Turn your budget into a valuable management tool

Transcription

1 Turn your budget into a valuable management tool Copyright: Ultima BV

2 Index Executive Summary...3 Introduction...4 Background...6 Functionality overview...7 Technology...8 Structure...9 User module...9 Management module...10 Rules module...10 Design and implementation...10 Summary...11 Company information

3 Executive Summary ValuePlan is a budgeting, forecasting and planning solution developed to address the needs of small and mid-sized enterprises that wish to use their budget as a truly functional and value-adding management tool. ValuePlan offers unsurmounted ability to allow users to forecast and budget from multiple viewpoints, for any number of business units and on multiple levels, using large datasets and multiple interlinked drivers and measures, through an exceptionally user-friendly interface. Aimed at the SME market ValuePlan provides the flexibility of enterprise level budgeting solutions at a fraction of the software price and implementation time as well as minimal ongoing support requirements. ValuePlan It adapts easily to any planning and budgeting approach and methodology, whether top-down, bottom-up, traditional annual budgeting or rolling forecasts. ValuePlan is designed to fit directly into the existing BI/reporting environment to cause minimum disruption. 3

4 Introduction Planning and budgeting is at the core of organizational control. Yet for many companies the process adds little value, is very time consuming and drives damaging internal politics. This is why, while seeing the budget as an important management tool, managers increasingly recognize the need for change. The key problems with traditional budgeting may be broadly classified this: A budget built once a year will soon be out of date, thus not really serving as a management tool. The traditional use of the budget as a combination of forecast and performance contract leads to poor forecasting and unrealistic performance contracts. Most traditional budgets focus on results figures rather than value drivers. The spreadsheet-based budgeting used in most organizations leads to errors, several versions of the truth and unnecessary workload. At the same time it limits the possibility to distribute planning and budgeting work throughout the organization, to the front-line people who possess the information and experience needed to build realistic forecasts. Often the planning and budgeting process is driven exclusively by a limited number of finance professionals. Frequency matters: As time passes reliability of the forecast goes down. This is why frequent revisions are important. 4

5 The above issues this have to do with how the budget is used, with the structure of the budgeting project and with the structure of the budgeting model. Changing the way the budget is used is the focus of management philosophies such as Beyond Budgeting, Better Budgeting and Advanced Budgeting. The other two issues are strongly linked with the power of the tools used for budgeting: If we do not have a tool that allows us to quickly review and reforecast at set intervals, then using the budget as a management tool will be difficult. If we lack the technical solution allowing us to build the budget on value drivers rather than after-the-fact results we will find it difficult to focus on the drivers. ValuePlan is built to address those core issues. It allows you to build true driver-based, multidimensional models. It makes it easy to work with different planning horizons and reforecast with ease when needed. Finally it allows the organization to let the people in the front line contribute effectively to the budget, thus integrating into it their knowledge of the market and products. 5

6 Background ValuePlan was originally developed in Iceland in 2003 to address the budgeting needs of FMCG companies with complex operations that needed to plan from the product and customer perspective simultaneously with datasets containing tens of thousands of SKUs and thousands of customers. Furthermore the solution needed to allow users to work at any level with multiple, interdependent measures. ValuePlan soon grew to become the leading planning and budgeting solution in the Icelandic market, now used by dozens of large and medium sized companies, including the main retail chains, largest airline, key players in the fishing industry, insurance, hardware and electronics and, of course, most of the largest FMCG wholesalers and producers. As of 2015 ValuePlan is being actively marketed in Europe, Middle East and Asia. Example of a rolling forecast: Each quarter a new 5 quarter forecast is created with a focus on adjusting for changes in key assumptions. Shaped by a complex environment and tight budgets Due to geographical location and small population Icelandic companies tend to be both quite small and at the same time very complex, since they must handle a wider array of functions than companies of the same size in larger markets. This means highly sophisticated IT solutions relative to size, but at the same time tight budgets for IT investment. At the same time budgeting tends to be widely distributed, requiring a very user friendly application. Built for this market ValuePlan provides the flexibility of enterprise level solutions but at a fraction of the cost. Return on software investment is high and ValuePlan is implemented in days/ weeks instead of months or years. The need for ongoing support is minimal. All general administration is handled by the non-technical client staff, including user permissions, workflow, creation of new budget versions and updates of historical data. ValuePlan is built to effectively support the core functionalities needed to provide value-adding planning and budgeting. It integrates easily with existing reporting/bi solutions and when needed the relevant OLAP cubes for reporting and analysis are provided. 6

