fp&a business partnering - jpk group€¦ · (management accounting) commercial skills...

upFP&A Intensive Workshop 2016December 5-6 • San Francisco, CA

FP&A Business Partnering

December 5, 8:30am

Jesper Hybholt Sorensen is the Senior Finance Director at Oracle leading theglobal business finance organization for the Managed Cloud Services Business.

He oversees strategic planning, forecasting, reporting and financial analytics.He is formerly of Dupont where he led the global finance teams for the BiotechDivision responsible for Performance Management including being the financial

lead and owner of the Forecast, Budget & Strategy Process, CompetitiveIntelligence Financial owner and Lead Analyst. Jesper has extensive

experience as a Financial Business Partner supporting a large number ofExecutive Vice Presidents with optimizing financial performance. During his

carrier Jesper has also worked in China and Denmark, has studied in Denmarkand Belgium and holds a Master Degree in Economics.

View presentation online at:www.jpkgroupsummits.com/attendee7

Jesper Sorensen – Oracle

Next Generation FinanceMoving From Average to World Class

Jesper Hybholt SorensenSenior Finance Director, Managed Cloud ServicesOracle Corporation December 2016

Copyright © 2016, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal/Restricted/Highly Restricted 3Copyright © 2016, Oracle and/or its affiliates. All rights reserved. | Confidential – Oracle Internal/Restricted/Highly Restricted 3

Senior Finance Director

Independent Consultant

Advisory Board Member

Jesper Hybholt Sorensen

Safe Harbor Statement

The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.

Confidential – Oracle Internal/Restricted/Highly Restricted 4

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Next Generation Finance

• What Matters Next

• Business Partnering Model

• Competency Model

• Capability Model

• Assessment Model

• Training Model

• From Average to World Class

• Cases & SurveyFrom Average to World Class Model

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Training Model

Introduction: The Modern Finance Professional

It is like dancing…

Trusted Scorekeeper

Extensive understanding on how to add value in the organization (Value Creation).

Deep financial knowledge and strong analytical skills (Complexity).

Finance Business Partner

... No magic formula on how to get there

(Not a Job Description)

1980s 1990s 2000s 2010s

VALUE CREATION

Descriptive Analytics

Standard ReportingQuery & Search Tools

Pivot & Visualization

Dashboards & Scorecards

Statistics, Intelligence& Data Mining

Modelling, Scenarios & Monte Carlo

Diagnostic Analytics

Predictive Analytics

Prescriptive Analytics

Reporting

Analyzing

Monitoring

Predicting

Simulating

What happened? Why did it happen? What is happening now? What will likely happen?

Introduction: Evolution of Analytics

BUSINESS INTELLIGENCE BUSINESS ANALYSIS

What might happen?

What happened? Why did it happen? What is happening? What might happen? What will likely happen?

Introduction: Evolution of Analytics

“While at the moment we are generally making good decisions, this is essentially unconscious competence because we’re often using our instincts rather than evidence. In the future, we want to be fully informed and consciously competent, and to be making decisions based on data and analysis of that data and,therefore, evidence.”

-Allan Tait, Vice Principal and CFO, University of MelbourneAs quoted in “Modern Finance in the Digital Age”, FERF, September 2015

Introduction: The 3 Offices

Front Office

Back Office

Head Office

Sarbanes Oxley

IFRS / GAAPTreasury

GovernanceInternal Audit

External Reporting

Financial Shared Service Centers (FSSC)Center of Excellence (CoE)

Business Process Improvements (BPI)

Business Partner

Introduction: Golden Circle

What: Everyone knows WHAT they are doing

How: Some knows HOW they do what they do Those who differentiate themselves from others

Why: Few can clarify WHY they do what they do Purpose, cause or believe

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Training Model

Next Generation: Advanced Analytics

“The analysis of all kinds of data using sophisticated quantitative methods (for example, statistics, descriptive and predictive data mining, simulation and optimization) to produce insights that traditional approaches to business intelligence (BI) — such as query and reporting — are unlikely to discover.”

