Planning, technology and intelligence

The role of the management accounting department in AOKN is crucial due to the functions performed. Those include data pre-processing, planning, and providing data and information to all relevant business divisions in the company, which is accomplished with the help of the BI mainstream tool Cognos. Management accounting delivers the data requirements that support an efficient decision- making process within the company. In this way, management accounting can be linked primarily with the provision of data in AOKN. The management accounting

conceptual design and its role can be illustrated with the help of the information value chain as presented in Figure 3.2.

Figure 3.2: Information value chain (IMA, 2008)

The traditional role of management accountants as information providers is often described and interpreted as positioned at the lower end of the value chain. The role of a management accountant should be expanded to participation in all levels of the value chain. Additionally, management accountants should be included in key strategic decisions as members of management decision-making teams (interviews management accounting employees). The role for management accountants has therefore shifted in two respects with regard to the information value chain: first, management accountants provide the conceptual framework for converting data into information; second, they fulfill the roles of enabler and strategic business partner along the entire information value chain (IMA, 2008).

The main tasks of management accounting in AOKN are summarized and presented in Figure 3.3. Those tasks are planning, countersteering, and controling of the business objectives (interview management accounting director health care; AOK Niedersachsen, 2013d).

Figure 3.3: Management accounting tasks in AOKN (AOK Niedersachsen, 2013d)

Management accounting provides an integrated managerial and economic analysis of the company and gives due consideration to environments in which the company operates. Furthermore, the management accounting concept pursues different tasks and roles (AOK Niedersachsen, 2009):

 Transparency of results, processes and strategies to increase economic efficiency,

 Integrated coordination of sub-goals and -plans and cross-functional organization of modern reporting,

 Moderation and presentation of management accounting process in order to support decision-maker of goal-oriented activities. Provision of required data and information, and

 Activities of managerial consultants for decision-maker and of navigators for goal achievements.

The management accounting concept focuses on different perspectives in order to develop transparency in structures, business processes, and questions relevant to different professional divisions. Standardized management accounting is necessary to ensure that all projects can be controlled. In the absence of this

practice, transparency and controllability cannot be developed and ensured, which hinders the ability to answer key business questions about a project. The four following perspectives clarify specific topics included within the field of management accounting field: activities, quality, cost-efficiency, and customer satisfaction. For each of the perspectives, numerous key business questions will be defined and the resultant ratios will be identified, in order to design and implement a management accounting approach (AOK Niedersachsen, 2012b) as shown in Table 3.1.

Table 3.1: Key business questions and ratios for four perspectives

Source: AOK Niedersachsen (2012b)

Employing these perspectives should ensure frequent measurements and activity measures as well as economical results in order to promptly prevent failures, if required (AOK Niedersachsen, 2012b). There are many ways and forms of reporting in AOKN’s daily business. Therefore, the information path is also different.

The standardized report is created with specific and uniform perspectives and is delivered in a fixed format; it is typically manifested as print media for business management. The effort of developing reports is manageable and takes approximately 30 to 60 minutes weekly. Reports only have to be created once AOKN’s current data actualization is established to deliver the reports automatically to the information receiver (interview management accounting employee). Currently, the quality of reports is assessed as good. However, potential is recognized for improvements in visualized and graphic presentations to improve the ability “read and understand” the reports’ objectives. Standardized reports can also be an entrance to data and relevant ratios. During or after business meetings, process chains and details should be discussed continuously to enhance current analyses and decision qualities (interview performance analyst). However, in some activity fields, standard reports only target relevant objectives marginally because relevant and concrete questions can only be answered a specific volume of data. Time can be lost when an employee is consumed with filling out reports, but lacks the correct data definitions or appropriate data bases in order to verify results. In that circumstance, the material needs of the business division have to be recognized by management accounting (interview physical therapy director). For healthcare projects, using a standardized report is not possible because each case is unique. Individual reporting is necessary and encompasses approximately eighty contacts that must be addressed (interview health care management director). Here, flexible analysis options must be used and will be described in the following sections.

Analysis templates such as dashboards or files in Analysis Studio, allow BI end users to conduct a navigation analysis and to explore data correlations. Explorative analytics should be a suitable, fitting data modulation for decision- making processes and the achievement of objectives (interview management accounting employee). BI users get an adequate analysis platform with relevant basis ratios and also have the opportunity to perform analyses at a detailed level with individual data. Explorative analytic applications are more complex than standard reports. Analytic applications center on a specific business process and encapsulate domain expertise that illustrates how to analyze and interpret that specific process. Panoratio and Cognos Analysis Studio are the most frequently

used BI applications in this situation (interview management accounting employee).

Furthermore, self-service should also be implemented to enable users to create their own reports and relevant ratios for their specific business area. Mobile reporting can be a future-oriented module available on tablets for top management and also for travelling business managers that need to access real-time ratios (interview BI consultant).

The management accounting employees are also still available to conduct an individual analysis or report for the respective professional business divisions. Prior to the conclusion of a contract, preliminary in-depth data analyses are necessary and are performed by management accounting employees (interview agent to CEO). BI end users should have a formal contact person within management accounting, which should be established during the process. Individual opportunities of ad hoc analysis on aggregate data model should be enhanced if standardized reports do not provide sufficient information to the users (interview BI consultant).

The information conversation can also be made on different business meetings and on the bilateral way. “Front” training for new users of BI; that means training in front of employees, is typically not helpful. However, on the job training can motivate users to formulate questions and can lower resistance to BI (interview management accounting employee). BI video podcasts with instructions and hints for individual analyses can also be a way to reach the BI end users (interview performance analyst). However, from interviews with several employees in the health system, it became apparent that the health system regards its efforts to refine data analysis ties as key to the future. The next step is to move from collection to analysis and action, which will require investment of additional resources in both information systems and staff. Many organizations in the health system see BI as key to improving value. BI can help to transform care delivery to models that are more patient-centered, cost-effective, and coordinated (Moore et al., 2012).