This is the third in a series of blogs discussing the requirements of a successful Enterprise Performance Management (EPM) implementation. The first two blogs stressed the importance of Executive Involvement and explained why the Office of the CFO, not IT, should lead the implementation. This installment encourages the customer to seek a partner focused on EPM, not a vendor dedicated to selling software.


Many Vendors Claim EPM Expertise 

Recall our working definition of Enterprise Performance Management from a previous blog: “The technology that enables improvement of the business processes of planning, budgeting, forecasting, reporting and analytics.” Improving these business processes is an endeavor that is both strategic and tactical. As such, senior executives are necessarily involved in both the selection and the implementation of a EPM application. The opportunity to interact with decision-makers at the senior executive level is a siren call to anyone who sells and implements software, which explains the profusion of “EPM experts”, both in sales and delivery, who have appeared in the last few years. It also serves as a warning to those initiating a EPM project.

Most of these newly-minted experts have significant experience in enterprise resource planning (ERP) or business intelligence (BI), and these software systems have some similarities with EPM. But there are also similarities between cruise ships and jet airplanes. Both carry large numbers of passengers to desired destinations. Question: do the similarities between ships and aircraft qualify a ship captain to pilot a jet?


A Bit of History

In the late 90s and early 2000s, there were only a handful of EPM applications on the market. Selection was limited, but the level of expertise was high. The software was generally developed, sold, and implemented by people who had firsthand experience with the problems encountered when budgeting without dedicated enabling technology.

But then the acquisitions began. Geac (now Infor) acquired Comshare, renaming it PM 10. Oracle acquired Hyperion. SAP acquired Outlooksoft, renaming it BPC. IBM acquired Cognos, which had only a month earlier bought Applix’s TM1. With mega-vendors like Infor, Oracle, SAP, and IBM now including EPM in their suite of offerings, the words, “EPM experience”, suddenly appeared on resumes around the world.


Change of Focus

Some EPM customers were beneficiaries of these acquisitions. If you happened to run both the ERP of the acquiring mega-vendor and the EPM application of the acquired boutique vendor, the hope of an “integrated” suite of software sounded enticing. However, the EPM raison d’être was now changed.

EPM applications generate a small fraction of the revenue and profit obtained from other items in the mega-vendor’s portfolio of applications. It is generally acknowledged that EPM is the ultimate enabler of improved planning, budgeting, forecasting, reporting and analytics. But to an acquiring software-suite-vendor, a new EPM tool is far more valuable in “enabling” heightened attraction to the lucrative ERPs, GLs, and middleware it wants to sell.

Sales Executives from these firms are usually quite knowledgeable about GL and ERP software – from which they receive large commissions. Delivery personnel are typically experienced in BI, or GL and ERP – which require thousands of man-hours to implement. But, often, neither sales nor delivery personnel are adept at the business processes that can be improved through EPM.

This not to say that these software-suite-vendors do not have any personnel who have genuine expertise in EPM. They do. And their EPM software does the job. But EPM is not their primary focus. For mega-vendors with more profitable offerings to sell, Enterprise Performance Management is often regarded as “the ticket of entrance” into the office of the CFO.


Choose a Partner

If the objective is to enable improvement of planning, budgeting, forecasting, reporting and analytics through EPM, it is important to work with a company that shares that objective. Alignment of objectives is the cornerstone of a mutually beneficial relationship. That is why companies are more likely to succeed in their implementation when they choose a EPM partner, not a software vendor.

Your partner should have sales executives who strive to understand your business and your functional requirements and to communicate how EPM can meet those requirements. Your partner should have solution consultants who can clearly demonstrate how the product works and, more importantly, how it works in your environment. Your partner should have dedicated EPM implementation consultants –  technically knowledgeable, yet business savvy – who are able to architect an application imbued with your company’s DNA and to deliver user interfaces that are simple, intuitive, and inviting.

A EPM project is an enterprise involving two parties: the customer and the supplier. Success is far more likely when the relationship is based on strongly aligned objectives – not merely a relationship between buyer and vendor. Choose a partner.




Author: Stephen Nelson