Modern civilization relies on biotechnology to develop medicine, products, agricultural advancements, and other key innovations that support the health and progress of human populations.
Yet, biotechnology is a highly competitive industry, and biotech companies face innumerable challenges when catering to the global marketplace. Due to being such a dynamic and high-growth industry, budgeting and forecasting is a challenging process.
In a recent webinar, How Fast-Growing Biotech Companies Manage Corporate Performance in the Cloud , John O’Rourke from Planful had a conversation with Robbie Tantoco, the Associate Director and FP&A at Keryx Biopharmaceuticals, and Robert Entwistle, the Financial Systems Manager at Sigma-Tau Pharmaceuticals, Inc. The webinar focuses on the difficulties that high-growth biotech companies face in the planning and forecasting process. With cloud-based EPM software, both Tantoco and Entwistle were able to drastically improve their approach to modeling and forecasting, while accessing a highly scalable platform that catered to their rapid growth.
The Challenges in the Biotech Industry
Biotechnology is a dynamic industry that is constantly adapting to global needs. Biotech companies face a number of distinct challenges including:
- High demand and rapid growth rate
- Global competition that puts pressure on costs
- Constantly introducing new products
- Significant regulatory requirements
- Complex legal requirements
These challenges make the planning and forecasting process even more difficult, which ultimately led Tantoco and Entwistle to search for more viable alternatives.
What Was Life Like Before Cloud-Based EPM Software?
In the webinar, O’Rourke asked Entwistle and Tantoco what the planning and forecasting process was like at their organizations prior to cloud-based EPM software. According to Tantoco, prior to cloud-based EPM, their organization was buried in spreadsheets, which led to the budgeting and forecasting process being conducted manually. This was incredibly tedious and time-consuming.
According to Tantoco, “Scenario planning and forecasting became a challenge because every additional change required us to redo the rollup and consolidation which takes hours if not a whole day to do.” In addition to being labor-intensive, Tantoco emphasized that their former system was prone to errors. Not only is the propensity toward human error increased, but the two-dimensional spreadsheets were harder to read and analyze.
Entwistle said his organization experienced many of the same difficulties as Tantoco’s company. He went on to add that the system made it difficult to ensure everyone within the organization had the information they needed, and oftentimes certain employees couldn’t access certain spreadsheets. Entwistle also said that, “Compiling the spreadsheets to create an aggregated budget was very difficult, and often that exercise had to be repeated,” which inevitably resulted in a highly tedious process.
Why Did They Turn to Cloud-Based EPM Software?
Both Entwistle and Tantoco decided that cloud-based EPM software provided the ideal solution to the issues their organizations were experiencing. Some of the key benefits that led them to adopt cloud-based EPM software include:
- Accessibility: With the cloud, all documents are accessible to all employees from any device, so all departments will have the information they need. As Entwistle mentioned, many employees at his organization were routinely denied access to spreadsheets. When based in the cloud, all employees can access the information from any device, remedying the accessibility issues of on-premises EPM tools.
- Agility: The biotech industry is constantly changing, and Entwistle said he needed a tool that could accommodate those changes. Cloud-based EPM software provides companies with the agility they need to quickly generate models and forecasts, allowing them to keep up with the frequent changes in demanding and high-growth businesses.
- Scalability: The cloud-based platform simplifies scaling, while making data cheaper to store. For high-growth companies, scalability is critical to providing a platform that can accommodate their future needs, as well as their current needs.
- Reporting: With increased flexibility in the reporting process, reporting is easier and faster than ever before. Tantoco mentioned that automated reporting was a priority for him, given the frequency of reporting that is required in his organization.
- Analytic capabilities: EPM software provides multi-dimensional modeling capabilities, which enhances analysis and provides more accurate insights. Tantoco saw this as a primary appeal, as it would eliminate the inaccuracy issues caused by two-dimensional spreadsheets.
- “What-if” scenarios: With advanced modeling capabilities, biotech companies can perform a variety of “what-if” scenarios to understand the impact of every business decision prior to implementation.
- Ease-of-use: Both Tantoco and Entwistle were particularly drawn to cloud-based EPM software, due to the software providing an Excel-based user experience. Having used Excel for modeling up until that point, they wanted a solution that would be easy to implement at their organizations, while requiring a low learner’s curve for employees. The spreadsheet interface was familiar and easy to use, making it the ideal software solution. The cloud also made implementation easier because they didn’t have to install the software on every single computer, which greatly expedited the implementation process.
- Low-cost: Tantoco emphasized that cost was a major factor, as the competitive nature of the job meant they have to keep the cost of products low. Since cloud-based EPM software provides a low cost to manage, it seemed like the best solution.
- Data integration: EPM software makes it easy to integrate the data and plans from all departments, eliminating the struggle of manually aggregating budgets.
The Impact of Cloud-Based EPM Software
Since adopting cloud-based EPM software, both Tantoco and Entwistle have been satisfied with the results. Entwistle said that the greatest advantage was escaping the two-dimensional view of spreadsheets. “With our current system, using the multi-dimensional setup has enormous benefits.” He said the ability to slice and dice data and gain that added visibility has helped improve the analysis and decrease human error, while allowing his organization to make decisions more confidently. Additionally, now all employees at his organization can access the data from anywhere and at any time, which has tremendously improved their operation.
Tantoco added that the rollup process is countless times more efficient than before. Also, having a centralized system to store all data has simplified their lives, while eliminating the hassle of organizing an endless quantity of spreadsheets. Tantoco also noticed that cloud-based EPM software has made it much easier to integrate all of their models across all finance functions, while expediting the reporting process considerably.
Biotech companies face innumerable obstacles in planning and forecasting. With the harsh competition, the endless public demand, and the fluctuating nature of the industry, biotech companies need modeling and budgeting software that is scalable, agile, and flexible. With cloud-based EPM software, biotech companies can reduce costs, improve the accuracy of modeling and forecasting, integrate their plans between departments, and access the information from any device.
To learn more about improving the reporting and forecasting process, read the Planful whitepaper, Enterprise Performance Management in Life Sciences.