Philip Lerche 0:00:05.6:

All right, so good afternoon, everyone. I'm very excited to be at the Anaplan Connect 2025 in Stockholm. My name is Philip Lerche. I'm here together with Martin Pasternak, and we are very excited to share our journey on financial planning transformation at Vestas. At Vestas, we have always been at the forefront of technology innovation within the renewable energy sector. So we are going to talk about how we are transforming financial planning for better decision-making and performance and moving ourselves forward. Before we go into the transformation itself, let's take a step back and look at who we are as a company besides what you just saw in the video and why the change and the transformation was needed. So Vestas dates back to 1898, where it started as a blacksmith shop in the Western Jutland. Then over the decades, Vestas has transformed multiple times from agricultural machinery through hydraulic lifts, and now in 1987, fully committed to wind power energy, and fast forward to today, we are now the world leader in renewable energy, with more than 188 gigawatt of installed capacity around the world. That also means that we are looking into what is we are in need of a change. 

Philip Lerche 0:01:51.7:

First a few facts of Vestas. We are now more than 35,000 employees around the world servicing and erecting, installing and also producing turbines for our customers and servicing them as well. We have responsibility to service more than 56,000 turbines worldwide, meaning beating 288 gigawatt of installed capacity, where some are serviced by Vestas but not all over time. That also leads us to be able to say that we are now part of avoiding around 239 million tonnes of CO2 emission annually with the turbine spinning every day for our customers and for clean energy. So many of you have seen what has happened in recent years. We have had a more volatile and more uncertain and more complex and in a more ambiguous world leading to why we are seeing increasing challenges operating in many industries. Vestas as a global actor in supplying wind turbines that had a very massive size, meaning our supply chains are complex and we deliver to new sites all the time. Therefore, we have seen that the uncertainty has created very, very complex and increasing challenges around our supply chains. We have seen increasing interest rates that have changed our customers' ability to finance the turbines they buy. We also see increasing inflation that has led us to see that both ourselves and our customers are challenged to deliver cleaner, cheaper energy for customers. 

Philip Lerche 0:03:45.9:

So those were the backgrounds of why we needed to see this change happen as a company. That led us to a few years back to say we needed to look at how do we respond to the needs of investors today versus how we did it before. So we used to be a company that got driven by annual budgeting planning and the strategy planning process and then in-year financial planning that was built up in silos. So we had a sales planning on its own. We had a production plan on its own. We had a construction plan on its own. We had a service plan that was not connected across. We saw that that meant that we could not really connect the dots, and we could not provide a proper way of operating. Out consolidated planning was happening in Excel. So we looked at, we had like a phase one was getting to a high-level design and problem statement. Then there was a detailed design phase, and last but not least, we saw a implementation and embedment phase, as you see on the slide. So in the high-level design, we started with a very thorough current analysis, state analysis, where we interviewed both our section management, senior leaders across the organization, both at group level, but also at regional level. So we had a very detailed mapping of, let's say, the leadership needs of financial planning and performance. 

Philip Lerche 0:05:25.4:

Then we added a walkthrough and interviews and analysis with the questionnaires to the wider finance organisation, leading us to have a clear problem statement for us to work with, thereby moving us to a detailed design and a future operating model high-level design. Once we had all of that in place, we looked at tools for implementation, and Martin will come into that in a minute, in the details around it, and ensuring that we had a high degree of embedment to ensure a lasting change. Since what we are trying to do is fast forward what Dane was showing earlier today from the 90s way of doing financial budgeting to a future proof connected financial planning and driving scenario planning for better decision-making. Over to you, Martin. 

Martin Pasternak 0:06:23.1:

Thanks. So, hello, everybody. Good to be here. My name is Martin. I have been working in Vestas for 10 years and been leading this massive transformation that we're doing in Vestas. So I will speak a little bit about why we succeeded the way we have done, actually. Also, of course, lastly, also talk a little bit about the tool selection process that we undertook, and why we took the choices that we did. So we succeeded, which is a success story that just happened because of the tool implementation. It actually happened with, it came with a transformation mindset change that happened. We had an end-to-end view, recognizing that financial planning cannot be seen in isolation. We need to look at it in a broader performance management cycle. We have also engaged heavily with our business because they will be hugely impacted by the way that we're doing. It's not only finance that will be changed, the ways of working, but it will also be the business that needs to adapt to a new reality, so to speak. So the change management and having that as a core pillar in our rollout and our transformation has been extremely important. Not having it as a one-time communication but having continuous dialogues with our stakeholders, business stakeholders and users and that has actually, I would say propelled our adoption and ownership of the solution that we are bringing forward to our customers. 

