For years now, there has been a growing push across many industry verticals to "break down silos." The word "silo" may bring to mind structures that store grains or missiles, but here it actually refers to an isolated part of an organization that does not normally share its practices, tools or communications with everyone else. An example might be the stereotypical IT department, which deals in technical jargon as well as advanced software and hardware that the rest of the business might never understand or even come into contact with.
Many finance departments – along with the tools they rely on, such as legacy corporate performance management applications – also fit snugly into their self-contained silos. However, this isolation from the organization at-large can have ripple effects on the accuracy of budgets, forecasts and plans:
- Finance teams, not being well-versed in the ungainly on-premises budgeting systems they use, may end up relying on the IT help desk for support, including assistance with any updates or other adjustments to specific business rules, calculations and integrations.
- Overall financial performance can be opaque. Stakeholders may lack access to an intuitive interface that provides a clear view into the company's operations, products and markets. As a result, they are not working with a single source of truth and cannot effectively collaborate.
- The immense amount of time spent tracing activity, verifying calculations and reconciling Excel sheets means that budgeting and forecasting cycles can stretch on for weeks, leaving little for actual analysis. Processes like cost allocations can be particularly draining.
It is no surprise that in this context, a fresh wave of tools and strategies has emerged to take on silos and promote better sharing of knowledge across the entire enterprise. DevOps is one broad cross-industry example, as it encourages collaboration between previously siloed software developers/testers and IT. For finance in particular, the evolution of CPM software has marked a new phase in silo-busting.
Old vs. new in CPM: Moving toward software that works for the SMB as a whole
CPM applications used to be designed for the near-exclusive use of finance departments, but they have since transformed into tools that can be utilized by employees of all types across a business. In a recent interview with TechTarget, Christopher Iervolino of Gartner noted this long-term change, describing budgeting and financial modeling as "strategic" tasks that were "most beneficial for the organization as a whole," not just the finance office.
Modern CPM software is helpful in identifying trends and making plans.
He used this remark to preface a discussion of Gartner's Magic Quadrant for CPM vendors, which as of the end of May 2016 included four companies in its "Leaders" segment: enterprise giants Oracle, SAP and IBM, along with SaaS provider Adaptive Insights. The latter is the only one providing a CPM solution exclusively for SMBs.
"SMBs can move beyond time-consuming manual processes and legacy CPM."
"Adaptive Insights is a Leader in this market," explained the original report authors. "This is due to its high customer satisfaction and strong execution and cloud experience, especially in the small and midsize business sector. This vendor's highest score was for customer experience; it also received above-average scores for sales and marketing execution."
What specific benefits do SMBs get from cloud budgeting and forecasting software like Adaptive Insights? They can move beyond time-consuming manual processes and legacy CPM tools and get direct access to:
- Automatic allocations that greatly simplify market benchmarking and analysis.
- The ability to set up accurate rolling monthly forecasts, which help better inform decision-making.
- Deep visibility into costs such as distribution and manufacturing, which can boost profit margins.
- An intuitive dashboard interface that lets anyone get a glimpse into past, present and future trends.
- Automated and detailed reporting that saves tons of time that would have otherwise been sunk into manual report building.
- Tight control over report formatting and synchronization, so that everything is up-to-date and not compromised by a copy/past error.
CPM has come a long way in the past few years, becoming a more usable and democratic solution for the organization at-large. An experienced partner such as RKL eSolutions can help you get started on implementing a top-notch CPM platform such as Adaptive Insights, so that you can build sustainable, scalable budgeting, forecasting and planning operations.
