2/23/2012. Strategic Planning is a Continuous Cycle. Metrics to Measure Operational Results and Align with Strategic Planning. What are Metrics?

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1 Strategic is a Continuous Cycle Metrics to Measure Operational Results and Align with Strategic Brian L. McGuire, Ph.D., CMA, CPA, CBM, CITP Associate Dean, College of Business MBA Director Professor of Accounting University of Southern Indiana Engage in Key Decisions Discuss Stakeholder Input Winter: Define Initiatives, Set Priorities Spring: Refine Plan and Financial Model Strategic Activities Fall: Perform Environmental Scan, Risk Assessment June Board Meeting: Approve Plan and Budget Summer: Review Process, Set P&D Goals Communicate Plan to Collect Input from and Development Committee Goals What are Metrics? The Committee works closely with the CEO and staff to: 1) Perform an environmental scan and risk assessment to identify the most important strategic issues to be addressed in the next four years 2) Ensure that the mission statement, operational plan, annual budget and other critical planning products are produced in a timely and effective manner and are aligned with the strategic goals and stakeholder requirements 3) Develop metrics that focus on what IMA wants to achieve in regards to its Strategic Plan (Jennings Ryan and Kolb, 2004) Strategic Metrics vs. Management Metrics Strategic metrics focus on the organization's vision and goals, helping senior management monitor progress, while management metrics focus on strategies and tactics, which is useful for implementation teams Strategic metrics focus on achievement of the organization's vision or goals, which identify strategic direction Metrics at the goal level work well for communicating with senior leadership regarding progress along specific goal areas Like management metrics, strategic metrics need to be clear, meaningful, objective, and measurable, but they should be relatively limited in number External Environmental Factors Impacting IMA Economic Factors Explosive economic growth in emerging Asian markets Lower US economic growth and high unemployment Economic growth in the Middle East Technology and Regulatory Factors Growth in demand, and shortage of accounting and finance professionals skills gap IFRS reporting of financial results in the global marketplace Other Associations AICPA joint venture with CIMA, including the new CGMA designation Reducing membership trends and changes in demographics across accounting associations 1

2 Planned expansion activities, including Leadership Academy, direct mail campaign, enhanced course provider network, European expansion, Middle East retention, and China corporate awareness campaigns, are well underway Extensive internal staff training, post launch vendor support, and operational process improvements are allowing IMA to maximize the benefits of the new technology tools Marketing campaigns accomplished and planned for winter/spring 2011 continue to promote awareness of the IMA and CMA brands Revisit IMA vision and mission statements Risk Assessment Review the top risks facing IMA Agree on risk mitigation direction for inclusion in strategic plan Strategy Map Outline the strategy map and plan elements for Create Superior Risks Member Value Increase Penetration of CMA Work with staff to develop strategic initiatives for Finalize the projected operating budget for 2011* Create the strategic plan document Develop the communication plan for all stakeholders: Board, Staff, Volunteer Leaders, Membership, Partners, etc. * FYE June 30, 2011 Perspective Member service / program risk Maintaining relevance of programs and services in a changing environment CMA exam changes acceptance in the marketplace Alignment of chapter and council decisions with strategy Competitive risks other organizations entering the global marketplace Internal risk Sustainability of processes dependent on volunteer involvement Board diversity, engagement, experience, and international representation Dependence on technology vendors with financial viability risk Mitigation Ongoing development of continuing professional education products; careful monitoring of certification trends Significant budget and plan for continued marketing and outreach Communication plan and strengthened resources for chapter/council support Continuous environmental scan Spirit of partnering with other accounting bodies Transition to staff focus: Leadership Academy and Fundraising Board training Transition to new platforms with stronger vendors Risk of internal stress related to multiple projects at one time Realistic goals and setting of priorities 10 Risks Create Superior Member Value Increase Penetration of CMA Projected 2011 Membership (and Approved 2011 Budget) Perspective Learning / growth risk Mitigation Ability to anticipate, identify, and react to change Ability to leverage Personify, the new association management system (AMS), and ensure its effectiveness Succession planning for key staff positions Maintaining board and staff links to progressive companies and organizations Extensive training Phasing in additional features Encouraging certification (CMA, CAE, ITIL, and others) and continuing education for all staff Financial risk Impact of the economy on members willingness to pay dues Impact of the economy on the investment portfolio International membership retention Keep dues low and affordable Develop other revenue streams Professional investment management through Merrill Lynch PO&A robust oversight processes Focus on strengthening local relationships, products, and services for international members 11 2

