sap budgeting, planning and forecasting survey jan 2014

Budgeting & Forecasting Finance Research

SAP Budgeting, Planning and Forecasting SurveyJANUARY 2014


Industry Segmentation

Automotive

Entertainment & Leisure

Advertising & Marketing

Construction, Machinery, and Homes

Food & Beverages

Nonprofit

Retail & Consumer Durables

Healthcare & Pharmaceuticals

Insurance

Finance & Financial Services

Government

Manufacturing

Telecommunications, Technology, Internet & Electronics

Utilities, Energy, and Extraction

Other (please specify)

0.00% 5.00% 10.00% 15.00% 20.00% 25.00%

66Resp


Geographic Locale of respondents

United Kingdom; 30.30%

Ireland; 3.06%

Singapore; 4.55%

Hong Kong; 3.03%

Malaysia; 7.58%

Other; 48.48%

66Resp


ERP Type

All In One76%

ByDesign2%

B15%

Other17%

63Resp


Tools in Use

A budget tool accessed over the internet

Just SAP

A specialized budget tool on the corporate network

A custom built budget tool


Microsoft Excel

A combination of a tool, spreadsheets and SAP

Just SAP and Spreadsheets 35%

20%

20%

62Resp


Microsoft Excel versions

Excel 2000 (v9.0)

Excel 2002 (v10.0)

Excel 2003 (v11.0)

Excel 2007 (v12.0)

Excel 2010 (v14.0)

Excel 2013 (v15.0)

54%

63Resp


The most difficult part of month end

Adjusting Journals

Variance Analysis

Allocations

Workflow

Reporting

Consolidations

Other

0 5 10 15 20 25 30

54Resp


Principal planning process pain

Lack of detail

Proper data gathering

Collaboration & participation

Performance against plan assessment

Absence of driver based forecasting

Workflow

Reporting

56Resp


How many users are involved in planning processes

1-19

20-49

50-100101-249

250+

0

20

40

56Resp


Participant locations

Multilo-cation;

89%

SingleLocation; 11%

Mul-ticountry; 53.57

%

Onecountry; 46.43%

56Resp


Budget frequency

Yearly Budget Only

Yearly Budget and Monthly Forecast

Yearly Budget, Monthly Forecast and Weekly Flash

Multiple versions without a consistent process

other

56Resp


Sources for variance analysis

Single tool29%

Multiple systems71%

Single tool Multiple systems

56Resp


Can you do flexible comparisons of actual/plan?

Yes and it is adequate

Yes but it is inadequate

No we don't need it

No but we would like it

Don't know

other

56Resp


Does your company use a rolling forecast?

No, and we have no interest in doing so

No, but we would like to

Yes, but it does not suit our needs

Yes, and it functions as desired

56Resp


Organization hierarchies

Province2%

Other2%

Legal Entity4%

Country7%

Regional9%

Division11%

Centralized21%

Business Unit45%

56Resp


Budget areas of concern

Salaries & Wages Projects Indirect costs/overheads Capital Funds/Grants None of these

61% 61%

70%

50%

18%

11%

56Resp


Budgeting methods used (non Sales)

Responsibility Center Management

Activity Based Budgeting

Incremental Budgeting

Zero Based Budgeting

Performance Based Budgeting

Not Applicable - I indicated I am not involved in any of the above budget

areas


43%

30%

36%

32%

14%

9%

2%

56Resp


The most important budgets

Salaries & Wages

Projects

Indirect Costs/Overheads

Capital

Funds/Grants

Other

27%

13%

32%

18%

4%

2%

53Resp


Important budget challenges

Lack of detail

Proper data gathering

Collaboration & participation

Performance against plan assessment

Absence of driver based forecasting

Workflow

Reporting


53Resp


Cited reasons for challengesRegulations; 2%

ROI; 5%

Data Distri-bution; 17%

Lead Times; 17%

Market Volatil-ity; 20%

Complexity; 29%

Data Quality; 32%

41Resp


What variance is considered significant 1%

2%

3%

4%

5%

6%

7%

8%

9%

10%11%

12%

13%

14%

15%

16%

17%

18%

19%

20%

0

10

20

51Resp


Budget philosophy

Bottom Up

29%

Other35%

Top Down35%

• Top down and bottom up which is the main issue.

• Our budgeting is bottom up but we are often asked to find savings when all the budgets have been consolidated.

• Mostly a mixture of top down and bottom up.

• It always starts as bottom up but ends up as top down....

• Mixed. Bottom up data is gathered and presented to management. Management issues certain guidelines based on which we (the budgeting team) negotiate with the various functions.

• The most likely scenario along with a number of scenarios are made and presented to management who then decide.

52Resp


Is non sales budget accuracy used as an incentive?

Yes35%

No65%

52Resp


Is non sales budget accuracy improving?

