WHU on Controlling Blog

Digitalization is not just for large businesses

Stefan Genten, Atlanta AG

Digitalization is overwhelming the economy. At the moment, most concrete examples of this come from big companies. Yet the trend is no longer limited to large businesses, as the case of Atlanta AG shows. Admittedly, with a turnover of around 2 billion euros, Atlanta is not such a small company, but it has a highly decentralized structure and a mid-sized business mentality. Atlanta’s plans for dealing with the issue of digitalization all sound very familiar.

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Is the Digital Boardroom setting a new standard?

[Translate to Englisch:] Christian Klein, SAP

The Digital Boardroom is a new tool from the ERP software market leader, SAP, which is designed to fundamentally change the reporting practices of decision-making bodies. As it comes from the market leader, it makes sense to take a closer look.

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Risk management – (what) can industrials learn from banks?

Dr. Andreas Peter, Fintegral

Risk management is a core function of banking. It is heavily regulated in the sector (“Basel III”), much more so than in industry. But risk management is growing in importance there, too. So, can industrial companies learn from banks? And, if so, what?

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Is the pathfinder the new role for controllers?

Stefan Schnell, BASF

Controllers take on many different roles. That diversity is one of the aspects that makes the controlling profession so interesting in my eyes. As scorekeepers, controllers manage the numbers needed for steering and even maintain the underlying systems. As guardians, they monitor whether managers reach their financial goals.

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Numbers are not always objective

We often read that communication is vital for controllers, and this is reflected in the findings of our WHU Controller Panel. But why is this? Isn’t it strange for a discipline that preaches objectivity and transparency, and which believes in the truth of cold, hard numbers?

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A profession under increasing pressure

Olaf Koch, Metro AG

METRO used to be an example of classic controlling: traditional planning levels, traditional processes, and a traditional mindset. Some aspects of this continue to be used in the organization today. Yet at the same time, it is becoming more and more important for organizations to seek out new business opportunities, to identify and react to changes in the market, or even to trigger these changes themselves.

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The Federal Employment Agency - A role model for controlling

Dr. Frank-Jürgen Weise

Controlling is an invention of the private sector. It has long set the tone when it comes to management control in complex organizations. We also find it in the public sector – from the German Armed Forces and Federal Police through to the Federal Employment Agency – all of which have staff numbers in six figures. Yet their management control has not appeared to be state of the art for some time now.

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Management control – Keep it simple!

Management control is at the core of controllers’ tasks, and this has helped them to gain influence and visibility with management. Yet if you ask managers, they are often dissatisfied – especially when it comes to budgeting – as those who read our blogs on a regular basis will know.

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In the future, controllers must focus more on each individual case

Dr. Florian Heinemann, Project A

The work that controllers do during a typical week is often routine. One reason for this is efficiency. Routine processes are the most efficient manner in which to address most typical business tasks. However, business is becoming increasingly heterogeneous and complex – and it is changing at a quicker pace.

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The future of controllers: Will they rise or fall in the digital world?

Bold statements can spur to action

Discussions, and sometimes even wild speculation, regarding the consequences of digitalization have been cause for alarm in the controlling community. On the one hand, there have been promises of interesting new work opportunities. The role of business partner, for example, is expected to continually increase in importance.

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Performance metrics – A data graveyard or the key to successful management control?

Performance metrics – A data graveyard or the key to successful management control?

Can you imagine controlling without performance metrics? We can’t. Entire books have been written on the subject of which metrics can be used for what purpose. Each and every correlation has at least one corresponding metric – often even more than one.

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More sophisticated, more powerful, more versatile: Why controlling tools can be too much of a good thing

Controlling needs the right tools

Controllers are proud of their tools. The toolbox is bursting at the seams with ever more and ever better tools. We are all too easily influenced by new features and higher performance: Who doesn’t want to simulate real-time – or to be able to base their calculations on distributions rather than estimates?

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Change is normal, change management is key

Jan-Henrik Lafrentz, MAN Truck & Bus AG

Obviously you just have to be patient. In the mid-1980s, I advocated controlling as a key tool for essential change management in the area of public administration. No one listened to me. It was, in fact, decades too soon. Similarly, change management has remained in the shadows in the private sector. 

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Can R&D controlling serve as a model?

