reducing risk in a dynamic environment with the cloud
DESCRIPTION
Video & Slides: http://www.proformative.com/events/reducing-risk-dynamic-environment-cloud-0 Understanding and effectively managing financial and operational risk exposures is a challenge faced by companies of all sizes. Finance leaders are increasing taking ownership of risk management at their companies in addition to taking on more direct leadership of company growth initiatives. Discover how Finance leaders from fast-growing start-ups to the Fortune 500 are turning to the Cloud to help them identify, mitigate, and manage dynamic risk exposures across the enterprise, and allowing them to focus more on driving company growth and shareholder value. This webinar will feature a case study detailing how one company has successfully leveraged the cloud in elevating the effectiveness of its risk management programs while subsequently driving successful growth initiatives.TRANSCRIPT
THE RESOURCE FOR CORPORATE FINANCE, ACCOUNTING & TREASURY PROFESSIONALS
Reducing Risk in a Dynamic Environment with the Cloud
© 2013 Proformative. Proprietary and confidential
Welcome to ProformativeProformative is the largest and fastest growing online resource for senior level corporate finance, treasury, and accounting professionals.
A resource where corporate finance and related professionals excel in their careers through:
Uniquely valuable, online Peer Network Direct subject-matter-expert advice Valuable Features and Resources
All of it completely noise-freeCheck it out at www.proformative.com
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Learning Objectives
After participating in this event you will be able to:
Understand the risk areas exposed in a rapidly changing economic and business environment.
Recognize the Finance business goals impacted by change and risk management
Identify areas that cloud-based financial applications can help manage change and risk
THE RESOURCE FOR CORPORATE FINANCE, ACCOUNTING & TREASURY PROFESSIONALS
Reducing Risk in a Dynamic Environment with the CloudIan Halifax, CMA, CPAChief Financial OfficerHost Analytics
© 2013 Proformative. Proprietary and confidential
What We Worry About
5
• Risk
• Surprises
• Cost
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What We Do
6
1. Accounting/reporting2. Planning/forecasting3. Analytics/intelligence4. Regulatory requirements (SEC, SOX)5. Taxation6. Treasury/cash management7. External /internal audit8. Investor/BOD relations9. Mergers and acquisitions10. Systems infrastructure
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Risk Areas Exposed by Rapid Change
7
• Control risk– Inflexible, antiquated systems– Inadequate audit trails
• Misstatement risk– Multiple data sources– Manual process mean higher risk of errors
• Forecast risk– Data accuracy– Timeliness – data aggregation versus data analysis
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What A CFO Needs
What Best-In-Class Means• No surprises• Right performance on demand• Powerful early warning system for the organization• Happy auditors• CFO sleeps at night
What a CFO Needs• Efficient and effective processes and systems• The right, accurate metrics on demand• Run rapid forecast scenarios• Flexibility to manage change (e.g. M&A)• Credible voice• Ability to move very quickly• Rapid enterprise application deployment
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Excel And Email Is Risky
No WorkflowNo SecurityNo PrivacyNo Version ControlLimited Reporting
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What Is Enterprise Performance Management?
Planning
Close
Reporting
Analytics
Enterprise Performance Management (EPM = CPM = FPM ≠ BI ≠ ERP)
To improve
InsightActionable
AccountabilityAcross the org
SpeedFaster processes
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How Does EPM Reduce Risk?
• Strengthens Control Environment– Controlled financial consolidations– Built-in audit trails
• Improves Data Integrity– Central source of truth– Lower chance of manual errors
• Enhances Forecasting Capability– More time for analysis and scenario modeling– Early warning system: faster and broader visibility of key metrics
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But EPM Projects Introduce Different Risks
Budget overruns services
Selecting wrong vendor
Project stalls
Lack of end-user acceptance
Missed target dates
Budget overruns software
Doesn't meet expectations
0 10 20 30 40 50 60 70 80
EPM Project Risks
Percent of total respondents N=226
Source: BPM Partners “The Pulse of Performance Management 2013”
© 2013 Proformative. Proprietary and confidential
The Cloud Lowers EPM Project Risks
Budget overruns services
Selecting wrong vendor
Project stalls
Lack of end-user acceptance
Missed target dates
Budget overruns software
Doesn't meet expectations
0 10 20 30 40 50 60 70 80
EPM Project Risks
Percent of total respondents N=226
Source: BPM Partners “The Pulse of Performance Management 2013”
Cloud:• No more drive-by software selling of large up-front software and hardware
purchases• Lack of infrastructure means you can start-small, then phase in additional
processes, departments, and users• Cloud vendors must win your business every year. They are more aligned to
meet customer expectations.
