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This article is part 8 of an 8-part series on evaluating the best CPM tools for your business. Part 8 focuses on why and when to use third-party rankings from analysts when evaluating the best CPM software applications.

 

While some companies don’t need to go through a detailed selection process to come up with a list of the top Corporate Performance Management (CPM) software solutions for their organization, others have their work cut out for them. If you belong to the latter category, here is a vendor evaluation tool that may be of help.

One of the key items on many CPM product evaluation checklists is to look at how third-party firms, usually referred to as analysts or analyst websites, review and rank vendors.

Below, we will discuss the use of analysts to help evaluate and score the best financial reporting and planning solutions for your business requirements. This type of third-party research can complement the findings and opinions from your internal team.

When analyst firms are of less importance

Before we go into detail about analyst firms, let’s briefly cover some situations where analyst reports with CPM vendor rankings are not as useful and, in some cases, cost extra time and money in the selection process. One such example is when there is already a leading CPM solution partnered with your ERP vendor and offering pre-built integrations and other benefits that outweigh other potential vendor differences.

Another example is when multiple people on your staff have deep knowledge of a leading CPM solution that they have used before, ideally while they worked at a company from the same industry to ensure that there is still a fit.

Which analyst firms should you use?

While there are a few firms with analysts that are CPM industry experts who do months of research every year to analyze trends and rank vendors, there are many more analysts that are a waste of time or are even directly misleading in their rankings.

  1. Examples of professional CPM analyst firms
    • Analyst and survey-driven rankings: Gartner and Dresner Advisory Services
    • User-driven rankings: G2
  2. Unqualified or misleading “analyst” firms
    • Clickbait websites that will come up with their own vendor lists with no proper research, purely to get ranked on a search engine in order to sell advertising or get “sponsorship” money vendors pay to be on (e.g., a “Top 10 CPM Vendors” list)
    • Websites owned by CPM vendors ranking themselves
    • “Research reports” from “analysts” paid for by a specific CPM vendor

So, if you consult analyst reports to help find the best CPM tool for your company, be conscious of who or what is proving the advice.

How do you know if analyst reports are biased or fair representations of vendors?

It is clear that almost all research performed by a human being is biased one way or another, either consciously (e.g., based on vendor sponsorships or who they speak with the most) or unconsciously (e.g., based on the knowledge of the analyst). Even a firm as well-known as Gartner arguably has some bias in their reports because they include analyst comments, and they include vendor revenue as one of the drivers in their “Magic Quadrants” – something which may or may not indicate who a “leader” should be in a specific industry. Especially with the pace of technology changes and acquisitions in the marketplace, the best CPM solution for your business 6 months ago may no longer be the top choice today.

Other analyst reports or vendor rankings are websites that are driven by user feedback as compared to analyst research. You could argue that these websites provide the most neutral feedback although not as detailed and analytical as the major reports produced by full-fledged analyst firms.

Then there are the countless firms that provide “awards” and rankings based on payments from vendors. These are highly biased and should be avoided. It is fairly easy to detect them by reviewing the firm’s website and observing the lack of depth in CPM research and content.

What professional analysts get right (and sometimes don’t)

The top CPM analyst firms typically do one major CPM report per year. All or parts of the data in the report is driven by customer surveys completed by each vendor’s customers. Because of all the work that goes into these reports and because customers don’t want to be constantly bombarded with surveys, the reports will represent data that is up to 15-16 months old. This lag is because customer surveys typically start 3-4 months before the report is released and then the report will be out on the market for a year until next year’s report is out.

Because many cloud software vendors have monthly releases, and new features arrive all the time, these reports could be missing important vendor features. Websites like G2 and others are starting to follow the same model; they are constantly updated whenever a customer decides to leave their feedback. However, they are less detailed and structured.

Examples of analyst firms that review CPM software

There are a number of companies that provide CPM vendor reviews and market research. Here are examples of three different categories of such firms:

  1. Gartner: Analyst + customer survey-driven vendor rankings. Also provides research reports across almost all categories of IT firms. A major CPM report is produced once per year.
  2. Dresner Advisory Services: Customer survey-driven vendor rankings. Also provides research reports. Almost exclusively focused on CPM (they refer to it as EPM, or Enterprise Performance Management). A major CPM report is produced once per year.
  3. G2: Customer feedback driven. Ranking reports are produced automatically on their website (g2.com). Rankings are continually updated as customers enter their feedback on the G2 website.