Joachim Christ and Oliver Maschinsky, Merck KGaA, with Professor Jürgen Weber

Research and development should actually be a very exciting field for controllers:  Scientists have always been more out of touch with economic issues than managers. They are more attracted to a Nobel Prize than the economic success of an invention, plain and simple! So it is a real challenge to get scientists interested in budgeting.  

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The planning process will shrink to a two-week core phase in some organizations.

Dr. Jörg Ehlken, Partner at management consultancy Ctcon

Organizations are rarely satisfied with their planning process. Too long, too complicated, too political – to name but a few of the criticisms. Nowadays, you can find them in any (good) textbook. These failings have been addressed over the years – and successfully, too. However, the achieved improvements are usually less than what was targeted. Now there is a new challenge looming in the form of digitalization ...  

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Will big data shatter the controller's claim to be the “single source of truth”?

Sabine Urban, Senior Vice President and Head of Corporate Controlling, Accounting, Taxes and M&A, BSH Hausgeräte GmbH

Controllers hold fast to their mantra that they are the "single source of truth" for performance metrics. This is indeed true in many companies - and that is a blessing because it ends the haggling over who has the correct data once and for all. Controllers determine exactly what is meant by turnover or material costs. They have had to do a lot of groundwork to get this far.  

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Why do controllers take on more and more tasks?

Why do controllers take on more and more tasks?

Controllers have undergone a very successful transformation. This is clearly shown in the various roles that they have taken on over the course of time: from bean counter to navigator to business partner. This transformation has fundamentally changed the face of their profession, which nowadays has more to do with management than a professional specialization.

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What is meant by “controlling” in Germany?

When we look at organizations today, we can see that the names they use for similar functions and departments are much the same throughout the world. This is where our field proves to be an exception. While the international community talks of management accounting, in German-speaking regions we speak of “controlling”. Confusingly, we also use the word “controlling” when we mean the management accounting department.

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ACMAR 2017 - Focus on digitalization

ACMAR 2017 WHU Conference

When it comes to innovations, professionals often look to academia. Although a large number of innovations do stem from the business world, fundamental changes typically originate from universities. This is true, at least, for the natural sciences and technology sectors. In our field, however, I am convinced that one must view this more critically. My point becomes evident when looking at digitalization. 

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Controlling in small and medium-sized companies – Does smaller mean different?

Dr. Harald Nippel, KraussMaffei Gruppe

Most of what we hear and read on the subject of controlling is based on large companies. As a university professor, I too am guilty of this: Large companies are involved with more complex – and consequently academically more interesting! – issues from a controlling perspective. They are also the place where I meet a number of specialists on controlling issues with whom I can hold lengthy discussions.

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Marketing – Refuting the old cliché of the creative artist

Dr. Kjell Gruner, Vice President Marketing, Dr. Ing. h.c. F. Porsche AG

The image of marketers as creative minds that hard-hitting analytical controllers don't really get along with is a stereotype that is still widely held today. Yet it is not only outdated, it is fundamentally wrong.

This is a view that was shared by Dr. Kjell Gruner, Vice President Marketing at Dr. Ing. h.c. F. Porsche AG when I interviewed him for Controlling & Management Review.

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“Nobody needs digital transformation...”

Niemand braucht die digitale Transformation...solange sie keinen zusätzlichen Wert generiert

This is a statement made by Dr. Reinhold Achatz, Chief Technology Officer and Head of Corporate Function Technology Innovation at Thyssenkrupp AG, whom I interviewed recently. However, the sentence continues: “... so long as it does not generate added value“.

This statement should be just what we controllers are wanting to hear. 

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Controllers have to wear several hats

Controllers have to wear several hats

Controllers have to be business partners. We read and hear this a lot at the moment. The logic behind it is conclusive. It is all about new management requirements as well as smart controllers who can perform on an equal footing with managers.

But does this mean that all controllers should become business partners? 

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Lean planning should inspire managers

Dr. Michael Müller, RWE

Managers do not get excited about routine planning activities – quite the contrary. This is why a restructuring of planning processes is on the agenda of many heads of controlling. I addressed Deutsche Telekom’s innovative approach to this issue in one of my earlier blogs. RWE has chosen a different way of going about it. The aim of Michael Müller, who was Head of Group Controlling until September this year, was a radical streamlining of the planning process.

