Corality’s Managing Director, Rickard Wärnelid, delivered a seminar on Managing Growth Risk to 100+ CIMA members last Wednesday night at the Radisson Hotel in Sydney. The session was well received by CIMA members and resulted in a lively question and answer session on identifying and understanding key business drivers.
Managing growth risk: the whole picture, international business risk
Corality’s session on managing growth risk highlighted critical aspects in strategic planning, financial modelling and budgeting to ensure that KPI’s can be set in a way that aligns all stakeholders to benefit the business and the owners. Specifically, key controllable drivers should be what influences the strategy set by senior management, the budgeting done by the finance team and then the implementation from the operations team – in that order.
“What a great night! The case study in the presentation was very informative and effective to deliver tonight’s message – Focusing on the key drivers and risks of your business. I especially liked the Excel model demo. Thank you, Rickard.” said Jia Ge ACMA CGMA, CPA, CA, CIMA NSW Committee Member 2012, PwC Australia
The key learnings of the seminar were:
Focus the business strategy & KPI’s on key drivers
Use iterative strategic planning with scenario and sensitivity analysis
Link variance analysis back to key drivers
Rickard’s presentation also covered important forecast modelling principles: having a consistent sheet structure, breaking up long formulae, setting up dynamic timing and a structured scenario analysis.
“I thoroughly enjoyed the CIMA presentation. It’s great to speak to people who are genuinely interested in learning and improving their businesses. The questions and interactiveness before and after the presentation were high quality!” said Rickard Wärnelid, Corality’s MD
The question and answer session focused on identifying the key drivers in the natural resources industry, infrastructure and oil & gas industry, siting Rio Tinto and BP as examples. The main consideration here was for management to identify those drivers that are controllable and non-controllable. For example, senior management of Rio Tinto has minimal scope to impact commodity prices (one would hope!) which significantly impacts the profitability of the business. However, there would be significant scope for management to control certain cost drivers.
Overall the presentation was well received and with around 100 delegates, offered a good opportunity to network and exchange opinions on project and modelling risk. We are looking forward to the next one!