Simulation in Vena: webinar recap
Modeling and simulations have never been more popular than during the Covid-19 crisis, when scientists and economists alike tried to forecast the spread and impact of the pandemic. As a CFO or controller, you’ve certainly run loads of simulations and we guess that you’re planning to continue doing so in the future. During the last webinar of our Vena series, we demonstrated how Vena software makes ad-hoc simulations easier and better.
For over a year, your finance team has been working hard to lead your organization through the pandemic. While today we have (we hope) left the peak of the public health crisis behind us, your priorities may shift – but the world is not yet back to normal. As the economic climate remains uncertain, agile, flexible planning and simulations are bound to be the new normal for the finance office. The topic of the third Vena webinar was therefore more relevant than ever.
Two uses of simulation
Michiel De Meyere, business controlling expert at delaware, opened the webinar explaining the different types of simulations: “We can roughly classify simulations as transactional or multi-transactional on the one hand, and more high-level, P&L-related simulations on the other. The first category is mainly related to pricing, answering questions like ‘how do you set the price for an incoming order or for a new product?’, or ‘is it more cost-effective to subcontract the production of a new solution or to develop it ourselves?’"
"The second type has more to do with the macro-economic level,” he continued. “More than, ‘should we change the price of a product or service’, this type of simulation will answer questions like ‘how will the worldwide surge in raw material prices impact our margins or our business in general?’, ‘how will the new product of our competitor affect our sales?’, or even ‘is there enough budget to hire new people?’”
The case for Vena
“Running ad-hoc scenarios, especially for high-level simulations, is difficult for finance teams, as they are only as good as the date you base your scenario on,” business consultant Ben Reynaert went on to say. “In fact, finance needs accurate, reliable and up-to-date information from sales as well as from production, operations, supply chain, etc. That’s no easy feat. So, the simulations as we’ve known them until today often contained a bit of guesswork and were error prone.
“ERP systems can help gather data from different sources, but the embedded simulation tools are not really flexible. Excel, on the other hand, is too flexible and it’s a stand-alone system, which makes the process of building a financial model complex and often frustrating.”
During the webinar, Ben and Michiel showcased a number of simulations often run by controlling, highlighting the benefits of Vena Software in boosting accuracy and efficiency:
- Central database: Vena brings data from every function of the business together in a secure, centralized database – as the ideal starting point for what-if simulations.
- Predefined simulation templates: preconfigured templates and flexible modeling capabilities make sure that everyone involved – sales, operations, finance – works in a uniform way. This helps save time and ensures accurate scenario models.
- Customized security/access rights: it’s easy to define user roles in Vena, allowing access to only those people who are authorized to run simulations and report on them. Moreover, controllers get complete visibility over the process.
- Easy archiving – and re-use – of past calculations and parameters: controllers can go back and view numbers or budgets from an earlier moment in time. This might be handy for audit trails, but also in reusing past scenarios and experimenting with them.
- Workflow assistance: Vena offers a process-mapping and management tool to take care of all the bottlenecks and workflow issues. It helps your team create process maps, automate processes, provides automated emails to notify users, etc. to avoid inefficiencies.
The best of both worlds
“Vena combines the flexibility and the familiar interface of Excel with a central repository for data and a powerful web interface. That’s a major advantage for ad-hoc simulations, as well as for budgeting and planning and for cost-to-serve analysis, like we explained in our earlier Vena webinars. CFOs and their teams who bundle all three in the Vena platform will be able to harness their interdependencies and deliver true added value.”