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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