Corporate Planner is the functioning and meaningful early-warning system that we needed in order to achieve our objectives.
- Integrated financial planning
- Variance analyses
- AX NAV
Restructuring in corporate performance management at Blunk Group
Blunk Group, located in Schleswig Holstein, Germany, is a traditional contractor for agriculture and forestry, utility companies, earthworks and bioenergy. Constant growth and increasing price pressure from smaller contractors meant that professional corporate performance management software was now called for.
The business of the proprietor-run family enterprise is characterised by a high level of investment in agricultural machinery (tractors, wheel loaders, combine harvesters, etc.). Optimal utilisation, both of people and of the machines, is crucial for the success of the enterprise. When Olaf Weick, management accountant at Blunk in Rendswühren, Northern Germany, got down to the job of analysing the existing data, he discovered that the information which was required for targeted enterprise management was inadequate in parts. The IT environment was very heterogeneous, and processes and communication channels were not clearly defined. Decisions were often made by “gut instinct”. By introducing a supportive and simple corporate performance management system, all this was to be sorted out.
New software, new processes
The objectives of the project were certainly ambitious. No less was at stake than the safeguarding of dominance in the North German market, with all the challenges that this pioneering role would entail for the next ten to fifteen years. “For the achievement of our objectives we need a functioning and meaningful early-warning system,” Weick says of the requirements of senior management.
The company took on board Corporate Planning, the corporate performance management software specialists from Hamburg. One of the first steps was the introduction of its CP-Suite module Corporate Planner for planning, analysis and reporting in operational management, in conjunction with CP-Cockpit for the visualisation of key performance indicators and results. However, the order placed with Corporate Planning did not simply consist of implementing the software at Blunk Group. That would have been a quick job. In addition to the technological support, new structures, new processes and clear areas of responsibility were to be established. Blunk was glad to accept assistance in this from an external, impartial consultant. Manja Meissner, Senior Consultant at Corporate Planning, took on the task of making an initial analysis of the current situation and of the specifications with the help of an employee questionnaire.
From data to information
The evaluation of the existing pre-systems showed that the available data were insufficient for the specifications and the information requirements. The granularity of the data was not identical across all of the systems in use, which meant that while these data could be transferred to the operational corporate performance management tool, analyses could not be carried out from every desired angle.
When the necessary adjustments had been made in the pre-systems, the first of the specifications could be implemented in the structures in Corporate Planner. Interdependent structures were built to suit different report recipients. A management analysis report structure was depicted for the executive board and, for the accounts department, a P&L compliant with the German Commercial Code (HGB). For the sales representatives, the figures were clearly laid out in an expense and revenue structure. At the same time, the figures converged in an integrated balance sheet and cash flow plan. On the basis of these extensive structures, which are broken down into the cost units, it was now possible to analyse the data from the pre-systems in uniform structures and to assess the data quality.
Higher data quality
“The analysis capabilities in Corporate Planner provided a basis which allowed us to make a detailed and thorough analysis of the values, only to find that, due to historical accounting practices, input methods in the various pre-systems and the associated data structure, the data could not be used for all analyses and reports,” Weick sums up the findings of the project. What was to be done? Blunk Group decided to go one step further and have a uniform ERP system largely replacing the pre-systems, alongside the corporate performance management solution CP-Suite.
The bottom line
However, against the background of the given task – the restructuring of the corporate performance management processes – Ms Meissner and Mr Weick have already gained some valuable insights:
1. An analysis can only be as good as the available data.
2. All colleagues are responsible for the data quality, not just the one who evaluates it.
3. There must be a common understanding of the corporate objectives.
4. Analysing the processes and penetrating the data set constituted a considerable amount of preliminary work towards the introduction of the ERP system.
5. The corporate performance management structures, analyses and reports depicted in the modules of the CP-Suite remain in use and provide important information on enterprise management.
With that, Blunk Group has taken a large step towards more professional, up-to-date and forward-looking corporate performance management.