How High-Growth Biotech Companies Rely on Cloud-Based EPM Software

How High-Growth Biotech Companies Rely on Cloud-Based EPM Software

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.

EPM software

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.

EPM software

  • “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.

EPM in Life Sciences White Paper

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What are the Benefits of Rolling Forecasts?

What are the Benefits of Rolling Forecasts?

Financial budgeting is the process of allocating resources based on projected sales, headcount, capital and operating expenses, in order to achieve financial objectives.

Static budgets rely on set periods, a fiscal year for example, and create a fixed forecast for that period. Rolling forecasts, as an extension to financial budgeting, support periodic updating of budget assumptions, and extend the time period out beyond the end of the fiscal year.  By continuously forecasting out 4 – 6 quarters, you can avoid the “fiscal year cliff” and give your organization a head start on next year’s budget.

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Static Budgets can Limit Growth

The future is uncertain, but rolling forecasts
will keep your business on the road to success.

Today’s market volatility is driving increasing interest and adoption of rolling forecasts.  In fact, in a recent Hackett survey, 55% of respondents indicated they were adopting a form of rolling forecasts.  Rolling forecasts are extremely beneficial, particularly for large and dynamic enterprises that have to perpetually alter their budgets and plans to adapt to new trends. Rolling forecasts allow for more accurate and versatile forecasting that will remain true to a company, even amid fluctuations in the industry, economy, or marketplace.

Improved Risk Analysis

Dynamic industries face an increased propensity toward risk, due to the fluctuating nature of their markets. With a rolling forecast, businesses can continually adapt future forecasts to reflect industry, economic, and business changes, enabling them to reduce risk and allocate resources more optimally in pursuit of their financial objectives.

Opportunistic Forecasting

For a business to thrive, it needs to be able to readily adapt to changing customer and market trends. For dynamic industries, this is particularly true as the habits of consumers can fluctuate rapidly. With rolling forecasts, businesses can be more opportunistic in their decision-making because they’ll have the ability to tweak their business assumptions, alter budget allocations, and adjust their spending more quickly, enabling them to better respond to industry and consumer demands.

Driver-Based Planning

For large, dynamic enterprises, financial forecasting is particularly challenging because it can be difficult to know where the business will be 12 months down the road. Additionally, every business decision entails considerable risk, and weighing the value vs. risk of a decision can be challenging.

One technique that many companies use as part of their rolling forecast process is “driver-based planning“.  The idea here, is that instead of budgeting or forecasting every line in your revenue or expense budget, you identify the key “drivers” that impact many other line items and focus on them. By linking other line items to the key “drivers”, planners can focus their forecasting efforts on material factors, such as orders or sales reps, and see the impact that changes to these line items have on the overall budget or forecast.

Up-to-Date Forecasting

Dynamic businesses are in a constant battle with time, and there are a lot of urgent business adaptations that they need to make to succeed. With a rolling forecast, businesses can better respond to time-sensitive decisions to ensure the company is perpetually advancing its goals. The forecast is regularly updated at predetermined intervals to ensure that forecasts are always based on the most relevant and timely information.

Increased Accuracy

The greatest difficulty in budgeting is factoring in all businesses variables to create accurate plans for the future. With rolling forecasts, the forecast is updated regularly, so businesses can perpetually adjust the forecast to accommodate any recent changes or trends, creating a plan that is far more realistic and reliable.

Rolling forecasts are indispensable to large enterprises, and they provide the versatile planning abilities that dynamic industries need. Nonetheless, many businesses fail to implement rolling forecasts effectively, resulting in an overly convoluted process that is difficult to maintain.

With cloud-based EPM software, businesses can greatly simplify their rolling forecasts, streamline the budget cycle, and reduce human error. With multi-dimensional forecasting abilities, businesses will have greater control over their budgets while experiencing increased visibility and control over the what-if scenarios that drive business decision making.

To learn more, read our free white paper Best Practices in Rolling Forecasts.