How much does it cost to use an analyst firm?

Some CPM vendor research reports are free while many are licensed by the CPM vendors themselves and shared with customers. However, be aware that vendors naturally will only license and share research reports that shed a good light on their product, so there is a bias here to be cognizant of.

Some analyst firms also provide selection services, either as paid calls with their CPM advisors or as full-blown gigs where they will lead or participate in the entire selection process as a “consultant.” In past years, they used to then provide clients with RFP templates with hundreds of pre-defined questions. These have become less popular in recent times as both vendors and internal evaluation teams dread lengthy narratives always shaped to sound good, or they can miss entire functionality areas that are up and coming.

In any case, it is almost always beneficial to do your own homework first by listing your current pain points in as much detail as possible and quantifying ($$) the cost and effort of running the current reporting and planning processes. This “homework” should also include the management team’s vision of the business benefits they want to achieve with a new CPM solution.

Conclusion

The leading cloud CPM software solutions have a lot of features and functionality, and changes and improvements are being released all the time. So, when you and your internal team are coming up with a shortlist of the best CPM solutions for the company’s needs, it is advisable to do your own research, review product demonstrations, and make sure the top candidates integrate easily with your ERP and other important systems. If you have special complexities or a lack of time and evaluation skills on your team, then an analyst firm can assist you in various ways.

Links to useful software research and evaluation assets

This article is part 7 of an 8-part series on evaluating the best CPM tools for your business. Part 7 focuses on methods for calculating ROI to find the best CPM software applications.

 

A business software selection process can be exhausting, involving weeks or months of product demonstrations, meetings, vendor scoring, and other time-consuming tasks. Usually, the most attention is paid to the product demos. However, one of the most important but ignored areas of a vendor evaluation is a Return on Investment (ROI) estimate.

As the name implies, an ROI calculation aims at estimating the return the company is expecting to get over time based on the investment they put into the software subscription, training, and implementation.

A best practice to select the best CPM software and vendor is to perform an ROI calculation and make it part of the total vendor score as you compare the finalist candidates with each other. Here is a free interactive vendor comparison tool that has three dashboard pages:

  1. Scoring of 8 major functionality areas (insert screenshot below this section)
  2. Calculator to arrive at ROI
  3. Summary dashboard comparing your top two CPM software finalists

Your team can use the sliders to adjust all scores according to your evaluation results:

Vendor Comparison Tool

Why should ROI always be used when you evaluate business software?

Many companies skip or miss the ROI step in their evaluation process to compare the top CPM vendors on their finalist scorecard. Why are so many organizations missing this ROI step? Usually it is due to one or more of these reasons:

  • They don’t have an ROI calculator
  • They feel there are too many variables to come up with a good ROI estimate
  • They have a bias toward a solution known or recommended to them
  • The vendor in the lead does not want to be compared to the runner-up competitor

However, because the vendors’ CPM features and prices both change over time, a good ROI estimate helps capture this to provide a picture of what business benefits would look like compared to the investment in subscriptions and implementation services.

How to calculate ROI for the best CPM software selection

It is almost always easy to get software costs and implementation estimates from the vendor because these are already part of standard price lists and quoting tools they use in their sales processes.  However, what is harder is to calculate your own costs and savings related to the project.

It is important to do your own homework first by listing and quantifying ($$) the pains of NOT having the new solution. Many organizations do list current pains before approving a new software purchase. Such metrics are also valuable after the project implementation in order to validate the degree of success. It also helps keep vendors and internal project members accountable for promises of outcomes, and keeps them focused on what is most important when there are obstacles in the implementation and to help support hard choices that have to be made.

Here is a list of the typical ingredients in an ROI calculation:

Vendor ROI Tool

  1. Benefits

This part of an ROI calculation is always the hardest to estimate. Here is where you quantify the annual value (amount) your business expects to gain from the improved and speedier decisions you expect to achieve from the CPM vendors you evaluate. Try to put a number on the resulting benefit to the business when managers can make faster and better decisions because the new solution provides self-service access, drilldown to answer questions, charting for better analysis, more accurate budgets, and other advantages.

Note: Don’t include any costs or time savings from the cost section (see below).

  1. Costs

Here is where you capture the costs of the new and old solutions. Your numbers should include software, hardware, and labor expenses.

