Department Planning

Cost center planning helps to create transparency and an overview of the costs incurred within a company and enables them to be controlled and managed more efficiently.In the course of this, an internal view of the operational value chain takes place. Here, internal flows of services and goods can be planned with the help of secondary costs. Allocations, on the other hand, relieve administrative cost centers and debit revenue-generating cost centers.With these two methods, planning ensures that internal company departments work cost-efficiently.

Personnel cost planning is the planning of costs resulting from the workforce structure of a company.

Personnel costs often account for a large proportion of the total cost pool of a company. For this reason, personnel cost planning is one of the most important departmental plans. Depending on the industry, a distinction can be made here between salaries covered by collective agreements, salaries not covered by collective agreements and wages.

• Further objects of consideration are
• country-specific differences
• salary bands
• the type of employment relationship
• cost centers
• Training costs
• recruiting costs
• the non-wage labor costs

Sales planning involves the development and implementation of a strategy to sell products or services. This is considered a detailed analysis of the sales goals and strategies a company will pursue to generate more sales, enter new markets, and retain existing customers. Sales planning can also include a review of sales practices, customer service, and other factors that impact the success of the business.

Perspectives to consider include

• Regions
• Sales executives
• Products
• Product groups
• Sales offices
• Key figures

Production planning is the process of planning the production of goods and services, including determining the required resources, schedule and costs. It also includes planning production in terms of market demand and inventory.

The process is as follows:

1. determination of the customer's requirements and the type of product/service required to meet those requirements.

2. determination of the quantity and timeframe in which the product/service must be produced

3. determination of required resources and costs

4. monitoring and control for timely and cost effective manufacturing.

Perspectives of consideration here may include

• Resources
• Production sites or facilities
• roads
• required personnel capacities
• energy consumption
• use of raw materials
• parts or semi-finished products

The perspectives can vary greatly depending on the industry.

Capacity planning is a strategic process used to identify and manage a company's available resources. This includes the analysis of operational processes in order to use resources optimally and to meet production needs or the demand for required services.

This process includes determining the number of

• employees
• Machinery
• Buildings
• Materials
• Expenditures
• and other resources required to provide a particular product or service

Capacity planning can also be used to develop a production strategy that reduces costs and increases efficiency.

The corporate treasury department is responsible for managing cash flows, ensuring solvency, utilizing credit lines, optimizing liquidity, etc. The planning component in this department comprises the forward-looking development of incoming and outgoing cash flows and the resulting aggregate account balance.The planning component in this department comprises the forward-looking development of incoming and outgoing cash flows and the resulting aggregated account balance of the company.

A distinction is made here between three leading perspectives of observation:

• the past (cash position)
• the near future (deterministic forecast)
• the distant future (probabilistic forecast)

Of particular interest for planning is the probabilistic forecast, which can be implemented with modern approaches of AI / Machine Learning.

Cash flow planning in the treasury area can be seen as a parallel to traditional cash flow planning from the finance area. In the optimal case, future assumptions regarding cash flow are coordinated and harmonized between both departments.

The results of all sub-plans come together in the integrated financial planning. This focuses on the company result (income statement), the company assets (balance sheet) and the payment flows (cash flow). There are interdependencies and value flows between these three plans, which must be mapped in an integrated financial plan so that they are consistent with each other.

Example of a value flow: Corporate taxes

• are dependent on the level of corporate earnings before taxes
• are also part of the cash flow calculation, since they are not cash-effective initially
• are part of the provisions on the liabilities side of the balance sheet