Realizing ROI with Enterprise Performance Management

A webinar highlighted current developments in EPM technology, the role CFOs should play in evaluating EPM solutions, and tips and recommendations for implementing EPM solutions.

CFO Playbook on Performance Management

Planful sponsored a webinar on titled “The CFO Playbook on Performance Management: Realizing ROI with EPM Improvements.”  Featured speakers include Karen Schreiber, Principal, The Hackett Group, and Matt Schwenderman, Principal, Deloitte Consulting LLP. Mary Beth Findlay of CFO Publishing moderated. Here’s a summary of the key points they covered in the webinar.

What is EPM, and why is it important?

Both panelists agreed that EPM is a process supported by tools and designed to help organizations link strategy to plans and execution.  The key processes in EPM include goal-setting, modeling, planning, reporting, and analysis.  The main objective is to help organizations maximize performance in terms of revenue and operating margins, and increase shareholder value.

What are recent developments in EPM and EPM tools?

Here, the panelists commented that EPM should include the entire organization, but usually starts in Finance. Key to achieving this is integration across EPM processes, as well as with source systems.  The use of in-memory databases allows for the processing and modeling of larger data sets. Data visualization tools help non-Finance users more easily consume the data. And Cloud/SaaS platforms are helping to drive broader adoption of EPM across the enterprise.

The panelists also talked about how master data management is also an important development in EPM.  These tools enable better change management processes and governance of master data used across EPM, as well as ERP, systems.

What advantages do EPM applications offer over spreadsheets?

The panelists highlighted how integrated EPM solutions speed key business processes, such as budgeting, planning, and financial reporting.  In calculating results, EPM solutions are much more efficient and accurate than spreadsheets. The panelists also mentioned that the data governance and data modeling tools found in EPM suites make it easier to manage EPM across a large enterprise.  While having one version of the truth is helpful, having common definitions of data across the organization is more important.

What role should the CFO play in the evaluation and implementation of EPM systems? How do you ensure that the EPM system can meet your needs?

On this topic, the panelists recommended that the CFO be the sponsor and advocate for EPM across the organization. Best practice is to focus on the business requirements, then select the technology that best supports those business requirements. According to the panelists, buyers should also evaluate the ability of the vendor to be a good long-term business partner.

The panelists recommended that you get a good sense of the long-term vision of the vendors you’re evaluating. Make sure you understand their R&D spending focus and plans. Speak with reference customers – from both a business and technical perspective. As a buyer, you need to understand the scope and purpose of the project while ensuring the solution chosen aligns to your current and future business needs.

What are some of the challenges and recommendations in implementing EPM solutions?

Some tips here included putting your best staff on the project. Throughout the project, develop a true partnership between Finance and IT. Start with desired results, and then build out the system to achieve that goal. Build a process to govern the data. Matt Schwenderman recommended that you “break some glass, do something innovative.”

Karen Schreiber called out data integration as the biggest challenge. The data coming into EPM applications must be clean and consistent. She also recommended that implementation teams demonstrate how the design supports the user requirements. Challenge the status quo – keep asking “why, why, why?”

Mistakes to avoid include starting with technology, which is the wrong approach. Not having the right data available can also be a problem.  Not getting the users engaged can slow the process. Another common mistake is re-implementing existing tools. Companies need to re-examine the business process, then identify the information that’s really needed and missing. Change management processes also shouldn’t be overlooked. Inadequate staffing can also impact your chance for success.

How can CFOs build a business case for an EPM project?

Here, the panelists cited research that demonstrates how companies with better analytics perform better than their peers.  In building the business case, the panelists recommended that buyers quantify efficiencies and expected process improvements, as well as missed opportunities.

Final takeaways and advice for buyers

In their final comments, the panelists highlighted that EPM is a mindset and process that can create competitive advantage.  If done right, it can increase business agility and insights.  The key is to align the technology to the goals and needs of the business.

To learn more about this topic, listen to a replay of this webinar. And to get additional tips on evaluating EPM solutions, download our free white paper.

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