AFP Upload
- 1. Operating System Transformation Leveraging FP&A Across a Multi-Industrial Organization Emmanuel Caprais Vice President – Strategic & Financial Planning ITT Inc. Holding Company Conglomerate Integrated Operating Company
- 2. A Brief History of ITT • Founded in 1920 • Holding Company Mentality • Diverse Set of Businesses • Continuous Acquisitions… • Divestitures and Spin-offs • “New” ITT From a Holding to an Integrated Operating Company
- 3. From a Holding to an Integrated Operating Company New ITT – A 100-Year-Old Startup • Organized Around 4 Value Centers • Increased FOCUS • Build on Strengths and Solid Foundation • Drive Operational Improvement • New Finance Operating System
- 4. Focus Areas to Turn Around Motion Technologies 1. Building the Finance Team for the Future • Performance Management & Restructuring • Promoting Hidden Jewels • Recruiting Outside Talent With Proven Operational Skills • Building Capabilities and Developing High Potentials FP&A at the Heart of the Finance Operating System FP&A Team Embedded in the Business & Focused on Efficient Decision-Making
- 5. FP&A at the Heart of the Finance Operating System Focus Areas to Turn Around Motion Technologies 2. Making a Strong Friction Business Even Stronger • Build On A Solid Growth Engine • Leverage Worldwide Production Capabilities • Supply Base Rationalization & Optimization • Drive Efficient Processes Through a Waste Hunting Mindset • Promote Accountability and Build a True Meritocracy • Focus on Fixed Costs Expand Margins By Profitable Growth and Lean Cost Structure
- 6. Focus Areas to Turn Around Motion Technologies 3. Turning a Shock Absorber Loss-Maker into a Growth Platform • Improve Customer & Operational Metrics • Address Cost Structure • Improve Commercial Performance • Drive Manufacturing & Administrative Efficiencies • Continuously Restructure Even When Growing FP&A at the Heart of the Finance Operating System Expand Margins by Driving Efficiencies & Cost Structure
- 7. FP&A at the Heart of the Finance Operating System FP&A Helps the Organization to Focus & Drive Accountability Focus Areas to Turn Around Motion Technologies 4. How Did FP&A Contribute? • A Different Way to Look at Financial Statements • Cost Structure Deep Dive • Enhancing Profitability Through Target Costing • Defining Turnaround Strategy & Metrics Order Backlog Analysis Machine Efficiency Improvement New Products & Platforms Costing Action Register Monitoring Finance Leads by Example FP&A Data StrategyBusiness Insight Generation Value Creation Strategic Support
- 8. Global FP&A: From Reporting to Driving Performance Transforming into an Integrated Operating Company 1. How Is The FP&A In The Field Contributing? • It All Starts With Data • Partnering With Business Leaders • Understanding & Leveraging Business Drivers • Building Knowledge & Driving Accountability • Prioritizing Focus Areas with Biggest Impact • Translating Weekly Progress Reviews into Accurate Forecasts • Driving Formal Operational Reviews (Financial & Productivity) Building FP&A Capabilities Is Key to Efficiency
