The Philips journey toward IBCS
Strategic Finance (IMA member magazine), October 2016
You know the problem: Choose any set of 10 reports from your company and you’ll find 10 different ways of presenting the information. Some reports put the message first, some put it at the end, and others don’t have any message at all. Some reports fail to specify the content, while others are overloaded with descriptions. Many contain no glossary with accepted definitions and abbreviations of key performance indicators. To make a long story short, there’s usually no standard policy for the conceptual and visual design of reports—often not even within the same company, let alone a globally accepted intercompany standard.
Philips, the Netherlands-based global player in healthcare, consumer lifestyle, and lighting technology, started to improve this situation within the scope of its multiyear change and performance program dubbed Accelerate!, which is being implemented across the organization to drive value creation and speed up growth.
For instance, if you look at the notation of currencies, you’ll find many different ways of expressing “in thousand euros.” Fonts and colors? They often depend on the personal tastes of whoever assembled the report. The width of columns in tables, the number of digits used to display values, the usage of grid lines: They’re all over the place. Even the choice of chart types seems to be arbitrary: Some people like pies; others prefer bars or lines.
Maurice Verhagen, head of Reporting Services, is in charge of the concept and rollout of reporting standards at Philips. Verhagen talked recently with Jürgen Faisst about reporting at Philips, implementation of the IBCS, the benefits achieved, and his recommendations for readers of Strategic Finance.
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