Scenario planning for higher education

Scenario planning based on drivers with SAP Analytics Cloud


What is the impact of an increasing inflow of students on the profit and loss account? How much does turnover change if the drop-out rate decreases in the first year? These kind of issues are easy to answer with the scenario planning solution of CPMview in SAP Analytics Cloud.

This plug & play application offers you the possibility to make earlier and better founded decisions because the impact of decisions are immediately visible.

Scenario planning based on drivers for higher education

CPMview has extensive experience with financial scenario planning based on drivers for higher education. As a result, we understand better than anyone what these organizations need in the field of the student forecast. Based on these needs in the market, CPMview offers an efficient and reliable alternative to the Excel problem. The application is a modern and simple solution based on the SAP Analytics Cloud platform. At the start of the planning, the application generates a complete basic scenario that calculates the results for the desired number of future years. After adjusting a driver within, for example, the positive and negative scenario, the impact on the profit and loss account can immediately be analyzed for each scenario.

Internal drivers

Based on internal business drivers, the application first calculates the entire student population and the number of employees per discipline. Based on these numbers, the income from the students and the costs linked to the employees are calculated.

The basis of the application is the calculation of the total student population using the following internal drivers:

Drivers calculation student population

  • The inflow of students per discipline;
  • The drop-out rate per year per discipline;
  • The graduation return per year per discipline.

Drivers calculation number of employees

  • The student/teacher ratio per discipline for teaching staff;
  • The student/teacher ratio per discipline for the different categories within the supporting teaching staff;
  • The student/teacher ratio per discipline for external staff.

Driver's calculation of income and costs linked to students

  • The statutory and realised tuition fees per student per discipline;
  • The personnel costs per internal employee per discipline;
  • The personnel costs per external employee per discipline.

External drivers

The organisation’s market share can be determined on the basis of the calculated student population. Together with the rates per student of the Ministry of Education, Culture and Science (OCW), the total national contribution is calculated. This national contribution is then allocated to the various study programmes on the basis of the number of students per programme. For this purpose, the following external drivers are used:

Drivers for the market share calculation

  • The national number of weighted enrolments and degrees of the Ministry of Education, Culture and Science;
  • The number of weighted enrolments and degrees of the organization.

Drivers for the national contribution calculation

  • Market share of weighted bids and grades;
  • The build-up of the macro budget of the Ministry of Education, Culture and Science;
  • The rate per student of the Ministry of Education, Culture and Science.

Driver for the national contribution allocation

  • Ratio for the internal allocation of the total national contribution to the various fields of study.

Result

The results of all calculations are included in the income statement for each scenario. Those parts of the profit and loss account that are not calculated on the basis of drivers, such as fixed costs, are filled on the basis of the average of a number of years. In addition, it is always possible to make manual adjustments per scenario.

Analyse

The results can be analysed per scenario for the different aspects of the solution. For example, the expected tuition fees per discipline can be viewed in both tables and graphs.

In addition, the dashboard provides insight at a glance into the different values entered per driver per scenario.

Solution

This planning application is offered in the following 3 variants:

Explorer: This solution contains the planning of the entire profit and loss account based on the various internal and external drivers. The driver input is generated based on historical averages.

Advanced: Especially for organizations that want to plan their income statement, balance sheet and cash flow using internal and external drivers. The driver input is generated based on historical averages.

Predictive Forecasting: The Predictive Forecasting functionalities of SAC are used in this solution to forecast the income statement, balance sheet and cash flow. The driver input is generated based on Machine Learning algorithms.

Time and quality gains


Thanks to this scenario planning solution it is possible to directly calculate and compare certain scenarios. In addition, ‘What-if’ issues can be answered easily and quickly. With this application it is therefore possible to make faster and better substantiated decisions, because the impact of decisions is immediately visible.

This time and quality gain can ensure that controllers can concentrate on the real issues within the organization.

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