The Business Simulator (What If tool)

This video is located on our main Buyer's Tour page, here:

CFO Scoreboard Buyer's Tour

The second major section of CFO Scoreboard allows you to play “What If” with your business so you can see the impact of making slight adjustments to your decision making and execution.

On the left hand side of this screen, you see the major levers available to you to drive the financial results of your business, specifically:

• Revenue,
• Cost of Goods Sold,
• Marketing and Sales Expenses,
• General and Administrative Expenses,
• Receivable Days,
• Inventory Days and
• Payable Days.

On the right hand side, you see three columns which compare your projected 12 month simulated results with your actual Trailing 12 month’s historical results and a difference column showing the financial impact of these assumptions would have on your Revenue, Operating Cash Flow and Operating Profit. The bar graphs compare the actual vs. Trailing 12 months with the “What If” scenario created.

By hovering the mouse over each category on the left hand side, you can select the assumptions you wish to make. For example, if you hover over Revenue, you can manually enter a growth rate. When you enter this growth rate, you notice the financial results comparison on the right hand side automatically change, as does the graph.

In the expense categories, you have the choice of selecting three options:

• “Hold Steady” (which holds constant the percentage this expense group is to revenue for the trailing 12 months), or
• You could select “Best Ever” (which will look back at the best percentage of revenue you have ever achieved) or
• You can manually select a custom setting.

There are three primary Balance Sheet levers for the What If scenario. CFO Scoreboard has converted the monetary amount of your Receivables, Inventory and Payables on the Balance Sheet into “Days.” Hovering over any of these three Balance Sheet categories will enable you to select different assumptions and allow you to observe what happens if you operated the business at Hold Steady, Best Ever or a enter a specific Custom setting.

You can mix and match and change any assumption in the What If scenario. You can see the impact of one change individually or in combination with other assumptions. And, you have the ability to save any scenario you create for future reference.

What If is an extraordinary tool for prioritizing various initiatives and immediately seeing the financial impact of different assumptions about how you could run your business.