Tom Shea, CEO, OneStream Software.
Technology is adapting to keep pace with today’s business needs, which include agility, flexibility and insight into the unknown. In my previous article, I introduced the concept of CPM+, or advanced corporate performance management (CPM) solutions, which are designed to provide timelier insights for steering businesses. These solutions combine operational and financial data for a more holistic view of the enterprise with advanced analytics and AI services for more dynamic and voluminous analysis, scenario planning and forecasting.
Yet, because CPM+ is a new category of solutions, organizations are just now starting to consider its capabilities. As they venture into new waters, they’re faced with deciding if they’re well-suited for it or not.
Determining The Way Forward With CPM+
CPM+ is not a fit for all organizations, but it can work for those who are in fast-changing markets or experience variable customer demand. Common industries include retail, financial services, consumer goods and anything with a heavy seasonality component. It’s also suited for organizations that have lots of historical data to analyze and the infrastructure to determine relationships between financial and operational information.
We can break this down with an example of CPM+ in action. When the pandemic flipped the supply and demand curve on its head for a power sports manufacturer we worked with, they turned to CPM+. The company sought better visibility into evolving commodity prices, pre-sold orders, build-to-ship timelines and more, so they used historical data and machine learning (ML) models to build predictive forecasts for more than 250 products at weekly intervals. The result? Improved speed and accuracy of demand forecasting and clear insight into the key forecast drivers for more informed decisions.
While CPM+ is a no-brainer for some organizations, it can be a challenge for others. Early-stage businesses may not require an advanced CPM+ solution that aggregates complex data. Instead, these groups may be able to leverage traditional CPM applications for planning and reporting.
Implementing CPM+
Organizations ready to advance their CPM+ journey can have a smooth rollout by getting all their ducks in a row before implementation. Here’s what to think about:
Define Business Requirements
Before starting implementation, business leaders must define the project objectives and scope of the project, plus identify the key stakeholders and the project team. This includes understanding the reporting and analysis needs of the organization, types of reporting required, critical KPIs and groups of users, as well as addressing the future needs of the organization and what requirements it will face as it grows.
Be sure to also gather essential documents, reports and accounting schedules so you are prepared to create a thorough design with your team.
Assess Current Infrastructure
Examine existing infrastructure and data sources within the organization and understand how a CPM+ solution would integrate within the ecosystem for accurate, timely information. At this point, consider where a CPM+ solution can automate and streamline processes. You can typically eliminate redundancies and automate repetitive tasks.
It’s also critical for teams to discuss a change management process at this stage for a frictionless transition to a new system so users can successfully adopt and utilize the new platform.
Select An Implementation Partner
I’ve talked before about the importance of choosing the right implementation partner—someone who has the right level of industry and functional experience, but it can’t be understated.
Choose a certified implementation partner. You should also consider whether their experience aligns with your industry or function-specific requirements and financial metrics.
Lastly, ensure a prospective partner has the bandwidth and capability to implement the project within your timeframe. If your project requires immediate attention, having an implementation partner that can facilitate your timeline and support the project needs is critical for success. But be aware of unrealistic promises or deadlines. A reliable partner will set clear expectations and provide transparent communication.
Involve Key Stakeholders
Key stakeholders—including finance, IT and line of business leaders—should be involved throughout the project, especially when defining the project goals, requirements and scope.
People who will be using the CPM+ solution should be brought in once things are off the ground. They can share input on requirements, learn the platform and participate in the necessary training. Ensure you have adequate user licenses, too. You can always start small and expand as the demand for access to operational insights increases.
Lastly, don’t forget to identify your administrator and plan on having that person help with the implementation as much as possible.
Avoiding Common Pitfalls
There are a couple of challenges organizations may encounter when tackling CPM+. Here’s what to avoid:
• Taking On Too Much At Once: It’s important to approach CPM+ with a phased plan to focus on key priorities, demonstrate business value and build a foundational solution before expanding and moving to more complex capabilities. Organizations must develop a clear roadmap and strategy that addresses their most critical priorities first.
• Not Understanding The Financial Investment: Licensing the software is just the tip of the iceberg. When planning for a CPM+ project, organizations must ensure they have an adequate budget for training and implementation services for the initial phase and beyond.
Taking The Wheel
All leaders need one source of truth and clarity to navigate the macroeconomic road ahead. By combining real-time financial and operational insights with predictive ML forecasts, CPM+ solutions will help decision-makers feel confident in their actions.
If you’re ready to venture down the CPM+ path, you now know where to start. Define your business requirements, take stock of your current tech infrastructure, identify your partners and team and map out your approach before taking on more than you can chew. And, of course, avoid scope creep and focus on an initial business problem that can be solved and demonstrate business value within six months or less.
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