One of the company’s most important decisions is which financial reporting and financial planning software to use. Would the current reporting and budgeting system in Excel spreadsheets need changing, or would the company need to move in a new direction?
After many years of implementing finance systems for medium to large organizations, one learns a great deal about what it takes to implement a new financial planning software – pivotal decisions, unforeseen issues, and plenty of lessons learned to name a few.
This article is a 2-part series. Its goal is to help other finance leaders guide their businesses through similar FP&A investments.
How to Choose the Right Financial Planning and Analysis Software
All project implementations begin with a review of existing financial management solutions to evaluate whether the next step is about to take the company to the next level of growth or personalize and improve customer relations.
Today, the discussion is not anymore about whether or not to move to the cloud; rather, it is now centered on choosing the right product, the right partnerships, and how to transition in the best way possible without disrupting the business too much.
Today what is essential to consider would be goals for growth, process efficiencies, accessibility of data, and the richness of financial reporting and budgeting to support business decisions.
Considering finance is a critical business function, your chosen solution must be flexible enough to manage unique and complex business models and one that can continue to support a company´s growth plans.
So many financial planning software out there seems like a good fit at first glance. Most of the time, the problem lies in the future ability to scale and grow with the business.
Here are the following benefits you should evaluate your FP&A software against:
- Profound reporting ability, including the ability to drill into journal-level information to provide the necessary insights critical for decision-making
- The ability of the financial planning software to streamline processes and reduce tasks that do not yield so much value, such as spreadsheet reconciliations, manual data gathering, etc.
- Increased financial control through workflow approval levels.
- The upgrade abilities of the software and its capacity to support a growing/constantly changing business.
- An entirely cloud-based solution that does not demand much from the IT team for maintenance and one that frees up on-site server capacity.
- The ability of the financial planning software to pull data directly from an ERP system like SAP B1 or any of Microsoft Dynamics 365 ERP systems or any of the Epicor ERP systems
How to Choose the Right Partnerships
The failure and success of a finance system implementation lie on several factors, and the skills of the consultants implementing the software are one of the most important.
The first step is to ask for quotations from various firms that know how to implement the software. It is good to compare the quotes to see if you are comfortable with the price points. If possible, it is a lot better to hire consultants who work directly for the company of the finance software you have chosen since they can put pressure on their technical team to deliver. It is pretty standard for software companies to have their consultants. If that option is unavailable, ask for recommendations on whom you should work with, ask for price quotes, and ask for references.
How to Plan for Success
A structured approach to the implementation is your best bet in ensuring success. While you could never foresee all the problems (and trust us, there will be many), it is good to have an overall working plan outlining key milestones or success indicators every step of the way.
In this part, it is common to have around eight sprints where sprints 1-4 would be essential for transitioning to the new system, and sprints 5-8 would be added desired capabilities that are not required for the new system to function but nice to haves. That said, how much time you´d spend on each sprint depends mainly on the availability and focus of the people involved and the complexity of the processes.
At this early, it is good to fill out a business requirement document and to do an intense workshop to discuss key elements of the configuration. Look for templates to set initial parameters. Bear in mind that this document is an evolving one and will require revisions over time as you understand better your processes, what the software can or cannot do, and you also understand better what you are asking your consultants to do.
This article’s next part will cover the real challenges and lessons learned during implementation. Stay tuned.
