In 2013, the Organization for Economic Cooperation and Development (OECD) published a report titled “Action Plan on Base Erosion and Profit Shifting” (commonly referred to as “BEPS”), which describes the challenges national governments face in enforcing taxation in an increasingly global environment with a growing share of digital commerce. Country-by-country (CbC) Reporting has developed in response to the concerns raised in the report. To date, 65 countries (including all members of the European Union but not the United States) are signatories of the multilateral competent authority agreement establishing CbC reporting.
Topics: ERP, GRC, audit, finance transformation, LongView, Tax, Business Analytics, Oracle, CFO, Vertex, FPM, legal, tax optimization, tax data warehouse Thomson-Reuters multinational, international tax, tax compliance
Fra Luca Pacioli, a 15th-century Franciscan friar living in what’s now Italy, is credited with codifying double-entry bookkeeping, which is the foundation of accounting. Pacioli, a polymath, was well acquainted with his contemporary and fellow polymath Leonardo Da Vinci. So, given they were at times collaborators, it’s fitting that one of the most important applications of SAP’s Leonardo technology will be in helping to disrupt finance and accounting organizations in corporations.
Ventana Research defines financial performance management (FPM) as the process of addressing often overlapping issues involving people, process, information and technology that affect how well finance organizations operate and support the activities of the rest of their organization. FPM software supports and automates the full cycle of finance department activities, which include planning and budgeting, analysis, assessment and review, closing and consolidation, internal financial reporting and external financial reporting, as well as the underlying information technology systems that support them.
SYSPRO is a 35-year-old software vendor that focuses on selling enterprise resource planning (ERP) systems to midsize companies, particularly those in manufacturing and distribution. In manufacturing, SYSPRO supports make, configure and assemble, engineer to order, make to stock and job shop environments. The company attempts to differentiate itself through vertical specialization and its years of ongoing development, which can reduce the need for customization and cut the cost of initial and ongoing configurations to suit the needs of companies in these industries, thereby reducing the total cost of ownership. Worldwide its targeted verticals include electronics, food, machinery and equipment and medical devices; in the United States, SYSPRO adds automotive parts (original equipment and after-market) and energy. The company’s development efforts follow a design philosophy that balances its target customers’ need for software capabilities that are on par with larger enterprises with their resource constraints (chiefly limited financial resources and technical staffs). Its software can be deployed on-premises or in the cloud.
Intacct, a cloud-based ERP vendor focused on midsize companies, recently held its annual user group meeting. Two of its products that were covered in the keynote are worth noting. One, already available, enables companies to manage their order-to-cash process in a continuous fashion, from the time a salesperson begins to engage with a prospect to the time funds are collected. The other is a custom report writer, to be available in the first quarter of 2017, that will provide business users with the ability to create even complex reports from any data that resides within Intacct in a straightforward, interactive fashion that is similar to building reports in a desktop spreadsheet. The company also presented modules that will facilitate compliance with the new revenue recognition standards.
The annual Oracle OpenWorld user group meeting provides an opportunity to step back and take a longer view of business, industry and technology trends affecting the company. Last year, after listening to Larry Ellison’s and Mark Hurd’s vision for the future of IT, I wrote that Oracle had to continue shifting its focus to business applications because the accelerating shift to cloud computing would lead corporations to outsource their IT infrastructures, services and security to third parties. Eventually, this would substantially shrink the market for corporate IT departments, which has been Oracle’s strength. At this year’s conference the company demonstrated how it is applying its technology strengths to create a competitive advantage that it can apply to its broad business applications portfolio.
Aria Systems provides companies with software for managing subscription or recurring revenue business models. A recurring revenue business models includes three types of selling and billing structures: a one-time transaction plus a periodic service charge; subscription-based services involving periodic charges; or a contractual relationship that charges periodically for goods and services. Aria’s cloud-based software addresses key requirements of users in the marketing, sales, operations and accounting functions in this type of business.