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The Habits of Highly Effective CFOs

Happy 2016!  As we move into the New Year, CFOs might be thinking about how they can be more effective in their roles.  Alternatively, up-and-coming Finance executives might be wondering what it takes to become a CFO.  

With that in mind, the Boston chapter of the CFO Leadership Council recently held a panel discussion on “The Habits of Highly Effective CFOs.”  The panel was moderated by Bill Driscoll, President of Robert Half International.  The panelists included a number of successful CFOs:

  • Keith Seidman, former CFO at Thinking Phones, Kiva Systems, Acme Packet
  • David Noymer, CFO at the Greater Boston Food Bank
  • Ted Myles, COO & CFO Ocata Therapeutics
  • Mary Jefts, CFO Unidesk

Here’s a summary of some of the key points made during the panel discussion.

Advice for Landing Your First CFO Role

Breaking through into a CFO role is difficult – even more so without the right experience.  It’s much easier to land a CFO position once you’ve been in a similar role.  One panelist leveraged his network to land his first CFO role in small NASDAQ company.  Another panelist had Controller experience and leveraged that with investors to move into the CFO role.  He took a risk that paid off.

Up-and-coming No. 2’s can be attractive CFO candidates for companies.  How can you make yourself stand out?

One word of caution – make sure to perform due diligence on companies before joining to uncover hidden issues.  Get outside opinions on the company from customers, partners, investors, and analysts.

Working with Boards

It’s key that you build strong relationships with board members.  Be prepared.  Treat meetings with board members like a job interview.  Connect 1-on-1 outside of meetings.  Get input.  Understand their issues and concerns.  Use board members to work through issues. 

The CFO needs to set expectations with board members.  There should be no surprises.  For you, that means being candid and direct.  Present problems and solutions.  Build trust.  Communication is key.

Here’s a link to a prior blog article on this topic.

Effective Communication with Employees, Other Stakeholders

bigstock-Business-presentation-on-corpo-89684099.jpgAs the CFO, you need to be consistent in messaging to stakeholders.  Employees, investors, customers – all are really important audiences. You need to clearly communicate goals and objectives to all stakeholders. 

The CFO, as a member of management team, needs to work on messages for employees in the case of major changes, such as pending acquisitions.  For you, this means highlighting the opportunities that will create for employees.  With employees – both formal and informal communications are important. 

Executives need to maintain contact with key customers and ensure solid relationships.  That means speaking with customers as part of your due diligence, before joining a company, to understand their point of view. 

Key Habits to Adopt

Preparing for board meetings is key.  That means you need to understand key objectives and create materials accordingly.  Pitch preparation is key in getting financing as well.  The best way to be prepared?  Know the details behind the summary pitch.  Practice pitches with different audiences.  Negotiation preparation is also vital. 

For CFOs in public companies, preparation for earnings calls and analyst questions is critical.  Have reference materials available – either on paper or electronic form – so you can go deep when needed. 

How Role of CFO Has Evolved

The role of CFO has expanded over time, with a much broader focus than 30 years ago.  CFOs are more involved now in setting the direction of the company, as well as managing day-to-day tasks.  The key here is “managing”—in other words, let your team handle the day-to-day stuff.  Sarbanes-Oxley (SOX) had a big impact in getting CFOs more in touch with the business, improving the governance of companies and broadening the CFO’s role. 

Technology has changed as well.  For instance, working with auditors has changed from organizing work papers to loading them on a thumb drive to uploading docs to the cloud. 

The CFO has become a more strategic partner to the CEO and the business.  The CFO needs to help with problem-solving, not just manage back-office tasks.  Having a seat at the leadership table is key in today’s world.

Future of Finance and CFO Function

bigstock-Business-Woman-876649.jpgCFOs of public companies face continued challenges in communication with an analyst community.  The role of social media and rating sites like Glassdoor put pressures on communications.  The workforce is changing.  Millennials are demanding, so you need to address their issues in order to attract and retain talent.  They have expectations and want flexibility in work location, styles.  You need to train them on boundaries of communication, what to share and what not to share.