Gartner Inc.

Next Generation: Advanced Analytics

Value Driver Analytics

Big Data & Data Mining

Predictive & Prescriptive Analytics

Strategic Decision & Risk Management

Competitive & Market Intelligence

Trusted Scorekeeper

Finance BusinessPartner

reatio

lexity

Next Generation: The Roles of Finance

Reporting & Compliance

(Financial Accounting)

Performance & Decision Making

(Management Accounting)

Commercial Skills

Technical Skills

INFLUENCE / STRATEGICCONTROL / GOVERNANCE

CONFIDENCE / REPORTING DILIGENCE / ANALYTICS

Next Generation: The Roles of Finance

Business Partners

Steward

Trusted Scorekeeper Technical

Expert

Commercial Skills

Technical Skills

Sarbanes-Oxley

IFRS/GAAP

Business Process Improvement

BI Analytics

Costing

Variance Analysis

Narrative Reporting

Cost Control

Risk Management

Performance Management

Business Strategy

Governance

Ethics Compliance

Strategic DecisionsAdvanced Analytics

Treasury

Internal Audit

Data Capturing

Transaction ProcessingBusiness Process Improvement

Narrative Reporting

Variance AnalysisCost Control

Transaction Processing

Modeling

External Reporting

Next Generation: The Roles of Business Finance

Business Partners

Trusted Scorekeeper

Commercial Skills

Technical Skills

Sarbanes-Oxley

Business Process Improvement

Variance Analysis

Narrative Reporting

Cost Control

Risk Management

Performance Management

Business Strategy

Compliance

Strategic DecisionsAdvanced Analytics

Internal Audit

Data Capturing

Transaction Processing

Modeling

Next Generation: The Role of Business Finance

Transactions

Reporting & Analysis

Strategy

Time Spending

Next Generation: The Role of FSSC / CoE

Strategy

Reporting & Analysis

Transactions2000s

1980s 1990s 2000s 2010s

Collaborate

Internal Function Focus

Next Generation: 4G Finance Business Partner

Behavior

Internal Organization Focus

External Organization Focus

The Scorekeeping Accountant

The Supporting Partner

The Shareholders

Wealth Creator

The Clairvoyant Impactor

1st Generation

Future Short Term & Long Term Focus

2nd Generation

3rd Generation

4th Generation

Focus on Technology for Process Improvements

Focus on Building Relationships and Decision Support

Focus on Predicting the Future and Respond to Risk & Opportunities

Record Report Support Influence Challenge Predict Impact

Focus on Safeguarding Assets and Promoting Wealth Generating Strategies

Next Generation: MUST Read

Confidential – Oracle Internal/Restricted/Highly Restricted

Overview if several consulting companies finance business partnering concepts and frameworks.

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Training Model

What is finance’s role in measuring and monitoring the value drivers in today’s digital economy?

What Matters NextGlobal survey 744 respondents plus 10 in-depth interviews

Between $100 million and $250 million Between $250 million and $500 million

Between $500 million and $1 billion Between $1 billion and $5 billion

More than $5 billion

United States of America

United Kingdom

IndiaSouth Africa

Germany

Netherlands

France

United Arab Emirates

Sweden

Australia

Canada

Ireland

Poland

Mexico

Brazil

Kuwait

Others

Sample CoverageResponses By Company Size

What Matters Next: Value Drivers & KPIs

0 100 200 300 400 500 600

Plant and Equipment

Supplier Relationship

Patented Product or Processes

Strategy Execution

Strategic Decision Making

Reputation of Brand

Quality of Your People (Human Capital)

Customer Relationships

Quality of Business Processes

Customer Satisfaction

Number of Respondents

Ranking the Value Drivers

0 20 40 60 80 100

Digital Marketing Effectiveness

Social Sentiment

Social Engagement

Talent Sourcing Pipeline

Brand Awareness and Equality

Customer Pipeine and Retention

Competitor Activity

Employee Engagement and Retention

Data Quality

Customer Experience and Satisfaction

Employee Productivity

Return on Invested Capital (ROIC)

