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SAP Analytics
Thought Leadership

EPM Value Is Exclusively The Client's Definition

Posted by
David Den Boer
David Den Boer
on Mon, Jan 13, 2014 @ 10:01 AM
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valueThis is an old story we see all the time. A policeman happens upon a drunk frantically searching for something at the base of a streetlight. “Hello there, looking for something?” The drunk looks up, “Yesh Offisher, I lost my keysh in the park.” “In the park? Then why are you looking on this street corner?” says the confused cop. “The light is better here!” says the drunk.

This is the problem with how EPM projects are governed today, and no, I am not implying drunks are prevalent in EPM! Too often prospects make decisions based solely on price, thinking that value is equivalent across service providers, and net ROI is maximized by selecting the lowest cost implementation proposal. I encourage customers to stop and think about what they get with the low cost provider. A team that doesn’t have the ability to offer the appropriate breadth services that are specifically designed to add value while reducing risk, leave only the lowest common denominator of value in their wake.

The value formula for such providers is intuitive, but not very compelling. Value at the lowest level for EPM solutions can be defined in terms of labor cost savings. When you automate a solution, it “frees up” resources with a labor cost associated with them to do other things. The formula goes something like this: Duration of process related tasks today, less the duration of process related tasks tomorrow = time “saved”. Simply multiply this time saved notion by a cost per hour to calculate savings.

If this is how you are building your business case, it might make sense (or even be mandatory) to cut corners on the implementation plan to save even minor expenses in order to produce positive ROI. However, as you cut corners like: training a larger group than the bare minimum, engaging a dedicated PM resource to oversee the project, QA oversight for checks and balances, technical resources participating to provide performance tuning; unintended consequences can creep in. Those services at first blush may seem like extraneous “upsell” services, but they will soon be proven to be essential to achieve significant long term value from an EPM investment.

Don’t settle by looking for value in only the most obvious of places. Engage a qualified consulting partner who can discuss how to drive maximum value from these initiatives…if you ask enough questions about how value will be achieved and risk will be mitigated, a you’ll see how the bright light from a highly qualified firm can illuminate value all across your EPM process. Not just in a narrowly focused corner.

Interested in learning more about EPM and BPC Value? Register for one of our upcoming webcasts!

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Topics: Best Practices, Enterprise Performance Management (EPM), EPM ROI, Value, Implementation, BPC (Business Planning & Consolidation)


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