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Budgeting & Forecasting Finance Research
SAP Budgeting, Planning and Forecasting SurveyJANUARY 2014
Budgeting & Forecasting Finance Research
Industry Segmentation
Automotive
Entertainment & Leisure
Advertising & Marketing
Construction, Machinery, and Homes
Food & Beverages
Nonprofit
Retail & Consumer Durables
Healthcare & Pharmaceuticals
Insurance
Finance & Financial Services
Government
Manufacturing
Telecommunications, Technology, Internet & Electronics
Utilities, Energy, and Extraction
Other (please specify)
0.00% 5.00% 10.00% 15.00% 20.00% 25.00%
66Resp
Budgeting & Forecasting Finance Research
Geographic Locale of respondents
United Kingdom; 30.30%
Ireland; 3.06%
Singapore; 4.55%
Hong Kong; 3.03%
Malaysia; 7.58%
Other; 48.48%
66Resp
Budgeting & Forecasting Finance Research
ERP Type
All In One76%
ByDesign2%
B15%
Other17%
63Resp
Budgeting & Forecasting Finance Research
Tools in Use
A budget tool accessed over the internet
Just SAP
A specialized budget tool on the corporate network
A custom built budget tool
Other (please specify)
Microsoft Excel
A combination of a tool, spreadsheets and SAP
Just SAP and Spreadsheets 35%
20%
20%
62Resp
Budgeting & Forecasting Finance Research
Microsoft Excel versions
Excel 2000 (v9.0)
Excel 2002 (v10.0)
Excel 2003 (v11.0)
Excel 2007 (v12.0)
Excel 2010 (v14.0)
Excel 2013 (v15.0)
54%
63Resp
Budgeting & Forecasting Finance Research
The most difficult part of month end
Adjusting Journals
Variance Analysis
Allocations
Workflow
Reporting
Consolidations
Other
0 5 10 15 20 25 30
54Resp
Budgeting & Forecasting Finance Research
Principal planning process pain
Lack of detail
Proper data gathering
Collaboration & participation
Performance against plan assessment
Absence of driver based forecasting
Workflow
Reporting
56Resp
Budgeting & Forecasting Finance Research
How many users are involved in planning processes
1-19
20-49
50-100101-249
250+
0
20
40
56Resp
Budgeting & Forecasting Finance Research
Participant locations
Multilo-cation;
89%
SingleLocation; 11%
Mul-ticountry; 53.57
%
Onecountry; 46.43%
56Resp
Budgeting & Forecasting Finance Research
Budget frequency
Yearly Budget Only
Yearly Budget and Monthly Forecast
Yearly Budget, Monthly Forecast and Weekly Flash
Multiple versions without a consistent process
other
56Resp
Budgeting & Forecasting Finance Research
Sources for variance analysis
Single tool29%
Multiple systems71%
Single tool Multiple systems
56Resp
Budgeting & Forecasting Finance Research
Can you do flexible comparisons of actual/plan?
Yes and it is adequate
Yes but it is inadequate
No we don't need it
No but we would like it
Don't know
other
56Resp
Budgeting & Forecasting Finance Research
Does your company use a rolling forecast?
No, and we have no interest in doing so
No, but we would like to
Yes, but it does not suit our needs
Yes, and it functions as desired
56Resp
Budgeting & Forecasting Finance Research
Organization hierarchies
Province2%
Other2%
Legal Entity4%
Country7%
Regional9%
Division11%
Centralized21%
Business Unit45%
56Resp
Budgeting & Forecasting Finance Research
Budget areas of concern
Salaries & Wages Projects Indirect costs/overheads Capital Funds/Grants None of these
61% 61%
70%
50%
18%
11%
56Resp
Budgeting & Forecasting Finance Research
Budgeting methods used (non Sales)
Responsibility Center Management
Activity Based Budgeting
Incremental Budgeting
Zero Based Budgeting
Performance Based Budgeting
Not Applicable - I indicated I am not involved in any of the above budget
areas
Other (please specify)
43%
30%
36%
32%
14%
9%
2%
56Resp
Budgeting & Forecasting Finance Research
The most important budgets
Salaries & Wages
Projects
Indirect Costs/Overheads
Capital
Funds/Grants
Other
27%
13%
32%
18%
4%
2%
53Resp
Budgeting & Forecasting Finance Research
Important budget challenges
Lack of detail
Proper data gathering
Collaboration & participation
Performance against plan assessment
Absence of driver based forecasting
Workflow
Reporting
Other (please specify)
53Resp
Budgeting & Forecasting Finance Research
Cited reasons for challengesRegulations; 2%
ROI; 5%
Data Distri-bution; 17%
Lead Times; 17%
Market Volatil-ity; 20%
Complexity; 29%
Data Quality; 32%
41Resp
Budgeting & Forecasting Finance Research
What variance is considered significant 1%
2%
3%
4%
5%
6%
7%
8%
9%
10%11%
12%
13%
14%
15%
16%
17%
18%
19%
20%
0
10
20
51Resp
Budgeting & Forecasting Finance Research
Budget philosophy
Bottom Up
29%
Other35%
Top Down35%
• Top down and bottom up which is the main issue.