Martin Pasternak 0:08:13.6:

Quickly, just talking a little bit about our ambition. Our ambition is to have a fully connected financial planning setup. We nd we want to, you can say, connect the financial disciplines that we have in Vestas better and also processes better. What we also want to do is linking our financial planning better with our operational plans and thereby, you can say, secure that we start looking at harmonised planning. As Philip alluded to before, we had it in silos. So we're doing finance only planning and now we are trying to bring in the business insights and thereby providing a forecast driven on finance from the business source, so to say. We have also enabled a rolling 18-month forecast as part of our transformation, which Philip also talked to before, we were only looking at in-year forecast. We believe that was a better fit for the business that we are. We are, to a large extent, a project-driven business. We need to have, we can say, an outlook further than the in-year. Also just to secure that the performance that we're seeing is also not all of a sudden declining start of next year or something like that. So that was also really important for us to establish. We have also worked on creating even more transparency into our executive management and started looking at, you can say, harmonised way of looking at risk and opportunities and not just working with one forecast number. 

Martin Pasternak 0:09:54.0:

We believe that there is a better, you can say, basis for dialogue if we have a viability into our forecast and talking to that, that brings better value and better dialogues and also on top of that, better actions in the end, that we get transparency one is actually driving our forecast up or down, meaning what events do we foresee that could actually either negatively impact or positively impact our forecast and talking to that in our dialogues that we have regarding performance. We can say the overarching outcome of all of this we're trying to do is, of course, increase our quality by sourcing and connecting to underlying operational planning. That is one thing. On the insights part, we're also creating even more transparency into our senior leagues to take the right decisions. Of course, also looking at the efficiency, we are also improving and standardizing with process workflows and so on. Of course, also establishing a new tool, investors, which I will just briefly talk into here. So to start off with, this is just a high-level, I would say, view of our application or financial application landscape investors, where we are on the lowest part of the ERP system, then we have a BW on top of that, and then last but not least, we had a lead consolidation residing on top of our BW.

Martin Pasternak 0:11:23.8:

In reality, we did not have this enterprise performance management layer. We had it sell, but that was literally not cutting what we needed. So as part of our transformation project, we also needed to look at a tool enablement. You can see even though that processes and mindset is at the heart of our transformation, technology is a key neighbor for us also. So we went into a vendor selection process where we had stated some key success criterias. We needed a dynamic and flexible tool because the world we are living in is changing so fast so we did something that can adapt the same way as the business is expanding. Then we also liked the modular approach because our financial planning engine is a buildup of models. So it's also have, you can say, accelerated our implementation journey that we actually had a tool which in its core is a very modular tool and technology. That has really helped us get models up and running and into the business and harvesting value fast. I can maybe just speak shortly about our implementation. During '24, we have implemented a full rolling 18-month forecast on the full P&L. That's more or less eight/nine models we have implemented fully. We have around 220 users using the system actively. That was also due to the technology that we could actually propel and fast track the implementation. 

Martin Pasternak 0:13:14.4:

We also of course looked for a best of breed solution. A mature solution was of course also very important for us. We needed to see that other people are using it for the purpose that we wanted it to be used for, meaning enterprise level. Also, of course, that it has a great user experience, both from the end users and developers. That, I would say, more or less, Anaplan ticked on all boxes, and we've been happy with the tool so far. I think that more or less concludes our presentation and we would actually like to see if there's any questions to what we've presented or questions about questions. 

Audience 0:13:59.1:

I have one. You say you're currently in the implementation phase of Anaplan. How far along are you in, like, phase three of it? What's actually delivered of Anaplan for your business model? 

