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Tidemark Systems offers a suite of business planning applications that enable corporations to plan more effectively. The software facilitates rapid creation and frequent updating of integrated company plans by making it easy for individual business functions to create their own plans while allowing headquarters to connect them to create a unified view. I coined the term “integrated business planning” a decade ago to highlight the potential for technology to substantially improve the effectiveness of planning and budgeting in corporations, and it remains true that integrating business planning can produce superior results. Companies that maintain direct links between functional or departmental plans more often have a planning process that works well than others. Our next-generation business planning benchmark research shows that two-thirds (66%) of those that maintain such links have a planning process that works well or very well, compared to 40 percent that copy information from individual plans into an overall plan and just 25 percent in which plans have little or no connection.Integrated Planning Works Better

Businesses commonly do a lot of planning within individual silos: There are sales plans, marketing plans, manufacturing plans, R&D plans and various others. However, in most companies the only unified plan is the corporate budget, which is a financial plan used mainly for allocating resources and controlling spending. Because they are focused almost exclusively on monetary consequences, budgets are not especially useful for planning the operations of a company, which requires attention to the things of a business (such as head count, numbers of purchased parts and tons of materials).

Tidemark has made significant progress with its software that I have previously assessed with how it unifies business planning and the company’s Fall 2015 release includes a new feature, Tidemark Complete, that enables companies to benchmark their performance against that of competitors. In almost all organizations, performance reviews compare results against the current plan or the previous quarter or year. While this is essential, it’s insufficient because business is not an “us-vs.-us” game; it’s an us-vs.-them competition. Even so, most companies don’t assess their results against the market because they find it too difficult and time-consuming to assemble the data. Tidemark Complete addresses this issue. The latest release also adds packaged configurations and metrics tailored for the insurance, hospitality and retail industries that enable such companies to accelerate their implementation of Tidemark. In the Spring 2015 release the company introduced packages for higher education and subscription commerce. The subscription commerce app is especially useful for companies with recurring revenue businesses for two reasons. One is that managing these types of businesses requires using metrics that are not directly available from the accounting process. These include the annual recurring revenue (ARR) and annual and total contract value (ACV and TCV). Typically, the finance staff assembles data from one or more sources in desktop spreadsheets to do the calculations, analyze the results and create reports. As well as time-consuming, this method is prone to errors and incompleteness in the data. The second reason is that revenue recognition in subscription businesses is often complex. For planning purposes, it’s useful to be able to automate the translation of booking events into reported revenue because it saves time and results in more accurate projections of future financial statements.

Ventana Research rated Tidemark a Hot Vendor in our 2015 Business Planning Value Index. Tidemark’s software offers all of the capabilities necessary to support state-of-the-art planning. That is, it offers engaging visualization and reporting functionality that enhances understanding and insight in developing plans as well as communicating results. It has workflows to manage plan creation and periodic updates that cut the time and effort required to supervise the process and thus shorten planning cycles. It offers Business Planning Value Indexintegrated analytics to support the planning and review phases of the process as well as Storylines and Playbooks, methods that present an organization’s performance in narrative form with engaging data visualizations. An important reason why companies invest time in creating plans is to set objectives so they can periodically review their performance to those objectives. By organizing all business planning on a single platform, Tidemark allows each planning unit to review its results faster and headquarters to review the overall financial and operational performance sooner. Our research finds that companies that use a dedicated third-party planning application such as Tidemark are more able to uncover details during a review meeting because they can drill down to uncover underlying details while the meeting is under way. This enables managers and executives to get to information that can promote agility and provides an environment that encourages action in the whole organization.