© 2013 Proformative. Proprietary and confidential
The Cloud Lowers EPM Project Risks
Budget overruns services
Selecting wrong vendor
Project stalls
Lack of end-user acceptance
Missed target dates
Budget overruns software
Doesn't meet expectations
0 10 20 30 40 50 60 70 80
EPM Project Risks
Percent of total respondents N=226
Source: BPM Partners “The Pulse of Performance Management 2013”
Cloud:• No hidden costs• Predictable ongoing subscription
© 2013 Proformative. Proprietary and confidential
The Cloud Lowers EPM Project Risks
Budget overruns services
Selecting wrong vendor
Project stalls
Lack of end-user acceptance
Missed target dates
Budget overruns software
Doesn't meet expectations
0 10 20 30 40 50 60 70 80
EPM Project Risks
Percent of total respondents N=226
Source: BPM Partners “The Pulse of Performance Management 2013”
Cloud:• Faster implementation, less implementation fatigue
© 2013 Proformative. Proprietary and confidential
The Cloud Lowers EPM Project Risks
Budget overruns services
Selecting wrong vendor
Project stalls
Lack of end-user acceptance
Missed target dates
Budget overruns software
Doesn't meet expectations
0 10 20 30 40 50 60 70 80
EPM Project Risks
Percent of total respondents N=226
Source: BPM Partners “The Pulse of Performance Management 2013”
Cloud:• Only need a browser• No VPN interruption issues• Single-sign-on• Consumer-web design• Clicks-not-code• Drag-and-drop UI
© 2013 Proformative. Proprietary and confidential
The Cloud Lowers EPM Project Risks
Budget overruns services
Selecting wrong vendor
Project stalls
Lack of end-user acceptance
Missed target dates
Budget overruns software
Doesn't meet expectations
0 10 20 30 40 50 60 70 80
EPM Project Risks
Percent of total respondents N=226
Source: BPM Partners “The Pulse of Performance Management 2013”
Cloud:• Shorter implementation means less fatigue• Finance administered, no IT burden• Less time required of finance to deploy
© 2013 Proformative. Proprietary and confidential
The Cloud Lowers EPM Project Risks
Budget overruns services
Selecting wrong vendor
Project stalls
Lack of end-user acceptance
Missed target dates
Budget overruns software
Doesn't meet expectations
0 10 20 30 40 50 60 70 80
EPM Project Risks
Percent of total respondents N=226
Cloud:• Fast pace of innovation means cloud vendors can catch-up on product
capabilities• Lower upfront cost as compared to on-premises systems means lower
switching costs
© 2013 Proformative. Proprietary and confidential
The Cloud Lowers EPM Project Risks
Budget overruns services
Selecting wrong vendor
Project stalls
Lack of end-user acceptance
Missed target dates
Budget overruns software
Doesn't meet expectations
0 10 20 30 40 50 60 70 80
Percent of total respondents N=226
Source: BPM Partners “The Pulse of Performance Management 2013”
Cloud:• Lower % of software costs (typically 25-75% rather than 100%-400%)• Clicks-not-code mean no expensive consultant needed to modify application
© 2013 Proformative. Proprietary and confidential
Why Software Buyers Choose The Cloud
Source: Forrester, April 2012, “The Changing Cloud Agenda”. Base 920 software decision-makers at firms
Improved business agility
Improved focus
Speed of implementation
Faster releases
Lower overall costs
OpEx not CapEx
Why Did You Choose Cloud?
© 2011 Proformative. Proprietary and confidential
• Security, privacy
– No more Excel security risks– No more out-of-date/un-patched software – no wait for patches– Granular security and privacy controls – Regular penetration testing and audits – Encryption
• Service interruption
– Service-level agreements that are typically higher than internal IT– No disruptive upgrades– Redundant, geographically distributed data centers
Is The Cloud Secure?
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Consider Platform Risk
Source: BPM Partners “The Pulse of Performance Management 2013” N=226
Would you or have you considered a Cloud-based EPM solution?