7 Functionality overview True multidimensional planning no limit to number of dimensions or dimension groups. Unlimited number of modules Tight integration with Microsoft Dynamics NAV and AX Multi-level planning: Application distributes figures to lower levels based on equal or relative distribution. Multiple interactive measures. Full integration with backend applications. Full integration with BI/CPM/Scorecard applications. Multi-user support. Multi-company support with full consolidation. Full logging of all data entries and activities. Powerful admin functionality: User access, workflow management, data and dimension management. Full support for rolling forecasts and different planning periods. Full workflow support. Workflow defined by user/group, role and phase. Dynamic user-defined calculation rules module to support driver-based planning. Full currency support, both one and multiple base currencies. Full language and region support. Flexible graphical data presentation with interactive charts. Integrated Excel component. Full integration with Microsoft security control The number of modules, dimensions, dimension groups and measures is unlimited and the solution can very easily be adapted to any business structure. ValuePlan offers a simple management interface, dimension based access management and workflow support, multi-currency support. 7

8 Technology ValuePlan is a client-server solution developed in.net C# that runs on a Microsoft SQL, Oracle, MySQL or other SQL database. Data is stored in and loaded directly from relational tables and, in certain instances, through OLAP cubes. Data update is always relational. All data changes are logged. The log tables store the user id, timestamp, dimension matrix and user comment if this exists. To load historical data into the ValuePlan databases there is a choice of using data integration tools such as MS SSIS, views into linked servers or stored procedures. The ValuePlan client requires Windows 7 or higher and.net framework 4.5 or higher. Hardware requirements depend on number and size of databases. ValuePlan extracts data directly from backend databases. Data is then split into modules. 8

9 Structure The ValuePlan solution consists of three applications: The ValuePlan user interface is the application used for data analysis and entry and also for managing model data, set up new versions etc. The ValuePlan management module is used to manage dimension based user permissions, management permissions and view project progress. The ValuePlan rules module is used to build calculation rules for updating data within and between budget modules. User module Each ValuePlan installation contains a minimum of two databases. One system database for management and a separate database for each planning module, such as sales, finance, HR, etc. Each database contains both the module data and the metadata for determining the module structure. A ValuePlan module can contain any number of dimensions, dimension groups and measures. Data flows between modules in three ways. One module can present data from another module by customizing the data view, data in one module can be updated by data from another module using stored procedures or using the ValuePlan rules module. The user module consists of a simple interface that allows the user to drill down through any number of dimension hierarchies to define the data to be updated and either enter numbers manually cell by cell, enter summary values or copy data from a spreadsheet. The user can choose between three types of views: An analysis view for comparison with historical data, list views defined by the level of detail chosen or a view showing all measures at the same time. ValuePlan gives the user access to all necessary information and analysis in a single intuitive, easy to use interface 9

10 Management module User access management is dimension and module based. A user may be granted access to one or more modules and to the whole matrix of a module or a subset of it defined by dimensions. Thus a sales manager may have rights to work on the budget for all products or a subset of products and a defined subset of customers in the sales module and on the trade marketing accounts for the same subset in the finance module. Rules module The ValuePlan Rules module is a unique tool that allows users to create a wide range of calculation rules to update data within or between modules using a powerful query builder. The Rules module is a key tool when using driver-based planning to build outcome on underlying assumptions, to allocate line item values and to calculate values, for example derive cashflow from the income statement and balance sheet or build scenario analyses based on key assumptions. Design and implementation The implementation of ValuePlan may be roughly divided into the following steps: 1. Decide the scope of the project and how to split into modules. Will we do only a simple financial budget by departments and accounts or will we include sales and production budgets, salary budgets and so on? 2. Design the modules to be used and how they are linked together. What dimensions will we use and how will we structure the dimension hierarchies? What measures will we use, how are those to be linked together? How is data supposed to flow, for example from the sales plan into the purchase plan or from the salary plan into the financial plan? 3. Build the links to historical data. 4. Build links to existing BI solution or build the OLAP cubes or dashboards to be used if no BI exists. 5. Decide and implement user rights and workflow process. A typical implementation of ValuePlan for sales and finance planning can take between consulting hours depending on availability of data and complexity of the project. The implementation can easily be done incrementally, starting with one function, business unit or department to include more later with minimal effort. The ValuePlan modules are linked together to provide an easy flow as assumptions are updated 10

11 Summary ValuePlan is a powerful planning, budgeting and forecasting tool that combines the flexibility of enterprise level solutions with low cost and user friendly interface. ValuePlan suits any business scenario, fits right into existing BI structures and helps bring the budgeting and planning work into the hands of the people who really hold the relevant information needed to build a realistic plan that helps drive the business forward. 11

12 Company information Global Headquarters ValuePlan Sjonarrond ehf, Grandagardi 16, 101 Reykjavik Iceland Ultima ValuePlan EMEA Far East WTC Utrecht, Papendorpseweg 100, 3528 BJ Utrecht The Netherlands Sjonarrond Development center WTC Utrecht, Surat, India 406, Apex Commercial Center Surat Gujarat India 12