2. Global CFO Study 2010
Geography Enterprise Size (US$) Sector
>$20B,
Others, 1%
Asia Pacific, Americas, 14% Communications,
>$10B to <=$500MM, Public, 13%
27% 31% $20B, 7% 25% 13%
>$5B to Industrial, Distribution,
$10B, 11% 25% 28%
$501MM to
$1B, 15%
EMEA, 42% >$1B to $5B, Financial Services, 20%
28%
Title Scope of Role
BU / Program
SVP / Others, 8% Area, 5%
Controller /
Treasurer, 14% Country,
27%
CFO / Deputy Enterprise /
CFO / Director, Global, 57%
78% Region,
11%
3. Increased pressure
Industry / Sector Changes Over the Next Three Years
Pressure to reduce cost base 78%
Need for faster decision making 74%
Demand for external transparency (e.g., 69%
Board, shareholders, taxpayers, regulators)
Product / service demand growth 61%
Ability to attract and retain talent 56%
Potential access to short-term liquidity / long-
40%
term capital
As a result of these factors, ~60% of Finance
organizations believe that they have to make
major changes to respond.
4. Role of finance
Elevated Role of Finance
Role of Finance in Driving Decisions Across the Enterprise
Enterprise cost reduction
management
45% 44% 89%
Selection of key
performance indicators 47% 41% 88%
Capital asset
management
34% 50% 84%
Risk management 41% 42% 83%
Prioritization of resource
allocation 53% 26% 79%
Strategic revenue planning 54% 24% 78%
Business model
innovation / reshaping
59% 19% 78%
Information management
strategy
39% 33% 72%
Advisor (e.g., analysis and insight) Decision Maker (e.g., create the plan)
Over 70% of CFOs believe they have an
advisory or decision making role on the
Enterprise agenda.
5. Expectation gap Importance
Effectiveness
CFO Agenda: Importance vs. Effectiveness
Rank Gap
Developing your people in the Finance
49% 84% 35%
organization
Executing continuous Finance process
55% 83% 28%
Core improvements
Finance Strengthening compliance programs and
59% 75% 16%
internal controls
Driving Finance function cost reduction 52% 61% 9%
Driving integration of information across
39% 73% 34%
the enterprise
1 Providing inputs into enterprise strategy 52% 80% 28%
Enterprise Supporting / managing / mitigating
51% 77% 26%
Focused enterprise risk
Measuring / monitoring business
2 performance
62% 85% 23%
3 Driving enterprise cost reduction 59% 80% 21%
0% 20% 40% 60% 80% 100%
6. Efficiency and Business
Insight
High
Corporate
philosophy of
information
standards
Standard Chart
of Accounts
32% 23%
Finance
Efficiency
Standard data
definitions
Standard
processes Low 33% 12%
Low High
Business Insight
Operational planning Common
Finance
and forecasting planning
talent development
capability platform
7. Quantifiable benefits
Efficiency + Business Insight Contributes to Outperformance
Revenue Growth EBITDA Return on Invested Capital
5-year CAGR, 2004-2008 5-year CAGR, 2004-2008 5-year average, 2004-2008
14.0% 11.3% 12.1%
Finance Efficiency
9.8% 3.9% 10.2%
9.0% 9.3% -2.1% -0.1% 7.8% 11.6%
Business Insight Business Insight
Value Integrators also have an almost
20% better operating efficiency ratio than
all other companies examined.
8. Theme #1
•Delivering efficiency through standards matters
more than ever
•Providing business insight drives performance
improvement beyond finance
•The greatest rewards come from doing both well
“In the next three years, change will drive the “Finance has undertaken a number of initiatives
criticality of decision support. Therefore, we to underpin growth, in particular the
must find better ways to do transaction establishment of a shared service center. This
support and control activities with improved has enabled us to respond much more quickly,
processes and more automation.” close in days not weeks, undertake rapid process
change and reduce costs.”