Cost of New Solution:

  • Annual software subscription
  • One-time implementation services

Cost of Old Solution:

  • IT costs to operate: This includes any server hardware and electricity, upgrade costs, annual maintenance/renewal costs, etc.
  • Cost of manual labor: This should be the excess time your IT and finance staff spends compared to what you expect from the new solution. Use a fully loaded hourly cost of own and/or contractor staff.
  • Cost of risk: This is where you capture the estimated annual cost of risks like errors in monthly reports, and the resulting cost of managers not having access to timely and detailed information.

If you leave all the figures in the ROI calculation as positive numbers, then the calculation can look like this: (Cost of Old Solution – Cost of New Solution + Benefit of New Solution) / Cost of Old Solution

Using one year or multiple years in your ROI calculation

Although there may be some firms that provide industry benchmarks to quantify the standard ROI of a new CPM software solution and its expected automation of financial reporting and planning processes, results can be highly individual based on how good or bad the old solution was and how well the new solution is implemented and utilized.

In very special cases, you may achieve a positive ROI in year 1, but in most cases it will take longer. For this reason, a good rule of thumb is to calculate both the 1st year and the 5-year (accumulated) ROI. This will also better capture discounts that vendors provide for one or more years before their price resets to list price.

Also, when you ask for the 5-year subscription cost from each vendor, make sure it includes annual price increases.

Vendor Evaluation Summary Dashboard

Do ROI calculations have an extra cost?

All decision makers like to see ROI calculations when staff members propose investments in new technologies. Sometimes, these calculations can be the major deciding factor in a decision if all other areas are somewhat equal. In other words, it may be well worth the hours it takes to come up with the estimates for ROI.

If you are using a professional software selection firm or third-party consultant to help with your selection, make sure to ask if their services include assistance with an ROI calculation or if this a separate cost.

You can use this vendor comparison tool, which includes an ROI calculator. It has three tabs: 1) Feature comparison, 2) ROI comparison, and 3) Summary score. You can use it as-is, or it may give you some ideas if you want to apply it, for example, to an Excel spreadsheet model that calculates ROI in a different way.

Conclusion

The best CPM software solutions have a lot of features and functionality. They are also very flexible. This means that implementation estimates can vary greatly based on the number of your reports or the complexity of your budget and forecast models.

Assuming you have a successful implementation, it is typical to stay with a solution for five to ten years or more. In such time periods, and if you choose a stable vendor, you can expect to see numerous improvements along the way that should further support your managers in making faster and better decisions. This future expected value can be captured in your multi-year ROI calculation to help ensure that you are making the best possible decision to pick the top CPM vendor for your organization to partner with.

Links to useful software research and evaluation assets

This article is part 6 of an 8-part series on evaluating the best CPM tools for your business. Part 6 focuses on the many Microsoft integration capabilities to look for in the best CPM software applications.

 

Most organizations in the world use one or more technologies from Microsoft. So, when selecting a new cloud Corporate Performance Management (CPM) solution the benefit of close Microsoft alignment can be from “slight” to “very important” or “required.”

As the world’s businesses have migrated one application after another to the cloud, they have had to re-establish whatever connectivity they had between their solutions when they hosted them in their own server room.

For the reasons mentioned above, most of the top CPM vendors have integrations to the most popular Microsoft technologies in order to increase their customers’ productivity.

Here are some of the top Microsoft integrations to look for in the best CPM solutions

Based on which Microsoft technologies your organization uses, one or more of these integrations may be beneficial (or even highly important):

  1. Microsoft Office / Microsoft 365 integration

The below CPM integrations to Microsoft Office / Microsoft 365 can probably be ranked in this order of importance to a Finance and Accounting team:

  • Excel integrations can offer everything from the CPM report designer being an Excel add-in, to report export to Excel and data import from Excel.
  • PowerPoint integrations are typically used to display and refresh reports or dashboards within a corporate financial presentation.
  • Word integrations are less popular but can be critical for governments and other organizations that need to refresh financial and other figures inside lengthy annual or quarterly report documents.

Example of a Power BI dashboard live inside a PowerPoint presentation:

Power BI inside PowerPoint

  1. Power BI integration

Power BI (closely followed by Tableau) has risen to be the most popular dashboard tool in the world. A large number of companies use it already and more will do so in the future. For this reason, an increasing number of CPM vendors have developed Microsoft-certified connectors that easily transfer data and dimensions to Power BI.

