Many organizations that use SAP are far from where they want and need to be with improving their performance. They typically apply intuition and externally oriented financial information, rather than information designed for internal decision support, when making decisions.
To address this problem a non-profit Profitability Analytics Center of Excellence (PACE) was created. PACE is based on a framework that integrates revenue management, capital and intangible investment management, and managerial costing. The framework provides a roadmap for finance to support strategy formulation, validate strategy with operational and financial models, improve the quality of strategy execution, and support strategy evaluation for continuous improvement. The result is improved forecasting and decision making.
Foundational to the PACE framework is the “causality principle” which is the basis of scientific insight, including decision science, as it applies to economic, financial, and operational decisions. Effective economic modeling is essential for all of the enterprise and corporate performance management tools.These include: a strategy maps and its companion balanced scorecard; product, service line, channel, and customer profitability analysis; capacity-sensitive driver-based budgets and rolling financial forecasts; enterprise risk management; supply chain management; and lean and Six Sigma quality management for operational improvement. Each method should be embedded with advanced business analytics of all flavors.
Amsterdam Financials 2017
ERPfixers is honored to announce that Paul Ovigele, Founder of ERPfixers, will present at the Financials 2017 Conference. The definitive conference for organizations using SAP solutions for finance to drive accounting, controlling, planning, and reporting excellence. Join us!
Our Session(s):
Tackle your most common financial pain points using existing and new SAP functionality
Wednesday, 14 June, 2017 16:30 - 17:30 G102
Speaker: Paul Ovigele, ERPfixers Founder
Learn the how-tos, gotchas, and workarounds you need to know to conquer the most common challenges associated with financial and managerial accounting, including the reconciliation of CO-PA with SAP General Ledger, and using cost component split functionality. Get expert advice to:
- Deal with the timing difference of goods issues between FI and CO-PA
- Learn the changes to CO-PA with SAP S/4HANA Finance
- Ensure that credit and debit memos, which relate to price alone, do not update the Cost of Goods Sold (COGS) value field in CO-PA
- Handle the posting of discount conditions to CO-PA
- Configure the cost component split using SAP S/4HANA Finance
- View cost of sales postings in the SAP General Ledger by cost component
Ask the Experts FIN and GRC
Wednesday, 14 June, 2017 17:45 - 18:30 Exhibition Hall
Speaker: Paul Ovigele, ERPfixers Founder
Sit down with leading experts who manage, deploy, and support SAP environments to get detailed answers to your toughest questions. Draw on the real-world experiences from some of the industry’s top technologists and tap into one-on-one time with experts and walk away with detailed answers to the questions that matter to you most.
SAP Material Ledger: Guidelines and Benefits
Thursday, 15 June, 2017 10:45 - 11:45 G105
Speaker: Paul Ovigele, ERPfixers Founder
Take a comprehensive look at material ledger, including what it does, when you should use it, and how to interpret its results. Delegates will:
- Discover how to properly analyse material ledger information using the Material Price Analysis report
- Find out how long the typical material ledger implementation should take
- Hear how certain companies have used material ledger to solve their transfer pricing and intercompany elimination requirements using standard SAP functionality
- Walk away with a clear understanding of how material ledger fits in with SAP S/4HANA Finance functionality
TWEET us at #Financials2017!
@ERPfixers #ERPFixers
Measuring and Managing Customer Profitability
You may have interest in this article I authored titled “Measuring and Managing Customer Profitability” for the Strategic Finance magazine published by the Institute of Management Accountants. Its message is that customers are the source of financial value to increase shareholder and owners’ value. But today customers view suppliers’ products and service-lines as commodities. Therefore suppliers must provide differentiated services to different customer segments. The sales volume of high demanding customers is not proportional to their profit level because they cause extra expenses from their suppliers. (I wrote the article related to my part time role as the IMA Executive in Residence now in my 4th year term. The www.imanet.org has 85,000 members in 140 countries.) Here is the link to directly download the article as a pdf file:
“Measuring and Managing Customer Profitability”; IMA Strategic Finance; February 2015.
I have also recorded two courses on this topic with Michael Management Corporation:
My first course is MMC – IC0541: Analytics Based Enterprise Performance Management
Second course MMC – IC0593: Measuring and Managing Customer Profitability
Third course MMC – IC0599: Driver-based Planning, Budgeting and Forecasting