FINANCIAL SERVICES UPDATE

SOLUTIONS
Got Compliance? Get CPM
Corporate Performance Management delivers a one-two punch for meeting regulatory challenges and boosting organizational efficiency.

Basel II. Sarbanes-Oxley. International Accounting Standards. Complying with the ever growing and more complex regulations surrounding financial institutions throughout the world is becoming a full time job. Financial services companies have particularly difficult regulatory challenges because of the depth of reporting and oversight they're being asked to perform compared to other industries. Add the wide range of products that exist under the financial services umbrella, and the job becomes even more daunting.

Fortunately, financial services firms are finding they don't have to expend resources only for compliance, without any direct bottom-line benefits. By implementing effective Corporate Performance Management (CPM) systems and procedures, banks, insurance companies, and others can manageme their businesses more effectively and develop the information foundation to ease compliance challenges.

To achieve CPM success, experts say financial services companies need to focus on six key areas.

Start small
Because CPM entails a host of technical, operational, and political revisions, a Big Bang approach to change can derail even the most carefully planned efforts. A better approach is to introduce CPM to a single business unit, which can later become a model for future roll outs. By starting small, any technical and cultural glitches can be closely contained and fixed more easily. As benefits begin to materialize, the real-world results will help sway skeptics in other departments.

Create "a single version of the truth"
Some financial services companies may find dozens of business intelligence projects have grown up over the years as individual departments create unique solutions to information gathering. Data stovepipes and lack of interoperability among systems supplied by multiple vendors wastes resources and opens up the enterprise to greater regulatory risk. By replacing departmental systems with corporate-wide solutions, financial services companies can seize control of performance information to aid both daily operations and compliance reporting.

Emphasize data quality, not quantity
A flood of information won't help managers perform their jobs better. More valuable is timely and accurate information that can demonstrate performance shortfalls or examples of successes that can be expanded to other areas.

Work the Web
When implementing balanced scorecards and other metrics-measuring tools, deliver reports via a Web interface. Web applications provide for real-time reporting and graphical formats that make it easier for executives to understand complex data.

Cultivate wide-scale support
Because CPM requires fundamental change and long-term commitment, senior executives need to demonstrate they're behind the effort. At the same time, department managers need to champion CPM to build consensus among lower-level staff.

Make use of sophisticated tools
The right commercial technologies are essential for data gathering and reporting for corporate performance management. The Oracle Corporate Performance Management suite gives financial institutions the tools they need for control, transparency and regulatory accountability. Key products within the suite include:

Oracle Profitability Manager: The latest version integrates the capabilities of Oracle Performance Analyzer and Oracle Activity-Based Management applications into one solution for calculating, analyzing and reporting profitability. Going beyond traditional cost allocation, the newly integrated solution lets organizations analyze profitability by customer, product, sales channel and other dimensions. Oracle Profitability Manager also reconciles inputs back to the source system of record, for auditing and tracing of results.

Oracle Enterprise Planning and Budgeting (EPB): The newest EPB release lets financial managers do their work offline on spreadsheets and then easily import the data to the system to produce professional quality reports. EPB lets users export an EPB report out to XML Publisher format, create or apply templates and output a report in PDF format. Through tight integration with Oracle General Ledger, EPB can seed budgets with historical figures and update forecasts with actuals data for more accurate forecasting.

Oracle Financial Analyzer (OFA): OFA gives financial managers the ability to quickly analyze performance metrics and evaluate risk to develop new plans and revise budgets and forecasts. In addition, the sales and marketing teams can use OFA to uncover new opportunities, measure promotional effectiveness, track sales and forecast future results.

Daily Business Intelligence: This tool lets managers quantify and manage the implicit rate bet that results from balance sheet management practices. In addition, it displays the pricing and profitability data necessary for holding business units accountable for their performance results. It can also produce account, customer and product performance measures.

Oracle Balanced Scorecard: Managers can take advantage of more than 250 pre-built key performance indicators (KPI) to align management actions with corporate strategy. The custom, graphical scorecards let users click on any indicator to perform more detailed analyses. Users can also move to any related function of the system to take corrective action as necessary. As a result, managers clearly see how their decisions impact both their direct area of responsibility and the overall organizational strategy.