Robert Kugel's Analyst Perspectives

Finance Analytics Requires Data Quality

Posted by Robert Kugel on Apr 22, 2014 9:48:59 AM

Our research consistently finds that data issues are a root cause of many problems encountered by modern corporations. One of the main causes of bad data is a lack of data stewardship – too often, nobody is responsible for taking care of data. Fixing inaccurate data is tedious, but creating IT environments that build quality into data is far from glamorous, so these sorts of projects are rarely demanded and funded. The magnitude of the problem grows with the company: Big companies have more data and bigger issues with it than midsize ones. But companies of all sizes ignore this at their peril: Data quality, which includes accuracy, timeliness, relevance and consistency, has a profound impact on the quality of work done, especially in analytics where the value of even brilliantly conceived models is degraded when the data that drives that model is inaccurate, inconsistent or not timely. That’s a key finding of our finance analytics benchmark research.

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Topics: Big Data, Planning, Predictive Analytics, Governance, Office of Finance, Operational Performance Management (OPM), Budgeting, close, Finance Analytics, Tax, Analytics, Business Analytics, Business Intelligence, CIO, Governance, Risk & Compliance (GRC), In-memory, Business Performance Management (BPM), CFO, Financial Performance Management (FPM), Information Applications (IA), Risk, Workforce Performance Management (WPM), CEO, Financial Performance Management, FPM

Finance Departments Still Lag in Using Advanced Analytics

Posted by Robert Kugel on Apr 11, 2014 9:54:39 AM

Business computing has undergone a quiet revolution over the past two decades. As a result of having added, one-by-one, applications that automate all sorts of business processes, organizations now collect data from a wider and deeper array of sources than ever before. Advances in the tools for analyzing and reporting the data from such systems have made it possible to assess financial performance, process quality, operational status, risk and even governance and compliance in every aspect of a business. Against this background, however, our recently released benchmark research finds that finance organizations are slow to make use of the broader range of data and apply advanced analytics to it.

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Topics: Big Data, Planning, Predictive Analytics, Governance, Office of Finance, Budgeting, close, Finance Analytics, Tax, Analytics, Business Analytics, Business Intelligence, CIO, Governance, Risk & Compliance (GRC), In-memory, Business Performance Management (BPM), CFO, Financial Performance Management (FPM), Information Management (IM), Risk, CEO, Financial Performance Management, FPM

Anaplan Springs Forward with Winter Release

Posted by Robert Kugel on Apr 4, 2014 8:36:44 AM

Anaplan, a provider of cloud-based business planning software for sales, operations, and finance and administration departments, recently implemented its new Winter ’14 Release for customers. This release builds on my colleagues analysis on their innovation in business modeling and planning in 2013. Anaplan’s primary objective is to give companies a workable alternative to spreadsheets for business planning. It is a field in which opportunity exists. Our benchmark research on this topic finds that a majority of companies continue to use spreadsheets for their planning activities. Almost all (83%) operations departments use spreadsheets for their plans, as do 60 percent of sales and marketing units. Yet the same research shows that satisfaction with spreadsheets as a planning tool is considerably lower than satisfaction with dedicated planning applications. But despite general agreement in companies that the planning process is broken and spreadsheets are a problem, companies seem reluctant to break the bad habit of using spreadsheets. This conclusion suggests that either switching to dedicated software hasn’t been easy enough or that the results of doing it have not been compelling enough to motivate change. Anaplan intends to address both of these issues.

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Topics: Big Data, Performance Management, Planning, Predictive Analytics, Marketing, Office of Finance, Operational Performance Management (OPM), Operations, Reporting, Budgeting, Controller, Business Analytics, Cloud Computing, In-memory, Business Performance Management (BPM), CFO, Financial Performance Management (FPM), Sales Performance Management (SPM), Sales Planning, Supply Chain Performance Management (SCPM), Workforce Performance Management (WPM), Financial Performance Management, financial reporting, FPM, Integrated Business Planning

Five Priorities for the Office of Finance in 2014

Posted by Robert Kugel on Feb 20, 2014 1:35:14 AM

A core objective of my research practice and agenda is to help the Office of Finance improve its performance by better utilizing information technology. As we kick off 2014, I see five initiatives that CFOs and controllers should adopt to improve their execution of core finance functions and free up time to concentrate on increasing their department’s strategic value. Finance organizations – especially those that need to improve performance – usually find it difficult to find the resources to invest in increasing their strategic value. However, any of the first three initiatives mentioned below will enable them to operate more efficiently as well as improve performance. These initiatives have been central to my focus for the past decade. The final two are relatively new and reflect the evolution of technology to enable finance departments to deliver better results. Every finance organization should adopt at least one of these five as a priority this year.

