E P R E nterprise P erformance R eporting

1. EPR Enterprise Performance Reporting A Fundamentally Better Way to do Business TM

2. Performance Reporting • The need for up-to-date information on the financial and non-financial performance continues to increase.  Accounting departments are expected to close the books in shorter time frames. Working faster or even smarter is no longer enough.  • Management and owners are expected to manage the business to the benefit of different, often conflicting, stakeholders.

3. Why Measure Performance? • Strategic Alignment of Objectives • Clear Responsibilities and Objectives • Effective Control • Optimized Resource Allocation • Anticipation of Trends

4. Problems with Most Measurement Systems • Too much data that no one uses • Lack of relevant detail • Measures that drive the wrong performance and discourage teamwork • Incongruent goals across the organization

5. The Keys to Effective Measurement • Less is More (K.I.S.S.) • Linkage to Vision, Values and Key Success Factors • Data must be available, consistent, complete, timely and reliable • Metrics should flow down to all levels • Metrics must be manageable

6. Measuring Financial Performance • Financial reports must contain the data that managers need to manage • Financial reports are useless if they aren’t read or acted upon • Timing is of the essence

7. Incorporating non-financial measures • Link to long-term organizational strategies • Identify drivers of success • Better indicators of future financial performance • Non-financial measures are less susceptible to external noise • Need to understand causal links

8. Non Financial Measures • Customer Satisfaction • Quality • Process Performance • Supplier Performance • Employee Satisfaction

9. EPREnterprise Performance Reporting is: • A unified view of the organization • Top-down in concept / Bottom-up in achievement • Cost-Effective • Focused on the fundamentals • Incrementally implementable

10. EPRAchieves: • Lower operating costs • Higher profitability • Working together towards common goals • Focus on goals and growth • Everyone knows where the company is going • Match between Accountability and responsibility

11. EPR Implemention • Select the Right Measurements • Link to vision and strategy • Establish Goals • Translate Measurement into Action • Communicate Performance

12. Selecting the Right Measurements • Start with the Vision and Strategy • Categorize into Groups or Perspectives • Define objectives • Define meaningful metrics that will help to measure the performance against objectives • Understand Cause and Effect

13. Linking to Vision and Strategy • Vision and Mission Statements should change the way a company works • Define goals from the strategy • Define performance measures to understand performance against goals • Be careful of deceiving measures

14. Business Goals • Goals should include a measure • Avoid short-term goals inconsistent with strategy • Avoid inconsistent goals at different levels

15. Data Acquisition • Data must be accurate • It must be timely • It must be consistent • It must be cost-effectively collected

16. Using Performance Measures Effectively • Accountability must link to performance measures • Regularly review and analyze the measures • Use metrics for more than just keeping score • Communicate performance information • Establish priorities

17. Avoid the Pitfalls • Keeping results at the top • Development process too long • Treating EPR as an IT project • Using EPR only for compensation

18. Conclusions • Start with the Vision and Strategy to develop a balanced set of relevant metrics and dimensions • Base business performance measurement on a unified view of the organization • Think Information, not Data • Select an application that will facilitate analysis, & promote communication • Follow measurement with action

19. EPREnterprise Performance Reporting Only from