- 9. FP&A at the Heart of the Finance Operating System SEP Week 1 KONI Group Week 1 SEP MTD Budget 6+6FCST PY vs BDG vs FCST vs PY *TURNOVER ( wo IC) Koni Group 1,892$ 11,278$ 10,888$ 11,656$ 10,245$ +$390 ($378) +$1,033 Koni Holland 681$ 3,403$ 3,489$ 3,481$ 3,002$ ($86) ($79) +$401 Koni Czech Republic 600$ 3,000$ 1,907$ 2,631$ 1,977$ +$1,093 +$369 +$1,023 1 Koni China 144$ 787$ 1,431$ 1,298$ 1,179$ ($644) ($511) ($392) Koni USA 456$ 3,842$ 4,021$ 3,975$ 3,817$ ($179) ($133) +$25 Koni France 57$ 473$ 258$ 497$ 270$ +$215 ($24) +$203 Central -45$ -226$ -217$ -226$ -$ ($10) +$0 ($226) Intercompany 503$ 2,800$ 1,787$ 2,727$ 2,389$ +$1,013 +$74 +$412 *ORDER IN TAKE Koni Group 2,248$ 10,532$ 11,560$ 11,967$ 11,088$ ($1,028) ($1,435) ($557) Koni Holland 655$ 3,277$ 3,593$ 3,450$ 3,457$ ($316) ($172) ($180) Koni Czech Republic 536$ 2,682$ 2,522$ 2,682$ 2,151$ +$160 +$0 +$531 Koni China 85$ 578$ 1,233$ 1,912$ 859$ ($655) ($1,335) ($282) Koni USA 914$ 3,522$ 3,954$ 3,522$ 4,304$ ($432) +$0 ($782) Koni France 57$ 473$ 258$ 402$ 317$ +$215 +$71 +$156 Central -$ -$ -$ -$ -$ +$0 +$0 +$0 *OPERATING Koni Group 1,933$ 1,933$ 1,471$ 2,173$ 1,459$ +$462 ($240) +$474 INCOME Koni Holland 340$ 340$ 259$ 418$ 125$ +$82 ($78) +$216 Koni Czech Republic 884$ 884$ 403$ 881$ 403$ +$481 +$3 +$481 Koni China 251$ 251$ 400$ 384$ 377$ ($148) ($133) ($126) Koni USA 457$ 457$ 447$ 490$ 403$ +$10 ($33) +$54 Koni France 47$ 47$ 7$ 47$ 0$ +$41 +$0 +$47 Central -47$ -47$ -43$ -47$ 151$ ($4) +$0 ($198) OI% 17.1% 17.1% 13.5% 18.6% 14.2% 3.6% -1.5% 2.9% KONI Group Flash Data SEP Week 1 BHFM REFRESH WEEK 1 WEEK 2 WEEK 3 MTD BUDGET PY Value % Value % WORKING DAYS Days 5 4 5 14 25 24 -10 -42% -10 -40% HEADCOUNT Total FTE 498 498 500 499 512 504 -13 -3% -5 -1% Direct FTE 195 196 198 196 198 208 -2 -1% -12 -6% of which Direct Paint/ Pack FTE 29 29 30 29 15 16 14 94% 13 82% Indirect Manufacturing FTE 188 187 187 187 196 176 -9 -4% 12 7% Other. Indirect FTE 116 116 116 116 119 120 -3 -2% -5 -4% SALES Total Sales K$ 1,585 1,525 1,590 4,699 10,694 10,253 -5995 -56% -5554 -54% Outside Sales K$ 1,076 1,090 1,151 3,317 8,312 7,377 -4995 -60% -4060 -55% Intercompany Sales K$ 509 435 438 1,382 2,382 2,876 -1000 -42% -1494 -52% Output Warehouse Total u 18,232 17,744 17,249 53,225 82,269 76,872 -29044 -35% -23647 -31% Daily Average u/d 3,907 4,095 3,234 3,713 3,335 3,203 378 11% 510 16% Daily Average per person u/d/h 20.8 21.8 17.2 19.8 17.7 16.2 2 11% 4 22% Output Assembly Total u 15,975 15,461 16,476 47,912 82,269 77,087 -34357 -42% -29175 -38% Daily Average u/d 3,423 3,568 3,089 3,343 3,335 3,212 7 0% 131 4% Daily Average per person u/h 18.2 19.0 16.4 17.8 17.7 16.3 0 0% 2 9% June Week 3 Unit ACTUAL FULL MONTH VARIANCES VS bdg VS. py Plant: All BY DETAILS PPV -$ Budget -$ -$ -$ 19,570$ -$ Act/Fcst -$ -$ -$ -$ -$ Variance -$ -$ -$ (19,570)$ 86,628$ Budget 27,016$ 28,289$ 31,324$ 29,285$ 71,917$ Act/Fcst 12,305$ 28,289$ 31,324$ -$ (14,711)$ Variance (14,711)$ 0$ -$ (29,285)$ 19,360$ Budget 6,050$ 6,050$ 7,260$ 5,747$ 40,279$ Act/Fcst -$ 17,184$ 23,094$ -$ 20,919$ Variance (6,050)$ 11,134$ 15,834$ (5,747)$ Restructuring 27,551$ Budget -$ 12,523$ 15,028$ 11,897$ 24,499$ Act/Fcst 6,131$ 8,349$ 10,019$ -$ (3,053)$ Variance 6,131$ (4,174)$ (5,009)$ (11,897)$ 2,505$ Budget -$ -$ 2,505$ 1,983$ -$ Act/Fcst -$ -$ -$ -$ (2,505)$ Variance -$ -$ (2,505)$ (1,983)$ 10,019$ Budget -$ -$ 10,019$ 7,931$ 24,499$ Act/Fcst 6,131$ 8,349$ 10,019$ -$ 14,480$ Variance 