„The Evolution of Corporate Performance Management is Accelerating“
Interview with expert Sven Baade
In today’s corporate performance management (CPM), two things are most important: speed and flexibility. Those who want to prevail in dynamic environments and set the course for success need more than just a plan. To make faster and better decisions, companies need to rethink their processes and systems. Expert Sven Baade is aware of the crucial role of modern technologies. The Chief Product Officer of Corporate Planning talks about current CPM trends and the opportunities offered by digitization.
What trends do you see in corporate performance management?
Baade: In the past 18 months, the Corona pandemic has partly reinforced and partly overlaid existing trends. These include the use of the cloud as part of the ongoing digitization in corporate performance management, but also the shortening of planning cycles – from the classic one-year budget to short-term forecasts. In agreement with the analyst firm BARC, we regard the provision of information in a self-service approach as the strongest trend in corporate performance management over the past two years: data is collected and made available in a decentralized manner. Everyone is actively involved in this process. Reports are no longer prepared and distributed in the same manner as in the past. Instead, everyone can help themselves to existing materials for their own field.
What opportunities arise from the current trends?
Digitization and a better position in the area of corporate performance management have moved up the list of priorities for many companies. Cloud solutions as well as basic information gathering solutions are in greater demand. At Corporate Planning, we are registering an increase in the number of participants at our information events. Likewise, there has been a massive increase in demand from customers who want to switch to professional software. This is good for us, of course, but the companies are also benefitting because the evolution of their corporate performance management processes is accelerating. After the pandemic, their situation will very much differ from what it most likely would have been otherwise. Modern corporate performance management has a positive long-term impact on future competitiveness. Rather than a short-term reaction to the pandemic, this is a sustainable change.
How are companies planning today?
The stage of development of companies varies greatly. On the one hand, there is the group of companies with professional software solutions which have already established comprehensive analyses, short forecast cycles and modern reporting. On the other hand, at events and in discussions, we meet companies that use an Excel-based planning solution requiring very high manual effort: the data has to be compiled to recreate the reporting from Excel every month. The work load unfortunately reduces the companies‘ ability to get meaningful insights from their numbers.
What does effective business communication mean and what role does it play in business management?
Business communication bundles all documents related to planning, analytics, scenarios, forecasts and the like. The reporting generated from this then serves as the basis for all decisions in corporate performance management. The central task of business communication is to convey the state of a company or a division of a company. This involves more than simply providing figures by way of tables or reports. It is about presenting deviations and their causes. A decision-maker should be able to quickly compile information on which to base his or her decision. This includes information-based analytics and comments in conjunction with comprehensible, easy-to-understand visualizations. It is crucial that reports are quickly understood. As a rule, the process of setting up such a report takes a lot of time and effort. Communicating effectively means greatly reducing the effort required, especially for recurring reports, while remaining flexible. After all, not every monthly report is identical. There are ad hoc situations that raise new questions, and you have to be able to respond to them.
More and more companies are using modern technologies such as the Corporate Planning software for better decision-making and are benefitting from greater effectiveness and efficiency in corporate performance management. What does the latest Corporate Planner version offer?
In general, we are continuously expanding all modules such as financial performance management and consolidation. With version 6.0, we have already changed our architecture and introduced a new usability to the market. The main new feature was the web-based approach, which makes all information available to any user via a web portal. With subsequent versions, we have significantly expanded the existing range of functions. After we recently created an ad hoc option for visualizations according to the International Business Communication Standards (IBCS) with hi-chart, we are continuing along this path with Corporate Planner 6.0.300. We have now fully integrated the entire IBCS reporting platform into our software. The latest version offers the great added value of being able to implement an overall reporting with data from all modules and areas based on the IBCS notation. In addition, we provide various new planning functionalities to be even more effective in the creation of scenarios and forecasts with Corporate Planner, especially in the area of sales performance management. However, we have also put great emphasis on further expanding the self-service approach and the associated convenience functionalities for individual users. The focus, however, is on reporting. For example, users can now summarize data from the various areas in recurring reports with a single click and generate PDF reports at the touch of a button. This significantly increases effectiveness.