Financial benchmarking helped by CPM, XBRL

Nov. 6, 2006 By Hannah Smalltree, News Writer, SearchDataManagement.com 

Competitive context is critical for financial data.

A company’s revenues and costs have new meaning when stacked up against its competitors’ numbers. So for years, organizations have benchmarked performance by manually comparing financial results with those of competitors to get a sense of where they stand in their industry. At Conshohocken, Penn.-based medical technology maker Viasys Healthcare Inc., the finance department does this by reviewing competitors’ public statements for key metrics and building spreadsheets, explained Mathew Gualtieri, assistant controller.

"It’s offline. You pick your hot spots and key indicators, you plop those into a spreadsheet and you do a competitive analysis," Gualtieri said. "It can’t be incorporated into every [financial] close; you just pick your key points to track quarter to quarter."

That’s set to change. Ultimately, Viasys plans to automate the benchmarking process by upgrading its corporate performance management (CPM) system from Norwalk, Conn.-based Cartesis Inc. The Cartesis 10 CPM suite, released in April, includes integration with the U.S. Securities and Exchange Commission (SEC)’s Electronic Data Gathering Analysis and Retrieval (EDGAR) Online database of public companies’ disclosure documents. That enables companies such as Viasys to pull competitors’ financial information directly into a Cartesis CPM system for automated competitive analysis. The prospect is enticing because it will save time and enable regular, detailed, competitive comparisons, Gualtieri said. Rather than looking at a few key areas, the finance department will use the CPM system to compare more granular metrics — such as debt-to-equity ratio — across the organization, he said. That will help the company benchmark performance against that of competitors and could affect business decisions.