Webinar On Top Trends in Management Accounting

Overview:

Management accounting practices have become increasingly progressive since the 1980s. What are the trends? They include channel and customer profitability reporting, integration of enterprise performance management methods (e.g., strategy maps, balanced scorecard), driver-based rolling financial forecasts, applying analytics, and co-existing methods (e.g. lean accounting). Accounting professionals need mastery with these.

Ultimately costing principles, such as the causality principle, must be converted into practical practices with supporting tools. This presentation examines how cost modeling has evolved over the last century. It will describe the trends and obstacles that have helped or delayed developments. 

Finance and accounting professional are typically considered to be very quantitative. They are by nature number-crunchers. But collecting, validating, and reporting data is not the same thing as analyzing the information that can be gleaned from data. Most organizations are drowning in data, but starving for information.

The CFO function is experiencing a shift from beyond financial reporting to dealing with and reporting non-financial information. Finance people are increasingly involved with creating and monitoring performance measurements. But do they know how to identify the appropriate measures? Their task should not be about what can be measured but what should be measured. And don’t stop there. This is not about just monitoring the dials of a scorecard or dashboard, but moving the dials. The decisions involved to improve performance require analytics of all flavors. 

Most companies are far from where they want and need to be when it comes to implementing analytics and are still relying on gut feeling, rather than hard data, when making decisions. Volatility and complexity are the new normal. 

Why should you attend: Many organizations struggle answering these types of questions:

• What type of managerial accounting should we use in our organization?
• Are we measuring the right metrics?
• How well do our managers and employees understand our executive team’s strategy?
• If we are measuring key performance indicators (KPIs), are they “balanced” between financial outcomes and the non-financial measures related to customer loyalty, process improvement, employee learning & growth, and innovation?
• Are we measuring too many strategic KPIs where many are arguably operational performance indicators (PIs)?
• Are our product and service-line costs accurate? Or are our accountants mis-allocating indirect expenses (i.e., overhead support)?
• Do we measure non-product channel and customer costs to report profit or loss by each customer?
• How effective is our annual budgeting process? Does its benefit exceed the costs to produce it?
• Is the budget out of date within a few months after it is published?
• Do experienced managers “pad” their department’s budgets?
• Is consolidating cost center budgets bottom-up cumbersome?
• Do we understand incremental / marginal expense analysis classifying the behaviour of our resource capacity expenses as sunk, fixed, step-fixed, or variable based on the planning time horizon?
• Are many of our decisions based on intuition or experience rather than on fact-based data?
• How much competency does our organization have with analytics?
• How much resistance to change does our organization have that is slowing our adoption rate of progressive managerial methods?

Areas Covered in the Session:

• The expansion from product costing to include channel and customer profitability reporting and analysis
• The integration of managerial accounting with other enterprise and corporate performance management (EPM/CPM) methods (eg, the balanced scorecard, incentive compensation, risk management, supply chain management)
• The shift from historical reporting to predictive accounting (eg, marginal / incremental costing; rolling financial forecasts, performance-based and driver-based budgeting, customer lifetime value [CLV] )
• Imbedding analytics into managerial accounting (eg, correlation and segmentation analysis, recursive partitioning with decision trees)
• Acceptance of two or more co-existing managerial accounting methods
• Chargebacks to internal users and service level agreements of information technology (IT) and shared services
• Recognition of barriers slowing the adoption rate of advanced managerial accounting (eg, resistance to change, being held accountable, weak leadership) to gain buy-in

Who Will Benefit:

• CFO
• Financial Controller
• Accounting Staff
• CIO and Information Technology Staff
• Strategic and Business Planning
• Marketing and Sales Managers
• Budget Managers
• Risk Managers

Instructor:

Gary Cokins is an internationally recognized expert, speaker, and author in enterprise and corporate performance management improvement methods and business analytics. He is the founder of Analytics-Based Performance Management, an advisory firm located in Cary, North Carolina at www.garycokins.com . Gary received a BS degree with honors in Industrial Engineering/Operations Research from Cornell University in 1971. He received his MBA with honors from Northwestern University’s Kellogg School of Management in 1974. 

Gary began his career as a strategic planner with FMC’s Link-Belt Division and then served as Financial Controller and Operations Manager. In 1981 Gary began his management consulting career first with Deloitte consulting, and then in 1988 with KPMG consulting. In 1992 Gary headed the National Cost Management Consulting Services for Electronic Data Systems (EDS) now part of HP. From 1997until 2013 Gary was a Principal Consultant with SAS, a leading provider of business analytics software. 

His two most recent books are Performance Management: Integrating Strategy Execution, Methodologies, Risk, and Analytics, and Predictive Business Analytics. His books are published by John Wiley & Sons.