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The Decision Factor offers insightful comments and observations on analytics—from views on new technology approaches and market dynamics to the latest industry trends driving demand for faster, smarter information analysis. This blog contains personal views, thoughts, and opinions from SAP employees, mentors, and friends working in the area of analytics. It’s not endorsed by SAP nor does it constitute an official communication of SAP.

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Why the New Breed of Chief Financial Officer Will Own IT

Why the New Breed of Chief Financial Officer Will Own IT

The increasing number of chief financial officers (CFOs) and their peers from Generation X and Generation Y that are now heading up finance functions are irked by poorly performing business systems that fall way short of the likes of Google and iTunes that deliver exactly what you want in seconds. So it’s not surprising that many have accelerated automation projects already underway to enhance core financial processes with technology solutions that lead to increased productivity and lower costs.

It’s the only way they can free up headcount from traditional finance functions like reporting, and treasury and transaction processing in order …

The New Breed of CFO and How to Become One Yourself

The New Breed of CFO and How to Become One Yourself

‘Stick close to your desks and never go to sea, And you all may be rulers of the Queen’s Navy’

The chorus of “Sir Joseph Porter’s Song” above, taken from the Gilbert and Sullivan operetta H. M. S. Pinafore, is a satire said to be based on William Henry Smith (1825-91), the Victorian businessman who made a fortune through expanding his father’s bookselling business into a national chain which still thrives today as WH Smith. Like many successful businessmen William entered Parliament in 1868 and was appointed First Lord of Admiralty in 1877, – equivalent to the American “Secretary of …

The New Breed of CFO and the Challenges of the Multi-Generational Finance Team

The New Breed of CFO and the Challenges of the Multi-Generational Finance Team

Things are going to change once the cream of Generation Y, (the ‘Millennials’), who were born between 1981–2005, have risen through the ranks of Finance and step into the CFO role. Generation X, the group born between 1961–1980 that are currently filling many CFO positions before ascending to become CEOs are said to be sceptical, pragmatic and continually looking to develop an ever widening skill set that will have seen many make significant contributions to their businesses well outside their finance role. But Generation Y can be expected to raise the bar further, demanding the utmost automation of routine finance …

Filling the gaps in Performance Management

Filling the gaps in Performance Management

Last time out, I discussed the gaps that are frequently found in many organizations’ immature financial performance management cycles; this time, I’ll talk about filling them.

Why Focus on Strategic Planning?

Strategic planning is about setting a course for where stakeholders want the organization to head and describing in detail what needs to happen to get there. This involves some well-defined processes that happen every year in order to set and translate strategy.

Effective execution of strategy requires a strong degree of organizational alignment to ensure everyone is focused on the same goals. It also requires some agility to allow …

Innovative Controlling with Predictive Margin Management

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We all know about the “new normal” for today’s chief financial officers (CFOs) from several recent blogs. Recently, I gained some interesting insight into the challenges of a CFO at a forum for financial management in Germany. The focus was about how the CFO can better manage the enablement and the development areas highlighted in the wheel.

Successful CFOs have managed to elevate their positions within their companies to the highest levels, becoming strategic advisors, drivers of initiatives, and business partners to all revenue-enabling organizations. Some of them even become the

Predict, Execute and Control: the mantra for better Financial Planning and Analysis

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Managing financial planning and analysis is an end-to-end process that starts with strategy definition and documentation. It then goes through the detailed planning, budgeting, and forecasting processes that define the activities and resource allocations necessary to achieve the strategic objectives. This is followed by profitability and cost analysis, and other modelling and simulation scenarios. Underpinning this whole process is the need for constant reporting and monitoring.

So, unlike external reporting, which is mandatory based on various regulatory requirements and needs to happen only at certain points in the financial year, internal reporting is on-going. Similarly, we can think of the …

How You Too Can Drive Innovation and Contribute Actively to Creating Value with Actionable Analytics

How You Too Can Drive Innovation and Contribute Actively to Creating Value with Actionable Analytics

While in control of their “traditional” tasks of accounting, controlling, and governance or finance operations, today’s chief financial officers (CFOs) are already stepping up their influence on corporate strategy. Yes—it’s the CFO and the supporting gang that will be the drivers of margins, the visionaries of operational processes, and the creator of vast increases in value contribution from a non-sales perspective.

Whenever you are in search of meaningful data these days, the magic guy or gal is always the controller, the finance guy, the lady in management reporting. There might be differences …

Sustainability and Technology are the Drivers of Financial Performance Management

Sustainability and Technology are the Drivers of Financial Performance Management

Debate will rage as to the longevity of the current low-growth, high-unemployment economic volatility and whether it’s really a “new normal,” or even if it’s really all that new. In fact, there’s nothing new at all about financial turmoil, and it’s been happening for centuries (see, “This Time is Different” from the Princeton University Press). What is likely is that there will be less time between these ups and downs—volatility will be the more normal.

Sustainability and technology are two trends that are here forever, and both will continue to shape the evolution of companies and …

Integrated Business Planning — What It Is and How to Start

Integrated Business Planning -- What It Is and How to Start

In my last blog, Integrated Business Planning— the Inevitable Journey for Finance, I discussed the many challenges that are driving companies to pursue Integrated Business Planning (IBP). Today, I want to discuss the solutions that IBP offers, and how you can get started with IBP within your organization.

IBP Offers Solutions to Business Planning Challenges

Business planning challenges are driving companies to start pursuing IBP. Some of the ways that companies can use IBP to address these challenges are:

Plan on a “right time” basis (i.e. when it needs to be done) The only …

Integrated Business Planning — the Inevitable Journey for Finance

Integrated Business Planning -- the Inevitable Journey for Finance

It should come as no surprise that the next mile of finance is upon us – changes are afoot in the world of budgeting and forecasting. Traditionally, this has entailed the finance organization accumulating information at a high level of aggregation from their business partners (sales, HR, marketing) and other cost and responsibility centers. This information feeds into budgeting, forecasting, and strategic planning models with most of the emphasis on revenues and expenses. But many of these models lack collaboration, clarity, and timeliness. In response, many companies are heading down the path towards integrated business planning (IBP).

What Is IBP …