Enterprise and corporate performance management (EPM/CPM) is now viewed as the seamless integration of managerial methodologies such as balanced scorecards, strategy maps, risk management, driver-based budgets, rolling financial forecasts, activity-based costing (ABC), customer relationship and value management, lean and Six Sigma quality management and resource capacity planning. Each one should be embedded with business analytics of all flavors, such as correlation and regression analysis, and especially predictive analytics. This workshop will describe how to complete the full vision of analytics-based enterprise performance management.
What You Will Learn:
- How to identify and differentiate strategic KPIs in a balanced scorecard and operational performance indicators in dashboards
- How to perform “predictive accounting” for driver-based budgets/rolling financial forecasts, what-if analysis and outsourcing decisions
- How to integrate enterprise risk management (ERM) with enterprise performance management (EPM)
- How to imbed statistics and analytics into product, channel and customer profitability analysis
- How to overcome implementation barriers such as behavioral resistance to change and fear of being held accountable
Overview of and Enterprise Performance Management (EPM)
- Why is there confusion and ambiguity about EPM?
- What is EPM?
- What are the forces and pressures causing high interest today in EPM?
- Public sector government and commercial organizations use of EPM.
- How do Enterprise Risk Management (ERM) and EPM integrate?
The Rise of Business Intelligence (BI) and Business Analytics (BA)
- Why is the interest in BI and BA?
- Where does Big Data fit in?
- What is the difference between BI and BA?
- What is the difference between forecasting and predictive analytics?
Fact-based Data with Managerial Accounting (Activity Based Cost Management [ABC/M])
- What has caused the need for advanced managerial accounting, such as ABC/M?
- The ABC/M cost assignment network structure that transforms expenses into costs.
- Strategic ABC/M to manage product, service-line, channel, and customer profitability.
- Applying ABC/M for equitable chargebacks of shared services (e.g., information technology).
- Explaining the clutter of ABC/M compared with time-driven ABC, resource consumption accounting (RCA), lean accounting, and other costing techniques.
Strategy Formulation and Strategy Management
- Leadership’s reluctance to communicate strategy to employees.
- The role and purpose of a Mission and Vision statement.
- The Strategy Map – its purpose and structure.
- Balanced Scorecard – and its many “balanced” dimensions.
- How to define and select key performance indicators (KPIs).
- Distinguishing between strategic KPIs in a scorecard and operational process measures (PIs) in a dashboard.
- Lessons learned and tips for success on how to implement measurements.
Customer Profitability and Value Management
- The shift from a product- centric to a customer-centric focus.
- Why non-product “cost-to-serve” measures have increased in importance.
- For business-to-consumer industries, measuring future potential customer value with customer lifetime value (CLV) metric.
- Actions that can be taken to increase the profit of customer micro-segments.
- Linking customer value to maximizing shareholder wealth creation.
- Applying EPM to the extended value chain of supply chain management of trading partners (buyer/seller).
Operational Costing to Optimize Process Costs
- Measuring Unit Costs for cost transparency and benchmarking.
- Applying “Attributes” to assess Value and Importance.
- Six Sigma quality management and measuring the “cost of quality (COQ)”.
- Lean management and calculating costs for value stream maps.
The shift to “predictive accounting” for Decision Making and Budgeting
- Problems and deficiencies with the traditional annual budget process.
- How to develop the “strategy, risk and capital project” budgets.
- How to develop the “operational budget” based on resource capacity planning.
- Integrating forecasts to shift from an annual budget to rolling financial forecasts.
- Probabilistic scenario planning.
The Shift in ROI’s Source from Tangible to Intangible Assets
- An integrated picture of FP&A and EPM.
- Increasing the ROI from information – FP&A and EPM as a Value-Multiplier.
Accelerating the Rate of Adoption for Implementing FP&A and EPM
- Understanding the barriers the slow the adoption rate of EPM: technical, perceptions, model design, and social / cultural
- Why overcoming behavioral resistance to change is a key to success – and how to overcome it
- Next steps?
IISE reserves the right to cancel a class up to 15 business days prior to the scheduled start date