Lawyers have a bigger impact now, especially in public companies.  Industry specialization is becoming more important.  Networks of CFOs vary by industry – e.g., Biotech vs. High Tech.  More involvement in operations is expected.

Automation and technology play a bigger role now in the CFO’s job.  Cyber security is a big concern.  CFOs and companies need to get ahead of the threats here.

Lessons Learned (what you would tell your 25-year-old self?)

CFOs shouldn’t get pigeon-holed.  In other words, you need to network with peers, stay current on industry trends, bounce ideas off others.  Do this early in your career.

You need to think strategically and consider alternative paths, options.  It’s OK to make mistakes.  Focus on excellence vs. perfection.  Communicate better with key stakeholders.

Don’t be too emotional.  You need to let problems unfold.  Listen to people.  Consider options.  

Key Takeaways

This was a great panel discussion with some practical advice for CFOs and CFO “wannabees”.  And in thinking about how cloud-based EPM solutions can support some of the key “habits” suggested by the panelists, I see a number of opportunities.  Some examples include the following:

  • Creating high-quality board presentations and books of reports
  • Generating accurate and timely financial statements and supporting detail for earnings releases, calls, and regulatory filings
  • Developing accurate revenue and expense forecasts that are used in setting guidance with stakeholders
  • Leveraging the cloud to support cyber security initiatives

To learn more about cloud-based EPM solutions and how they can help you be a more effective CFO, check out this free white paper “Introduction to EPM in the Cloud.”

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Relieving the Pain of Year-End Close and Reporting

How’s the 2015 year-end closing going?  Many of you may still be in the throes of year-end close and reporting.

This can be a stressful process that goes on for weeks, even months, when you include the creation of year-end regulatory filings, year-end audits, and tax filings.  Trust me, I’ve felt your pain.

But with the right tools and processes in place, the year-end close and reporting process can be less stressful and painful for the Finance team, maybe – dare I say it – even something you look forward to.

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Remembering the Good Old Days

When I was a staff accountant back in the mid-1980s, I remember spending many nights and weekends working to close the year-end books.  When we’d arrive at the office on Monday morning after a long weekend of work, the Finance department floor would be littered with empty pizza boxes, donut boxes, coffee cups, and even a few empty beer cans.   Ah, the memories!

year-end closeOf course, the technology we were using to collect and consolidate financial results back then was pretty arcane.  My company’s international subsidiaries would send their trial balances via Facsimile.  (Yes, remember Fax machines?)  Half of the time the numbers were unreadable, so we had to confirm them via phone.

Then we would key the numbers into a spreadsheet and perform the currency translations there.  (I think we used Lotus 123.)  Then we would create journal entries and post the changes to the mainframe GL for consolidation.  Intercompany reconciliations were a nightmare, with many phone calls to the foreign subs.  Running reports was an overnight, batch process – night after night.

Life is so much easier for accounting and Finance staff now with today’s technology.  But year-end close and reporting can still be challenging.  Why?

It’s More Than Just Rolling-Up Numbers

Those who do this for a living know how challenging the process can be and what the complexities are.  The financial close is an iterative process that typically requires many steps:

  • Collecting financial results from multiple systems, divisions, subsidiaries – often with different charts of accounts, currencies, and business practices
  • Consolidating the financial results following US GAAP or IFRS guidelines, including these steps:
    • Performing currency conversions
    • Managing complex intercompany reconciliations
    • Correctly accounting for minority interests
    • Entering top-side accruals and other adjusting journal entries
  • Reviewing the results for completeness and accuracy, making corrections and reclassifications of revenue and expenses as needed
  • Performing hundreds, sometimes thousands of account reconciliations
  • Producing financial statements that the CFO and CEO are confident in signing off on
  • Ensuring adequate audit trails for internal and external auditors
  • Creating regulatory filings that combine text, financial statements, tables, and charts

keep_calm_year_end_close_career_blog_post_50.pngOf course, if the accounting team is doing all of this with spreadsheets and email, especially in a multi-entity enterprise, the process can be almost impossible.  Collecting and consolidating multiple spreadsheets creates too many opportunities for errors and omissions.  This approach adds a lot of time and manual effort to the process.  And when the auditors review the process?  They’ll conclude that there’s a total lack of security, control, and audit trails when using spreadsheets.

