As Seen in CFO Studio Magazine Q1 2017 Issue


-BY GEORG ANNEN, Chief Financial Officer, Unger / USA & Europe


To navigate a company through rough market conditions requires knowledge, experience, and leadership. Management teams rely first of all on timely and accurate financial data and detailed business analytics. ROI calculations, valuations, and future cash-flow predictions are other critical factors. All this can give a company a vital competitive edge — and this is where controlling comes into play. Such prognostic information is so essential to management decisions, and the responsibilities of the controlling function are so extensive that I prefer to call it “ÜBER-Controlling” (“über,” the German word meaning “in excess of,” “above,” or “over,” not to be mixed up with Uber, the mobile taxi service!).

Basically, ÜBER-Controlling consists of three functions:

  1. Sales & Marketing Controlling: Information about revenue development by customer and product as well as volume/price/mix effects; success of marketing campaigns and price sensitivity; market-related versus cost-plus pricing models; price entry points for new-product development, etc.
  2. Production Controlling: Information about material, labor, energy, freight, and other manufacturing costs in total and by unit; make-or-buy decisions; margin comparison based on standard costs and variance analysis; discounted cash-flow calculation for capital investments, depreciation alternatives, and inventory optimization.
  3. Overhead Controlling: Information on so-called fixed costs per department (Selling, Marketing, R&D, Supply Chain, Admin) and cost category (Personnel, Travel & Entertainment, Consulting, etc.); comparison to budget and prior year expenses.

An ÜBER-Controller does not just collect data from these three functions. He or she adds another dimension to it: Instead of looking just backwards or at today’s performance, he or she concentrates on looking forward. Through strategic and mid-term planning, annual budgeting, and rolling forecasting systems, the future of the company is being shaped by the ÜBER-Controller’s involvement and expertise.


Nevertheless, ÜBER-Controlling can only be successful when it works hand-in-hand with the financial accounting department under the leadership of the corporate CFO. Statutory financial statements for external information purposes (looking back) and management reports for management decisions (looking forward) are closely intertwined. Modern, fully-integrated ERP systems with new general ledger concepts and dedicated FI and CO modules can provide a multitude of management reports. For improved management reporting purposes, it is important to use notional costs for depreciation, interest, taxes, and asset and liability amounts based on actual market valuations.

The ÜBER-Controller’s role and responsibilities are critical for the success of a company. They transition the typical conservative finance function into a future-orientated, vibrant think tank. The more specialized and entrepreneurial the controlling knowledge is, the better is this individual’s support as a business partner.

The function of the ÜBER-Controller and his or her entire controlling team is highly delicate, because they are a hybrid in an organization. Whenever I discuss my concept of an ÜBER Controller, the question comes up: Are they part of finance or of an operational business function? The best way to deal with it is to have controllers sit next to the sales and production managers and be their day-to-day “sparring partners.” However, it is best for the ÜBER Controller to report into the CFO function, thereby guaranteeing complete independence and objectivity in their judgment.

Copyright 2017