Yes, compliance and performance are compatible, but let's lose the doe-eyed fantasies of technology salvation. That's the advice independent planning-, reporting- and risk-management consultant David Axson doled out to financial types at a June seminar held in New York sponsored by Cognos.

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"The idea of a single version of the truth is a crock," said Axson, skewering an oft-heard performance management marketing phrase. "Until worldwide GAAP [generally accepted accounting principles] standards are harmonized, global companies will need to maintain at least three versions of the truth." (Note to Cognos: "Single version of the truth" came up 37 times on your Web site.)

Meanwhile, you can put all sorts of policies and processes in place to try to achieve compliance, "but if it doesn't change practices and behavior, your investment in compliance is of marginal value," noted Axson, one-time head of corporate planning at Bank of America and a cofounder of the Hackett Group.

So how do you combine performance management and compliance? Develop early warning systems around risk rather than focusing on cost, switch from annual budgeting to dynamic planning and value responsiveness over detailed forecasts that can't possibly be accurate.

"If you have an effective early warning mechanism that tells you you're not closing deals, for example, you'll be able to respond," said Axson. "That's where performance and compliance meet up, because traders just might do something dodgy when their close ratios start falling rapidly."

Most of all, Axson stressed that compliance and performance are processes, not one-time projects.
— Doug Henschen