Yes60%

No13%

Not Sure27%

52Resp


Using SAP ERP

Yes56%

No17%

Unsure27%

52Resp


Cost Center transactions used

KPF7 - Display CElem./Acty Input Planning

KPE7 - Display Revenue Element Planning

KPE6 - Change Revenue Element Planning

KPC7 - Display activity input planning

KO22 - Change Order Budget

KP47 - Display Statistical key

OKOB - CO Orders: Budgeting profiles

KPD6 - Change Statistical Key Figure Planning

KP26 - Activity and Price Planning Maintenance

KP46 - Change Statistical Key Figure Planning

KP07 - Display/Planning Primary Costs

KOAB - Order Types: Budget Profile

KPF6 - Cost Element Planning

KP06 - Change Cost Element/Activity Input 100%

50%

13Resp


Project Systems transactions used

CJ40 Change Project Plan

CJS2 - Change Statistical Key Figure Planning

CJ34 - Project Budget Transfer

CJR2 - Project Systems Cost Elements

CJ38 - Budget Return in Project

OPS9 - Budget Management Profile PS

CJ30 - Change Project Original Budget

CJ37 - Budget Supplement in Project

7Resp


ABC transactions used

CP46 - Change Statistical Key Figure Planning

CP06 - Change Business Process Planning Cost Elements/Activity Inputs

CP26 - Change Business Process Planning Quantities/Prices

CP47 - Display Business Process Planning Statistical Key Figures

100%

2Resp


Profit Center transactions used

7KE5 - Change Statistical Key Figure Planning

7KE3 - Plan Inventory Maintenance

7KE1 - Plan Costs and Revenues Maintenance

5Resp


Profitability analysis transactions used Only one respondent out of

the 13 transactional respondents indicated that they are using KEPM

1/13Resp

Yes92%

No8%


Public sector transactions used

FMBBC - SAP Budgeting Workbench

KOCO - Budget Carryforward for Orders FI - Funds Management

IM32 - Change Budget of Inv. Prog. Position Investment Management - Investment Programs

IM52 - Process budget distribution Investment Management - Investment Programs

CJCO - Carry Forward Project Budget FI - Funds Management

80%

5/13Resp


Plant Maintenance transactions used

5/13Resp

Only five respondents out of the 13 transactional respondents indicated that they are using KO22

Yes

28%

No72%


Real Estate transactions used

Only two respondents with one using FOKP and one FOKX

2/13Resp


Special purpose ledgers1/13Resp

Only one respondent using GP12N


Cost object controlling

KK17 Display Periodic Cost Object Planning Cost Elements

KK16 Change Periodic Cost Object Planning Cost Elements

KK47 Display Periodic Cost Object Planning Statsitical Key Figures

KK46 Change Periodic Cost Object Planning Statsitical Key Figures

66%

3/13Resp


Most commonly used to create

The results to this question were mixed with no significant indicators however the follow on responses indicated

57% felt that what they used to create budgets was easy to use

79% restricted access to this tool/transaction

All respondents relied heavily on standard or custom reports to review the data

92% felt that the review mechanisms were easy to use

43% provide access to the review mechanisms to many users

10/13Resp


Maintaining the numbers from Excel

We manually load the data

72%

We have a cus-tom program;

6%

We don’t bother; 22%

18Resp


No of objects per new cycle

<10

10-49

50-100

>100

11%

28%

6%

56%

18Resp


No of objects per minor cycle

<10

10-49

50-100

>100

17%

22%

17%

44%

18Resp


Are budgets adjusted mid year?

Yes75%

No; 19%

Not Sure; 6%

16Resp


Would Workflow Help?

Is workflow used for adjustments*?

*Adjustments are classified as reallocations or reassignments

No; 41%

Not Sure; 12%

Yes47%

17Resp

Yes; 44%

No; 6%

Unsure50%


How long is the budget cycle?1-10 days

31 - 60 days

61 - 90 days

More than 90 days

16Resp


Biggest impact of delayed decisions

Reporting delays

Manual data maintenance and workarounds

Number goals become moving targets

Key Performance Indicator relevance

10Resp


Using BPC & Classic Planning In SAP

Respondents using BPC23Resp

Yes35%

No; 65%

Yes33%

No; 67%


How is BPC performance

Adequate

A struggle

Delayed

Excellent

44%

22%

22%

11%

9Resp

We’re using HANA!


Is BPC sufficient?

No

Unsuitable for operational views

Unsuitable for strategic views

Its' OK

33%

11%

44%

11%

9Resp


BPC Reporting

We do not run reports from BPC

We run only some reports from BPC and it is fast enough

We only run only some reports from BPC because it is slow

We do all reporting from BPC and it is ok

Other

0%

25%

25%

38%

13%

8Resp


Satisfaction with BPC

No

Somewhat

Yes

Other

22%

56%

11%

11%

9Resp

Main Complaints:SlownessShortage of Skilled resources to manage it

Main praise:Easy to useSingle place to go for the data


Conclusions

The data sample was smaller than we hoped for however it is indicative

SAP classic planning transactions are still widely used

Manually maintaining the data for classic planning transactions is still prevalent

Budgeting cycles are for the most part taking too long and this erodes effectiveness and relevance

Workflow solutions are data maintenance and decisions would be advantageous

BPC is evolving and the consensus is that new versions bring a better experience

Of particular significance is that SAP customers running BPC on HANA are having a much better experience than those on legacy


Follow up comments/questions

Clinton JonesDirector of Solution Management for [email protected]

Learn More about Winshuttle for Budgeting Planning and Forecasting at

http://www.winshuttle.com/financial-sap/budget-planning/

mailto:[email protected]



sap budgeting, planning and forecasting survey jan 2014

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