Profitability and Cost Management (formerly PCMCS)
To maximize profitability, a business must be able to accurately measure, allocate, and manage costs and revenue. Profitability and Cost Management is an analytic software tool that manages the cost and revenue allocations that are necessary to compute profitability for a business segment, such as a product, customer, region, or branch. Profitability and Cost Management enables you to use cost decomposition, consumption-based costing and scenario-playing to measure profitability for effective planning and decision support.
The allocation rules engine in Profitability and Cost Management enables business users to take ownership of rule building and data acquisition. This is important since enterprise profitability analysis must evolve as business evolves (e.g. growth, acquisition/divestiture, regulatory changes, competitive landscape, etc.). For example, business users may want to explore the use of different allocation drivers for a certain stage of a multi-tiered allocation process. With Profitability and Cost Management, business users can easily make a change in allocation assumptions and compare the new method with the previous method through inherent scenario analysis capability. A point-and-click interface makes it easy to create or alter complex allocation rules using the best practice framework. The framework includes validation reports for every step of the allocation process and an auto-documenting feature that allows allocations to be easily audited. This is important when an allocation method is scrutinized internally (e.g. shared service) or externally (e.g. transfer pricing). Furthermore, allocation drivers can be easily re-used across different business processes in a very consistent manner. This significantly improves the controls across all reporting processes