For better decision-making, corporate performance management monitors enterprise performance with metrics, workflows, and other operations. CPM software stems from enterprise performance management (EPM) software.
This article covers what corporate performance management (CPM) is, top software benefits and features, and corporate performance management business solutions examples.
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Table of Contents
What Is Corporate Performance Management?
Corporate performance management (CPM) is a process that gains in-depth insight into business practices, including scenario analysis, financial planning, budgeting and more. Corporate performance management metrics, reporting and budgeting tools can spot and detect vital trends.
Who Uses CPM?
Numerous business sectors and employees, including accounting professionals, department managers, analysts and executives, use CPM to analyze their practices.
Metrics
Corporate performance management business solutions gauge numerous metrics, including:
- Gross Margin: Leftover money after subtracting expenses.
- Customer Retention Rate: How well companies keep their current consumers.
- Sales Growth: Review improvement methods for marketing and selling goods or services. Assess specific sales strategies.
- Employee Retention: Observe overall employee satisfaction and turnover rates to determine what works well.
- Acquisition Costs: Determine how much marketing funds you spend to gain business from one client.
Frameworks and Management Methods
Executives and business leaders utilize several frameworks and management methods to craft effective CPM business strategies, from Six Sigma to the balanced scorecard and more.
Six Sigma
This manufacturing practice thrives on diminishing process variations to strengthen production times, product quality and customer satisfaction. Unlike Lean Manufacturing, Six Sigma says waste is anything that veers from effective production workflows.
This practice comes with five distinct principles:
- Customer Focus: Keep customers’ needs at the forefront of your company.
- Root Cause Identification: Pinpoint the exact cause of your bottlenecks and address it at the root to avoid downtime.
- Variation Elimination: Remove steps or defects that leave room for waste or mistakes.
- Teamwork: Ensure your team stays on the same page with your practices to avoid incompetence or confusion.
- Flexibility and Thoroughness: Maintain a flexible work environment that offers growth opportunities.
Although Six Sigma comes with disadvantages, it can lead to more profits and improved manufacturing workflows.
The Balanced Scorecard
The balanced scorecard helps you gather general data about your company’s objectives, measurements, initiatives and goals, and find obstacles squandering performance.
The four perspectives include the following:
- Financial Analysis
- Customer Analysis
- Internal Analysis
- Learning and Growth
The European Foundation for Quality Management (EFQM) Model
The EFQM Model asks three critical questions to establish a management agenda for companies to achieve a long-term, tolerable future. These queries include:
- Direction: Why does this organization exist?
- Execution: How does this company intend to deliver on its purpose?
- Results: What has this company achieved overall, and what will it achieve tomorrow?
This framework assists companies by providing them with an improvement and innovation-centric atmosphere.
Whether you implement one or all three of these frameworks, they each bring in-depth improvement strategies.
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Primary Benefits
Corporate performance management comes with several advantages that capture vital data.
Produce More Accurate Financial Data
CPM solutions typically comes with real-time analytical tools to keep you in the loop of economic updates and changes.
For example, you may have accrued considerable expenses for a commercial you’re shooting for an upcoming fashion show for your clothing company.
You can monitor items and talk with your financial and marketing teams to scale back if you find fees that go off budget.
Reduce Risks
Managing numerous financial KPIs and data allows you to minimize potential hazards.
Your clothing company may be considering potential partnerships. However, you’re unsure if you have the right resources to make this collaboration happen.
Corporate performance management business solutions can review actual asset performance and compliance adherence to ensure you’re running a smooth, legitimate organization before you make your next big move.
Increase Automation
Similar to ERP software, corporate performance management solutions can automate repetitive assignments while you maintain more client-facing and problem-solving tasks.
For example, this solution can help you review customer satisfaction rates to ensure you’re meeting their needs. You can also detect and rectify problems to strengthen practices, increase customer retention and initiate ways to attract prospective clients.
Make Well-informed Choices
Gauging the right metrics and performance helps you make better business choices.
Your garment company may not understand why employee turnover rates increased over the past few months.
You can allocate surveys with your current workers to understand their frustrations and what’s going well.
Then, you can accommodate reasonable employee suggestions to increase employee retention.
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Key Features
Corporate performance management in business sectors offers several diverse features to streamline performance measurements.
Budgeting, Planning and Forecasting
This module enables organizations to perform strategic short-term and long-lasting plans. You can access scenario modeling, what-if analyses, budgeting and more.
Your clothing company may think about planning new items for fall and winter, but in the long term, you may consider using environmentally-friendly fabrics. You can evaluate future expenses and determine if you’re making the right business move.
Consolidation and Close
Merge and explore data from several sources in one centralized location. You can manage multiple currencies, journal reports, general ledger entries and thorough audit trails.
You may have partners in Italy and Japan that collaborate with your organization. You can review their practices, pay appropriate compensations, taxes and more to ensure compliance and good practices.
Financial Reporting and Compliance
Draft and allocate appropriate reports and maintain awareness of standard and local regulations.
Receive updates for specific tax regulations, verify adherence to the Generally Accepted Accounting Principles (GAAP) — such as consistency, regularity, sincerity and non-compensation principles — and deliver timely invoices to the right clients.
Analytics
Reviewing gross margin, customer retention rate and other KPIs requires proficient analytical tools. KPI management settings, customizable dashboards, benchmarking and thorough reporting help you understand performance and boosts hindrance awareness.
Your clothing company may have insufficient supply chain issues. KPI management can pull up on-time deliveries.
