Director of Planning and Control
Sparking performance management innovation
ESAF – Espírito Santo Activos Financeiros, which manages financial assets amounting to 19.6 billion euros (US$27 billion) – invested in SAS® Performance Management in order to achieve sustainable business growth through innovation. ESAF is the fully owned subsidiary of Portuguese banking company BES. The financial services investment company offers insurance and investment products and owns hospitals and retirement homes.
By initially adopting the SAS® Activity-Based Management solution, ESAF aimed to increase the visibility of indirect costs and improve knowledge of the actual profitability by product and service. ESAF later adopted SAS® Strategy Management, which linked the organization's strategic objectives with measurable key performance indicators (KPIs), thereby quantitatively aligning the planning and budgeting process with those objectives.
SAS has improved ESAF’s ability to access data, allowing the organization to make better decisions, act faster on data and anticipate trends.
While experiencing strong business growth, ESAF felt the need for more powerful business analytics tools, from both commercial and financial standpoints. With SAS, we found everything we need.
More efficient, smarter planning
With SAS Activity-Based Management, ESAF improved business development cost analysis, paving the way for more efficient cost control, and increasing the company's capacity to measure operational efficiency and improve resource planning.
Flávio Lança, Director of Planning and Control at ESAF, explained that, at a critical time for the company in terms of bringing aboard the innovation necessary to maintain long-term sustainable growth, ESAF's goal was to create the ideal conditions for performance-enhancing strategic and operational decision making.
"While experiencing strong business growth, ESAF felt the need for more powerful business analytics tools, from both commercial and financial standpoints," says Lança. "With SAS, we found everything we need."
With SAS, ESAF can determine specific results by business segment, including net margins by product or by distribution network, contribution margins by product or distribution network, break-even points by product and cost-to-income ratios, among other indicators. ESAF relies on this information in its annual budgeting of assets-under-management volumes, a process which integrates commercial strategy with product mix networks, new-product pricing, and the fine-tuning of existing products.
ESAF's area managers can now identify costs allocated (directly or indirectly) to services, clients and processes, as well as understand their operational impact. SAS provides a better perspective of the relationships among resources, processes, activities, and cost objects (outputs), Lança notes. As a result, ESAF managers now have one more tool for better predicting resource needs, a key first step on the road to performance improvement.
The implementation of an analytical cost accounting model and a management platform, both based on SAS tools, allowed for "overall improvements in administrative processes, the cross-functional alignment of company resources, and faster decisions, due to their support of highly-detailed data," says Lança.
Following up on good results achieved with SAS Activity-Based Management, and benefiting from the modular nature of SAS software, ESAF implemented SAS Strategy Management to gain additional decision support.
SAS Strategy Management’s functional characteristics allowed for the creation and management of multiple performance-management environments and scorecards linking ESAF’s strategic objectives to KPIs, which are updated on a scheduled basis.
The solution also has functionalities that address planning and budgeting processes and automate their supervision.
Lança says that SAS offers another advantage: "Its point-and-click Web-based interface provides all users with easy access to information, regardless of their location. This is a result from having the entire operational infrastructure based on standards, which simplifies solution integration in ESAF intranet environments."
Lança credits SAS with ESAF's success in achieving its goals. "All data is now gathered within a single, easy-access platform," he says. "This ensures consistency and allows for efficiency and ease of access."
The company wanted to achieve long-term growth through intense, detailed scrutiny of income and cost structures and integrate all its business data on one platform to better fine-tune budget process, product launches and campaign plans.
ESAF can now access detailed information – through a single platform – regarding assets under management, income and costs by fund, by portfolio or by service. ESAF now has improved insights into the details of each business unit’s results, including net margin cost-to-income ratios by product. This allows for budgeting and strategic to align with market realities and strategic objectives.