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It is easy to predict the future when it is business as usual. However, if your business environment is suddenly impacted by something like the coronavirus, a delayed product launch or an unplanned acquisition, your corporate budget may become obsolete very quickly.

How Do I Know it is Time To Replace the Budget with a Forecast?

Sometimes unexpected events happen and it is clear the company’s actual performance is moving so far above or below the annual budget that it no longer provides value in the following ways: 

  • A cost control tool
  • A target for employee compensation plans
  • A detailed financial break-down of corporate strategic goals
  • A financial plan for various corporate initiatives

There are many signs that your budget is becoming obsolete due to unexpected events, such as:

  • Management comments why a revenue or expense budget variance is occurring
  • Complaints from sales teams that their targets are too high due to XYZ event
  • Lack of budget ownership from department heads

In addition, you will start hearing from executives that the budget column in the financial statements is “useless” or that the budget target figure in a Key Performance Indicator (KPI) is no longer valuable. 

Some organizations have a predefined monthly, quarterly or semi-annual forecasting process, and when the unexpected happens, they simply take this into account next time they reforecast. These companies often have budgeting and forecasting software such as Solver, Adaptive Insight or Planful to speed up and automate the time and effort it takes to create budgets and forecasts.

Other organizations’ forecasting techniques only include a single annual budget version as a baseline, and for these companies a “forced” reforecast due to unexpected events might involve a lot more arms and legs and interruptions to people’s work schedules.  

What to do When the Corporate Budget Becomes Obsolete?

Companies generally do one of the following when their budgets become obsolete: 

  1. Do nothing and live with the undocumented comments and questions until next year’s budget is launched
  2. Leave the budget as is and use report comments to explain big budget variances (see sample screenshot below).
  3. Reforecast the rest of the year and replace the now defunct budget with the new forecast

Most companies enter their corporate forecasts at a higher level than the annual budget, and often it is only done at the Profit & Loss account level and sometimes also for Balance Sheet and Cash Flow.

In most cases, smaller organizations with well organized, home-grown Excel models can forecast in their spreadsheet and then re-import the forecast into their ERP system or third-party reporting tool. In mid-sized and larger organizations even forecasts at the GL account level may require a lot of work due to requirements to do this by division or department. These companies either have more human resources available to perform the work or they use a budgeting tool to automate it.

Picture1

How to Reforecast Your Budget?

Whether your forecasting requirements are simple enough to be handled in Excel or your company is using a modern budgeting tool, there are ways to avoid the painfully slow bottom-up data entry process. The problem with the latter is that the new forecast may already be old by the time you are done. In these cases, the unexpected event that led to the reforecast could have changed again, leading you to start all over.

Budgeting and  forecasting software automation typically means that your input model is highly formula driven. For example, your forecast model can rapidly calculate all the required entries automatically such as % Revenue Increase, Target Net Income, Reduction/Increase in Headcount, etc. This functionality has many names such as:

  • Top-down planning
  • Driver-based modelling
  • Break-back modelling (see sample screenshot below)
  • What-if analysis

Picture2

Regardless of what you call it and the type of planning tool you use, an automated reforecasting model can create an entire forecast in minutes or hours versus days or weeks with manual methods. 

 An automated model also allows you to create multiple scenarios. For example, armed with a “Best Case”, “Worst Case” or “Likely” forecast scenarios, you can be prepared for unexpected events without rushing to reforecast. Instead, you replace the “Likely” budget version with the already created “Best Case” or “Worst Case” scenario and you are done. 

If the situation calls for a brand new scenario, you adjust the drivers in the automated model and it will recalculate and store the underlying account-level forecast transactions.  

When your company has the right tools and plans ready for a budget reforecast they will be prepared for a virus outbreak, stock market crash or exciting acquisition of a competitor. Planning ahead will reduce stress and blood pressure for the organization’s finance team.

sage-intacct

If you have surveyed an audience of mid-market accounting and finance professionals, you almost always find that 90-95% primarily rely on manual budget models in Excel. How is this possible when most enterprise resource planning (ERP) systems, including Sage Intacct, have both basic native ERP budget functionalities? In some cases, they also have specialized add-on modules. For example, the Microsoft Dynamics on-premise ERPs had the now “retired” Forecaster product and for Sage, it is the Sage Budgeting and Planning. Other ERP systems have built various Excel export and import mechanisms to make it easier for users to budget in Excel. Then, re-import the GL portion of the budget.