Percentages

Measuring and Monitoring KPIs

1st 2nd 3rd 4th 5th Always Recently started(in the last 12 months)

Plan to (in next 12 months)

Plan to in the future (12 months+) No Current Plan

What Matters Next: Relating KPIs to Value Drivers

Top KPIs

DATA QUALITY

RETURN ON INVESTED CAPITAL

(ROIC)

EMPLOYEE PRODUCTIVITY

EMPLOYEE ENGAGEMENT AND

RETENTION

CUSTOMER EXPERIENCE & SATISFACTION

BRAND AWARENESS AND EQUITY

COMPETITOR ACTIVITY

CUSTOMER PIPELINE & RETENTION

TALENT SOURCING AND

RETENTION

65% 60% 57% 55% 50% 49%

CUSTOMER EXPERIENCE

QUALITY OF BUSINESS PROCESS

CUSTOMER RELATIONSHIP

QUALITY OF PEOPLE

REPUTATION OF BRAND

76% 64% 63% 61% 58%

Top Value Drivers

The traditional performance metrics no longer capture the value drivers

0 10 20 30 40 50 60 70 80 90 100

Social Engagement

Digital Marketing Effectiveness

Brand Awareness/Quality

Customer Experience and Satisfaction

Talent Sourcing/Pipeline

Customer Pipeline and Retention

Employee Engagement and Retention

Social Sentiment

Competitor Activity

Data Quality

Percentages

KPIs and the Functions that Provide them

What Matters Next: Providing KPIs

Each function is likely to provide the performance measures relevant for its own domain

Finance Sales Marketing HR IT Other Outsourced

What Matters Next: Responsible for Performance

13.4% 18.5% 47.2% 2.9% 6.7% 11.4%

43.9 26.3% 6.9% 3.8% 9.1% 10.0%

10.9% 16.9% 42.5% 4.2% 10.0% 15.4%

9.6% 20.0% 10.7% 8.2% 31.8% 19.6%

13.4% 37.4% 9.6% 19.2% 9.8% 10.7%

4.7% 69.3% 8.0% 6.7% 4.7% 6.7%

15.8% 11.4% 7.3% 13.8% 15.8% 35.9%

8.2% 33.4% 11.6% 7.8% 16.9% 22.0%

29.6% 9.8% 8.0% 8.7% 15.6% 28.3%

CEO CFO CIO CRO COO Other

Information Technology

Corporate Strategy, Business Model Development

Digital Transformation

Supply Chain and Logistics

Risk Management

Financial Planning and Analysis

Human Resources

Shared Services Centers

Social and Environmental Issues

Ranked 1st

Ranked 2nd

What Matters Next: The Challenge

Provide insight from different data sources

Partner to support decision making

Have business acumen to provide insight

Provide stewardship and governance for Intangibles

Balance focus between current and future performance

Risk of being side-lined

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Training Model

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Business Partnering Model – The Concept

BACK OFFICE FRONT OFFICE

COMFORT ZONE VALUE CREATION

Reporting Analysis Insight Influence Impact

Reporter Commentator Advisor Advocate Strategist

alitativeQ

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Business Partnering Model – The Roles

The Reporter utilize all financial systems when reporting in a timely and accurate manner.Reporter

The Commentator turns data into information and provides basic analysis and adjusting the language to meet the audiences needs.Commentator

The Advisor builds relationship in the organization and use business awareness to provide insight that identifies issues, problems and opportunities. Advisor

The Advocate is proactive, predict the future and evaluates risk & opportunities to influence the decision making.Advocate

The Strategist is seen as a true peer who thinks strategically, drives Financial Leadership and uses Innovative ‘Out of the Box Thinking’ to impact the business direction.Strategist

Business Partnering Model – The Mindset

“Closing the books, reporting more efficiently … those are just table stakes for a modern CFO. You can’t ask for a more strategic role in the organization if you can’t deliver on the basics.”

