As IT systems proliferate across the enterprise to enable efficient management of function specific key processes, their reach in most cases has been limited to transaction oriented processes like managing financial ledgers, customer service requests and supply chain transactions. These activities tend to be aligned to recording past performance or optimizing present state of enterprise value chain. But how about planning effectively for the future? How about the key finance activities of annual budgeting and long term planning?

Even today, sizeable percentage of businesses – small and large, complete their budgeting process using disconnected excel spreadsheets. Just glance through following typical scenarios often encountered during such budgeting exercises….

  • Budget templates created by finance team circulating among line managers in sales, operations, supply chain functions collecting data over and over with numerous reviews that are difficult to track
    • Result: Superfluous data entry, lack of version control, no structure/ framework to budget review process
  • Some line manager invariably enters wrong data or miscalculates the budgeted value of a line item and then shares it with others for updation, for them to later realize that all subsequent budgeted values are erroneous, with no clue about where the error is and how many data points have been impacted
    • Result: Data accuracy, ineffective collaboration and wasted user bandwidth
  • Versions upon versions of budget data template files, limited only by budget process participants and number of review cycles
    • Result: Poor process governance and communication overkill

Have you experienced these constraints before?

Well, it is time to move to a packaged EPM product. Conventional IT wisdom says – you get the product software licenses from a vendor, have its implementation partner install and customize them for you and… Voila! All is well….. Problems solved…

However, when you go to your IT procurement decision makers, they will raise red flags saying some of the following things….

  • These licenses for all your users cost a fortune, who is going to foot the cost for this?
  • We are running at full capacity in our data centre, we neither have the server space to host this application and database nor network bandwidth to integrate it with our existing enterprise applications
  • The hardware and software configuration maintenance on these products is very specialized and quite brutal. We currently don’t have these skill sets in house

You might think you have no option but to live with your suboptimal, excel based budgeting mechanism, but there is!

Welcome to the world of budgeting on cloud!

About the Author

Nirupam Kulkarni – BI Analyst

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Posted by Nirupam Kulkarni

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