Some CPM vendors even go as far as offering Power BI as their main best-of-breed dashboard solution and include out-of-the-box financial dashboards to get customers ramped up quickly. If you already own or plan to buy Power BI, this approach eliminates the need to buy a CPM vendor’s proprietary dashboard licenses and enables the finance team to learn only one visualization tool.

  1. Microsoft Teams integration

Teams is Microsoft’s widely popular collaboration portal. Numerous third-party vendors have built apps to surface their cloud applications inside the Teams portal.

While all of the best CPM solutions can export fully formatted reports to Excel, and these can be imported to Teams, not many have built apps that enable you to open the CPM app from Teams and, for example, run reports while inside a Teams group discussing profitability or liquidity with other managers.

  1. Microsoft Dynamics integrations

Dynamics 365 Finance and Dynamics 365 Business Central are Microsoft’s cloud ERP applications. If you already own or plan to implement one of these ERPs, it is important to closely review how well the CPM vendors you are evaluating connect to those solutions.

A tight and easy integration between your ERP system and the CPM solution enables dynamic reporting, as well as budgets and forecasts that have updated historical data. Some integrations even allow for easy write-back of budgets to the General Ledger (GL).

If you are on a legacy Microsoft Dynamics ERP such as GP, SL, NAV, or AX, the new CPM solutions integration is equally as important. If you plan to migrate to Dynamics 365, you can even use the CPM as a storage of your old historical ERP data, making the migration to the new ERP faster and easier.

  1. Azure deployment

Since CPM vendors manage their own cloud applications, it is typically not visible to an end user which cloud platform, such as Azure or AWS, their CPM portal is running on. Azure may be more important for certain IT departments if they already have plans or projects using other Microsoft Azure tools such as Power Apps.

Does deep Microsoft alignment have an extra cost?

This will depend on each CPM vendor. The cloud platform (in this case Azure) is always built into vendor pricing, but oftentimes vendors charge a price per integration connector (e.g., to Power BI, PowerPoint, or Dynamics 365).

While it is important to do your homework to ensure that the vendor you choose has the key Microsoft integrations needed for a successful and efficient deployment, the total savings in time and effort, as well as improved decision making, are just as important.

Here is a free vendor comparison tool to help you compare vendors across a number of different features. This tool also includes a simple return on investment (ROI) calculator that is part of the total vendor score.

Conclusion

In summary, ensuring that a new CPM solution integrates well with productivity and ERP applications helps ensure longevity of the solution as well as user satisfaction. In other words, integration should be on the checklist of features to review in demonstrations and vendor conversations.

Links to useful software research and evaluation assets

This article is part 5 of an 8-part series on evaluating the best CPM tools for your business. Part 5 focuses on data warehouse considerations to focus on as you are evaluating the best CPM software applications.

 

In the Digital Era, companies that make faster and better decisions than their counterparts are the most successful – yet accurate decisions require accurate information. Because all businesses have numerous data sources in addition to their ERP system, it takes a lot of time and effort to extract and compile information from all the internal systems. The fact that most of these systems are now based in the cloud does not make it easier.

This fast decision-making requirement has led an increasing number of companies to now implement a cloud data warehouse in order to streamline data collection, reporting, and analysis. Some of these data warehouse platforms are included with Corporate Performance Management (CPM) solutions. Because CPM solutions already use databases to store financial data and budgets, these vendors sometimes offer an expandable CPM that can also serve as a data warehouse. More about this later.

However, implementing a corporate data warehouse can be risky and expensive without proper technology selection and planning. And, of course, the return on investment (ROI) needs to be positive.

When working through a software selection process to find the best data warehouse platform for your organization, there are some features that are more important than others.

Here are some of the top features to look for in a data warehouse app

While most vendors can probably showcase more than 100 features in their product — something which can make software selection a virtual nightmare — there is a clear 80/20 rule that can be applied to zoom in on critical success factors.

Here is a list of five major functionality areas to consider:

  1. Data warehouse platform

In today’s world, IT departments and business managers are eager to move their applications out of their server room and into the cloud. Therefore, most new data warehouses are now being deployed in the cloud. All the big database vendors offer their own data warehouse platforms including Microsoft, Oracle, Amazon (AWS), IBM, Snowflake, and others.