2012 2013
Cloud 57%
Cloud 62%
“We expect SaaS to become the primary FPM deployment model within three to five years.” - Paul Hamerman, VP Principal Analyst, Forrester Research
© 2013 Proformative. Proprietary and confidential
Summary
• Excel and email are not ERP/BI/EPM solutions
• Extensive historic EPM deployment
• All enterprise applications are moving to the cloud
• EPM is very much part of this wave
© 2012 Proformative. Proprietary and confidential
Thank You
THE RESOURCE FOR CORPORATE FINANCE, ACCOUNTING & TREASURY PROFESSIONALS
Reducing Risk in a Dynamic Environment with the CloudShane Riddle Manager FP&APlanar Systems, INC
© 2013 Proformative. Proprietary and confidential
Introduction to Planar
Planar is your choice for Premier Display SolutionsFrom desktop monitors to video walls. From information to inspiration. Industry leaders rely on Planar’s differentiated digital display technology for a range of applications.
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Introduction to Planar
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ARCHITECTURAL DISPLAYS
DESKTOP & TOUCH MONITORS
LCD VIDEO WALLS
TRANSPARENT DISPLAYS3D DISPLAYS
REAR PROJECTION VIDEO WALLS AND IMAGE PROCESSING LARGE FORMAT LCDS
OUTDOOR DISPLAYS
Planar Products
Planar products also include open frame and ruggedized displays and luxury home theater projectors
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Clarity Matrix LCD Video WallChesapeake Energy ArenaHome of the NBA’s Oklahoma City Thunder
Planar Products
© 2011 Proformative. Proprietary and confidential30
Confidential | Planar Systems
30
Clarity Matrix LCD Video WallPavillon De L’ Arsenal — Museum in Paris, France
Planar Products
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Financial Risk• Missing plan• Compliance risk• Confidentiality risk
Technology Risk• Service-level risk• System failure• Complexity risk
Three Buckets Of Risks
Team Risk• Team retention• Key-man risk
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Challenge• Missing plan• Surprise miss• Currency risks
Solution• One source-of-truth• Leading indicators• Accountability across the org• Real-time data
Turn To EPM Solution To Minimize Plan Risk
© 2011 Proformative. Proprietary and confidential
Challenge• SEC Compliance• Yearly process• Audit costs• Weak security with spreadsheets• Highest risk is insiders who have
access to data
Solution• “Audit-as-a-Service”
– SOX compliant– SSAE-16 Soc 1&2
• Audit trails minimize audit costs• Strong security• Lock-down access
Turn To Cloud-based EPM To Minimize Compliance Risk
© 2011 Proformative. Proprietary and confidential
Challenge• Keep HR and comp info private• Weak privacy with spreadsheets• Risk of leakage by internals with
special access
Solution• Lock-down access• Roll-up info without employee
names• No internal access• Fully-encrypted at all points
Turn To Cloud-based EPM To Minimize Confidentiality Risk
© 2011 Proformative. Proprietary and confidential
Challenge• Long ERP implementation• Units flying blind• Pressure on finance for answers
• Upgrade risks• Lot of effort to manage• Quarterly patches for security
updates
Solution• Short EPM implementation• Bridge transition• Validate ERP data
• No more upgrades• No time wasted• No more patches
Turn To Cloud-based EPM Solution To Minimize Service-level Risk
© 2011 Proformative. Proprietary and confidential
Turn To Cloud-based EPM To Minimize System Failure Risk
Challenge• On-premises physical system failure• Ongoing hardware requirements• Lots of infrastructure to keep-up• Expensive
Solution• Cloud infrastructure
– World-class data-centers– Redundancy
• Service level agreement• Lower total cost of ownership
© 2011 Proformative. Proprietary and confidential
Challenge• Managing too many systems• Requires more IT staff• Lots of maintenance contracts
Solution• System rationalization• Reduce headcount• Save a ton of money• Reduce complexity
Turn To Cloud-based EPM To Minimize Complexity Risk
© 2011 Proformative. Proprietary and confidential
Turn To Cloud-based EPM To Minimize Team Retention Risk
Challenge• Exit interviews revealed that
antiquated systems contributed to talent churn
• Want to be analysts yet sucked into system dev. work
Solution• Provide modern tools and best
practices to retain talent• Excited to be analysts again
© 2011 Proformative. Proprietary and confidential
Challenge• If I get hit by a bus, can someone
pick-it up• Turn-over is a fact of life
Solution• Chose systems that are easily
learnable
Turn To Cloud-based EPM To Minimize Key-man Risk
© 2012 Proformative. Proprietary and confidential
Thank You
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