Martin Pasternak 0:14:18.5:

So when we look at what we've implemented so far, we have implemented a full rolling P&L, meaning from top line down to bottom line, so to speak. We did that within a year, and now we are progressing on implementing full cash flow, CAPEX and balance sheet for this year, and also enabling target setting in Anaplan. That is next in line, which we will deliver during 2025. So we can say full rollout within two years. Yes, and we've been delivering to plan and it's really, when I reflect upon it, I've been working with a lot of tools during my career, and the dynamic and flexibility of Anaplan is something that I've never seen any other places. So we have also made mistakes. We have gone down the road down here and then found out, oh, that's not really what we would like. We would actually like to do something else and we have actually been able to do that. Of course, also speeding up not and really being firm on our timeline and showing the business that what we're saying is also what we're doing which is also really, really nice.

Philip Lerche 0:15:36.3:

Adding to that the user experience we are seeing is superior to what we are seeing our finance users across the world having with other of our financial tools. So they're much more happy from the go-get. It's much easier and more logical for them to work well in many ways. We can actually deliver better quality output for them as a user in the daily work. It delivers what they need instead of them having to add a lot of manual work in Excel or other models to get to something they can use. 

Martin Pasternak 0:16:09.4:

It's also very much like we're both doing continuous improvements on the already existing models that we have worked with and also implementing new ones. There is a push now from the users, ah, this is really nice, could I also get this. So there is this quick adoption, right and they can see the value of the tool that we're bringing forward to them, which is super nice. 

Audience 0:16:34.9:

So how did you see from the change management perspective? [Unclear words 0:16:39.6] about that. So was it easier in terms of implementing this tool? 

Martin Pasternak 0:16:48.4:

Yes, I would say we had a good start, meaning that our executive management also recognised that we need to change the way we're doing financial planning. So the tone from the top was very clear, meaning that we need to change and there's no way about it. We want to go into this rolling 18 months forecast setting and of course, that needs to cascade down throughout the whole organization and the business especially, right. Of course, there we are in continuous dialogues of anchoring the changes that needs to happen to the business. This is not something that happens overnight. It's a longer process, so to speak. For that, we are also utilizing our business partners towards the business to drive that change with their counterparts, because we are a project organization which is not that big. We cannot do everything. We also need to be mindful of our scope and then utilize our business partners towards their stakeholders and instilling that change together with them. 

Philip Lerche 0:17:46.7:

Then we introduced like an early co-creation. So with our business finance functions across the world and our group, we saw that when we started involving them at an early stage, we addressed the seeing things from a different perspective, meaning we had a much easier approach to having everybody in the same boat, seeing the same things, acknowledging, making the compromises needed for the speed of change we wanted to install and for the mindset change. So it's a clear recommendation for any implementation that you look at not only running it and ruling it out, but actually involving key stakeholders very early on, listening in and showing that you really look and listen to what they need for their business to operate well. 

Martin Pasternak 0:18:40.5:

It is also an act of compromise. You cannot just serve everybody's needs down to the lowest detail because then we won't progress at all. So it's a give and take to some extent. 

Philip Lerche 0:18:51.6:

So we listened, but we didn't obey to all the needs and we will not do that either going forward. We made a clear design principle from the beginning, keeping things as simple, not solving all the needs for everybody across the organization and that we have maintained for quite some time. I think we have time for one final question. 

Audience 0:19:17.7: 

Thank you. Good running there. So I guess it's still early days, but do you have any feeling for the return on investment on this tool in terms of cash-in cash-out or any other measurements? 

Martin Pasternak 0:19:34.2:

I would say if we look at when we started this off and it's a good question, so if I may say when we started having the support from the executive management, his our case for change in our business case to do this was not about saving money. It was all about ensuring stronger foundations for the right business decisions at the right point in time. Our main customer is enabling executive management for better decision-making. That has been our first and foremost. So if you look at a return on investment, yes, it is early days. We are already now seeing the benefits of the transformation in terms of better quality in our planning, better explanations to why the forecast is and this, the ability to work with risk and opportunities to mitigate that in a transparent way across the business. So I would say the return on investment has been mainly at this point in time improved decision-making ability because we can now provide senior leadership with options. So strategic optionality, that allows them to make better choices for the future and navigating this in a much more real-time version that we were able to see before, where our budget bottom-up process took around five months, and we're not connected at the end because of different synchronization issues. 

Male 0:19:34.2:

Great, thank you very much, Philip. Thank you very much, Martin. I think you will be here still for the breaks.