformanceManagement EPM iscriticaltomanagenear andlong termperformance High performancebusinessesuseEPMto IdentifyandpredictvaluedriversthatwilloptimizepositioninthevaluechainLinkstrategywithplanning budgeting forecastingandperformancereportingcapabilitiesCaptureinformationthatcangenerateinsightandturnthatinsightintoactionSetbetterstrategicgoalsandmakemoreinformeddecisionsIdentifyissues threatsfaster andreacttothemmorequickly EPMPointofView CommonGaps SatisfactionRate 0255075100 Alignmentbetweencompanystrategyandplanningprocess 40 Focusonkeybusinessdrivers 24 Amountoftimerequiredtocreatetheannualplan 47 Speedandaccuracyoftheforecastingprocesses 48 Abilitytoproducebusinessmodelsandtestimpactofchanges 31 Speedandaccuracyofthemonthlyfinancialreporting 63 Reportingofnon financialmeasures 28 Businessusersviewandanalyzeperformancereportsatwill 25 IntegratedITsystemstocollectandmanagetheinformation 41 Visibilityintocurrentresults 29 Understandingoffutureperformancetrends 30 Source October2002surveyof245companiesconductedbyCFOResearchServices Fact ManyorganisationsarenotsatisfiedwiththeircurrentEPMcapability EPMPointofView Accountingearningsbasedfinancialmanagementhasbecomelessrelevantasthemajorityofvalueisinthefuture CurrentValueversusFutureValueRussell3000 May2003 trillions FutureValueisasignificantcomponentoftotalEnterpriseValueformostorganisationsFutureValueistheexpectedincrementalvaluebeyondthevaluedeliveredbycurrentoperations EPMPointofView NeitherdoestheBalanceSheetadequatelytracktheassetsthataredrivingvalue MarkettoBookValueOverTimeS P500 1980 2002 EPMPointofView HoweverfeworganisationsextendEPMbeyondtraditionalfinancialmeasurement Traditionalscopeoffinancial accountingmeasurement EPMPointofView Agenda AccentureOverviewOurPointofViewonEnterprisePerformanceManagementImplementationframeworkHowtogetstarted StrategicPlan RefineCorporateVision StrategicObjectives TargetSetting BusinessPlan CascadeTargetstoLowerLevelMetrics Organization SetTargetsforKeyMeasuresofAccountability Operate DevelopPlanstoAchieveTargets AllocateResourcestoAchievePlans Review Challenge FinalizePlans Forecasts Monitor DevelopActionPlans Re allocateResourcesandUpdateForecast MonitorKeyMeasuresofBusinessPerformance DetermineKeyMeasuresofSuccess CloseandConsolidateBooksandReportActuals PortfolioValueAssessment Enablers CommonDataStructures IncentivesandRewards Policies Procedures IntegratedITArch ReviewPerformancewithExecutiveManagement DetermineKeyBusinessDrivers Controls WeworkwithourclientstoimplementaholisticframeworkforEnterprisePerformanceManagement EPMImplementation TargetSetting BusinessPlan CascadeTargetstoLowerLevelMetrics Organization SetTargetsforKeyMeasuresofAccountability PortfolioValueAssessment TypicalEPMissues targetsetting EPMImplementation StrategicPlan RefineCorporateVision StrategicObjectives Operate DevelopPlanstoAchieveTargets AllocateResourcestoAchievePlans Review Challenge FinalizePlans Forecasts Monitor DevelopActionPlans Re allocateResourcesandUpdateForecast MonitorKeyMeasuresofBusinessPerformance DetermineKeyMeasuresofSuccess CloseandConsolidateBooksandReportActuals Enablers CommonDataStructures IncentivesandRewards Policies Procedures IntegratedITArch ReviewPerformancewithExecutiveManagement DetermineKeyBusinessDrivers Controls Targetsettingwrappedintothebudgetingprocess slowandresourceintensive StrategicPlan RefineCorporateVision StrategicObjectives TargetSetting BusinessPlan CascadeTargetstoLowerLevelMetrics Organization SetTargetsforKeyMeasuresofAccountability Operate DevelopPlanstoAchieveTargets AllocateResourcestoAchievePlans Review Challenge FinalizePlans Forecasts Monitor DevelopActionPlans Re allocateResourcesandUpdateForecast MonitorKeyMeasuresofBusinessPerformance DetermineKeyMeasuresofSuccess CloseandConsolidateBooksandReportActuals PortfolioValueAssessment Enablers CommonDataStructures IncentivesandRewards Policies Procedures IntegratedITArch