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Topics: Big Data, Performance Management, Planning, Predictive Analytics, Office of Finance, Budgeting, close, dashboard, PRO, Tax, Analytics, Business Analytics, Business Collaboration, CIO, In-memory, Business Performance Management (BPM), CFO, Customer Performance Management (CPM), Financial Performance Management (FPM), Sales Performance Management (SPM), Supply Chain, Supply Chain Performance Management (SCPM), CEO, demand management, Financial Performance Management, FPM, S&OP

Opportunity for the Office of Finance in 2014

Posted by Robert Kugel on Jan 13, 2014 8:22:59 AM

Senior finance executives and finance organizations that want to improve their performance must recognize that technology is a key tool for doing high-quality work. To test this premise, imagine how smoothly your company would operate if all of its finance and administrative software and hardware were 25 years old. In almost all cases the company wouldn’t be able to compete at all or would be at a substantial disadvantage. Having the latest technology isn’t always necessary, but even though software doesn’t wear out in a physical sense, it has a useful life span, at the end of which it needs replacement. As an example, late in 2013 a major U.K. bank experienced two system-wide failures in rapid succession caused by its decades-old mainframe systems; these breakdowns followed a similarly costly failure in 2012. For years the cost and risk of replacing these legacy systems kept management from taking the plunge. What they didn’t consider were the cost and risk associated with keeping the existing systems going. Our new research agenda for the Office of Finance attempts to find a balance between the leading edge and the mainstream that will help businesses find practical solutions.

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Topics: Big Data, Planning, Predictive Analytics, Governance, GRC, Office of Finance, Budgeting, close, Tax, Analytics, Business Analytics, Business Collaboration, CIO, Cloud Computing, Governance, Risk & Compliance (GRC), In-memory, Business Performance Management (BPM), CFO, Financial Performance Management (FPM), Risk, CEO, Financial Performance Management, FPM

Finance Can Get a Big Advantage from Big Data

Posted by Robert Kugel on Nov 16, 2013 8:22:39 AM

All the hubbub around big data and analytics has many senior finance executives wondering what the big deal is and what they should do about it. It can be especially confusing because much of what’s covered and discussed on this topic is geared toward technologists and others working outside of Finance, in areas such as sales, marketing and risk management. But finance executives need to position their organization to harness this technology to support the strategic goals of their company. To do so, they must have clarity as to what big data can do, what they want it to do, and what skills and tools they need to meet their objectives.

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Topics: Big Data, Performance Management, Predictive Analytics, Customer Experience, Fraud, Governance, GRC, Office of Finance, audit, Controller, Analytics, Business Analytics, Cloud Computing, Governance, Risk & Compliance (GRC), Operational Intelligence, Business Performance Management (BPM), CFO, compliance, finance, Financial Performance Management (FPM), Information Management (IM), Risk, Financial Performance Management, financial risk management

Tidemark Unifies New Generation of Business Planning Software

Posted by Robert Kugel on Oct 31, 2013 8:00:44 PM

Tidemark announced the release of the Fall 2013 version of its eponymous cloud-based application that my colleague assessed earlier in 2013. This new release adds capabilities for labor planning and expense management as well profitability modeling and analysis. These two areas of planning and analysis are common to all businesses. The new release adds features that enhance the software’s ability to do sales forecasting, initiative planning and IT department planning. The company continues to refine its modeling capabilities to make it easier for people engaged in the planning process to translate their expectations and concerns into a quantified view of the future. For example, users now can build models using natural-language modeling. The objective is to eliminate the need for help from business analysts or experts trained in the use of a tool and immersed the details of the IT plumbing, such as the metadata used for specific general ledger accounts or operational data.