Internal knowledge, cost, and other factors should be evaluated when choosing a solution. Any cloud CPM vendor that has a solution that expands into a full data warehouse generally also runs on one of these platforms, either with the cloud vendor’s database or a proprietary database.

  1. Homegrown versus commercial data warehouse

In the past, the majority of all businesses either managed to operate without a data warehouse or they purchased a database license like Microsoft SQL Server or Oracle and designed a homegrown system. For a mid-sized company, such a project could take upwards to nine months or more and often cost more than $100,000 in consulting fees (much more for a large enterprise).

Today, however, there are a number of commercial cloud-based data warehouses with user-friendly interfaces that provide menu-driven configuration requiring few technical skills to run. As a result, most companies, especially smaller and mid-sized businesses, utilize commercial cloud data warehouses that are pre-designed and configurable through a web interface.

Of course, it is critical to easily get data in and out of a data warehouse, so any good data warehouse must provide application programming interfaces (API) to allow integration tools and business intelligence (BI) solutions to connect to it.

Here is an example of a commercial data warehouse interface:

  1. Separate data warehouse or combined with CPM solution?

If a selection process is driven by an IT department and the data warehouse solution will be managed by their team, they often prefer a stand-alone commercial data warehouse or may already have an enterprise data warehouse in use. A CPM solution that includes data warehouse functionality becomes a one-stop reporting and planning database that can leverage the data stored in the enterprise data warehouse (where one already exists), as well in the ERP, payroll, and other systems.

This combination approach may offer a lower cost and has the added advantage that CPM tools offer strong report writers, which make it easy to query the reporting and planning data warehouse directly without purchasing yet another third-party reporting tool.

  1. Data extraction, transformation, and loading (ETL)

ETL tends to be the most technical and tedious part of a data warehousing project. This is because it involves extracting data from various transaction sources, transforming it into the format required to store it in the data warehouse, and then setting up automated data loading. Many of the leading data warehouse and CPM solutions offer their own native ETL tools, often with pre-built connectors to popular data sources. In addition, there is a whole industry of third-party ETL vendors that can be “middleware” between your transaction sources and the data warehouse. Of course, these come with their own subscription cost.

You should always request detailed information about the vendor’s integration to your systems, including the time and cost it takes to get them configured. A really good, pre-built integration should take at the most an hour to configure while “toolboxes” can take days to set up and connect to each data source. Which one your vendor offers will therefore usually become clear when you see their estimates for the integration step in the implementation.

Without good, automated integrations to your source systems, your users will end up spending a lot of wasted time on loading and possible “cleaning” of data.

  1. Modules, dimensions, and trees

In general, data warehouses store transactions and dimensions and connect these in their schema. In commercial data warehouse user interfaces, an administrator can typically add business logic to dimensions (accounts, companies, etc.) by setting up hierarchies represented as graphical trees or attributes. These hierarchies are then used by report writers and dashboards to automate reporting and consolidations.

To select the best data warehouse solution for your business needs, it is advisable to get a demonstration of the web portal. This gives you the ability to see how user friendly (or not) it is to manage the dimensions and data, and also to understand the effort it takes to set up user security as well as control access rights.

How much does a data warehouse solution cost?

Cloud-based data warehouses are sold on a subscription basis and vendors have various pricing models that could include factors like:

  • Number of users
  • Number of data source connectors
  • Number of transactions stored in the database
  • Amount of data processing

Vendors that offer multi-tenant solutions versus stand-alone systems per customer have a cost advantage as upgrades are simpler and processing resources can be shared.

Beyond features and the quoted price, here are some things to think about when you get prices from your vendor finalists:

  • Does the annual subscription from each vendor contain the same user count and modules?
  • If you are receiving a discount, how long until it resets to the list price?
  • Does the vendor provide a written policy for annual price increases?
  • Are the implementation estimates from each vendor for exactly the same work?

A good rule of thumb is to ask each vendor for the total subscription cost for the first 5 years. Make sure this includes any potential price increases. And, if the vendor is owned by a private equity firm, chances are that they will be sold while you are still a customer, so ensure that you receive a document stating their policy for price increases in the future, including stipulations if they are sold to another company.

Here is a tool to help you compare vendors and calculate return on investment (ROI).

Why not use the ERP system as a data warehouse?

