This week we are profiling Controlling 2014 speaker Gary Cokins. Gary is an internationally recognized expert, speaker, and author in advanced cost management and enterprise performance and risk management systems. He is the founder of Analytics-Based Performance Management LLC, an advisory firm located in Cary, North Carolina.
How did you get your start with SAP and SAP Controlling?
I began my involvement when after retiring from a 40 year career consultant in enterprise and corporate performance management (EPM / CPM) methods, including management accounting, SAP began inviting me to present at its customer conferences.
What is one of the most important trends that you see currently in SAP Controlling?
An important trend is to expand costing for expenses below the product gross profit margin line to report costs and profit margins of distribution, sales, marketing and other costs-to-serve expenses for channel and customer profitability analysis.
In your opinion, why does SAP Controlling matter?
SAP Controlling matters because there is an imbalance with excess emphasis on non-cost metric like cycle-time, quality, throughput, service-levels, and other “process-related” measures. Cost in the language of money is a common denominator to evaluate decisions.
How do you stay on top of Controlling topics? What resources do you regularly use?
I read articles published by the Institute of Management Accountants (IMA), The Chartered Institute of Management Accountants (CIMA), and the Institute for Operations Research and Management Science (INFORMS). I also actively participate in Linkedin discussion groups.
What are you looking forward to about Controlling 2014?
I am looking forward to assess what “stage of costing maturity” various organizations are at. For example, are they primarily focusing on direct labor and indirect material with little regard to how indirect and shared expenses are assigned to products? Have they expanded to reporting and analyzing channel and customer profitability analysis? Are they overly focused on past period cost variances with relatively less focus on increment and marginal expense analysis on decisions that impact future expenses and profit?
Where is your favorite place in the world and why?
My favorite place is Denmark in part because their management accounting practices, influenced by a strong accounting department at the Copenhagen Business School, are some of the most progressive practices that I have encountered.