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Topics: Big Data, Performance Management, Planning, Predictive Analytics, Office of Finance, Operational Performance Management (OPM), Reporting, Budgeting, Controller, Analytics, Cloud Computing, In-memory, Business Performance Management (BPM), CFO, Customer Performance Management (CPM), Financial Performance Management (FPM), Sales Performance Management (SPM), Supply Chain Performance Management (SCPM), Tidemark, Workforce Performance Management (WPM), Financial Performance Management, financial reporting, FPM, Integrated Business Planning

CEOs and Executives Need Business Planning Software

Posted by Robert Kugel on Oct 22, 2013 10:16:21 AM

Business planning is a new software category. These applications enable senior executives to integrate all the plans of business units into a single, integrated view, which helps them have more accurate plans, do more insightful what-if planning, achieve greater agility in reacting to changing business and economic conditions, and execute plans in a more coordinated fashion than was possible. Business planning software is intended for CEOs and COOs, who are not well served by current capabilities. Business planning software enables executives and managers to understand both the operational and the financial consequences of their actions, but it emphasizes the things that the various parts of the business focus on: units sold, sales calls made, the number and types of employees required, customers serviced and so on. Lines of business already do this but in a fragmented fashion using desktop spreadsheets circulated within silos via email. Business planning software provides a platform to support modeling in individual business units, individual planning processes and visualization of the impacts of changes in what-if scenarios. It offers a central data repository for all plans; our benchmark research shows the advantage of this approach: Companies that directly link individual business unit data to an integrated plan get more accurate results. To be specific, 22 percent of those with such links have very accurate budgets compared to just a handful with less direct links and none that employ summarized data.

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Topics: Big Data, Performance Management, Planning, Predictive Analytics, Office of Finance, Operational Performance Management (OPM), Reporting, Budgeting, Controller, Business Analytics, Business Collaboration, Cloud Computing, In-memory, Business Performance Management (BPM), CFO, Workforce Performance Management (WPM), Financial Performance Management, financial reporting, FPM, Integrated Business Planning

It’s Past Time for the Next Generation of Business Planning

Posted by Robert Kugel on Oct 11, 2013 12:07:59 PM

Business planning as practiced today is a relic, a process hemmed in by obsolete conceptions of what it should be. I use the term “business planning” to encompass all of the forward-looking activities in which companies routinely engage, including, for example, sales, production and head-count planning as well as budgeting. Companies need to take a fresh view of all these, adopting a new approach to business planning that while preserving continuity makes a substantial departure from what most companies do now. Currently, in most organizations the budget is the only companywide business plan. However, while necessary for financial management and control, budgets are not especially useful for running an organization.

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Topics: Big Data, Planning, Predictive Analytics, Social Media, Office of Finance, Operational Performance Management (OPM), Reporting, Budgeting, Controller, In-memory, Business Performance Management (BPM), CFO, Financial Performance Management (FPM), Supply Chain Performance Management (SCPM), Financial Performance Management, financial reporting, FPM, Integrated Business Planning

Find Out Which Is the Hottest Financial Performance Management Software

Posted by Robert Kugel on Oct 9, 2013 8:56:33 AM

We recently issued our 2013 Value Index on Financial Performance Management. Ventana Research defines financial performance management (FPM) as the process of addressing the often overlapping people, process, information and technology issues that affect how well finance organizations operate and support the activities of the rest of their organization. FPM deals with the full cycle of finance department activities, which includes planning and budgeting, analysis, assessment and review, closing and consolidation, and internal and external financial reporting, as well as the underlying IT systems that support them. Our Value Index is informed by more than a decade of analysis of how well technology suppliers and their products satisfy specific business and IT needs. We perform a detailed evaluation of product functionality and suitability to task in five categories as well as of the effectiveness of vendor support for the buying process and customer assurance. Our resulting index gauges the value offered by each individual vendor and its products in supporting FPM, which is necessary for running an organization efficiently and effectively.

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Topics: Mobile, Planning, Predictive Analytics, Office of Finance, Budgeting, closing, Consolidation, contingency planning, Analytics, Business Analytics, Business Collaboration, Cloud Computing, Business Performance Management (BPM), CFO, Financial Performance Management (FPM), Value Index, Financial Performance Management