Tidemark also offers built-in social collaboration capabilities in context. Collaboration is essential in the process of planning in corporations because it helps ensure that activities are coordinated. Companies have multiple objectives for their planning processes. Chief among these is accuracy. But since things don’t always go to plan, companies need agility in responding to changes in a timely and coordinated fashion, and collaboration facilitates this also. In a small business, planning can be informal because of the ease of communications between all members and the ease with which plans can be modified in response to changing conditions. In larger organizations the planning process becomes increasingly difficult because communications become compartmentalized locally and diffused across the enterprise. Facilitating collaboration across geographies or business silos addresses the communications issues. Tidemark’s Collaboration is Important to Planningcollaboration capabilities address this issue more readily and completely than email or instant messaging. Setting and changing the company’s course require coordination to ensure that the actions of one part of the organization complement (or at least don’t impede) the actions of others. Better communication across the organization promotes coordination because it enables better understanding of the impact of policies and actions in one part of the company on the rest of it. Yet only 14 percent of companies are able to accurately measure that impact, and fewer than half (47%) have even a general idea. Integrated business planning coupled with a collaboration capabilities addresses that issue.

Using the most capable technology also helps. Using limited tools is a major barrier preventing companies from integrating their planning efforts; spreadsheets in particular are a major Spreadsheets in Planningculprit. Our research reveals that across the spectrum of corporate planning activities, seven out of 10 organizations use spreadsheets to manage their planning processes. Tidemark’s common planning platform for individual departmental and functional plans, plus built-in analytics and reporting and its focus on ease of use, provides a compelling reason to switch from spreadsheets. Also, compared to using spreadsheets, Tidemark’s applications can make the planning process far more interactive by utilizing in-memory processing to speed calculations. When even complex planning models with large data sets can be run in seconds or less, senior executives and managers can quickly assess the impact of alternative courses of action in terms of their impacts on key operating metrics, not just revenue and income. Furthermore, having the means to engage in a structured conversation with direct reports can help executives implement strategy and manage their organization more effectively.

Integrated business planning applications are changing the conversation from a finance-centric approach to one that supports planning operations and finance in parallel. Companies that are dissatisfied with their current approach to business planning and are looking to improve important aspects of it including accuracy, insight, speed and alignment should consider dedicated business planning tools. When they do that, they should consider the kind of software that will enable them to support a better process. We recommend that they include Tidemark in their evaluation.


Robert Kugel – SVP Research

Infor described this year’s Inforum user group meeting as a coming-out party for a large startup company. Such a debut was necessary because Infor had been operating in something of a stealth mode for the past three years: a limited marketing presence, no unified message and a weak, sometimes inconsistent brand identity. It also needed to formally introduce Infor to customers of Lawson, the ERP supplier it acquired last year. The “startup” designation is meant to signal that Infor has been able to render a decade-long consolidation of dozens of smaller companies into one cohesive entity.

I think the current management team has put Infor – particularly the pre-Lawson portion of the portfolio – solidly on the road to viability. This has been no small feat. It’s hard to amalgamate a mix of smaller applications software companies, none with substantial market share. Unlike bringing together a more homogenous set of businesses (say, metal fastener distributors), achieving operating efficiencies has required from Infor a clever dose of pragmatic technology, notably its ION middleware. Infor has had to create a software architecture that makes it easier for both the company and its users to maintain its applications. As well, ION makes it feasible for users of software to upgrade it or migrate to other portfolio applications and to add complementary applications without difficulty.

One of Infor management’s more important objectives for the conference was to get across to users its new strategy, which I covered in an earlier blog. The keynotes on the first day provided the long version of what I expect will be the company’s core message over the next year or so. To persuade its installed base to stay with it, Infor is promising they can keep what they have for as long as they want. Moreover, it will make it easier and less expensive for them to get a broader set of capabilities, such as analytics, performance managementsocial business applications and cloud-based applications designed to meet their specific needs from Infor rather than going to another vendor. None of these products breaks new ground; all are necessary for the company to remain competitive. For new customers, Infor is offering the promise of faster time to value and potentially lower implementation costs in its targeted verticals. I think this is the right message, but it will require frequent repetition and an aggressive marketing effort supported by a solid roster of willing customer references.