Bob Driessnack
CFO, Intermec Inc. Richard Yu
VP Finance, Aviva-Cofco Life Insurance, Co. Ltd
9. Efficiency Accelerators
Implementation of a Common Ledger and
Adoption of Process Ownership Accounting Transaction Applications
Enterprises Enterprises
with high
with high 91%
81% Finance
Finance efficiency
efficiency 47%
145% more
more All other
62%
All other enterprises
33%
enterprises
Adoption of Alternative Delivery Models
Enterprises
with high
49%
Finance
efficiency
69%
more
All other
29%
enterprises
10. Theme #2
•Delivering efficiency through standards matters
more than ever
•Providing business insight drives performance
improvement beyond Finance
•The greatest rewards come from doing both well
“For multinational companies, regulatory and “Business analytics is one of our most critical
political changes can happen arbitrarily at Finance initiatives. We need to have the
any time, significantly impacting the right people and tools and stay very close to
execution of strategy. As a result, planning the business.”
must be much more scenario-based with the
Mike Newman
ability to rapidly adapt.”
CFO, Office Depot
Markus Kistler
CFO - North Asia and China, ABB
11. Business Insight
• Where exactly is the • What will happen next?
Key problem?
• What happened? • What if these trends
Business • Why is this happening? continue?
• How many, how often?
Questions • What actions are • What are the risks or
needed? opportunities?
Rear View Current View Forward-Looking View
• Balance sheet, profit • Customer, product and • Cash forecasting
and loss, and cash flow market profitability • Scenario-based
Examples statements • Spend optimization planning and
of • Revenue and cost • Working capital analysis forecasting
Business variance analysis • Market, customer and • Strategic investment
Insight channel pricing decision support
• Sales and supply chain • Volatility and risk-based
effectiveness predictive and
behavioral modeling
12. Business Insight Challenges
Lack of a common 49%
planning platform 49%
Not statisfied with
operational planning and 61%
forecasting analytical 55%
capabilitiy
Operational metrics 49%
produced manually 53%
Poor to average at 48%
anticipating external
forces 44%
ANZ Global
13. Anticipate External Forces
ANZ Global
Finance Finance
organizations organizations
with strong 75% with strong 71%
business % Better business % Better
insight insight
70% 34%
All other All other
44% 53%
enterprises enterprises
14. Timely Metrics
ANZ
High Automation Impact on Analytics Satisfaction
Finance
organizations Enterprises that automate
with strong 83% % More the production of financial 42% % Better
business metrics
Financial insight 26% 31%
Metrics
All other
66% All other enterprises 32%
enterprises
Finance
organizations Enterprises that automate
with strong 79% the production of 52%
% More % Better
business operational metrics
Operational insight
Metrics 93% 116%
All other
41% All other enterprises 24%
enterprises
15. Non-Financial Data
Statements
High Adoption of Non-Financial Data Standards
ANZ Global
Finance Finance
organizations organizations
with strong 70% % More with strong 55% % More
business business
insight 169%
insight 49%
All other All other
26% 37%
enterprises enterprises
16. Theme #3
•Delivering efficiency through standards matters more
than ever
•Providing business insight drives performance
improvement beyond Finance
•The greatest rewards come from doing both well
“What makes companies stand out from one “Our job is to focus the enterprise on making
another is the ability to use analytics across timely, risk-based decisions by providing
the end-to-end business model. Greater access to the right business-relevant
transparency from one end of the business information and insight-driven analytics.”
to the other is key.”
Mark Buthman
Dennis Hickey CFO, Kimberly Clark Corporation
VP - Corporate Controller, Colgate Palmolive
17. Efficiency and effectiveness
Value Integrators
Scorekeepers Disciplined Constrained Value Constrained Advisors
(Baseline) Operators Advisors Integrators Disciplined Operators
0% 19% Better 33% Better 59% Better Scorekeepers
Driving integration of information across
the enterprise
Measuring / monitoring business
performance
Developing your people in the Finance
organization
Providing inputs into enterprise strategy
Executing continuous Finance process
improvements
Supporting / managing / mitigating
enterprise risk
Driving Finance function cost reduction
Driving enterprise cost reduction
Strengthening compliance programs
and internal controls
0% 20% 40% 60% 80% 100% 120% 140%
Percent more effective than baseline
18. Paths to Higher Value
High efficiency enabled by process Value Integrators can maintain
and Finance data standards their advantage through a program
suggests Disciplined Operators High of continuous improvement to
focus on maturing business insight sustain capabilities and value
and partnering capabilities
Finance
Efficiency
Scorekeepers can attempt a direct Constrained Advisors have good
path to become Value Integrators. business insight, constrained by
This will involve establishing structural complexity, therefore
Finance efficiency while Low address process and data
simultaneously building business Low High standards to improve efficiency,
insight capabilities. Alternatively, a Business Insight accuracy and speed
staged approach can also be done
