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Transforming Finance Through Analytics

Jenny Hellström11 Oct, 2011

jenny.hellstrom@se.ibm.com mobile: +46.70.793.29.49

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Denmark for me!

Anne Phil

Brottet

De utvalda

Livvakterna

Frihet!

Legoland!

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Businesses are challenged by rapid change

Years to reach 50M users:

RadioRadio TVTV InternetInternet FacebookFacebook

Supplier lead time is 62% faster than just two years agoSupplier lead time is 62% faster than just two years ago

38 years 13 year 4 year 2 year

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The role of the CFO’s is changing

Advisor (e.g., analysis and insight)Decision Maker (e.g., create a plan)

Enterprise cost reduction management

Selection of key performance indicators

Capital asset management

Risk management

Prioritization of resource allocation

Strategic revenue planning

Business model innovation/ reshaping

Information management strategy

Elevated Role of FinanceRole of Finance in Driving Decisions Across the Enterprise

45%

47%

34%

41%

53%

54%

59%

39%

44%

41%

50%

42%

26%

24%

19%

33%

Over 70% of CFOs believe they have an advisory or decision making role on the Enterprise agenda.

Source: 2010 IBM Global CFO study

In the Nordics it was 90%!

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…Improve effectiveness on the enterprise agenda

34%

28%

26%

21%

16%

9%

28%

35%

23%

Core Finance

EnterpriseFocused

CFO Agenda: Importance vs. Effectiveness

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GAP

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Importance

Effectiveness

Driving integration of information across the enterprise

Providing inputs into enterprise strategy

Supporting / managing / mitigating enterprise risk

Driving enterprise cost reduction

Strengthening compliance programs and internal controls

Driving Finance functioncost reduction

Executing continuous Finance process improvements

Developing your people in the Finance organization

Measuring / monitoring business performance

RANK

0% 20% 40% 60% 80% 100%Source: 2010 IBM Global CFO study

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Efficiency Challenges

- due to issues related to automation and standards

Source: 2010 IBM Global CFO study

Finance continues to spend nearly 50% of time on transactional activities

Over 25% lack the necessary common data

definitions and processes

Nearly 40% of enterprises produce financial metrics

manually

Over 35% lack a common reporting platform

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Business Insights Challenges

- staff, technology and analytic capabilities strategic insights

Source: 2010 IBM Global CFO study

44% are poor to average at anticipating

external forces

Over 50% manually producing operational

metrics

Nearly 50% lacka common

planning platform 55% not satisfied withtheir operational planning

and forecastinganalytical capability

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4 Finance profiles

Finance Efficiency

Business InsightLow High

Low

High

23%

12%

32%

33%

Standard data

definitions

Standard Chart

of Accounts

Standard

processes

Corporate

philosophy of

information

standards

Operational planning

capability

Finance

talent development

Common

planning

platform 85%Source: 2010 IBM Global CFO study

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General Accounting & Financial statement

reporting

Provide a CFO dashboard with an enterprise focus

Planning & Performance Management

CFO DashboardAnticipate & Shape

Trusted Information

Or....IBM Cognos Dashboard

Jenny Hellström

Scenario & Predictive analytics

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General Accounting

Automate production of key financial metrics

Dynamic reporting

Ad-hoc Analysis

Business self-service

CFO DashboardAccount & Control

Accounts Receivables& Payables Asset

Analysis

Balance Sheet & General Ledger

Customer Payment History

Days Sales Overdue

Product & Sales Analysis

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Financial statement reporting

CFO DashboardControl & Confidence

Product & Sales Analysis

External Reporting (SEC, HMRC, etc)

Internal Financial and Management Reporting

Integrated XBRL tagging solution

Regulatory Reporting

Public Sector Reporting

Corporate Social Responsibility (CSR) Reporting

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Planning & Performance Management

Incorporate KPIs from revenue, expense, workforce, capital and operational plans and forecasts

Integrate what-if scenario planning

Evaluate performance gaps

CFO DashboardVisibility & Control

+3%+3%

RevenueRevenue

WorstWorst

BaseBase

BestBest

-7%-7%

+0%+0%

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Predictive Analytics: Moving Forward

Ensures that the interactions are the right ones at the right times for the right customers with the right relevance.

Predict future outcomes

Algorithms that automatically “learn” significant patterns

Deployed into business process for dynamic decision making

CFO DashboardVisibility & future outcome

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Where to create the CFO-dashboard?

New unified workspace:

Self service dashboard assembly

Interact & analyze

Share & collaborate

Search assisted authoring

Data exploration & ability to “do more”

Faster time to better decisions

Powerful analysis and in-place data exploration

Better utilization of existing BI assets

Business User self service

Reduces IT bottlenecks

Benefits

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Jenny Hellström, FPM Swat team Nordics +46.70.793.29.49 jenny.hellstrom@se.ibm.com

If you have questions! Please stay and talk with me after the session!