Key CFO Ideas for 2015, from the Lessons of By Scott Costello, Director of Cloud Services and Emerging Technologies. Key Performance Ideas

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1 Key CFO Ideas for 2015, from the Lessons of 2014 By Scott Costello, Director of Cloud Services and Emerging Technologies Key Performance Ideas

2 As the economy continues to move from recession to growth, 2015 could be the year of critical strategic direction setting for CFOs. As a CFO, how do you know you have the correct analytical capabilities to allocate investments to the right areas? Are you doing enough to track and monitor business performance and providing the right indicators to your executives for them to make sound decisions? Are all areas of growth being explored? Are you providing your team the right tools and making your team strategic thinkers and great business partners? One of the biggest lessons learned of 2014 for me was the impact that digital and cloud innovation has had on the function of Finance, specifically in the areas of planning, budgeting and forecasting. Visibility into where to invest, how you are performing, and where additional opportunities may exist, all have a heavy reliance on utilizing the right technology to provide the right insights. And, investing in the proper technology can be a major factor in how to keep the Finance team happy, particularly during an economic upswing when the labor market movement becomes more competitive. CFO s can no longer ignore the importance of technology to the Finance function. But, as a CFO, how do you know which planning, budgeting and forecasting technology is best for your organization? Can you make appropriate investments in technology without over-investing? How can you manage the digital revolution and prepare for future changes, while still doing your real job: managing the financial risks of your company? Which Technology is Best for the Office of Finance? In March of 2014, Gartner, Inc., a leading information technology research and advisory company, released their Magic Quadrant for Corporate Performance Management Suites. A Gartner Magic Quadrant (MQ) is a culmination of research in a specific market that provides wide-angle views of competitors across a common market. In the Corporate Performance Management (CPM) or Enterprise Performance Management (EPM), or Performance Management (PM) market, Gartner examined technology that corporate finance leverages to manage performance results. In a nutshell, Gartner reviewed the best technology suites for financial planning, budgeting, forecasting, modeling and reporting (including consolidations). Their results showed that Oracle s suite of Hyperion and Oracle Business Intelligence Enterprise Edition (OBIEE) products came out ranked highest in their ability to execute and their completeness of vision (Gartner, March 2014). Oracle has continually been a strong contender of the Gartner MQ for CPM. In fact, in 2013, their suite of products received a number of significant additions, as noted by Gartner. Oracle s Hyperion and OBIEE technology is an excellent technology decision for any organization as the world s leading companies have invested in Oracle. Gartner, however, also noted that Oracle s Hyperion and OBIEE products are typically used by large, complex organizations. This leads me to my second answer challenging CFO s and the second lesson I learned in Key Performance Ideas 1

3 Can you make the needed investment in technology without over-investing? Gartner will certainly recognize a need to update their 2015 report in the observation that Oracle is primarily deployed by large organizations and that midsize companies tend to consider (it) too expensive. In 2014, just shortly after Gartner released the MQ for CPM, Oracle released Planning Budgeting Cloud Service (PBCS). It is Oracle s first EPM cloud-based application available to customers in a software as a service (SaaS) deployment model. It provides a flexible planning and budgeting application that s ready for the Cloud and includes all the world class budgeting and forecasting features, reporting, and data management capabilities that are used today in Hyperion Planning and Essbase. It is a viable option for any sized company interested in using a sophisticated planning and forecast application without all the overhead of a 'traditional' in-house deployment. I personally have managed the go-live of one of the nation s first implementations of PBCS and Key Performance Ideas has (at date of publishing) the most PBCS implementations of all Oracle partners globally. The companies who have implemented PBCS are not only large firms, but organizations of all sizes. For the first time, midsized organizations across a variety of industries are able to take advantage of the features of Oracle s Hyperion Planning software through this hosted model in the Cloud. Organizations of all sizes are turning to Oracle s PBCS for an answer to their financial planning and forecasting issues. In fact, we are seeing clients implement PBCS to address their needs associated with sales forecasting or customer analytics. Hence, lesson learned number two: organizations are able to take advantage of PBCS due to its limited investment exposure and by utilizing a rapid implementation of the solution. They utilized Key Performance Ideas PLANtastic, a unique methodology that gets organizations up and running on a new solution in a short period of time and minimum cost investment. By leveraging cloud deployment with prebuilt functionality, organizations can customize key features of the solution economically to meet their needs and more efficiently adapt to the new solution Key Performance Ideas 2

