In a previous blog entry, I discussed some pointed items to consider when implementing an Enterprise Performance Management (EPM) solution. In this entry, I focus on helping you to find the right technology and understanding why this is so important.
It’s not just enough to say, “Let’s buy the cheapest technology out there as long as we’re automated and centralized” or “Let’s look to buying the product that covers all aspects of an EPM implementation”. That second statement would simply mean that you’re buying technology that contains more moving parts that your enterprise can manage. As a result, finding the right tool is a delicate balance of what your organization needs in the short term and in the long term.
Before you decide which application or applications are right for you, consider these elements:
- Make sure you have a long-term EPM vision into which your current portfolio of Finance, IT, and operational initiatives fit
- Decide where EPM “lives” in your organization: Finance, IT, Operations or in a cross-functional center of excellence
- Define and document the business case for EPM, including items such as:
• Revenue growth
• Cost management
• Systems rationalization
• Cash cycle velocity
• Fixed-asset utilization
• Visibility and accountability
- Connect EPM to your management methodology
- Connect financial and operational models and scenarios to your planning processes
- Provide financial, operational, and predictive analytics to your business analysts and managers
- Integrate your IT roadmap with EPM
- Inventory your EPM processes and align them with your roadmap
- Leverage your technology investments
- Rationalize systems and standardize where appropriate
- Upgrade to functionality that gives your business benefit
- Leverage your data assets
- Expose data quality issues
- Implement the EPM umbrella on top of your transactional systems and data warehouses
- Implement a robust data governance policy and methodology.
An integrated EPM system, the backbone of your management operating system, is the foundation for building an agile enterprise. It delivers a balance of standardization (common definitions and calculations, common processes, and a common management information interface) and flexibility (multi-GAAP and management reporting, scenario planning and analysis, alternate hierarchies including entity and product roll-ups, workforce planning, etc.).
Author: Mohan Chanila, Performance Architects