Navigating COVID-19 with CPM

These are popular days for Corporate Performance Management (CPM)…

As the COVID crisis unfolds, finance teams are facing new, demanding circumstances that are testing their systems and processes. Suddenly, the benefits of having a CPM solution in place are even more clear. It’s apparent that to be successful, the Office of Finance needs to automate their key FP&A processes.

In the words of one leading industry analyst, “the COVID crisis has underscored the shortcomings of trying to do budgeting and planning with rigid, inflexible platforms.” As a result, analysts have seen a significant increase in the number of clients asking about CPM.

Another analyst, Rob Kugel from Ventana Group, wrote on his blog this month, Fortune Favors the Prepared, that black swan events such as the current crisis happen regularly and can have a very negative impact on businesses. He goes on to say that “planning done in spreadsheets is inconsistent and fragmented…it’s not feasible to use desktop spreadsheets to do any significant contingency planning or consider the impact of any major change.” His advice? He “urge[s] heads of FP&A to switch to dedicated planning [CPM] software.”

Similarly, Prophix recently collaborated on a webinar with Craig Schiff of BPM Partners in which he talked about the importance of moving away from a reliance on spreadsheets in these uncertain times and instead adopting appropriate planning technologies, such as Prophix.

Perhaps one of the most prescriptive discussions of the benefits of CPM during this crisis is outlined in a recent report published by Dresner Advisory Services. In Use EPM to Help Navigate Through the COVID-19 Crisis the author and lead analyst, Howard Dresner, underscores that now more than ever “management teams and business leaders need to address short term issues and respond rapidly to changing business circumstances.”

The report goes on to point out that since late March, the percentage of organizations whose budgets and projects have been impacted by COVID-19 has grown from 70 percent to nearly 90 percent. Dresner maintains that “EPM [a.k.a. CPM] systems have a key role to play in helping organizations navigate their way through this crisis. They can identify short-term impacts and help organizations to react quickly.”

In particular, the report highlights that scenario analysis is the most important EPM capability for organizations impacted by market volatility. Creating multiple scenarios with varying assumptions and inputs is a necessary part of preparing your organization for uncertainty. Similarly, “the strategy management capabilities of EPM systems enable the rapid creation of updated strategic business plans…teams will need to revise and update their organization’s strategic plans and objectives. EPM systems can provide support in this area.”

Ultimately, the report concludes with the recommendation to “work with the CFO and finance team in your organization to ensure they leverage EPM capabilities instead of spreadsheets wherever possible.”

Read EPM to Help Navigate Through the COVID-19 Crisis here.

Mike Tindal

As the SVP of Corporate & Market Development at Prophix, Michael Tindal is responsible for the overall marketing function within the company. Michael drives long-term strategy by gathering market intelligence and by seeking out and developing relationships with other relevant technology providers. Based on 35+ years in the technology industry, he brings extensive management, marketing, sales, and business development experience to his role at Prophix. His past positions have included global management roles with worldwide leaders in the software industry, such as OpenText and SAS, along with sales management positions at SUN Microsystems and Digital Equipment. Michael’s background has involved a variety of national and international responsibilities across all aspects of the marketing continuum, from product marketing to corporate communications, field marketing, and enablement. In each of these roles, he has focused on introducing, measuring, and successfully achieving quantifiable metrics that have a direct impact on the success of the company.