ReviewPerformancewithExecutiveManagement DetermineKeyBusinessDrivers Controls TypicalEPMissues enablers EPMImplementation Inefficientuseofresource poorcontrolfromover relianceonspreadsheetsLackofcommonbusinesslanguageleadstomisinterpretationofnumbers StrategicPlan RefineCorporateVision StrategicObjectives TargetSetting BusinessPlan CascadeTargetstoLowerLevelMetrics Organization SetTargetsforKeyMeasuresofAccountability Operate DevelopPlanstoAchieveTargets AllocateResourcestoAchievePlans Review Challenge FinalizePlans Forecasts Monitor DevelopActionPlans Re allocateResourcesandUpdateForecast MonitorKeyMeasuresofBusinessPerformance DetermineKeyMeasuresofSuccess CloseandConsolidateBooksandReportActuals PortfolioValueAssessment Enablers CommonDataStructures IncentivesandRewards Policies Procedures IntegratedITArch ReviewPerformancewithExecutiveManagement DetermineKeyBusinessDrivers Controls TypicalEPMissues linkagetostrategy EPMImplementation LackofbroadunderstandingofkeyvaluedriversCurrentreportcontentdoesnotalignwithstrategy EXAMPLE Determiningkeybusinessdriversusingavaluetreefortheorganisation EconomicProfit Variances ExistingBusiness NewBusiness CapitalCharge Persistency Distribution Other ProfitMargin AverageProductProfitMargin TotalAPE APEbyProduct Commission DistributionMargin DirectlyControllableCosts AllocatedOverhead CommissionVariance X BUSINESSDRIVERS DistributorProfitabilityCostofServicingSalesforceRemuneration ProductDesignQualityofServicingBrandSalesforceCalibre IllustrativeexampleforLifeInsurance ValueTree BusinessDrivers EPMImplementation EXAMPLE Usingbusinessdriverstodevelopstructuredreportingrequirements SalesforceCalibre ActualAPEvsTargetbyConsultant PriorityDrivers KeyMeasures ofConsultantswithBasic AdvancedSkillsTraining InformationRequirements PrioritisationofdriversbytheirEconomicValuesensitivity MappingofKPIstoprioritisedbusinessdrivers withidentificationofadditionalnewKPIswhererequired LinkingaccountabilityforbusinessdriversandtheiroutcomestoindividualbusinessrolesenablesamatrixofinformationrequirementstobedevelopedMatrixincludesclassificationofinformationpriorityandrequiredreportingfrequency IllustrativeexampleforLifeInsurance EPMImplementation Agenda AccentureOverviewOurPointofViewonEnterprisePerformanceManagementImplementationframeworkHowtogetstarted Implement Implement Implement Implement CONCEPTUALDESIGN DETAILEDDESIGN IMPLEMENT Implement DetailedDesign Plan BusinessCaseDevelopment HighLevelArchitectureDesign ImplementationPlan SoftwareEvaluation ConceptualDesignofSolution REVIEW HighLevelPlan BusinessCase Assesscurrentstatetoidentifygaps PerformDiagnostic StakeholderEngagement LeadingpracticeistobreakEPMintoanumberofdiscretestages DetailedDesign Plan DetailedDesign Plan DetailedDesign Plan DetailedDesign Plan Gettingstarted Organisationalalignment Justificationofinvestment Implementationblueprint Realisationofbenefits OurEPMDiagnosticenablesissuestobeconfirmed identifiedinastructuredapproachover4 8weeks Copyright 2004Accenture PatentPending AllRightsReserved Gettingstarted TheDiagnosticispre populatedwithleadingpracticeforeachofthemainbuildingblocksoftheEPMframework OpportunityandriskassessmentInvestorexpectationsKeycompetitorandexternalinformationCurrentbusinessperformanceCurrentstrategicplan AgreeduponbusinessassumptionsWell understoodbusinessstrategy objectivesRevisedandprioritizedvaluedriversandcauseandeffectmapsIdentifiedstrategicinitiativesUpdatedscorecardswithrevisedkeymeasuresforeachbusinessunitDefinedkeymeasures KeyInputs KeyOutputs DetermineKeyMeasuresofSuccess DetermineKeyValueDrivers RefineCorporateVision StrategicObjectives ClearlydefinedCommunicatedtoalllevelsoftheorganizationConsistentlyunderstood IdentifiedPrioritizedWell understoodClearlylinkedtostrategy CriticalfewkeymetricsAlignedwithshareholdervaluecreationClearlydefinedcommondefinitionsAlignedwithmeasuresreportedupandusedtomanagedown EXAMPLE StrategyFormulation Planning C