4 Case In Point Diono, a Seattle-based manufacturer of car seats, convertible/boosters & travel accessories, struggled with an inability to consistently pull data from their SAP General Ledger in a timely manner for their needs across the Finance organization. In fact, all users had to manually enter and add links within MS Excel on a regular basis. Diono realized they required a single repository to meet their planning, forecasting, and reporting needs, including typical monthly financial reporting, as well as sales forecasting at product and customer level, and operational forecasting at the entity and cost center level. After partnering with Key Performance Ideas and leveraging PLANtastic, Diono has significantly enhanced their planning processes. Not only did Diono streamline and standardize their financial budgeting, forecasting and reporting process, with the implementation of a sales plan, Diono can complete sales forecasting by customer by item and price. Additionally, Diono has established consistency across the company as users now utilize the same reports, planning methodologies, and technology. Overall, PBCS and Key Performance Ideas has: Helped Diono eliminate spreadsheet challenges, including disorganized and inconsistent files and links Allowed Diono to automate reporting with direct daily feeds from their General Ledger Provided Diono with unit level global market forecasting How can you manage the digital revolution while still doing your real job: managing the financial risks of your company? The digital revolution, as some may call it, isn t really a revolution. My third lesson-learned in 2014 is that managing digital changes is not a revolution for the Finance function, but an innovation with major benefits that any CFO can exploit. First, let s look at the innovation of the Cloud. For years, organizations have spent millions of dollars investing in in-house deployments of systems that are difficult or unable to change as the business grows, and are too expensive to maintain. Cloud computing has proven to enable businesses to reduce costs and deliver results faster, as well as deploy new applications that are core to business processes and associated upgrades quickly. Our PBCS customers have met or exceeded these requirements and are benefiting from less engineering or integration of mismatched applications and fewer systems to maintain due to the Cloud. Second, digital innovation brings new answers to old-fashioned approaches. An IT department full of staff who are managing, configuring, tuning, upgrading and monitoring applications are no longer needed. In fact, Finance-specific system administrators are spending less time doing general maintenance on their systems and more time supporting unique business user needs. How? CFOs are now partnering with companies that provide certified Oracle product experts to manage and make certain that applications are available and delivering accurate results. More important, by partnering with companies to manage their mission-critical systems, CFOs can reduce administration costs by more than 50%. Several of our clients have leveraged our S.M.A.R.T. (System Maintenance and Remote Troubleshooting) program and are no longer 2015 Key Performance Ideas 3

5 impacted by administrator vacation, sick time or turnover, nor struggling with data validation, report updates, or hierarchy changes. Overall, innovation in remote system maintenance reduces operational risk and eliminates single point of failure concerns, allowing the entire office of finance to do their real job. The economic outlook for 2015 remains positive: for the overall market and for CFOs as they make the necessary technology decisions on where to invest (without over-investing) so that they can continue to manage the financial risks of their company. Digital and cloud innovation provides major benefits that CFOs at any size organization should leverage. Not only can the CFO keep the Finance team happy, they can also provide the visibility necessary to identify how the organization is performing, where opportunities exist and become the strategic thinkers and business partners the organization and its stakeholders expect. About the Author Scott Costello, a CPA and Certified Oracle Hyperion Planning, Essbase, and Hyperion Financial Management consultant, is a recognized leader and frequent speaker at national and virtual events to foster best practices in Enterprise Performance Management and Business Intelligence. He has more than 16 years of consulting management experience and has guided customers across a variety of industries in their implementation of successful planning, forecasting, close, and reporting solutions. Scott can be reached at scostello@keyperformanceideas.com Key Performance Ideas 4