Area of application

Controlling

In today’s dynamic business world, active control and management of business processes is crucial for the success of a company.

Many companies are increasingly relying on Enterprise Resource Planning (ERP) systems to make their business processes transparent and to optimize them. However, ERP systems offer more than just process automation: an ERP system can also play a central role in controlling by providing modules and tools that contribute to cost control, analysis, and management.

On this page you will learn how an ERP system can help your company to optimize its controlling and operate more efficiently.

What is meant by controlling?

Controlling is known as internal accounting and deals with the preparation, procurement and analysis of data to prepare entrepreneurial decisions.

Controlling is an essential component of every company. The controlling module is also playing an increasingly central role in many ERP systems.

The importance of controlling in the company

Controlling is much more than simple cost control within a company. Through detailed planning and monitoring, corporate goals are efficiently pursued and all kinds of poor decisions are avoided.

Controlling thus provides a central basis for market-oriented and efficient corporate management. This area of business contributes to a detailed mapping of the success of individual departments in order to identify and eliminate potential weaknesses.

Companies with effective, holistic controlling are demonstrably more successful than companies that forgo the use of integrated controlling instruments.

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Sub-areas of controlling

To better understand the components of controlling, the individual sub-tasks of the department are described in more detail below.

Planning

The first subtask in controlling is planning. Planning is a central component, as it is in this step that the management of the company is determined. However, this is only possible once the company’s objectives have already been defined.

Information gathering

In controlling, target states are compared with actual states using key performance indicators and presented graphically. The resulting information is then provided to management in a timely and concise manner to initiate the necessary actions for business management.

Monitoring

In monitoring, a fundamental distinction must be made between process-oriented and outcome-oriented controls.

Process-oriented monitoring is generally carried out during planning, error correction, and information development.

In contrast, results-oriented monitoring consists primarily of comparisons between target and actual states within a predefined period.

Both types of control play a central role in controlling. Accordingly, both process-oriented and result-oriented controls involve not only a root cause analysis but also an impact analysis in order to offer solutions and recommendations for future business decisions.

Management

Finally, the last subtask of the controlling department is the management of the preceding subtasks. The central goal of this management is to identify deviations from the target course and thus be seen as a forward-looking, regulatory function.

Controlling modules in the ERP system

Whether a small family business or a large corporation – a successful controlling system has a central influence on the operational success of a company.

By using the right controlling tools, companies receive transparent figures and key data that can be used to demonstrate their growth potential.

Controlling instruments include, among others:

Commercial controlling instruments

Investment controlling
Financial controlling
Cost and revenue driver controlling
Personnel controlling

Sales controlling instruments

Marketing controlling
Sales controlling
CRM controlling

Controlling multidimensional databases

Remote controlling
Risk management systems
Management systems

Technical controlling instruments

Logistics controlling
Value chain controlling
Process controlling
Production controlling

What business objectives can be achieved through controlling with ERP?

The ERP system supports your employees in controlling and analyzing relevant data sets and makes a significant contribution to identifying and counteracting potential errors and weaknesses in a timely manner.

This is achieved by the controlling module providing a transparent and reliable overview of key performance indicators, which serves as a basis for all operational decisions by those responsible.

Your company can pursue the following business objectives through an effective controlling module:

Advantages of ERP controlling

Controlling in ERP systems offers companies a wide range of advantages. We have compiled these for you below:

Firstly, a controlling module enables better monitoring of financial performance. Through the integration of accounting data, budgeting functions, and cost control, controllers also gain a comprehensive overview of the company’s financial situation, thus ensuring a high degree of transparency.

Controlling modules can generate automated reports, analyze financial key figures, and detect deviations early on. This supports informed decision-making and minimizes the risk of financial bottlenecks.

Key aspects of controlling tools in the ERP system

Controlling tools in ERP systems are controlling methods and functions within an Enterprise Resource Planning system that help to monitor and control the economic activities of a company.

Below we present some key aspects of controlling modules in ERP systems:

Cost calculation

Controlling in ERP systems includes, among other things, the monitoring and regulation of operating costs.

Integrated cost accounting functions enable companies to monitor the costs of different business processes, perform analyses, and thus evaluate the profitability of individual products.

The controlling tool makes a significant contribution to the optimization of resource allocations.

Performance analysis

By combining the controlling tool with other ERP functions, companies can now monitor and analyze internal performance in real time.

By integrating business data from other departments into the ERP system, controllers are enabled to gain comprehensive insights into the company’s operational performance at any time and to identify potential weaknesses early on.

Performance analysis contributes to supporting data-driven decision-making.

Financial controlling

ERP systems offer extensive functions for financial control. These include, among other things, the management of accounting data, cost control, cash flow analysis, profit and loss statements, and balance sheet preparation.

The ERP system’s controlling function enables employees to monitor financial key figures in real time, generate reports, and analyze the company’s financial performance.

Risk management

Controlling in ERP systems also includes the identification and assessment of risks. By integrating risk management functions, companies can identify and assess potential risks early on and take measures to mitigate them. This contributes to improved business security and the minimization of financial risks.

Reporting

Controlling also includes writing reports and analyses. Using the ERP system, controllers can access predefined report templates or create customized reports to provide relevant information to management and other stakeholders.

By automating reporting processes, companies can save a lot of time and improve the accuracy of information and key figures.

In general, integrating controlling into ERP systems enables companies to use operational data more efficiently to monitor internal performance and address potential weaknesses in a timely manner. Controlling modules thus contribute sustainably to a company’s efficiency and economic growth.

Conclusion – Controlling in ERP helps your company grow

ERP systems have become some of the most important software in a company. They help optimize internal processes, saving both time and personnel resources and ultimately increasing revenue.

In general, a controlling module in the ERP system helps to comprehensively monitor and control your financial data – in this way, weaknesses and careless mistakes can be identified and counteracted early on.

Similarly, the automation of reporting processes leads to detailed and transparent information sharing, which can have a positive impact on internal business processes.