While most ERP vendor’s budget add-ons do the job better then entering budgets directly into the ERP system, there still seems to be a large group of companies that simply need a full-featured budgeting and forecasting solution to get the workflow, formula and layout flexibility they need. These solutions are typically referred to as Corporate Performance Management (CPM) tools. They also include a reporting and consolidation functionality.

How do I know if my planning process is NOT streamlined?

Typically, there are a number of key motivators when an organization begins to look for a CPM solution to improve its planning process:

  • Effort spent exporting and importing data from Sage Intacct to home grown Excel budgets
  • Current process is error-prone and a resource strain on the finance team
  • Lack of time and resources to quickly re-forecast (for example if a virus hits the economy!)
  • Lack of automation to create many budget versions
  • Current tool too complex for staff to learn so ended up back with a manual Excel model
  • Find that the ROI of automation with a CPM tool is higher than the cost of manual processes

Which benefits should I expect from modern CPM Planning tool?

Because Sage Intacct is a cloud-based ERP system, pretty much all customers looking for a full featured CPM solution like Solver, Adaptive Insight or Anaplan, will also expect a high degree of functionality, including:

  • Cloud-based platform
  • Pre-integration to Sage Intacct and Sage Intacct approval as a certified add-on vendor
  • Complete workflow functionality to manage submissions, reviews and approvals of the budget
  • Highly flexibly budget form design to completely replace the company’s manual Excel models
  • Strong native report writer for variance reporting and budget consolidations
  • User administration and security that allow for any person to participate in the budget regardless if they are users of Sage Intacct or not
  • Usability features like spreading, break-back, lien items with comments, and more.

I am planning to implement Sage Intacct. What is the best timing for budgeting tool?

Accounting teams always have a lot on their plate. Therefore, it never seems to be a great time to implement another software. However, the best time seems to be in the 2-3 months after the most recent budget cycle. Not only will issues and needs be fresh in mind, but it also allows for plenty of time to select, implement and test a new planning solution before the next budget cycle starts. Some organizations even do a “dry run” of their new budget solution during the year for one of their forecasts.

Carefully selecting a CPM vendor is important

Turbulent Mergers & Acquisition (M&A) market

For example, when a vendor gets acquired, it usually ends less than good for customers. The most typical reason that issues arise is that acquiring companies are much larger than the target company. Therefore, politics and other internal priorities at the parent company tend to drive employees away, disturb the focus of product development, increase prices and more.

Eventually, many acquired products die slowly, and customers end up switching products and vendors. Comshare, Adaytum, SRC Software and Clarity are a few vendors that suffered this during the M&A spree that took place in the CPM space about 15-20 years ago. Over the past 3 years, another wave of M&A has happened, including Workday acquiring Adaptive Insight, a PE firm acquiring Host Analytics from its old investor, Wolters Kluwer acquired Tagetik, and PE-owned Insight Software acquiring Jet Global, Atlas, BizNet and other players in the game.

Protecting the significant financial investment

There are more CPM solutions that are cloud-based. Customers can sign up for one or more years of subscription versus having to purchase the software upfront. However, even if a subscription is reasonable, the amount of time and effort from the internal staff (often with the help of costly consultants) has to be put in to get a CPM solution fully up and running. Also the reports, budget model and dashboards that management need are very significant. You can expect anywhere from twenty thousand dollars and to several hundred and thousands of dollars in direct and indirect costs for full blown implementations. In other words, picking the right vendor and the right product carries a much larger costs than simply a year’s worth of subscription.

Protecting your job

While a good vendor selection and successful implementation can be a significant boon to the careers of project management, it can be the opposite if it all does not work out well. Let alone the stress and long hours that often come from enterprise software implementations,  should it not end well,  can be a scar that follows you for a long time in your career.

Be Strategic

Whether there is too much pain from spreadsheet budgeting or a tactical hint for competitive advantages with faster and better decision-making that drives your search for a CPM solution, a final piece of advice is to be strategic about it. Don’t look at a CPM solution as a temporary band-aid, but view this technology for what it can be when properly chosen and implemented with care. One of your most important decision-making tools that can help drive growth and success for your organization in the 2020s.

financial planning analysis blog

The rapid growth of Microsoft’s Dynamics 365 Business Central (D365 BC) cloud ERP system comes with investments in add-on app solutions by independent software vendors (ISVs)For example, Progressus is a company as described above and has a project solution for D365 BC. With Progressus, small and mid-sized companies receive easy-to-configure and advanced project accounting functionality in the cloud. 

