The Best CPM Software: 9 Things to Evaluate in a Tool

Matthew Dziak

9 Benefits of Corporate Performance Management Software

Finance functions are not only responsible for measuring the health of the business but uncovering ways to optimize performance. When evaluating the various Corporate Performance Management (CPM) software providers, determining which is best can vary on a Company’s needs. Regardless, CPM solutions should empower finance to be an essential cross-functional value provider for the business.

82% of CFOs and 85% Heads of FP&A expect to spend more time prioritizing advanced data analytics technologies and tools in Finance, according to the Gartner Finance Trends Survey.

Before implementing a new solution to scale your finance function’s maturity, a proper evaluation of your options is the optimal approach to ensure you not only choose the best CPM software but the right partner to work with on an ongoing basis. In this post we break down the nine process improvements and benefits you should expect from CPM software. 

1. Realize more efficient budgeting and forecasting processes

We are in the age of automation and the robots should be embraced, not feared (unless of course, they are calling you from random numbers, we can certainly do away with those). Automation is a core value that most CPM software providers offer, but the level at which tasks and data manipulation is automated ranges by vendors. 

Unfortunately, finance teams are heavily reliant on Excel to satisfy reporting, budgeting and forecasting processes. Spreadsheets can grow like weeds, becoming more and more complex and entangling your finance function in a web of hard code and lookup formulas. 

The ability to automate repetitive, low-value tasks frees up capacity for more meaningful work. For example, CPM software can immediately automate the budget to actual variance analysis, so there are no discrepancies, errors or miscalculations to review and you can get right to the presentation portion of your report. Not only will you generate greater insight to achieve company objectives, but your finance team will be more engaged, working with a sense of purpose so many crave. 

2. Offer multidimensional data structuring from your disparate systems

Finance professionals' daily tasks have evolved into that of a digital cattle herder. Alright, so we aren’t trading in the button-down shirts and suits for oversized belt buckles and cowboy boots any time soon, but the same way a rancher herds its cattle, finance professionals herd their operational and financial data. 

The data you need resides in your disparate CRM, ERP, HR and Platform databases, all of which aren’t structured or organized in the same fashion to report. This manual wrangling of your data from systems and cleaning it for use is where most hours are spent.

Even your accounting systems and ERP tools don’t automate your data for use. ERP tools like Quickbooks, Sage Intacct and Netsuite are fantastic for recording transactions and housing your accounting data but often fall short when it comes to satisfying reporting, budgeting and forecasting needs of finance professionals. 

To get control of your data, extraction is just the beginning. Sure, not having to manually export your data and import it into Excel to query is a must, but few CPM solutions go the extra mile of transforming your data from your source systems so that it is automatically processed, tied to your accounts, staged and ready for instant reporting and analysis. 

On-line analytical processing (OLAP) technology structures and stores data in multidimensional cubes. Unlike relational databases used by other providers, OLAP provides a means to group data with multiple attributes. With multidimensional cubes it is possible to analyze and report on metrics in far greater detail.

3. Provide more detailed insights to drive strategic conversations

Measuring your company’s performance is step one on the path to operating like a mature finance function. Identify opportunities to improve performance.

There’s great untapped value in the ability to deliver strategic insight to improve performance. Conducting deeper analysis is necessary to unearth actionable insights that inform budget owners and decision makers. 

Excel is a two-dimensional view of data with rows and columns, where CPM software like the FutureView Platform is built using Jedox's OLAP technology with multidimensional layers of data, where you can slice-and-dice data to create ad-hoc reports with drill through capabilities.  

4. Measure company performance with greater accuracy and speed

Although your closing process should be accurate, (if not, then you consider partnering with an expert to tighten up your accounting processes) the performance metrics can vary due to your calculations and inputs. Measuring company performance is necessary to know where you stand in relation to your targets. 

One means to measure company performance is variance analysis, comparing your monthly actual results with the budget expectations. You can take this a step further by comparing your forecasts to the monthly results as well. 

For example, you can compare your previous month’s actual results with the predicted results in your forecasts to get a better understanding of the recent trend and what action might be required to adjust course or double-down on any efforts leading to positive results.

The problem with many solutions is the inability to scale as your data sets expand. Often times tools within Excel rely on the data storage and computing power of spreadsheets, which as many know, can lead to lengthy calculating times as your computer sounds as if it is ready for take off. The ideal CPM tool prevents the dreaded speed performance deterioration in Excel preventing you from continuing your workflow and ensures the numbers are correct.

5. Expedite the closing and reconciliation processes

Inevitably the numbers have to work, debits have to equal credits and the books have to be closed for the month. One of the greatest challenges accounting and finance teams face is keeping an organized chart of accounts and data structure consistently without tedious, manual financial data processing. 

