If the Enterprise Resource Planning (ERP) solution is the heart of a consumer goods organization, the Trade Promotion Management (TPM) solution is the lungs. The two must work together to ensure that the company’s financials are accurate in order to accomplish key objectives around financial efficiency. When selecting a trade promotion management software, ensuring that both systems can be in-sync is a must. Your TPM solution, along with TPO and RGM, should abide by your financial rules, streamlining not complicating financial processes. If you have to do a lot of customizations and work-arounds, your TPM is not doing its job. The information in this blog will lay out the Why’s and How’s of using trade promotion management tools to enhance, not detract from, your ability to maintain strong financial discipline.
Requirements for Finance in relation to Trade Promotion Management:
- Alignment of business P&L structures and reporting standards between systems is critical for user and business confidence – comparing apples to apples across business systems without having to do manual calculations is a must. For example, the business P&L view from the ERP system should align with the customer P&L view from TPM in terms of lingo and calculation logic. What’s “below the line” in one must be “below the line” in the other!
- Finance needs confidence and flexibility in the configuration and usage of differing spending structures, types, calculation logic and alignment to ERP financial systems for GL accounts and pricing conditions. Without alignment clients often cannot integrate systems directly resulting in continued duplication of processes and inaccuracies.
- With the transactional nature of systems SOX compliance standards must be adhered to.
- Finance and business leaders require the accuracy of daily transactions at the lowest level (Account/Sku level profitability and Net sales position by day) – while minimizing the burden on users in terms of entry and maintenance.
- Deduction management in TPM must enable finance to quickly and accurately match expenses to promotions, validate those expenses and create the credit memo to balance in ERP. Only when this process is completed with integrity can the RGM team have the information needed to gain efficiencies and the finance team to accurately record and allocate liability.
How CPGvision can be the lungs for your ERP:
PSignite’s product and delivery teams are chock full of experts in trade finance, and our platform, CPGvision v5, is designed to allow our clients to configure (for us configure means without touching code!) our trade solution to match their financial procedures and rules. This means:
- Our solution flexes to your financial calendar, need Gregorian, 4-4-5, 4-4-4? We've got you covered. No more adjusting for inflexible calendar differences!
- CPGvision enables clients to configure their own P&L structure and logic that is highly visible throughout the solution and standard reporting package – no need for heavy client specific customization.
- Spend types are configured with flexibility of accrual calculation logic, pricing calculation logic and the ability to configure and cater for varying forms of complexities required for direct integration with ERP systems for GL Codes, GL code strings, Yearly GL codes, Pricing Condition codes etc. This allows for clients to maintain flexibility in terms of the level of detail required within CPGvision vs the level at which postings are integrated to the ERP accounts. Through configuration of spend types to tactics the user interaction of planning and maintenance is simplified removing the possibility of incorrect GL assignments.
- Significant enhancements in the integration and management of varying data types including sell-in (daily Invoice level), sell-through (daily and weekly) and sell-out (daily, weekly, monthly) data types enable clients to accrue liability based on actuals following a best practice methodology. This also supports the ability for more accurate accrual logic for Indirect customers. CPGvision also handles credit logic and auto accrual adjustments.
- CPGvision’s daily accrual calculation engine caters for all manner of scenarios to ensure accrual calculation logic is accuratel Examples include; daily accrual calculations on actuals/plans, overpayments auto trigger accrual adjustments, promotion closure handles the write back process, etc. This simplifies the burden of traditional month end reconciliation processes for finance with full visibility of opening balances, transactions to date and closing balances at any level and any point in time.
- Through the linking of promotion tactics and spend types to funds, CPGvision has automated the fund allocation process to simplify the user process and remove incorrect fund allocations.
- CPGvision provides a highly configurable workflow engine allowing clients to configure internal approval processes including, funds, terms, promotions and settlement processes.
- As CPGvision is a transactional system SOX compliance and appropriate audit and reconciliation capabilities are catered for as standard.
- CPGvision’s deduction management capabilities include audit-trail preservation through the use of in-app communication to keep all information attached to the right records and transactions.
Want to know more about how CPGvision can help improve your financial discipline?
Get in touch with PSignite or visit here to learn more about how our CPGvision platform can help streamline your financial processes while ensuring financial discipline.