Some ERP vendors and implementation partners suggest that customers use the ERP system as a data warehouse. This could work if all or most of the data is from the ERP system itself. However, most data warehouse use cases do not work well inside an ERP database for these reasons:

  • Major data loads and processing could slow down the ERP system and make daily work difficult for accountants.
  • Licensing requirements for the ERP may become more costly than expected.
  • Some ERP APIs may not be suitable for flexible and fast data import and export.
  • ERP databases are generally not built to easily handle lots of detail from other data sources such as CRM data, helpdesk information, or other solutions.
  • ERP systems typically don’t offer best-of-breed reporting, budgeting, and dashboards so chances are that you will end up exporting data out of the ERP “data warehouse” and into CPM and BI systems anyway.

Conclusion

In summary, choosing a new data warehouse solution to centralize your important data in order to support front-end tools that drive better and faster decision making has increasingly become a strategic priority for organizations across all industries. As we discussed earlier, certain features are more important than others and can be key success factors – in addition to a well-executed implementation process.

Here is a free vendor comparison and ROI tool to help you compare vendors across a number of different features. This tool also includes a simple return on investment (ROI) calculator that is part of the total vendor score.

Links to useful software research and evaluation assets

This article is part 4 of an 8-part series on evaluating the best CPM tools for your business. Part 4 focuses on evaluating the range of dashboard features within the best CPM software applications.

 

While the financial reporting, consolidations, and budgeting functionality of Corporate Performance Management (CPM) tools are highly valuable to accounting and finance professionals, most executives want to also see the organization’s key figures represented graphically.

Graphical analysis tools generally fall into two categories: 1) Static charts; and 2) Interactive dashboards. Both can be desirable because static charts can significantly highlight the most important information in financial reports such as revenues, profits, and margins, while well-designed interactive dashboards provide deep, user-guided analysis.

When you are looking to acquire a new financial reporting or planning solution and you are comparing your vendor finalists, it is important to review which of the above graphical analysis methods they provide.

Here are some of the top dashboard architectures to look for in the best CPM software solutions

In general, one or more of these three types of graphical analyses below are provided by leading CPM vendors:

  1. Charts embedded inside financial reports

These are typically bar charts, column charts, pie charts, or trend charts embedded inside of financial statements like Profit & Loss reports and Balance Sheets. While financial report writers are purpose built, and much better than dashboard tools, to manage account structures and financial statement formatting than dashboard solutions, they can significantly benefit from charting and traffic lights to highlight the most important figures. This type of “hybrid” report is offered by some CPM vendors and should not be confused with dashboard solutions.

P&L – Variance, Modern Design

  1. Native dashboards in CPM portal

A number of CPM vendors have developed proprietary dashboards inside their cloud portals.

A benefit of native dashboards is that they typically derive from the same data structure/tables as the CPM solution’s reporting and planning module. Another benefit is therefore a shorter implementation time and one place to set up user security. However, companies are increasingly investing in purpose-built dashboard solutions like Power BI and Tableau, and therefore it is less efficient to use multiple dashboard tools than one enterprise-wide solution that can easily be supported internally.

Additionally, these purpose-built solutions like Power BI and Tableau offer much more advanced capabilities than most proprietary dashboards.

  1. Integrated best-in-class dashboards

Professional dashboard solutions have risen in popularity over the years, and solutions like Microsoft’s Power BI and Tableau have become market leaders. Because of the singular focus the vendors of stand-alone dashboard solutions can put behind their products, the pace of development is rapid and the breadth and depth of functionality is very solid. As a result, a large number of organizations have deployed these solutions as a standard across one or many departments internally and use them to present data from their various transaction systems including their CPM solution.

Based on their customers’ standardizations for these best-of-breed dashboard solutions, a number of CPM vendors have built connectors that make it very easy to pull data, dimensions, and database logic from the CPM product and into the dashboard tools. The result is a quicker implementation of dashboards, as well as a lower learning curve and a lower license cost compared to also implementing a proprietary dashboard inside the CPM solution.

Distribution – Revenue and Margin Analysis

How much does a dashboard solution cost?

While it is important to do your homework to ensure that the vendor you choose has the key features needed for a successful deployment, the total savings in time and effort as well as improved decision-making capabilities are just as important.

