Cost Trace Visualization in Financial Allocation Models
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Solution Overview
Problem
Complex financial allocation models in large enterprises face difficulties in tracing cost allocations due to their size and complexity, making it challenging to analyze and visualize the flow of costs between various cost objects and items.
Innovation Solution
A system and method for visualizing the trace of costs across a graph of financial allocation rules, which allows for the selection of cost objects, generation of cost traces, and simultaneous tracing of multiple cost line items, enabling efficient cross-referencing and visualization of traced costs within a financial allocation model.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Measurement precision
If the number of tracked activities and elements in a financial allocation model increases, then the accuracy and comprehensiveness of budgeting improves, but the complexity of the financial allocation model increases
Solution Approach 1:
The patent segments the complex financial allocation model into a hierarchical structure with cost pools at different levels (enterprise-level, business unit-level, department-level). Each cost pool contains specific cost objects and allocation rules, allowing the system to manage complexity by dividing the overall model into manageable segments while maintaining comprehensive tracking of activities and elements.
Solution Approach 2:
The patent introduces a visual dimension to the financial allocation model through graphical user interface elements that display cost pools, cost objects, and allocation relationships. This visual representation adds a new dimension to the data structure, enabling users to comprehend and analyze complex multi-dimensional cost relationships without being overwhelmed by the underlying complexity.
2Quantity of substance
If the size and complexity of a financial allocation model increases, then the comprehensiveness of cost tracking improves, but the ease of analyzing and tracing cost allocations deteriorates
Solution Approach 1:
The patent introduces cost pools as intermediary structures between individual cost objects and the overall financial model. These cost pools act as aggregation points that summarize costs from multiple sources, making it easier to trace and analyze cost allocations without having to navigate through every individual cost object in the comprehensive model.
Solution Approach 2:
The patent extracts and highlights specific cost trace information from the comprehensive financial allocation model through visual indicators. When a user selects a cost object, the system extracts and displays the relevant cost trace showing how costs flow through allocation rules, separating the essential tracing information from the rest of the complex model for easier analysis.
3Productivity
If sophisticated computer programs are used to assist in generating budgets, then the productivity of budgeting processes improves, but the device complexity increases
Solution Approach 1:
The patent implements automated calculation and visualization features that allow the financial allocation model to self-update and self-explain. When cost objects or allocation rules change, the system automatically recalculates cost pools and updates visual representations, eliminating the need for manual intervention and reducing the operational complexity for users while maintaining high productivity.
Solution Approach 2:
The patent incorporates real-time visual feedback mechanisms that display cost traces and allocation relationships as users interact with the model. This immediate feedback helps users understand the impact of their actions on the overall budget, reducing the learning curve and operational complexity while enhancing productivity through intuitive interaction.
Data Source
AI summary
Embodiments are directed towards budgeting and forecasting of information technology and services. In at least one of the various embodiments, financial allocation models may include multiple cost objects and one or more allocation rules. In at least one of the various embodiments, allocation rules may determine how costs associated with cost objects may be allocated to other cost objects. In at least one of the various embodiments, costs corresponding to one or more selected cost objects may be traced within a financial allocation model. Also, costs associated with multiple cost line items from different cost objects may simultaneously traced for efficient cross-referencing of disparate cost line items. Further, in at least one of the various embodiments, a display of the cost traces may be rendered and displayed to provide a visualization of the traced costs.