• Our budgeting is bottom up but we are often asked to find savings when all the budgets have been consolidated.
• Mostly a mixture of top down and bottom up.
• It always starts as bottom up but ends up as top down....
• Mixed. Bottom up data is gathered and presented to management. Management issues certain guidelines based on which we (the budgeting team) negotiate with the various functions.
• The most likely scenario along with a number of scenarios are made and presented to management who then decide.
52Resp
Budgeting & Forecasting Finance Research
Is non sales budget accuracy used as an incentive?
Yes35%
No65%
52Resp
Budgeting & Forecasting Finance Research
Is non sales budget accuracy improving?
Yes60%
No13%
Not Sure27%
52Resp
Budgeting & Forecasting Finance Research
Using SAP ERP
Yes56%
No17%
Unsure27%
52Resp
Budgeting & Forecasting Finance Research
Cost Center transactions used
KPF7 - Display CElem./Acty Input Planning
KPE7 - Display Revenue Element Planning
KPE6 - Change Revenue Element Planning
KPC7 - Display activity input planning
KO22 - Change Order Budget
KP47 - Display Statistical key
OKOB - CO Orders: Budgeting profiles
KPD6 - Change Statistical Key Figure Planning
KP26 - Activity and Price Planning Maintenance
KP46 - Change Statistical Key Figure Planning
KP07 - Display/Planning Primary Costs
KOAB - Order Types: Budget Profile
KPF6 - Cost Element Planning
KP06 - Change Cost Element/Activity Input 100%
50%
13Resp
Budgeting & Forecasting Finance Research
Project Systems transactions used
CJ40 Change Project Plan
CJS2 - Change Statistical Key Figure Planning
CJ34 - Project Budget Transfer
CJR2 - Project Systems Cost Elements
CJ38 - Budget Return in Project
OPS9 - Budget Management Profile PS
CJ30 - Change Project Original Budget
CJ37 - Budget Supplement in Project
7Resp
Budgeting & Forecasting Finance Research
ABC transactions used
CP46 - Change Statistical Key Figure Planning
CP06 - Change Business Process Planning Cost Elements/Activity Inputs
CP26 - Change Business Process Planning Quantities/Prices
CP47 - Display Business Process Planning Statistical Key Figures
100%
2Resp
Budgeting & Forecasting Finance Research
Profit Center transactions used
7KE5 - Change Statistical Key Figure Planning
7KE3 - Plan Inventory Maintenance
7KE1 - Plan Costs and Revenues Maintenance
5Resp
Budgeting & Forecasting Finance Research
Profitability analysis transactions used Only one respondent out of
the 13 transactional respondents indicated that they are using KEPM
1/13Resp
Yes92%
No8%
Budgeting & Forecasting Finance Research
Public sector transactions used
FMBBC - SAP Budgeting Workbench
KOCO - Budget Carryforward for Orders FI - Funds Management
IM32 - Change Budget of Inv. Prog. Position Investment Management - Investment Programs
IM52 - Process budget distribution Investment Management - Investment Programs
CJCO - Carry Forward Project Budget FI - Funds Management
80%
5/13Resp
Budgeting & Forecasting Finance Research
Plant Maintenance transactions used
5/13Resp
Only five respondents out of the 13 transactional respondents indicated that they are using KO22
Yes
28%
No72%
Budgeting & Forecasting Finance Research
Real Estate transactions used
Only two respondents with one using FOKP and one FOKX
2/13Resp
Budgeting & Forecasting Finance Research
Special purpose ledgers1/13Resp
Only one respondent using GP12N
Budgeting & Forecasting Finance Research
Cost object controlling
KK17 Display Periodic Cost Object Planning Cost Elements
KK16 Change Periodic Cost Object Planning Cost Elements