6,131$ 8,349$ 0$ (7,931)$ 2,505$ Budget -$ -$ 2,505$ 1,983$ -$ Act/Fcst -$ -$ -$ -$ (2,505)$ Variance -$ -$ (2,505)$ (1,983)$ 3 Additional PPV Challenge 0.4% GSS/ Material Savings E. van der Zande 4 3 FTE Tube Cutting Machine Restructuring J. den Haan 1 KHT GSS/ Material Savings E. van der Zande 2 Normal PPV 2.0% GSS/ Material Savings E. van der Zande 5 0.5 FTE Material Flow Pilot Line 4 Restructuring J. den Haan 6 2 FTE Improvement Operator Efficiency/ Quality Restructuring J. den Haan 7 0.5 FTE 6S Improvements Restructuring J. den Haan FLASH DASHBOARD ACTION REGISTER BACKLOG
- 10. FP&A at the Heart of the Finance Operating System Op. Income Bridge Backlog / Sales Product Mix Quality Purchasing Performance Added Value Variation Efficiency Headcount Absenteeism Breaking Down Variable & Fixed Costs To Track Breakeven Point Linking Key Performance Indicators With Financial Statements Granularity Allows Management To Understand Major Variances And Link KPIs With P&L Breaks Down P&L Line Items And Provides Understanding Of Drivers & Costs / Revenue Evolution Contributor To Explain Performance, Drive Execution And Ultimately Achieve Targets
- 11. Strategic Plan Operating Plan Budget Forecasts / Outlooks Global FP&A: From Reporting to Driving Performance Transforming into an Integrated Operating Company 2. How Is Headquarters FP&A Contributing? • Headquarters Leading by Example to Drive Change • Facilitating Focused Operational Reviews • Direct Support to Senior Leadership for Decision Making • Driving Returns With Prioritized Capital Allocation • Proactively Engaging in Projects to Improve Operations • Measuring Execution & Improving Forecast Cycle A Global FP&A Team Ready to Help
- 12. FP&A Compelling Vision - 5 Pillars Track & Drive Performance Contribute to Efficient Resource Allocation Support Efficient Decision Making Manage & Develop FP&A Team Champion a High- Performing Culture Define & Analyze Performance Drivers Provide Insights, Challenge the Status Quo Facilitate Financial Reviews & Drive Focus Track & Improve Forecasts Manage Target-setting process, Build Budgets Optimize CapEx & Working Capital Analyze Returns & Help Prioritize Provide Insightful and Ad-Hoc Analytics Support Active Portfolio Management Optimize FP&A Team Strategy Develop Analytical Skills & Business Acumen Recruit, Develop & Lead Global FP&A Talent Leverage Continuous Improvement Mindset & Best Practices Drive the Right Level of Accountability Foster Data-Driven Discussions Enterprise-Wide Team Player Impeccable Character Bold Thinking Collective Know-How 1 2 3 4 5 Support External Financial Communication Embedded Business Partner Driving Performance
- 13. Partner FP&A Leadership Principles Dive Deep • Operate At All Levels • Connect With The Details • Understand the Business • Data Driven Decision Making Be Curious • Listen to Understand • Seek Diverse Perspectives • Challenge, Then Commit • Be Skeptical But an Enabler Deliver Results • Highest Standards & Integrity • Execute And Never Settle • Drive Accountability & Performance • Fire up Operational Levers Drive Efficiency • Bias For Impactful Actions • Productivity Obsession • Accomplish More With Less • Invent & Simplify Business Building an FP&A Team Around Clear Principles
- 14. THANK YOU