IPM is inlumi’s ‘intelligent’ approach to helping you to achieve ‘Performance Management’ excellence – taking traditional performance management to the next level. To realise this – to become data-driven and agile – Finance needs the right technology platform.
This was a challenge in the past. On-premises applications came with complex infrastructure and clunky (costly) upgrade processes, irregularly performed. Basically, staying up to date was time-consuming, expensive and often unrewarding. The arrival of the next generation of ‘intelligent’ Performance Management platforms heralds more significant benefits than perhaps we’d realised.
In the early days of the digital finance revolution – the days when we talked about it more than we actually did it – the simple premise was: move to the Cloud, remove legacy infrastructure, run on a SaaS basis and this will be the last upgrade you ever need to do. This was interesting and there was some case for change. However, we were missing the real point. It has taken some time for us to realise, but there was far more mileage to be had in the business case for change.
I think of next-gen technology and the value proposition in four ways:
- Deploy on Cloud and SaaS.
- Select and implement a single, integrated platform equally capable across multiple processes.
- Leverage a marketplace of apps (pre-built vendor content) to add value to your subscription and reduce the complexity in your ongoing cost of ownership.
- Enable operational-level detail which inspires data-driven analytics and unifies XP&A across the organisation.
You can, of course, make the shift and phase the change in order to prioritise speed to value. In fact, I would recommend this. But I would 100% encourage a broader look at the potential benefits and development of a more ambitious case for change.
A single, extensible platform
The secret sauce of next-gen IPM technology solutions can be summed up in two words: platform and extensible. Modern solutions are equally capable across many different processes. There is no need to compromise on planning or analysis capabilities when choosing a new consolidation system. The market leaders hit the top right box in both Gartner’s FP&A and Financial Close CPM Magic Quadrants. It is true, however, that not all FP&A vendors possess the financial intelligence capabilities to adequately support your consolidation needs. My top tip would be to use your financial consolidation and reporting needs to create a short list of vendors when considering new Performance Management technology.
Your next technology expectation should be the vendors' platform capabilities. The key is the ability to design and implement a data model which is extensible across all of your performance management processes, meeting your needs at a Group and business unit or divisional level. This is important as it drives both value in the business case and buy-in across the organisation.
A marketplace of solutions & additional value
No need to limit yourself to the core and traditional Performance Management scope of consolidation and FP&A. Next-gen solutions offer access to a suite of pre-built applications – People Planning, Predictability, Workflow, IFRS 16, Tax, Account Reconciliation, Balance Sheet Recs... The list continues to grow – in a very good way. These apps can add significant value to your business case and materially reduce the number of different technology vendors you need to maintain relationships with and support. The benefit here is not only the speed to value that comes with a prebuilt solution, but also the longer-term ROI that comes from a reduction in the complexity you as a customer need to own, maintain and develop.
Data-driven analytics and XP&A
The single most significant and transformational benefit is the ability to extend and unify planning and analysis processes across the organisation. XP&A is the revolution and revelation – the Ferrari in the garage – of the leading next-gen technology vendors. In the early days of my performance management systems implementation career, I thought loading an ERP extract by flat file with a couple thousand rows of data was advanced and sophisticated. We are now delivering projects loading half a billion records, unifying processes across more than 15 source systems, and applying predictive, machine learning capabilities on the data all the way up to the Group consolidated result. Projects are looking at planning and analysis needs across the organisation in areas ranging from supply chain, manufacturing and product costing to marketing, Finance and HR. It is not even the same game anymore.
This progression has been amazing, and I am certain it will become the new normal for progressive finance teams, leading the evolution of processes to create the organisational resilience to absorb shocks and the agility to take advantage of the opportunities that today's volatile and uncertain markets present. More on this and XP&A in a blog to follow!
If you found this interesting, and when you are ready, drop me a line and I would be delighted to share more of my views and experiences with you.