Most organisations today have implemented systems to manage the operational and transactional processes in their business. This systemised approach to replacing the many disparate transaction and operations systems such as accounts payable and receivable, inventory management etc, is typically called ERP (Enterprise Resource Planning) and whilst this has been proven to be an essential approach to assisting companies in running their business, in isolation it is no longer the competitive differentiator it once was.
Enterprise Performance Management can be defined by a combination of people, process and technology. At the heart of the EPM framework are a set of analytical applications, initially focused on the office of finance which support strategy management, planning, budgeting and forecasting, financial close, consolidation and reporting and profitability and cost management. Today, for advanced practitioners, those applications have extended beyond finance into operations such as supply chain, procurement, sales & marketing. It is these analytical applications that enable companies to translate goals into measured and achievable results. This is done through the capturing of objectives and goals, determining the initiatives required to move the company closer to the achievement of those objectives. Next the initiatives need to be monetised through the budgeting and planning cycles and headcount needs to be planned for then through the cascading of interactive scorecards and metrics throughout your organisation performance can be measured in order to drive accountability and keep goals on track.
The role of EPM is to ensure that any enterprise has a complete view of business performance from top executives to the shop floor. The means unifying information from operations, finance and compliance to ensure everyone is in lock step. From detailed costs through to strategic plans and the plans and forecasts that link all of this together.
This supports collaboration between senior executives and operational managers who can provide feedback and be in alignment with the corporate strategy as they go about their daily jobs.
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