Managing the process with legacy, on-premises EPM applications is a little better approach.  But if your EPM tools are old, cannot easily integrate all the necessary data, have limited dimensionality, and inflexible reporting, the Finance team will still struggle.  A lot of Finance team time and resources will be spent manually entering data, reconciling balances, manually creating reports, and dragging out the process.

And, in some cases, the installation and implementation of on-premises EPM applications can take 6 months to a year.  The maintenance can also be time-consuming. And upgrades? They’re almost as costly and complex as the initial implementation.  We can do better than this.

Year-End Close and Reporting with Cloud-Based EPM Software

Enter cloud-based EPM software.  The financial close and consolidation modules provided by cloud-based EPM providers, such as Planful, make the year-end close and reporting process much less painful.  Some of the key features that make the process smoother include the following:

  • Automated data loads from multiple sources – ERP, HCM, CRM, and others – both on-premises and in the cloud
  • Financial close process management and status reporting
  • Automated currency translation and intercompany reconciliations
  • Multiple reporting hierarchies
  • Built-in accounting for minority ownership
  • Ability to consolidate results according to US GAAP, IFRS, and other guidelines – within minutes
  • Real-time, dynamic reporting and bursting of reports to managers across the enterprise
  • Automated creation of regulatory filings, board books, and presentations that combine reports, charts, graphs, and text

All of this is backed up by robust security and audit trails that enable both internal and external auditors to trace individual numbers on the balance sheet or income statement – back to their source – within minutes.  This saves a lot of time, effort, and cost during, as well as after, the close process is completed.

Cloud-based EPM software also provides a number of added benefits over on-premises solutions.  For example, the applications can be deployed much faster, are a fraction of the cost, are updated automatically, are more secure, and more scalable than on-premises alternatives.

Customer Examples

Hundreds of companies are now performing their year-end, quarter-end, and month-end close and reporting processes using cloud-based EPM solutions from Planful. These companies replaced either spreadsheets or legacy on-premises applications with our cloud-based EPM suite.  Here are some examples of the types of improvements and benefits customers achieved with our solution.

  • iCIMS reduced board reporting from 4 days to 4 hours
  • Axioma reduced its close process from 16 days to 4 days and time spent correcting spreadsheets from 20 hours monthly to zero.
  • Physio Control reduced the monthly close by 2 weeks
  • Groupon reduced the monthly consolidation from 3 days to 1 hour

If you’re fed up with the pain of year-end close and reporting and want to learn more about the cloud-based approach, here are some resources to check out.

Watch the replay of our financial close webinar on

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4 EPM Essentials for Fast-Growing Companies

4 EPM Essentials for Fast-Growing Companies

Is your company outgrowing the capabilities of your current budgeting, planning, and financial reporting tools?  If you answered yes, you’re not alone.

This is often the case when companies start out relying on spreadsheets for these critical processes.  It also occurs when companies reach the limitations of low-end EPM applications.  

The key is to be aware of the symptoms that you have outgrown your current EPM tools and that you are aware of the available alternatives.  It also helps to learn from other companies that have made the leap from spreadsheets to cloud-based EPM solutions and to understand the potential benefits your organization can achieve by making that same leap.

Challenges of Managing High Growth

Finance executives and teams in fast-growing companies face unique challenges.  The most critical, of course, is managing cash flow and ensuring there’s enough cash on hand to keep the business afloat.  Then there’s the challenge of when and where to add headcount to drive and support growth.  As the sales channel is being expanded, there’s also the question of how much should be invested in Marketing to provide adequate market awareness and demand generation.  The operational challenges are endless.