Unlike legacy accounting systems, CPM software gives you the ability to see the financial statements prior to closing the books. This is beneficial to expedite the closing process where you can see how the numbers are shaping up in comparison to previous periods at the account level. 

For example, if you are a subscription business that books recurring revenue, you have a record of actuals from the previous months that gives you a baseline of expected revenue. With a CPM system, you can quickly review current revenue metrics and analyze any discrepancies so you can dig into the causation, ensure you appropriately tie expenses to the correct vendors and verify book revenue from the correct customer prior to the start of close. 

The longer it takes to close the books, the less time there is to analyze, strategize and act. Remaining agile is a necessity to keep up with the competition and the faster you can analyze your company, the faster you can optimize strategies for desired results. 

6. Provides seamless, automated reporting packages

Improving the monthly reporting process is a focal point for many new CFOs, and rightfully so.  With a modern CPM solution, once the books are closed, the reports are all dynamically synced to the GL data, so reporting is instantaneous and ready for export to share with stakeholders. 

There’s no need to develop complex reports in Excel, praying that everything references correctly and the right data is in the right spot. It’s very easy for us to paste a collection of data into the wrong column and build a pivot table with the wrong data. 

We’ve seen it time and time again, it’s just one of the many problems finance and accounting teams run into relying solely on Excel, but it is not indicative of your capabilities or finance acumen. It is simply a human error that is unavoidable without the use of technology. 

7. Maintain version control over collaborative measures

Budgeting season is a time no finance professional looks forward to and who in their right mind can blame them. The process has evolved into a time-consuming people and spreadsheet management exercise requiring a near herculean effort to finalize targets. Requesting revisions to version 4.0 of marketing’s budget spreadsheet and hoping they don’t alter your inputs or calculations is less than ideal. 

There are many budgeting processes, ranging from top-down, bottom-up, zero-based and a host of others. If you’re interested in more insight on which process might work best for you, check out our budgeting methods blog post. 

Your budgeting process should be collaborative in nature, and unlike spreadsheets, the best CPM software providers enable you to manage user access levels, and data version control, while rolling up inputs to your admin platform view of the collective metrics for reporting, planning and budgeting. 

Quick Tip: Start your budgeting conversations with business partners and budget owners early and often. Iterations to the numbers are bound to occur, but the sooner you can plan for a business unit’s needs, the quicker you can satisfy the needs of management and expectations of your investors and board without sacrificing your weekends and sanity. 

Budgets are designed to guide decision makers on where they should allocate their resources for the year. If it takes you months to develop a budget, you are losing valuable time needed for each business unit to strategize and take action.

8. Generate tangible ROI

The great benefit of automations and software solutions is the time saved conducting repetitive tasks that are necessary, but not an optimal use of an analysts or finance professionals time. The initial cost of a new software solution will elicit a far different ROI in the first month, than what will be realized in 3, 6 or 12 months later.

CPM software can save finance professionals over 20 hours of manual tasks each week and the peace of mind that there are no errors and the data you need is at your fingertips is invaluable, dare we say — priceless. The time saved processing data frees up capacity for more meaningful analysis. When your finance team spends the majority of its time wrangling and staging data, the drain leaves one far less motivated to do the work that can have the most impact. 

Focus your analysis efforts on the 20% that is responsible for 80% of the results rather than 80% of your time on the manual tasks that only affect 20% of company performance

9. Supplement Your Finance Transformation

Embarking on a finance transformation requires a blend of people, processes and technology, and just like a recipe, you can’t produce your end result without the proper amount of each ingredient. We’re focused on the technology portion in this post to help guide you on your journey to operating like a mature finance function. 

Before implementing any CPM software or finance tool for that matter, it’s important to develop a clear finance transformation roadmap. You must assess the state of your operation and ask the following questions: 

  • What areas are you trying to improve
  • Where do your gaps and weaknesses lie
  • Who will be involved in deciding on a tool
  • Who will be using the tool
  • How will you implement the tool  
  • How quickly do you need to implement

You should be able to answer most of these questions, while others are up to the vendors you are evaluating to provide. Partnering with FutureView Systems is more than selecting a CPM system provider, it’s a partnership with proven finance experts and leaders with decades of experience sitting in your shoes. 

The FutureView Platform is powered by Jedox, the premiere global leader in OLAP technology, and paired with our finance experts’ proven methodologies to truly transform your reporting, budgeting and forecasting processes. If you’re eager to learn more, contact us and request a demo, we’d love to speak with you and see how we can help.