- Jeff Henley, vice-chairman of the board and former CFO, Oracle Corporation

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Training Model

Competency Model• Provide timely, accurate and clear information

• Identifying and understanding issues, problems, and opportunities

•Adjusting language to capture the attention of the audience

•Building relations in both business and the finance organization

•Recognize options to select an appropriate course of action

•Using business terminology when communicating with others

•Maintaining knowledge of leading tools and techniques

•Understanding overall business, economic and political environments

• Evaluating opportunities & risk and predict trends & events

• Provide key drivers, implications and actions required to stay ahead of competition

•Developing and influencing business decisions to impact the strategic direction

•Being a role model with vision & leadership to innovate finance

Acumen

Basics

Leadership

Engagement

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Training Model

Capability Model

Analysis & Judgment

Communicating with Impact

Analysis & Judgment

Teamwork & Collaboration

Analysis & Judgment

Business Acumen

Business Insight

Analysis & Judgment

Business Acumen

Risk & Opportunity Management

Business Insight

Persuasion

Analysis & Judgment

Business Acumen

Risk & Opportunity Management

Business Insight

Persuasion

Strategic Planning

Acumen

Leadership

Basics

Engagement

Reporter Commentator Advisor Advocate Strategist

Competencies

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Training Model

Assessment Model

• Forward Looking

• Simulate & Optimize

• Player on the Team

• Backwards Looking

• Analyze

• Scorekeeping

• Challenging

• Mining & Discover

• Predict

• Supportive

• Slice and Dice

• Understand

Strategist Commentator

Advocate Advisor

World Class Average

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Training Model

Training Model

Online Finance Academy

On the Job Training

Dual Job (Incl. Projects)

Mentoring

Certifications

Leadership Training

Internal Communities

External Communities

BUSINESS PARTNER SKILLS & CAPABILITIES

Strategist

Commentator

Advocate

Advisor

Reporter

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Training Model

1980s 1990s 2000s 2010s

BUSINESS VALUE

Descriptive Analytics

Query & Search Tools

OLAP & Visualization

Dashboards & Scorecards

Modelling, Scenarios & Monte Carlo

Diagnostic Analytics

Predictive Analytics

Prescriptive Analytics

ReportReporting

AnalysisAnalyzing

InsightMonitoring

InfluencePredicting

ImpactSimulating

What happened? Why did it happen? What is happening now? What will likely happen?What might happen?

From Average to World Class: The Concept

Strategist

Commentator

Advocate

Advisor

Reporter

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

Statistics, Intelligence& Data Mining

What happened? Why did it happen? What is happening? What might happen? What will likely happen?

From Average to World ClassBusiness

Partnering Model

Competency Model

Capability Model

Assessment Model

Training Model

Reporter

Commentator

Advisor

Advocate

Strategist

“Historically, finance has been the recorder of history. Now, finance is leveraging the power of information to predict events, accelerate decision-making, and create more agile organizations.”

-David Pleasance, Senior Partner, Deloitte Consulting LLPAs quoted in “Modern Finance in the Digital Age”, FERF, September 2015

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From Average to World Class: The Challenge

• Wrong People (Traditional Accountants)• Back-Office focus• Work in the comfort zone• Too busy Fire-fighting • Uncomfortable with Business• Limited Financial System

• Sizable Team of Financial Business Partners• Training to Develop Seniors as Business Partners• Not afraid of new Challenges (Getting out of Comfort Zone)• Tools and Techniques to drive Decision Making• Mechanism to Measure Benefit from Business Partnering• Less Business Administration (Free up Time)

Commentator

Advisor

Advocate

Strategist

Average

World Class

Business Partnering

Competency Model

Capability Model

Assessment Model

Training and Development

From Average to World Class: Golden Circle

What: Everyone knows WHAT they are doing

How: Some knows HOW they do what they do

Why: Few can clarify WHY they do what they do

Finance Business Partner vs Trusted Scorekeeper

FP&A / Business Finance / Management Accounting

Value Creation: We present INSIGHT that is actionable which INFLUENCE the decision-making and IMPACT the strategic direction (The 3 i’s)