Here are some things to think about when you get prices from your vendor finalists:

  • Does the annual subscription from each vendor contain the same user count and modules?
  • If you are receiving a discount, how long until it resets to the list price?
  • Does the vendor offer a written policy for annual price increases?
  • Are the implementation estimates from each vendor for exactly the same work?

A good rule of thumb is to ask each vendor for the total subscription cost for the first 5 years. Make sure this includes any potential price increases. And, if the vendor is owned by a private equity firm, chances are that they will be sold while you are still a customer so you must ensure that you receive a document stating the policy for price increases in the future – including if they are sold to another company.

Here is a free vendor comparison tool to help you compare vendors across a number of different features. This tool also includes a simple return on investment (ROI) calculator that is part of the total vendor score.

Conclusion

In summary, choosing a new dashboard solution to compliment the company’s financial reporting and budgeting tools is increasingly becoming a strategic priority for organizations across all industries. As we discussed earlier, certain features are more important than others and can be key drivers of success, in addition to a well-executed implementation process.

Links to useful software research and evaluation assets

This article is part 3 of an 8-part series on evaluating the best CPM tools for your business. Part 3 focuses on Excel functionalities that strengthen the best planning and financial reporting software applications.

 

Almost every financial professional both loves and hates Microsoft Excel. It seems like we can’t live with it and we can’t live without it!

So, when you are looking to acquire a new financial reporting or planning solution and you are comparing your vendor finalists, how well each solution interacts with Excel tends to be part of the top user requirements.

It should be noted that while an increasing number of cloud solutions emerged between 2010 and 2015, the popular sentiment from the browser-based vendors was that their tools would completely get rid of Excel. But, in short order, their customers started to miss the formatting and calculation power of Excel (as well as its familiarity) when they were creating reports and budget models. As a result, the early cloud vendors added Excel add-ins to provide an alternative design experience for Excel fans, and several newer vendors such as Vena and Solver made Excel an integral part of their cloud solutions.

For most companies, Excel functionality is THE key to success when using the best planning and financial reporting software.

Here are some of the top features to look for in reporting and budgeting Excel add-ins

Most finance, accounting, and budgeting users would consider strong Excel integration to be one of the top 5 or top 10 features when evaluating and comparing planning and reporting vendors. Below, we will discuss some important features to consider in this regard.

  1. The difference between Excel export/import and Excel add-ins

While pretty much every reporting, planning, and corporate performance management (CPM) solution can import data from and export reports to Excel, these processes should not be confused with Excel add-ins, which are plugins to Microsoft Excel that appear on its ribbon.

With an Excel add-in design tool, users build dynamic, parameter-driven reports that pull data from the ERP or CPM database. Data can be refreshed and written back (budgeting and forecasting) without any type of export and import process, which provides self-service for end users.

On this page you can find hundreds of examples of reports and budgeting forms built with an Excel add-in and made to run in a browser. Reviewing vendor examples of the types of templates you want to build with your new solution can be a very good assurance that the design and layout capability in your chosen solution is going to take care of your organization’s needs.

  1. Examples of pure Excel tools versus web portals with Excel add-ins

In the past, Excel add-ins were stand-alone reporting tools that needed to be installed on every user’s desktop (or virtual machine). So, if you had 50 users your IT department would be maintaining and upgrading 50 Excel add-ins. Luckily, this has changed. Since cloud architectures emerged in the CPM market, almost all vendors have built multi-tenant web portals that are managed and automatically upgraded by the vendor.

Today, there are still a few of the classic Excel add-ins left and most have the ability to connect to cloud ERPs and “trickle” the data to Excel when reports are processed. All major vendors, however, have web portals where reports are stored and, in some cases, also executed in the user’s browser without requiring Excel to run them. This architecture is particularly useful for planning processes where a significant number of end users can simply open their browsers and enter budgets and forecasts that are stored directly in the CPM solution’s cloud database.

  1. The importance of dynamic Excel rows and columns versus static ones

Most organizations add accounts, departments, and other dimension members to their ERP during the year. For older Excel add-ins, this usually requires manual maintenance of reports and budget templates in order to insert new rows or columns, or to maintain the content of dropdowns for parameters (e.g., a list of departments). This is because these add-ins can only put formula references at the cell-level in the spreadsheet.

With modern Excel add-ins, you can have dynamic listing of rows or columns and global report parameters.