If on-time deliveries exceed your expectations, you can investigate delivery drivers or vendors for suspicious activities.
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Corporate Performance Management Examples
Here’s a brief rundown of some of the best CPM business solutions in the market.
Oracle EPM – Best for Planning, Budgeting and Forecasting
This cloud-based system offers full business workflow centralizations for medium and enterprise-level organizations. It provides stakeholders with precise data insights and narratives to enhance collaboration and decision-making.
You can also use on-premise deployment.
An example of Oracle EPM’s interface. Source
Features
- Planning: Access dashboards to measure performance and make predictive strategies to increase workflows and revenues.
- Profitability and Cost Management: Use automatic price recording to calculate and chronicle overhead rate justification, jurisdiction, negotiations and so on.
- Automatic Consolidations: Include narrative commentaries to reports and maintain changes with automated consolidations.
- Account Reconciliation: Perform transaction detail matching with the automatic engine. Expedite equivalency operations by validating or declining auto-suggested matchups.
- Enterprise Data Management: Cross-examine viewpoints to increase business quality programs. Incorporate tailored application confirmations to record notes during request protocols.
Limitations
- Hybrid integration needs improvements
- Doesn’t integrate with Salesforce
- Lacks governance features
Anaplan – Best for Financial Consolidation and Reconciliation
Obtain real-time internal and external data to observe production and forecast diverse circumstances. This application serves all business sizes. It’s flexible with all market scenarios with adequate planning and budgeting.
A preview of Anaplan’s database.
Features
- Finance: Obtain current data to study product rates, develop market predictions and make well-informed company decisions.
- Sales: Produce realistic production possibilities while increasing more accurate revenue estimates.
- Supply Chain: Establish in-depth sales and operation planning procedures with relevant KPIs and forecasts.
- HR and Workforce: Conduct “what-if” tests, discover recruitment gaps and review financial impacts to strengthen the company workforce.
- Marketing: Create dependable plans and predict profitability effects by combining sale integers, marketing achievements and financial data trends.
Limitations
- Has a steep learning curve
- Difficult to replace new expenses, headcounts and open hires
Jirav – Best for Project Planning
Streamline financial and analytical tasks with detailed economic modeling. Construct expansion estimates and ascertain actuals to projections with more accuracy. Centralize metrics for better budget building.
This CPM business solution serves all company sizes and offers cloud deployment.
An example of Jirav’s interface.
Features
- Integrations: Merge this system with QuickBooks, NetSuite, Gusto and more.
- Forecast: Plan simple sales forecasts and use customizable tables to craft industry-specific models.
- Report and Dashboard: Adjust documents and files for employees, managers, investors and other company roles.
- Plan: Pack and distribute monthly accounting documentation to stakeholders and business leaders.
- Expenditure Monitoring: Define capital purchase examples and assess related depreciation.
Limitations
- Occasionally slow
- Vague and random error messages
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Prophix – Best for Capital Expenditure Planning
This cloud-based and on-premise solution offers tools to streamline planning, reporting and budgeting needs. The spreadsheet-like interface arranges and displays financial information in a comprehensive format.
Supervise cash flow statements, budgets and balance sheets in one system. This program serves all company sizes and works with Windows, Linux and Mac platforms.
A preview of Prophix’s revenue planning tool. Source
Features
- Planning: Consolidate information, streamline operations and minimize human errors.
- Capital Expenses: Review tangible and intangible assets’ bottom line impact with expense tracking. Produce automatic depreciation ciphers and assess capital fee assumptions with specific KPIs.
- Forecasts: Generate tactical company choices with flexibly precise estimates. Monitor significant changes with rolling predictions.
- Workflow Automation: Enable budgeting, Excel modeling and analysis collaboration. Automate routine responsibilities and merge manual tasks with the WorkFlow Manager tool.
- Financial Consolidation: Document intercompany loans, charge corporate overhead, adjust entries and stop transactions while aligning with regulatory compliances. Cloud computing and AI capabilities can detect risks and delay closing procedures.
Limitations
- Has a high learning curve
- Graphs and charts have limited capabilities
- Implementation is lengthy
Planful – Best for Reports and Dashboards
Formerly known as Host Analytics, this CPM business solution serves all company sizes and operates on the cloud. It can centralize data and supervise financial and operational tasks. It can also plan and manage reviews, approvals and submissions.
An example of Planful’s drill-through capabilities. Source
Features
- Financial Consolidation: Receive pre-made unification for currency conversion and reporting, translation adjustment calculations and postings. Automatically map out information.
- Structured Planning: Gather, merge and verify economic data to create a centralized database. Craft and revise reports as needed.
- Dynamic Planning: Review, predict and make better choices with custom financial models, operations, use cases and more.
- Reporting: Confirm that everyone works with real-time data to create accurate documentation. Work with several reporting formats and delivery options.
- Scenario Analysis: Plan across several scenarios and key drivers to make practical arrangements. Align executives and partners with data-based choices.
Limitations
- Has complex MDX coding
- Expense templates are cumbersome
- Can’t switch between tenants without logging out
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Next Steps
Corporate performance management solutions in business environments diminishes risks, boosts automation and streamlines budgeting, planning and forecasting protocols. You can also perform deep analytical processes for better KPI measuring to gain more company insights.
Ready to take the next step? Access our in-depth comparison report featuring top market systems and leaders.
How can corporate performance management make a difference in your organization’s processes? Let us know in the comments!