Driving forward through uncertain times

To thrive in today’s competitive business environment, organisations need to harness the power of data to deliver the right information to decision-makers on a rapid, on-demand basis. In the current difficult economic circumstances, finance departments, in particular, must provide a wider spectrum of services to the enterprise, providing financial information and acting as a business partners that provides both qualitative and quantitative information.


A systematic approach to selecting a CPM solution

When choosing a new CPM system, many vendors can appear to offer similar or identical solutions. Therefore, selecting the right solution requires an evaluation process that addresses these key areas:

  • Understand and assess the business requirements. Before setting out to choose a vendor, assess the business and operational requirements. Then, having addressed current procedures and deficiencies, set strategic goals. This process requires a cross-functional  evaluation team that contains members from all key stakeholder groups, especially Finance and IT.
  • Request Proposal (RFP) & Initial Vendor Evaluation. Decide who should be on the vendor shortlist and why. Do not overlook vendors who are unfamiliar - they could have a better solution or deliver equal functionality for less cost. Create the Request for Proposal (RFP), complete with scoring criteria, to be submitted to each vendor to be evaluated. As a primary assessment document, your RFP must represent finance and IT requirements.
  • Vendor Interviews & Proof of Concept. Consider a proof-of-concept exercise as part of the vendor interview process, and demand a customised demonstration specific to the requirements. Remember that selecting a product means the selection of  a strategic partner, so determine if vendor personalities will integrate well into the implementation team and corporate culture.
  • Due Diligence, Final Selection & Negotiation. Visit at least three reference clients so as to understand their experiences - especially their relationships with the vendor - and how smooth the implementation process was, and whether the vendor was responsive after the go-live date. Independent market analysis should also be conducted to further narrow down the short list.


Risk mitigation

Typical CPM adoption strategies tend to focus on the development stages of the project lifecycle, while the process of vendor selection often receives far less attention. Both, however, are equally important and failing to adopt a comprehensive evaluation process has a number of significant risks associated with it:

  • Market - the CPM market has experienced rapid growth as it continues to mature and converge with BI and enterprise applications. In this consolidated market, large-scale-vendors have eclipsed smaller, independent providers and new entrants, making it harder for these smaller enterprises to receive the same consideration. A common misconception is that by limiting selection to market leaders, risks are mitigated, yet by initially dismissing niche or emerging vendors, organisations may miss out more flexible and responsive partners that could provide an inexpensive solution every bit as scalable and complete as those on offer from market leaders..
  • Vendors - CPM vendors have an uncanny way of making their products and demonstrations perfectly match the prospect’s demands. However, organisations should question how clearly the requirements are defined; what has been achieved using the ‘vanilla’ product, and how much customisation has been used.
  • Communication - it is generally accepted that vendor selection projects require a balanced cross-functional steering committee comprised of representatives from all key stakeholder groups. Stakeholders must be effective in communicating their requirements to the committee and ensure that they communicate the overall vision to divisions/operations locally, to generate buy-in from the entire user community.

 

CPM - Making the right choice!

The issues and risks highlighted above are by no means exhaustive but, hopefully go some way in proving that the vendor selection exercise is key to the overall success of a project. To this end a clear and comprehensive selection process is essential. Ultimately, your appraoch must be a clear and adaptable methodology to suit the size of the organisation, budget constraints and timescales.