3 Membership Metrics as of December 31, 2010 Investment Results as of December 31, 2010 Membership - December 2010: 64,369 total is under budget by 592 4,846 year-over-year increase One Strategic Plan a united vision The Strategic Plan is underway! This is the plan and budget for: Institute of Management Accountants, Inc.* (IMA) and its affiliates: - Institute of Certified Management Accountants, Inc. (ICMA) - IMA Foundation for Applied Research Inc. (FAR) - Institute of Management Accountants Memorial Education Fund, Inc. (MEF) United by a global vision: To be the resource for developing, certifying, connecting and supporting the world s best accountants and financial professionals within businesses. In fiscal 2009 IMA embarked on a period of transformational change by focusing on key metrics, delivering an operating surplus, and building a solid foundation for expansion of its international reach. Fiscal 2010 marked the launch of the new CMA exam, an increase in exam registrations of 55%, an 81% increase in new CMA candidates, and the delivery of an operating surplus for the second consecutive year The Strategic Plan is underway! Key risks in the environment affecting IMA Competitive Landscape Global Factors U.S. Factors In fiscal 2011 we built out the very popular IMA Leadership Academy webinar series, implemented key technology improvements to enable continued program expansion, and will deliver a third consecutive operating surplus. We will certify more CMAs in fiscal 2011 than in any previous year. AICPA announces: Joint Venture planned with CIMA to offer a global management accounting designation early in 2012 Free student memberships Plan to administer CPA exam in international locations IMA s members are concentrated in the U.S., the Middle East and China The world is emerging from the global recession Unemployment remains high in many regions Political unrest and turmoil have 75% of IMA members are in the U.S. The population is becoming more diverse; more women and minorities are entering the profession Baby boomers are reaching retirement; aging of the profession is a key concern; average U.S. member is 53 years young We approach the future as an inspired and confident team, intent on continuing to advance the profession, and recognizing 2012 as a pivotal year. We will proudly celebrate the 40 th anniversary of the CMA. Voting membership offered to people who pass the CPA exam but are not licensed in a state CIMA and other management accounting bodies expand their presence in China and the Middle East Associations seek ways to partner for scalability plagued Egypt and other key countries in the Middle East Convergence of accounting standards creates an international marketplace for accounting bodies Management accounting is recognized as a clearly defined career path in the global marketplace Unemployment rate in the U.S. remains high at 8.8% (March) Mergers, outsourcing, off-shoring, and more efficient transaction processing all contribute to a shrinking management accounting profession within the US Academic institutions prepare students for a career in public accounting These conditions require an agile approach, strong leadership, sound strategic intent, a willingness to invest in the future and the ability to adapt to change

4 Serving the profession CMA Program 40 th Anniversary in 2012 We play a critical role in helping financial professionals to become ethically sound, capable, and talented leaders in a global business environment. Jeff Thomson, IMA 2010 Annual Review The IMA has led the management accounting profession in the U.S. for over 90 years. Our management accounting certification was established 40 years ago, and we do it better than anybody! Becoming a CMA gave me great self-confidence and the ability to present my knowledge to someone else. Now I am the head of internal audit in an international insurance corporation, and I couldn t have reached this position without being certified. Tarek El S.M. El Meaddawy, CMA, CIA, CFE, CGEIT (Kuwait), May 2011 Strategic Finance On July 1, 1972, the NAA hired Dr. James Bulloch as the first Managing Director of the CMA program. In December of that same year, the first CMA exam was administered to 410 people all in the US. The first 54 CMA certificates were issued in 1973, and since then we have issued over 34,200 CMA certificates and we administer the exam in 80 countries CMA Program 40 th Anniversary in 2012 Strategic goals: In the last three years, over 25,000 candidates have joined the CMA program and more than 4,000 new CMA certificates have been issued. For nearly 40 years, the CMA program has had a long tradition of high quality and rigor and we continue that tradition as we move toward our vision of being the leading certification in the world for accounting and financial professionals working in business. The CMA program is poised for dramatic growth and unprecedented recognition around the world. We proudly look forward to celebrating our 40 th anniversary! Three primary strategic goals drive our plan: 1. Create superior member value 2. Increase the penetration of the CMA exam 3. Grow membership Success with these goals will continue to result from a primary focus on the needs of our members, supported by strong internal processes and our capacity to learn and grow. Success also creates the financial resources that are the foundation for sustainable growth, as illustrated in the following IMA high-level long-term scorecard view IMA high-level long-term scorecard view What members want Create Superior Member 3 High-Level Strategic Goals Value Increase Penetration of CMA 4 Scorecard Perspectives: Networking Products and Professional Product Member Service Opportunities Services Support Branding Internal Process Member Acquisition Relationship Operational Innovation According to a survey* conducted in the spring of 2011, the top five reasons members belong to IMA are: to obtain or maintain their certification to stay current on information in their profession for networking opportunities to show that they are professionals for continuing education credits Learning and Growth Create Cultural Alignment Develop baseline metrics linking programs to member benefits Master the Technology Tools * Dr. Larry Seibert of Association Metrics conducted a survey of members and reported his findings on April 26, All members were invited to participate; characteristics of the 3212 respondents closely align with the characteristics of membership. Financial Resources Revenue Growth Improved Financial Resources Available for Member Benefits

5 IMA s key member-facing programs Operations Footprint Geographic Perspective ICMA Team CMA Certification Professional Development Team CMA Exam Prep materials Relationships with review course providers Conferences for members and students NASBA-approved CPE Subscription e-learning courses Webinar series Ethics training and specialty e-learning Leadership Academy Publications Team Strategic Finance Management Accounting Quarterly Strategic TechNotes Member Services and Marketing Teams Chapter and Council Support Academic and Student Relations Corporate Outreach Affinity Programs Job Board Online Social Network (LinkUp IMA) Newsletters and communication Speakers Bureau Research Team Initiatives targeted at thought leadership Statements on Management Accounting FAR grants IMA Educational Case Journal Research partnerships/collaboration Americas Office Head Office Europe Office Middle East Office Asia Pac Office Strategic is a Continuous Cycle Update Engage in Key Decisions Spring: Refine Plan and Financial Model June Board Meeting: Approve Plan and Budget Communicate Plan to Winter: Define Initiatives, Set Priorities Strategic Activities Summer: Review Process, Set P&D Goals Questions? Discuss Stakeholder Input Fall: Perform Environmental Scan, Risk Assessment Collect Input from 5