Here are some quick examples:

  • Dynamic rows

If you have, for example, 20 Operating Expense accounts, you can create a range formula on a single row in Excel that automatically expands out to 20 rows. If someone adds 1 new account number in that range, you automatically get 21 rows in the report (or budget form). In older Excel add-ins, you have to manually create each row and, since they are static, new accounts will not become new rows automatically.

  • Dynamic columns

Let’s say you want actual data from January up to the current month and a forecast from next month through December. In a modern Excel add-in this report can be done dynamically, regardless of which month you run it for. With static, legacy Excel add-ins, you will need to manually change the formulas each month, make 11 versions of the report, or do major “tricks” in the report to make it more dynamic.

Template design with dynamic rows and dynamic columns

Template design with dynamic rows and dynamic columns

  • Dynamic global parameters

Typical examples of these are report filters for company, department, period, or budget version. In legacy Excel add-ins, these are designed as regular Excel dropdown boxes that populate based on data (e.g., a list of months or departments) hidden somewhere in the workbook. In modern Excel add-ins, these parameter selectors are dropdowns on a side menu or in the Excel sheet that pulls their content directly from the database.

In other words, they are always fresh and don’t need hidden dimension lists in each report or budget template.

In summary, modern Excel add-ins with dynamic rows, columns, and global parameters provide quicker report design and less maintenance work. They are also less likely to produce wrong reports because they can automatically include new accounts and other ERP dimension members that tend to change.

  1. Is Excel the primary design tool or an additional solution to learn?

Finance and accounting people tend to be very busy and few like to spend more time than necessary to build or maintain reports. As we discussed earlier, this is a major reason that Excel add-ins are so popular and have returned as part of cloud CPM solutions. However, when you compare vendors with Excel-based report designers, it is important to research whether their Excel tool is their second (“optional”) report writer or THE report writer.

Cloud solutions where there is a proprietary web designer, plus an optional Excel designer, result in users having to not only learn two tools but also having to constantly deal with decisions regarding whether a new report should be built in Excel or in the proprietary browser tool. Making a monthly package of reports from both tools, if possible, can be messy and lead to too much manual effort.

Solutions with a single, purpose-built Excel designer have the advantage of delivering one single tool to learn for users, and packaging and distributing reports can all be done in one place.

  1. Built for cloud

While some legacy Excel add-ins are still pure on-premises tools, most can now connect to cloud ERPs. The latest generation of Excel add-ins can not only be managed (installation, user security, etc.) from cloud portals, but some, like Solver, can even “convert” templates automatically from Excel to web reports and input forms. In these tools, users can choose to run the same report as a web report without requiring an Excel add-in. Alternatively, they can use the Excel add-in to open the report in Excel and execute there.

In other words, part of the research and comparison of the vendors’ reporting and budgeting solutions should be to find out if their planning and financial software relies on legacy tools or purpose-built cloud architectures.

How much does a CPM solution with Excel-based reporting and planning cost?

While it is important to do your homework to ensure that the vendor you choose has the key features needed for a successful deployment, your total cost and savings in time and effort matter – as does your improved capacity for better, faster decision-making at your company.

Here are some factors to consider when you get prices from your vendor finalists:

  • Does the annual subscription from each vendor contain the same user count and modules?
  • If you are receiving a discount, how long until it resets to the list price?
  • Does the vendor have a written policy for annual price increases?
  • Are the implementation estimates from each vendor for exactly the same work?

A good rule of thumb is to ask each vendor for the total subscription cost for the first 5 years. Make sure this includes any potential price increases. Also, if the vendor is owned by a private equity firm, chances are that they will be sold while you are still a customer, so you will want to ensure that you receive a document that states their policy for price increases in the future (including if they are sold to another company).

Here is a free vendor comparison and return on investment (ROI) tool to help you compare vendors across a number of different features. This tool also includes a simple return on investment (ROI) calculator that is part of the total vendor score.

Conclusion

In summary, choosing one of the best financial reporting software solutions to automate monthly reporting, as well as to cover other management reporting needs, will ultimately drive better and faster decision making at your company. This is why the task of finding the best planning and financial reporting tools is increasingly becoming a strategic priority for organizations across all industries.

As we discussed earlier, certain features are more important than others in the evaluation process and can act as key drivers of success – in addition to a well-executed implementation process, of course.

Links to useful software research and evaluation assets