WEBINAR Translating Finance to Strategy

1. WEBINARTranslating Finance to Strategy How FP&A Can Win Executive Friends, Influence Corporate Strategy, and Improve Shareholder Returns 40% By Doing What They Do Anyway

2. Agenda • The Strategy – Execution Gap • Finance at the Nexus • Common Challenges to FP&A • Translating Finance to Strategy • Calculating the ROI

3. Big thinking, marginal results Source: McKinsey & Company study (2012) Most companies allocate the same resources to the same business units year after year. That makes it difficult to realize strategic goals and undermines performance.

4. Strategy and targets are usually not linked

5. Execution isn’t easy Strategies are a lot easier to communicate than to execute

6. Agenda • The Strategy – Execution Gap • Finance at the Nexus • Common Challenges to FP&A • Translating Finance to Strategy • Calculating the ROI

7. Finance is expected to execute strategy Here’s the Corporate Strategy Context. Thanks. Great context for the budget. How do I translate this into budgets which maintain continuity and fit into corporate targets?

8. We look for ways to reduce the gap CFO’s Know Technology to Support Decision Making is Inadequate • …So we revert to what we know Source: Gartner/FERF presentation at FEI Summit Leadership Conference, May 2013 Source: modified template from CPM Methods consulting engagement 2012

9. Agenda • The Strategy – Execution Gap • Finance at the Nexus • Common Challenges to FP&A • Translating Finance to Strategy • Calculating the ROI

10. Guidance is usually too limiting All budget requests should be within 3% Can you make me a slide that shows how this budget reflects our strategic goals? Leadership What’s the point? Finance Executive Business Units ---- Functions ---- Regions

11. Make guidance more specific

12. Data can be ambiguous We’re not sure how to provide scores to correlate with corporate goals? How confident are you in this assessment of our corporate goals? Leadership That’s okay, just do your best Here is our consolidated outlook… “4” means it is not a “5” “4” means higher than average correlation “4” means strong correlation Business Units ---- Functions ---- Regions

13. Minimize ambiguity; maximize the systemic

14. Circumvention is too easy The gap makes it easier for strong business leaders to get supplemental budget, effectively widening the gap through end runs. If I’m going to hit these revenue targets I need some margin relief and more budget I can probably find this in the corporate pot somewhere

15. Make sure end runs can be put in context

16. “Improvements” are incremental “Improved” Planning Tools, Business Intelligence Tools do not address the gap Thanks. Even better context for the budget Based on your improved analytics, here’s the new and improved corporate strategy presentation Still not sure how I translate this into budgets which maintain continuity and fit into corporate targets?

17. Link strategic goals and budgets

18. Agenda • The Strategy – Execution Gap • Finance at the Nexus • Common Challenges to FP&A • Translating Finance to Strategy • Calculating the ROI

19. Bidirectionally translating finance and strategy

20. FPG is unique solution Funding Profiles Feature Function BI, CPM, ERP Dashboard /Scorecard Modeling Construct Library Preconstructed Queries Strategy Visualized

21. Agenda • The Strategy – Execution Gap • Finance at the Nexus • Common Challenges to FP&A • Translating Finance to Strategy • Calculating the ROI

22. There is a material impact on the bottom line Companies that evaluate the performance of business units, acquire and divest assets, and adjust resource allocations based on each division’s relative market opportunities will be worth an average of 40 percent more after 15 years. Using Funding Profiles helped us gain actionable insight into our strategic plan and helped us bridge our long-range plan with our operating budget. Vice President of Finance and Investor Relations at Advent Software (NASD:ADVS)

23. A typical ROI case

24. Q & A

25. Thank You