Topics: SaaS, Sales, Customer Engagement, Customer Experience, ERP, Marketing, NetSuite, Office of Finance, Operational Performance Management (OPM), Recurring Revenue, customer life cycle, Business Analytics, Cloud Computing, Customer Service, Business Performance Management (BPM), Customer Performance Management (CPM), Financial Performance Management (FPM), Sales Performance Management (SPM), billing software
The steady march of technology’s ability to handle ever more complicated tasks has been a constant since the beginning of the information age in the 1950s. Initially, computers in business were used to automate simple clerical functions, but as systems have become more capable, information technology has been able to substitute for increasingly higher levels of human skill and experience. A turning point of sorts was reached in the 1990s when ERP, business intelligence and business process automation software reduced the need for middle managers. Increasingly, organizations used software to coordinate activities as well as communicate results and requirements up and down the organizational chart. Both were once the exclusive role of the middle manager. Consequently, almost every for-profit organization eliminated management layers so that today corporate structures are flatter than they once were. Technology automation also eliminated the need for administrative staff to perform routine reporting and analysis. Meanwhile, over the course of the 1990s, the cost of running the finance department measured as a percentage of sales was cut almost in half as a result of eliminating staff and because automation enabled companies to scale without adding headcount. During the last recession, companies in North America and Europe once again made deep reductions to their administrative staffs, relying on information technology to pick up the slack.
Topics: Sustainability, ERP, GRC, Office of Finance, audit, finance transformation, Human Capital, LongView, Tax, Analytics, Business Analytics, Governance, Risk & Compliance (GRC), Oracle, Business Performance Management (BPM), CFO, Financial Performance Management (FPM), Vertex, FPM, Innovation Awards, Thomson-Reuters multinational
The ERP market is set to undergo a significant transformation over the next five years. At the heart of this transformation is the decade-long evolution of a set of technologies that are enabling a major shift in the design of ERP systems – the most significant change since the introduction of client/server systems in the 1990s. Some ERP software vendors increasingly are utilizing in-memory computing, mobility, in-context collaboration and user interface design to differentiate their applications from rivals and potentially accelerate replacement of existing systems (as I noted in an earlier analyst perspective). ERP vendors with software-as-a-service (SaaS) subscription offerings are investing to make their software suitable for a broader variety of users in multitenant clouds. And some vendors will be able to develop lower-cost business systems to broaden the appeal of single-tenant hosted cloud deployments for companies that cannot adapt their businesses to share with other tenants or prefer not to.
Topics: Performance Management, ERP, FP&A, Office of Finance, Reporting, Consolidation, Human Capital, Business Analytics, Uncategorized, Business Performance Management (BPM), Financial Performance Management (FPM), Financial Performance Management, FPM
Workday Financial Management (which belongs in the broader ERP software category) appears to be gaining traction in the market, having matured sufficiently to be attractive to a large audience of buyers. It was built from the ground up as a cloud application. While that gives it the advantage of a fresh approach to structuring its data and process models for the cloud, the product has had to catch up to its rivals in functionality. The company’s ERP offering has matured considerably over the past three years and now is better positioned to grow its installed base. Workday recently added Aon, the insurance and professional services company, to its customer list (becoming its largest customer to date) and reported that its annual contract value (ACV – the annualized aggregate revenue value of all subscription contracts as of the end of a quarter) has doubled since the second quarter of this year, albeit from a low base. This is an important milestone because for years the company’s growth has come from the human capital management (HCM) portion of the business, not financials. Workday has around 160 customers for its financials (more than 90 of which are live) compared to more than 1,000 customers for HCM.
Topics: Microsoft, SAP, ERP, FP&A, NetSuite, Office of Finance, Operational Performance Management (OPM), Reporting, close, closing, Controller, dashboard, Human Capital, Reconciliation, Tax, Analytics, Business Intelligence, Cloud Computing, Collaboration, IBM, Oracle, Uncategorized, Business Performance Management (BPM), CFO, Data, finance, Financial Performance Management (FPM), Financial Performance Management, FPM, Intacct