Finance also faces a number of logistical challenges:

  • Providing accurate and timely reporting of financial and operating results to management and external stakeholders
  • Developing accurate plans and forecasts that drive resource allocations
  • Keeping a steady pulse on the market and the business, and making mid-course corrections
  • Developing business models to test “what-if” scenarios and support critical investment decisions

Most, if not all, enterprises start off running their businesses on a basic accounting and payroll system, augmented by spreadsheets for budgeting, reporting, and analysis.  This approach usually works for a period of time.  But most companies typically outgrow these basic systems as the businesses expand and become more complex – adding more people, opening new offices, and adding more products, services, and customers.

Symptoms That You’ve Outgrown Your Current EPM Tools

Here are some of the symptoms we often hear from customers, indicating that they’ve outgrown their current enterprise performance management (EPM) tools for planning, reporting, and analysis:

  • big-fish-in-small-bowl.jpgFinance is drowning in spreadsheets.
  • 80% of Finance time is spent on data collection, not enough time on analysis.
  • Finance is working nights and weekends to close the books.
  • Management reporting is not timely, so managers gather data themselves.
  • The budgeting process takes too long, takes too much effort, and is outdated.
  • Finance and operations plans are out of synch.
  • We cannot attract and retain talent due to outdated systems.

If these symptoms sound familiar to you, then it’s likely time to take the next step and invest in EPM applications that are purpose-built to support key management processes – budgeting, forecasting, financial consolidation, reporting, modeling, and analysis.

4 EPM Essentials for Growing Companies

One question customers often ask as they look to make the leap from spreadsheets to EPM applications is – “Where do I start?”  I don’t want to get too cute here, but the answer is, “It depends.”  It depends on your company and where your immediate pains are.  It also depends on the evolution of your company and whether you are public or privately held.  But based on my interactions with hundreds of companies over the past 15+ years, I suggest the following as a guide to the EPM essentials for growing companies.

  1. A streamlined and flexible planning process – This seems to be the pain point most companies reach early in the evolution process. When Finance is spending the majority of the time collecting budget data via spreadsheets and email – and very little time on analysis – it’s time to deploy a purpose-built planning application.  These applications make data collection and aggregation less painful and free up Finance staff to spend more time analyzing budgets and understanding the underlying assumptions before they’re finalized.
  2. Timely and accurate management reporting – This is the second most common pain point that companies hit. Given the limitations of management reporting tools provided within entry-level accounting systems, many organizations use Excel for reporting.  But rekeying or copying data into Excel for reporting leads to errors and lots of manual work.  And actual vs. budget reporting can also be time-consuming in Excel.  Instead, EPM applications typically provide flexible reporting tools that make report creation and maintenance much easier – with the ability to compare actual results vs. budget, forecast, prior year, and other views of performance.
  3. Rock solid financial reporting with audit trails – The next hurdle I see many companies hit is financial reporting. When delivering financial statements to the board, banks, venture capital investors, or public markets –a high degree of accuracy in the results is essential.  Spreadsheet-based financial reporting is time-consuming, error prone, and won’t stand up to either internal or external audit requirements.  EPM application suites typically include a financial consolidation module that is purpose-built.  These modules are designed to help organizations automate and manage the complexities of consolidating and reporting financial results according to US GAAP, IFRS and other guidelines.  And they provide audit trails that enable the tracing of summary balances on the financial statements, back to the source data, and any adjustments that occurred during the process.
  4. Enterprise modeling to test alternative scenarios – Another essential tool for fast-growing companies is enterprise modeling. When the CFO and CEO are creating the initial revenue and expense models for a company, Excel models can work fine.  But when there’s a need for operations analysts in Sales, Marketing, Customer Service, and other functions to develop operational models that have financial implications – disconnected Excel spreadsheets will cause a number of problems.  It’s time to consider enterprise modeling tools. 

Enterprise modeling tools enable organizations to develop complex financial and operational models that link to each other.  For example, changes made to the sales staffing plan by Sales Operations – will update the revenue and expense model in Finance and allow both groups to quickly understand the revenue and expense impacts of hiring new sales reps.

financialapps_techaction_2014_03-121407-edited.jpgAlthough EPM solutions in general can help organizations become more agile, cloud-based EPM solutions provide key advantages over on-premises solutions when it comes to business agility.  For example, eliminating the need to set up hardware and other infrastructure makes the deployment process much faster.  You can get up and running in a matter of weeks or a few months with an initial solution.  As you want to turn on additional modules or add users, cloud-based solutions can quickly be scaled to address new requirements.  In addition, you only pay for what you need via subscription-based pricing. 