World Class Average

Advocate Advisor

Assessment Target

From Average to World Class: Assessment

World Class Average

Advocate AdvisorAssessment Target

Click to take Surveyhttps://jezpers.typeform.com/to/koR1I7

Questions & Break

Agenda

Business Partnering

Competency Model

Capability Model

Assessment Model

Training Model

• Introduction

• Training Model

• Cases & Survey From Average to World Class Model

Survey: CapabilitiesB

Competencies StrategistCommentator AdvocateAdvisorReporter

Analysis & Judgment

Business Acumen

Business Insight

Analysis & Judgment

Business Acumen

Risk & Opportunity

Management

Business Insight

Persuasion

Analysis & Judgment

Business Acumen

Risk & Opportunity

Management

Business Insight

Persuasion

Strategic Planning

Create clear and understandable

information

Adjust language to meet audience needs

Translate needs into Insight

Effective Communication that

leads to Action

Active in leadership teams

Survey: Assessment

World Class Average

Advocate AdvisorAssessment Target

Value Driver Analytics

Big Data & Data Mining

Predictive & Prescriptive Analytics

Strategic Decision & Risk Management

Competitive, Market & Customer Intelligence

Trusted Scorekeeper

Financial BusinessPartner

Case 1: From Average to World Class – Prescriptive Analytics (Risk Management)

Simulation (Monte Carlo)

Modelling

Variable 1

Variable 2

Variable 3

Variable 4

Variable 5

Variable 6

Variable 7

Variable 8

BaseScenarios (Tornado Diagram)

Scenarios

Subject Matter Experts (SMEs)

High / Low Case

Simulation

Probability

Advocate

High P90, Base P50, Low P10 Case Cummulative Probability Curve

Case 2: From Average to World Class – Predictive Analytics

Trend / Seasonality Model(Smoothing)

rrency

Full Year

PVMC Run Rate

Intelligence

Market

Customer

Competitors

Underlying Asset Model(Regression)

Revenue = C + xA + yB

Case 2: Predictive Analytics – Run Rate

rrency

Full Year

PVMC Run Rate

Case 2: Predictive Analytics – Intelligence

Intelligence

Market

Customer

Competitors

Market (12%)

Competitors (10%)

Case 2: Predictive Analytics – Trend & Seasonality Model

Trend / Seasonality Model (Smoothing)

Case 2: Predictive Analytics – Underlying Asset Model

Revenue = 3.33c + 0.99788a

Case 2: From Average to World Class – Predictive Analytics

Trend / Seasonality Model (Smoothing)

rrency

Full Year

PVMC Run Rate

Intelligence

Market (12%)

Customer

Competitors (10%)

Revenue = 3.33c + 0.99788a

Case 3: From Average to World Class – Strategic Decisions

Corporate has asked you Division to increase your

forecast by $20M (New Target 360M)

1. Which region / regions should get the $20M challenge?

2. Does your answer change if you knew the regions

probability curve?

Red μ = 70

Burgundy μ = 90

Orange μ = 90

Gray μ = 90

Red μ = 70 / σ =3

Burgundy μ = 90 / σ = 8

Orange μ = 90 / σ = 14

Gray μ = 90 / σ = 1

Questions

Appendix

Click to Know more

Customer Satisfaction

Quality ofBusiness Process

Customer Relationship

Qualityof People

Reputationof Brand

Return on Invested Capital

(ROIC)

CompetitorActivity

Research: Relate KPIs to Value Drivers to Financial Performance

Data Quality

Employee Engagementand retention

Customer Experienceand Satisfaction

Customer Pipeline and Retention

Talent sourcingand Pipeline

Brand Awarenessand Equity

KPIs Value Drivers Financial Performance

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