Serious challenges remain for Infor in the business environment and in executing the strategy. After a decade of modest, incremental improvements, the overall pace of technology change is accelerating. The software consolidators of the past decade benefited from limited technological evolution as they tried to stitch together their acquisitions. The slowdown extended the useful lives of enterprise applications, especially record-keeping systems such as ERP. Vendors have been able to keep customers paying software maintenance and had time to integrate the pieces of their portfolios. Now this is changing. For example, companies see that cloud computing can be a better choice for deploying software than doing it on-premises, whether functionally, economically or both. Increasing numbers of people are working with mobile devices, larger sets of data and more sophisticated analytics. Customers’ expectations of how to interact with systems are starting to change as vendors tout the “consumerization” of their business software offerings to make them more like the apps available on mobile devices and more appealing to the social media generation of business users. Infor is responding to each of these, including creating positions for Senior Vice Presidents of Cloud and Speed to promote rapid product development and innovation.

In addition, while Infor is now the third-largest enterprise software company, it is competing with a roster of cash-rich titans (notably IBM, Microsoft, Oracle and SAP). Infor’s recent recapitalization put it on stronger financial footing, but it is still highly leveraged. To the extent that it is successful in generating incremental revenue, it will be able to get cash to pay down its debt. Solid revenue growth also would give it the opportunity to raise equity in the public market and de-lever its balance sheet even faster. The downside to this virtuous circle, however, is that to the extent that Infor is unable to generate “escape velocity” revenue growth, it will crimp its competitiveness because of the need to service the debt. For this reason, how well the organization executes is very important.

In my opinion, Infor faces at least four substantial execution challenges in achieving its objectives. The first is to build broad awareness of the benefits of Infor’s approach and the value of its software. One of Infor’s key strengths is its installed base of midsize companies.  These buyers want software that doesn’t require much customization and implementation effort because they have small IT staffs and limited budgets to buy, implement and maintain the software. Infor’s “micro-vertical” applications provide deep functionality built for specific types of businesses. For instance, this means not just the food and beverage vertical but milk producers, brewers or bakers, each with its own business-specific capabilities, units of measure and workflows built into the software.

A second challenge is to identify, define and refine a set of core sales offers that promote cross-sells or up-sells with the most revenue-generating potential. Infor offers a lot of options, but there are endless permutations of what customers can do using ION and individual pieces of Infor’s portfolio. To accelerate clarity of what’s possible and promote sales execution, I think Infor needs to define offers for the needs of specific sets of users. The new mobile and cloud applications utilizing ION are certain to be attention-getters and likely to be among the most quickly adopted, but I don’t expect them to be big earners.

A third challenge in this chain is that sales execution. Whether it’s inside or outside sales, in each of its traditional areas (ERP, analytics and other software categories across multiple micro-verticals) Infor is now offering a broader, more complex array of purchase offers than before. Training sales people to be able to understand customer requirements and communicate value propositions among all the options will not be easy. Simplifying this with a short menu of predefined offers can make it easier for the sales organization, but it’s just a start.

The fourth issue is demand, which is a function of buyers’ software budgets. Of course, the better Infor is able to articulate and demonstrate the value of its solutions, the easier it will be to close business. Moreover, the company is expanding its presence in rapidly growing countries such as Brazil and China. Yet however compelling Infor’s value proposition may be, other capital or operating budget priorities and spending constraints are likely to be a limiting factor, especially in its core market of midsize companies. This factor to some extent may be beyond Infor’s ability to change.

Infor’s attempt to rationalize and overhaul a sizable portion of the U.S. software business has been a big bet. I’m encouraged by what I saw and heard at Inforum. The real test is whether it will be able to sustain double-digit license revenue growth and its retention rate of existing clients in the mid-90 percent range over the next six to eight quarters. That’s a challenge for any large startup.


Robert Kugel – SVP Research

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