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Digitalization might cost controllers their jobs – What can be done about it?

Professor Utz Schäffer, Director, Institute of Management Accounting and Control

Digitalization is on everyone’s lips. It is on the agenda at every conference, with the 10th WHU Campus for Control­ling being no exception. It is hardly surprising that controllers have shown such a keen interest in digitaliza­tion: On the one hand, predictions are that the economy and society can expect disruptive changes; on the other hand, controllers still know far too little about how it will actually affect their companies as well as their own role. 

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Should all controllers really become business partners?

Volker Hagemann, Head of Controlling at Leica Camera AG

"Business partner" is a term that has spread like wildfire. Every controller should be a partner to management – at least, that is the claim being made by the professional bodies, ranging from the International Controller Association (ICV) to CIMA. As a professor, this prompts me to ask two questions: First, what actually is a business partner? Second, do all controllers really have to pursue this new role?

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Controlling & HR – Closer cooperation is needed

Melanie Kreis, Board Member for Human Resources of Deutsche Post DHL Group

The main task of controlling is to steer the entire company. All business areas should be included in this process and that includes, of course, Human Resources (HR). In order to be able to pursue their main task, controllers need to have knowledge of the business and to work closely with other business areas . The same applies to HR. Unfortunately, the reality is rather different.

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This year's International Controller Association (ICV) Controller Award – A prize-winning controlling reinvents itself once again

ICV Controlling Award 2016

Are you familiar with the Controller Award presented by the International Controller Association (ICV)? It was presented for the 14th time at the end of April, chosen by a jury that I have the privilege to chair. After a somewhat slow start, the award has become firmly established in the German-speaking community. Applicants regularly include DAX-30 companies as well as a broad spectrum of businesses of all sizes and sectors.

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A three-screen setup – How SAP is going to transform executive meetings

Rouven Morato, Head of Enterprise Analytics, SAP

Reports are an essential part of regular executive meetings and a key output of controllers who use them to achieve a common understanding of the current state of their company. In face of the increasing availability of real-time data from self-service applications, however, it remains to ask whether the controller’s “key output” will not become obsolete in future.

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“It's a cultural thing” – How Deutsche Telekom revolutionized its planning processes

Michael Wilkens, Senior Vice President Group Controlling, of Deutsche Telekom AG

Planning sessions can be a pain in the neck for managers, especially in large corporations. Jack Welch once spoke of budgeting as "the bane of corporate America". Even from a more rational perspective, corporate planning does not win any friends due to its complexity, long duration, and extensive decision-making processes. Managers often find it to be abstract in the true sense of the word because the actual planning machinery lies largely in the hands of the controller.

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Decision making based on facts – What is new about the latest buzz phrase “evidence-based management”?

Have you heard the latest? There is a new buzz phrase going the rounds – “evidence-based management”. Managers should be aware of their own cognitive limits and not simply follow their first intuition, that is to say, they should not make decisions the way they did in the past. They need to take a much more systematic approach and base their decisions on facts. This should be music to controllers‘ ears.

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Why do CIOs need controllers? As referees and business-savvy partners – but not as a financial police force

We often hear the old cliché that IT and Controlling don’t work well together. Yet this view is not shared by all. Dr. Roland Schütz, CIO at Lufthansa Passage, suggests just the opposite in his interview with WHU Controlling & Management Review. He values the controllers’ eye for the bigger picture as well as their neutrality. In this respect, according to the CIO, they are unrivaled.

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The role of human behavior in controlling: Why data alone is not enough

Controllers are rational beings. They see the world in numbers, they distrust the gut feeling of managers, and they prefer things to be black and white. They get as enthusiastic about bigger and better data as they do about finely tuned data analysis tools. But this is not enough to prevent even the most seriously flawed decisions. 

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Our Authors

Prof. Dr. Utz Schäffer is director of the Institute of Management Accounting and Control (IMC) of WHU – Otto Beisheim School of Management in Vallendar. His primary research areas are controlling and strategy execution as well as the roles of CFOs and controllers.

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Prof. Dr. Dr. h.c. Jürgen Weber is director of the Institute of Management Accounting and Control (IMC) of WHU – Otto Beisheim School of Management in Vallendar. In his research, he focuses on organizational change processes and on the dynamics and complexity of controllership.

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