The Top 2 Essential Corporate Performance Management Tools for Businesses During COVID-19
As we all struggle to adjust to our new reality of social distancing and general economic uncertainty, it seems as if our expectations for the future are changing day-by-day, if not hour-by-hour.
It is hard to tell what next week will be like for businesses across the world, much less what next month will look like – or six months from now. However, with a good Corporate Performance Management (CPM) solution, your company can gain insight into a range of possible future scenarios, so you can start executing meaningful action items right now.
With the right CPM in your toolbox, you can get fast answers to pressing COVID-related questions, such as:
How will it impact my business if I let some employees go?
What can I expect for cash flow, as things stand now?
Which expenses should I cut – now and later?
Who are the customers that are slow to pay?
What is the best case scenario of COVID on my business… and the worst?
If you are not sure how to find those answers with your CPM, or if you are not sure whether your current system provides this critical information, this article will help.
What Are the Two Essential Capabilities of Corporate Performance Management During COVID-19?
If you already have and use a world-class Corporate Performance Management system such as Solver, Adaptive Insights, or Prophix, you can breathe easy. You already have access to the tools you will need to answer your COVID-related questions.
Those tools are:
1. Forecasting
Due to the ever-changing nature of the COVID-19 pandemic, nearly every company across the planet is having to throw out and replace their 2020 budgets right now. Forecasting on the fly can be difficult if you are working from spreadsheets but, with a highly effective CPM solution, you will have the freedom to run new forecasts for every twist and turn as the coronavirus situation unfolds.
Some of the best forecasts to run include:
Payroll modelling / forecasting
As a business leader, you already understand that it is possible you may have to let a few employees go or do a temporary salary cut before we all return to “business as usual.” This forecast helps you clearly identify the effect of your staffing strategy, so you can be more confident that you are making the right choice.
Sales modelling / forecasting
Perhaps you are not looking at staff reductions. Essential industries such as healthcare or food and health manufacturing are experiencing a steep rise in sales as a result of the coronavirus. However, whether your sales are on the rise or your company is facing a temporary slowdown, it is critical that you have accurate, timely insight into what you can expect for sales and revenues in 2020.
P&L, Balance Sheet, and Cash Flow forecasting
It is always a good business practice to keep a close watch on your P&Ls and Balance Sheets to make sure your financials are in order. With the abrupt market shifts we are all seeing right now, it is more important than ever to closely oversee changes in your operating, investing, and financing cash flows as you update your strategy.
2. Reporting
In an emergency, it can be difficult to sort through the sea of reports available to you from a Corporate Performance Management solution, so here is your quick guide to the essential reports you will need right now.
Multiple forecast versions compared
Gain insight into your organization’s best-case scenarios, worst-case scenarios, and everything in between using this easy-to-understand comparison report that maximizes your forecasting vision.
Actuals vs. Budgets are handy when your budget fits a predicted scenario, but we think it is safe to guess that your budgets do not quite match up with your reality right now. This report replaces your budgets with forecasts, so you can perform a more accurate actual vs. “budget” comparison that is based on the most up-to-date data.
Reports focused on vendor and payroll expenses
It may be time to cut expenses soon, so knowing which of your expenses are “expendable” may be critical information for your company. This report gives you the numbers you need, so you are prepared to cut back if and when that is required.
Customer aging receivables
Right now, every company across the world is anxious about the future and rethinking their expenditures – including your clients. By using reports focused on customer aging receivables, you will get quick and accurate insight into which of your customers or clients are late to pay, so you can check in instantly.
Not Using a CPM Solution Yet? There Is Still Time.
If you are relying on unwieldy spreadsheets or the limited reporting options included with your ERP, you are probably frustrated at the lack of insight you have.
In truth, lack of insight can be a big problem for companies right now, considering how quickly the economic landscape situation is changing. If you are ready to get accurate, up-to-date financial and operational data at your fingertips, including easy-to-read KPI dashboards, planning tools, and a secure data warehouse to house all your data, now is the right time to get your Corporate Performance Management solution set up.
Setting up a modern CPM solution is easier than ever, but you will still need to make sure you choose the right solution for your needs. Though you have a wide range of strong CPM solutions available to your company, your ideal solution will depend on your unique business setup, size, industry, integration needs, and objectives.
However, to make sure your CPM system meets your precise needs during the coronavirus situation and beyond, you will want to ensure you choose a CPM that fits these requirements:
Cloud-based solution
If your workforce is largely working from home (WFH) for the duration, now will not be the right time to deploy or support an on-premises / in-office server solution. A cloud-based CPM is more convenient to implement and support during a disruption, and it is also more convenient to access for consultants working from home.
Rapid deployment
A CPM that takes months to deploy will not help you solve the situation right here and now. Cloud-based solutions are faster and easier to deploy than on-premises solutions, and CPMs that include pre-built vendor report and forecast templates will get you analyzing your evolving numbers the same day your solution goes live, so you can answer your critical questions instantly.
Learn More About Your Options for Corporate Performance Management
If chosen carefully, effective, cloud-based CPMs can help you maintain your agility with quick decision-making during the coronavirus or any other unexpected setback.