However, as all project-centric business managers know, good transactional systems also need proper financial planning and analysis tools. In today’s highly competitive market, this can be the difference between success and failure.  As successful project-based companies invest in new cloud-based ERP systems like D365 BC and add advanced project apps like Progressus, a natural next step after the implementation is to look for an integrated and flexible reporting and planning solutionA reporting and planning software like Solver can operate down to the detailed field and dimension level in the Progressus tables inside the ERP system.  

Project Reports for D365 and the Progressus App

Lately, most companies prefer pre-integrated solutions. Due to this, Solver partnered with Progressus and now the corporate performance management solution delivers an out-of-the box integration to both Dynamics 365 Business Central and Progressus. Solver not only provides D365 BC customers with a strong financial reporting and budgeting software for general ledger and sub-ledger data, but it also now extends this functionality into all the project detail provided by Progressus. 

Customer Benefits:

  • Pre-built integration to Dynamics 365 and Progressus tables
  • Pre-built Progressus Project reports
  • Full report writer with Excel design
  • Optional Budgeting module
  • Multi-tenant Azure Cloud Platform
  • Pre-built Power BI integration for interactive Dashboards

However, as with any reporting solution, pre-built report templates speed up deployment when can be used as a starting point. 

Solver offers a number of project-focused reports for Progressus including:  

  • Benchmarking
  • Project Manager Benchmarking
  • Project Capacity by
    • Customer Group and Resource
    • Department and Resource
    • Customer Group and Resource
  • Project Detail by Customer
  • Project List
  • Resource Detail
  • Actual vs Budget Variance

 

project capacity

project 2

Both solutions are independently integrated to Microsoft Dynamics 365 Business Central. After the partnership between the two companies, they decided to configure a joint integration. With the rapid growth in popularity of cloud ERP software like D365 BC, one of the next big cloud drivers is that ISVs, such as Progressus and Solver, work together to give customers elegant integrations across both standard ERP data as well as transactions originating from ISV add-ins to the ERP systems. This eliminates many of the custom integrations that are configured in the old on-premise platforms.

Technology is driving major industry changes into the next decade. Project managers and executives will need and demand complete insight to their data to drive faster and better decisions. Cloud-based ERP vendors and ISVs are making good strides to make this happen!

LOS ANGELES, CA. – January 28, 2020 – Solver, ranked by G2 as one of the highest rated companies in cloud-based Corporate Performance Management (CPM) for customer satisfaction, today announced a more than 100%  year-over-year increase in cloud subscriptions.  Solver attributes this growth to cloud platform maturity, continually enhanced functionality and ease of use.  In 2020, Solver expects continued rapid cloud subscription growth with the launch of its new simplified branding, unifying its product and company name, in addition to advancements in its cloud platform and expansion into new markets with growth  of its global teams.  With a rapidly increasing number of cloud-based users, Solver is now able to provide the latest cloud updates and features to all of its cloud customers automatically on a monthly basis.

As Solver matured its cloud platform over the past few years, it is now rich in functionality and well received among its reselling Partners.  Solver is now focused on delivering even more innovative solutions to its users. From rapid deployment of robust data source connectors and process optimization for reporting and planning, to an expanded local presence in new international markets.

“We are thrilled with Solver’s rapid cloud growth and the adoption in our partner channel” says Nils Rasmussen, CEO at Solver. He continues; “We are deeply focused on the next level of innovation to help our customers grow by enabling them with faster and better decisions.”

Overall, Solver’s growth in cloud subscriptions marks its success in meeting users’ needs and offers its Partners a bright outlook for the decade ahead.