Delivering Real-World Results

Planful works with customers in a number of high-growth industries – such as retail, CPG, high technology, biotechnology, pharmaceuticals, and medical devices – who have turned to our cloud-based EPM suite to replace spreadsheets for budgeting, planning, reporting, and modeling.  Here’s one example.

Tandem-Diabetes-Care.jpegTandem Diabetes Care is a rapidly growing medical device company based in San Diego, California. Tandem’s revenue jumped from $2.5 million in 2012 to $29 million in 2013 to just under $50 million in 2014 with 437 employees and a second innovative product in the pipeline. As a result, the budgeting and forecasting system was showing the strain of this growth. To address both existing needs – and a future that looked like more and more growth – Tandem turned to Planful. 

Like many companies, Tandem had used legacy Excel spreadsheet approaches for budgeting and forecasting.  What was adequate for a company with $3 million in sales was becoming a headache for a company ten times as big.  It needed a solution that was more scalable, less prone to errors, and provided better audit trails and more flexibility to accommodate change.  In addition, the Microsoft Dynamics/Great Plains software did not provide the flexibility to manage dynamically changing assumptions within Tandem’s budgeting process– it simply provided a place to put them. In short, Tandem had outgrown spreadsheets and manual processes. They needed more.

With the goal of both resolving current challenges and mitigating future ones, Tandem turned to Planful and deployed the Planning, Reporting, and Analytics modules of our Cloud EPM Suite. 

The benefits to Tandem from moving to Planful have been immediate and significant – both in addressing Tandem’s short-term needs and in laying a firm foundation for the future. Critical business processes began to be significantly streamlined. A few details from the present highlight additional results:

  • Rather than living in Excel spreadsheets emailed around the office, numbers are now locked down in one central, cloud-based database.
  • Everyone knows where the data is, and it’s immediately accessible. The Tandem team can now trace details, determine the sources of assumptions and estimates, and identify the “when,” “where,” and “how” of the numbers. 
  • There’s a new degree of data integrity and an audit trail on forecast assumptions, unlike in Excel.
  • Compared to Excel, Planful provides vastly more supporting detail, richer and more useful notes, and much more information.

Planful provided this fast-growing company with an easy, effective collaborative environment with the flexibility, security, and resources Tandem needed in the present – along with the capabilities and scale it would need in the future.

That’s just one example.  To learn more about how other Life Sciences companies are leveraging cloud-based EPM solutions to support their growth, check out this white paper.  And to learn how companies in other industries are managing growth, check out our customer videos and case studies.

White Paper – Enterprise Performance Management in Life Sciences

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Building the Business Case for Cloud-Based Budgeting

Building the Business Case for Cloud-Based Budgeting

Has your organization outgrown its spreadsheet-based system for budgeting and planning?

Are you ready to upgrade to a cloud-based EPM solution that can help you spend more time on value-added analysis and less time on data collection and fixing Excel errors?  Are you wondering how best to make the business case to your company for investing in a cloud-based budgeting solution?

This article provides some guidance and tips on where to look for the savings and benefits your company can achieve by kicking the spreadsheet habit and moving to the cloud.

Reducing Reliance on Spreadsheets for Budgeting & Planning

Despite all of the news in the market about the high percentage of errors in spreadsheets (88% according to a University of Hawaii study) and the challenges of using spreadsheets for budgeting and planning, many organizations continue to struggle with the tool.  In fact, in the 2015 BPM Pulse survey by BPM Partners, 14% of respondents indicated they were using spreadsheets as the primary solution for budgeting.  In the same survey, 55% of those using spreadsheets for budgeting said they were dissatisfied with their budgeting processes. 

