Learn More About Enterprise Performance Management Software
Why is an EPM sytem important now?
Allied Market Research projected the EPM market to reach $13 billion by 2025, growing at a CAGR of 12% from 2018 to 2025. The major factors that drive EPM adoption are: the need for sharing and executing business strategies transparently, the need for improved scalability and the increase in complexity of business systems and their integration.
The need for sharing business strategies transparently: Large companies are notoriously slow in changing their strategies. To ensure that the whole organization is aligned on the strategy, strategies need to be transparent and constantly monitored. With EPM software scorecards and dashboards, business strategies are shared transparently and relevant outcomes are easily monitored. Thus, it is easier to rapidly change a company's strategy in light of market changes and take action rapidly to achieve the desired performance.
The need for improved scalability: In expanding and growing businesses, scaling is required to manage the increasing demand for raw materials, technology and human resources. EPM systems can help organizations understand and forecast their requirements for growth.
Increase in complexity of used systems: Enterprises have to manage many complex software and hardware systems and run complex processes. This complexity gradually increases over time as companies serve a larger number of customers and customers demand more customized service. As complexity increases, financial planning becomes difficult. EPM tools facilitate financial planning and increase the level of automation in performance management tasks.
What are the benefits of an EPM system?
The advantages of EPM systems are generally related to financial planning and the effectiveness of business strategies. EPM software also enables companies to analyze different costs on a single platform to improve cost management.
Fast budgeting and forecasting: As the EPM software provides an overview of the factors affecting budget planning, the budget planning process is accelerated. Thanks to EPM systems, historical outcomes can be easily used in budget forecasting.
Reducing effort necessary for financial close: EPM systems enable enterprises to quickly adap their financial planning to changes in the market which makes it easy to complete the financial close.
Key enterprise data consolidated in one source: EPM systems allow the data accumulated in different sources to be analyzed in a single environment. In this way, different department data can be monitored in a single management platform.
Improved financial performance management: EPM systems enable companies to continuously monitor the impact of current business strategies, enabling them to continuously improve these strategies.
What are the critical capabilities of an EPM system?
An EPM system typically has the following capabilities:
- Financial management:
- Planning and forecasting
- Performance analysis and management: Cloud-based EPM systems provide a collaborative and sharing platform for employees to help improve performance management.
- Workflow and process management
EPM systems achieve these capabilities by providing interactive dashboards and data visualizations, aggregating data from various data sources.
How to choose the right EPM system for your business?
The main points to be considered before purchasing an EPM system are system integration with other systems, implementation method, ease of use and system security.
Integration and Customization: An EPM system should be integrated with important systems of record. Different platforms should be able to share data and workflows in real-time with EPM software. Therefore, the integration and customization features of the EPM systems should meet the requirements of the enterprise.
Implementation: There can be two options for an EPM system: cloud-Based or on-premise. Many EPM systems are available as both cloud and on-premise. A cloud-based EPM can provide a faster implementation, real-time access to data, and reports without t further capital investment. On the other hand, on-premise implementations can provide a potentially more secure solution and full control over the system. Also, depdnding on the license agreement, on-premise solutions may need further investment in constant upgrades for new functionalities.
User Interface: Several interfaces can be needed for different users in the same EPM system. EPM software should be adaptive for use on different types of devices as well. Moreover, an EPM system should provide effective data visualization and interactive dashboards in order to be a user-friendly platform.
Functionalities: An EPM system should cover the critical capabilities as described in the previous section. A product may have more advanced reporting or data analytics features. Depending on the enterprise requirements, companies should trade off costs against advanced functionalities.
Security: Financial planning procedures can have a vital role and the security of the data must be maintained. On-premise implementations can provide a more secure but costly solution. However, an on-premise solution that is not up to date can be less secure than a cloud solution.