 

About Solver

With a quickly growing community of thousands of global customers and hundreds of partners worldwide, Solver provides the leading cloud Corporate Performance Management suite for Microsoft Dynamics 365 Finance and Operations and Business Central, Acumatica, SAP Business One, SAP ByDesign, Sage Intacct, Sage 100, Sage 300, Sage 500, Sage X3, NetSuite and other ERPs. Solver is ranked in the leader quadrant in the Corporate Performance Management (CPM) Software Grid on G2, and as a Microsoft Gold ISV Partner, Solver has won countless awards, including the Microsoft BI Partner of Year Award, recognition on the Gartner Group CPM Magic Quadrant, and Best Places to Work for a workplace culture that celebrates customer service, integrity, and innovation. Solver is sold through its 12 global offices and a worldwide network of partners. For any questions, visit www.solverglobal.com or contact Solver at info@solverglobal.com.

LOS ANGELES, CA. – January 7, 2020 – Solver, ranked among the highest rated companies in cloud-based Corporate Performance Management (CPM) for customer satisfaction by G2, today announced the rebranding of its product from BI360 to Solver.  As a key part of the overall strategic objective of making implementation, education, selling and marketing its product even easier, Solver’s rebranding is a response to its customers and partners, as well as to the larger shifts in the industry.  The simplification and unification of its brand is one of many steps Solver is taking to align itself with the market’s demand for ease of use.

“Our BI360 suite had its humble beginnings in 2009. Since then the names of our company, Solver, and our product, BI360, have lived side by side.”, says Nils Rasmussen, CEO of Solver. He continues, “Now that we have stepped into 2020 and we have an exciting decade ahead with cloud as the platform, we have decided to unify and simplify our brand by renaming BI360 to Solver and replacing the product logo with our company logo.”

“The new, unified Solver brand is one of many initiatives we have underway to make it as easy as possible for our global partner channel and thousands of customers across all industries to do business with us,” says Tad Remington, Chief Commercial Officer at Solver.

As Solver enters a new decade where cloud technology is already the dominating platform in the ISV industry, prioritizing its ease of use will continue to drive its overall strategy.  By combining its company and product name, Solver expects to make a direct positive impact on its current customers and partners while setting itself up for future success in the era of cloud technology.

 

About Solver

With a quickly growing community of thousands of global customers and hundreds of partners worldwide, Solver provides the leading cloud Corporate Performance Management suite for Microsoft Dynamics 365, Acumatica, SAP Business One, SAP ByDesign, Sage Intacct, Sage 100, Sage 300, Sage 500, Sage X3, NetSuite and other ERPs. Solver is ranked in the leader quadrant in the Corporate Performance Management (CPM) Software Grid on G2, and as a Microsoft Gold ISV Partner, Solver has won countless awards, including the Microsoft BI Partner of Year Award, recognition on the Gartner Group CPM Magic Quadrant, and Best Places to Work for a workplace culture that celebrates customer service, integrity, and innovation. Solver is sold through its 12 global offices and a worldwide network of partners. For any questions, visit www.solverglobal.com or contact Solver at info@solverglobal.com.

This blog entry will discuss the achievements Solver is most proud of in 2017 – and what to look forward to from the team in 2018.
Read more

This article will focus on how what you should be looking for in the Best Performance Management Tools for Credit Unions.  
 
scorecard
What is Corporate Performance Management?  According to the Harvard Business School, performance measurement focuses on four main areas:

  • Communicate with external investors to ensure that a firms’ securities are fairly priced and that they are able to access capital
  • Measure and Evaluate a firms’ economic performance
  • Improve resource allocation and strategy implementation within a firm
  • Build Accountability for performance through effective external and internal governance

The emphasis of this article will be on improving resource allocation and strategy implementation, specifically for Credit Unions.  Though Credit Unions have evolved over time, their basic function is to take in deposits and reinvest those funds back into the community in the form of loans for such things as houses, cars, education, and infrastructure. Read more

This article will focus on the Top Management Reporting Software for Credit Unions.
 
topmanagementreportingsoftwareforcreditunionDifferent Types of Reporting –   At first, this article was going to be about the top Reporting software for Credit Unions.  I then realized that there are many different types of reporting needs for Credit Unions that tools will need to focus upon.
Read more

This article will focus on Cloud-Based analytics for Banks in the Era of Data Hackers.
 

Image taken from Pixabay.

Image taken from Pixabay.


Getting to know all about you – A $1 Billion Credit Union recently approached me wanting to know my methodology to Corporate Performance Management (CPM) before they wanted to see a product demonstration.  Their ultimate goal is to have me perform a Data Analytics Assessment to see how good their current CPM process is before recommending any improvements. Read more