In a prior blog article, we highlighted the key challenges in using spreadsheets and email for budgeting and planning: 

  • Too much manual work – the process takes too long

  • Lack of security sending budgeting spreadsheets via email

  • Spreadsheets are error-prone, low data quality

  • Limited reporting and analysis capabilities

All of these issues only get magnified as an organization expands and grows in complexity.  The next logical step is to replace the spreadsheet-based process with a purpose-built enterprise performance management (EPM) application designed to streamline budgeting, planning, and forecasting.    

Managing Budgeting and Planning in the Cloud

Historically, most organizations have deployed packaged budgeting and planning applications on-premises.  But many are now finding that this approach can be time-consuming and costly, especially for small and mid-sized organizations.  This is fueling increasing interest and demand for cloud-based budgeting and planning.  

The good news here is that cloud-based solutions have been available for a number of years, and many now offer the same capabilities as on-premises solutions. They also provide a number of advantages over on-premises solutions:

  • Speed of deployment

  • Reduced reliance on IT

  • Faster innovation

  • No hardware or software to set up or maintain and upgrade over time

  • Reduced up-front costs and lower ongoing cost of ownership

  • Better security

These benefits are well-documented in a number of our published blog articles, white papers, customer videos, and case studies.  But to acquire and implement a cloud-based budgeting and planning system, you’ll still need to get approval for the annual subscription, as well as the implementation and training costs.

So how do you make the business case for investing in cloud-based budgeting and planning applications to your senior management?  Based on the work we’ve done with many other customers, here are some suggested areas to focus on and ranges of potential savings.

Making the Business Case for Cloud-Based Budgeting

Reduce manual data collection and aggregation – With automated data collection and template-based data entry by line managers, you can reduce the time and effort here by up to 75% per planning cycle.

Streamline budget reviews and approvals – A purpose-built budgeting and planning solution includes workflow and process management that takes the guesswork out of managing version control in spreadsheets and relying on email messages for management approvals.  This can save a number of days in the budgeting and planning process, reducing it by 50-80% per cycle.

Automated and timelier reporting – A purpose-built application with integrated reporting tools will make the creation and distribution of budget vs. actual reports much easier and faster.  Again, here you can expect time-savings of 50% or more each reporting cycle.

Finance time shifts to value-added analysis – One of the key benefits of all of the time-savings covered above is that the Finance staff can finalize the budget to deliver the results much faster to management.  This often means that the days or weeks shaved off the annual budget or quarterly forecasting cycle allow Finance staff to spend more time on value-added analysis of the business and on providing decision support to line-of-business managers.  This benefit is tough to quantify, but it can reduce the need to hire financial or operations analysts across the business.

Platform to support future needs – Finally, a key benefit of implementing a cloud-based solution for budgeting and planning is that it provides a platform that can support other needs or future requirements.  Most cloud-based applications are part of an integrated suite that also supports financial consolidation and reporting, forecasting, modeling, and analysis of the business.  The solution can benefit not only the VP of FP&A’s office, but also the guys in the financial reporting department who are struggling with spreadsheets.  So there’s plenty of upside benefit to be gained here as well by replacing other spreadsheet processes with the same platform.

Customer Examples

Planful has worked with over 500 companies to help them improve budgeting, planning, financial and management reporting, and analytic processes.  These companies replaced either spreadsheets or legacy on-premises applications with our cloud-based EPM suite.  Here are some examples of the types of improvements and benefits customers achieved with our solution in the budgeting and planning area.

  • Health Integrated reduced its budgeting cycle from 8 weeks to 3 weeks

  • Parsons Electric

    reduced its annual budget process by half – 5 months to 2.5 months

  • CEA

    reduced its budgeting process from 12 weeks to 3 weeks

  • Evraz report assembly went from 2 weeks to 1 minute

To learn more about the benefits your organization can achieve by replacing spreadsheets with Planful Cloud EPM Suite, check out our customer videos and case studies.  Also, here’s a free white paper that should help you develop the business case as well.

Download the Whitepaper

Best of luck!

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