KK47 Display Periodic Cost Object Planning Statsitical Key Figures
KK46 Change Periodic Cost Object Planning Statsitical Key Figures
66%
3/13Resp
Budgeting & Forecasting Finance Research
Most commonly used to create
The results to this question were mixed with no significant indicators however the follow on responses indicated
57% felt that what they used to create budgets was easy to use
79% restricted access to this tool/transaction
All respondents relied heavily on standard or custom reports to review the data
92% felt that the review mechanisms were easy to use
43% provide access to the review mechanisms to many users
10/13Resp
Budgeting & Forecasting Finance Research
Maintaining the numbers from Excel
We manually load the data
72%
We have a cus-tom program;
6%
We don’t bother; 22%
18Resp
Budgeting & Forecasting Finance Research
No of objects per new cycle
<10
10-49
50-100
>100
11%
28%
6%
56%
18Resp
Budgeting & Forecasting Finance Research
No of objects per minor cycle
<10
10-49
50-100
>100
17%
22%
17%
44%
18Resp
Budgeting & Forecasting Finance Research
Are budgets adjusted mid year?
Yes75%
No; 19%
Not Sure; 6%
16Resp
Budgeting & Forecasting Finance Research
Would Workflow Help?
Is workflow used for adjustments*?
*Adjustments are classified as reallocations or reassignments
No; 41%
Not Sure; 12%
Yes47%
17Resp
Yes; 44%
No; 6%
Unsure50%
Budgeting & Forecasting Finance Research
How long is the budget cycle?1-10 days
31 - 60 days
61 - 90 days
More than 90 days
16Resp
Budgeting & Forecasting Finance Research
Biggest impact of delayed decisions
Reporting delays
Manual data maintenance and workarounds
Number goals become moving targets
Key Performance Indicator relevance
10Resp
Budgeting & Forecasting Finance Research
Using BPC & Classic Planning In SAP
Respondents using BPC23Resp
Yes35%
No; 65%
Yes33%
No; 67%
Budgeting & Forecasting Finance Research
How is BPC performance
Adequate
A struggle
Delayed
Excellent
44%
22%
22%
11%
9Resp
We’re using HANA!
Budgeting & Forecasting Finance Research
Is BPC sufficient?
No
Unsuitable for operational views
Unsuitable for strategic views
Its' OK
33%
11%
44%
11%
9Resp
Budgeting & Forecasting Finance Research
BPC Reporting
We do not run reports from BPC
We run only some reports from BPC and it is fast enough
We only run only some reports from BPC because it is slow
We do all reporting from BPC and it is ok
Other
0%
25%
25%
38%
13%
8Resp
Budgeting & Forecasting Finance Research
Satisfaction with BPC
No
Somewhat
Yes
Other
22%
56%
11%
11%
9Resp
Main Complaints:SlownessShortage of Skilled resources to manage it
Main praise:Easy to useSingle place to go for the data
Budgeting & Forecasting Finance Research
Conclusions
The data sample was smaller than we hoped for however it is indicative
SAP classic planning transactions are still widely used
Manually maintaining the data for classic planning transactions is still prevalent
Budgeting cycles are for the most part taking too long and this erodes effectiveness and relevance
Workflow solutions are data maintenance and decisions would be advantageous
BPC is evolving and the consensus is that new versions bring a better experience
Of particular significance is that SAP customers running BPC on HANA are having a much better experience than those on legacy
Budgeting & Forecasting Finance Research
Follow up comments/questions
Clinton JonesDirector of Solution Management for [email protected]
Learn More about Winshuttle for Budgeting Planning and Forecasting at
http://www.winshuttle.com/financial-sap/budget-planning/