TRG International and PwC Vietnam held a seminar entitled “Planning & Budgeting in Vietnam: Top challenges and solutions”. The event included a presentation as well as discussion on Planning & Budgeting in Vietnam. Built upon the top challenges shared by attendees themselves prior to the event, the 2 speakers – Rick Yvanovich from TRG International and Bart Ziemerink from PwC addressed: Basic theories relating to Planning, Budgeting and Forecasting How to maintain strategic planning, budgeting and forecasting Best practices for Planning, Budgeting and Forecasting in turbulent times How an effective Planning, Budgeting and Forecasting system can help

1. Planning and budgeting
in Vietnam
Top Challenges and Solutions

2. Agenda
• What
Setting the • Why
scene • Challenges
• Overall concepts
Best • Best practices
practices • Approaches
Examples of how technology helps
Your • Question’s you asked
Q&A’s • … and some answers
Question forms
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3. Setting the scene
Bart Ziemerink
Associate Director Consulting, PwC Vietnam
Bart leads the Enterprise Performance
Management (EPM) team in Vietnam. He was
involved in the development of the global PwC
EPM framework and approach. Prior to
joining PwC in Vietnam in 2011, Bart worked
for PwC in the Netherlands and Malaysia. He
has advised clients in various industries,
published articles and spoken at different
events on performance management topics.
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4. What is Planning, Budgeting and Forecasting?
• Top down development of 3 to 5 year plans to deliver long term value
creation
Planning • Considers a balanced set of financial and non financial measures
• Provides the basis for targets cascaded to the BU and OU level
• Enabled through modelling technology to evaluate consolidated business as
usual and project scenarios
• Annual budgets are the financial representation of the organisations
activity based business and project plans expressed as a profit & loss,
Budgeting balance sheet and cash flow statement
• Focused on the activities required to deliver against strategic targets
• Forecasting focuses on actions to bridge performance gaps
• It is largely driven out of the typical month end management reporting
Forecasting process
• In addition, it should encompass new knowledge regarding the external
environment and additional factors that may impact performance
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5. Attributes of Planning, Budgeting and Forecasting
Strategic
Business
Activities
Financial
Operational
Fixed Horizon
Planning, Budgeting
Cycles
and Forecasting
Rolling Horizon
Top-down
Bottom-up
Blended
Process Flexible
Zero-based
Beyond Budgeting
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6. Why do we all Plan, Budget and Forecast?
Planning & Budgeting for most organisations is the single most expensive of all Finance
processes, with a lot of hidden costs, too much detail and poor system support.
However it doesn't need to be so expensive.
To spend money?
Number of man days spend on creating the budget
To keep everybody busy? An median company with $1 bio. 25,000
To set targets for bonuses? Best in class company 700
(Numbers from Hackett group)
To adjust direction?
To influence behaviour?
On the other hand Planning & Budgeting should lead to the To drive action?
value creation that is expected by the organisations owners.
It is the most important of all Finance processes.
To beat the competition?
In most cases > 50% of Enterprise
Value is ‘Future Value’ To create value more
(= value that can not be explained based on future cash
flows from current activities)
effectively and efficiently?
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7. What are the Top challenges you shared with us?
Weak or no alignment
between strategy, planning
and budgeting. They are all
done in isolation
Lagging behind: a call for
more rolling techniques
Limited technology: the
search for an effective
planning & budgeting
system
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8. It starts with your Strategy
Planning & Budgeting
Mission
Target setting,
Vision Translate value Forecasting
planning & budgeting
drivers into driver
based plans &
Strategic related budgets to
objectives Strategy
focus your
Map business planning
Value drivers on strategy Analyse &
evaluate results Adjust planning
versus planning & forecasting
and forecast
Translate mission, vision &
strategy & values into
strategy maps showing what
to focus on to manage your Translate value
business performance drivers into KPI’s Dashboard (e.g.
KPI’s
at several levels in Balanced Scorecard)
your organization
to focus your
business reporting Periodic Management and Operational
on strategy Reports
Organisation Processes People Data Technology
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9. Key Value Drivers enable you to focus the entire
organisation on executing the strategy by consistently
asking one single question...
Use as table of Use as guide for
content for prioritising
Strategy Map Use as an investment proposals
business plan
agenda for
(yearly)
planning Check projects on
their value add to
What did you do to the strategy
improve performance
on one or more of the
Communicate
drivers delivering strategy to all
your strategy?
Use for appraisal Use as guide for
and rewarding of determining
employees information need
Use as starting
point for reporting
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10. By translating value drivers to KPI’s, setting targets on those KPI’s
and defining actions and related budgets to reach those targets,
your budget will be entirely focused on strategy execution
Strategy Map
• A good strategy map “tells the story” of your strategy by showing the
cause-and-effect relationships between your value drivers and your
strategic objectives. It is the cornerstone of your Performance
Leadership potential.
• Joint development of your strategy map will enable your management to
immediately use the created insight in what drives your strategy to
manage the organisation.
Value drivers KPI’s Targets Initiatives Budget
Measurable factors Measurement Level of desired Main initiatives to Financial mandate
that impact strategy of success in realising success or indication realize objectives needed/given to
execution and create the strategy improvement execute these
value potential initiatives
1 2 3 4
What do we really How do we know if How good do we What initiatives What do we need /
have to excel at to we are actually need / want to be at are needed to reach want to invest to
reach our strategic excelling at this? this? our target? reach our target?
objectives?
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11. Keen on reading the rest of the slide!
Please click HERE to
download full version of
the Presentation at TRG
International Blog