Decoding misconceptions and maximizing your decision making power
GARTNER CLOUD CPM MAGIC QUADRANTS:
In the last two years the CPM Magic Quadrant has been split in two and become "cloud-only". How does that impact how your use it?
We provide a set of questions that uncover additional insights to help you take full advantage of this valuable Gartner research..
The Gartner Magic Quadrants for Corporate Performance Management are highly anticipated every year, and for good reason. No analyst firm has more influence on the market than Gartner and no tool is used more than the Magic Quadrant(s) in evaluating technology and business applications. The Magic Quadrants are undoubtedly valuable resources for anyone evaluating CPM solutions but to get the most out of the information you need to be able to read between the lines, or in this case see more than the graphic. Gartner is very clear in their assertion that the graphic alone does not tell the whole story. This ebook is designed to help you act on Gartner's recommendation and "see past the graphic" to identify the solutions that best fit your business needs.
The Cloud CPM Magic Quadrants are valuable resources. Learn what other available resources can help you match your needs with vendor strengths..
this eBook will HELP YOU:
Many assumptions while seemingly logical, lead to misconceptions. Learn how to avoid 8 common misconceptions about the Cloud CPM Magic Quadrants..
Fundamental Changes to the Gartner Magic Quadrants for CPM
Over the last two years Gartner has fundamentally altered its view of the CPM market. The impact has significantly changed the vendor CPM landscape.
This year Gartner declared another controversial change by including only Cloud CPM solutions. This altered the landscape by excluding former leaders like SAP and elevating the status of cloud-only solutions. Has the pendulum swung to far? Every cloud-only solution is a leader this year and only one that offers both cloud and on-premise (Oracle) is a leader. Food for thought as you weigh the value of deployment options for your organization.
In 2016, Gartner split the CPM Magic Quadrant in two, one for Financial CPM and one for Strategic CPM. The goal was to group solutions targeting similar audiences together for easier comparison. But the end result is more vendors with specific specializations making an apples-to-apples comparison more difficult.
Split in TWO:
Cloud Vendors Only:
8 Common Misconceptions: Identifying and overcoming them
Beware of the following misconceptions:
I saw the picture, that's all I need.
1. Take the time to read both reports, if you're not a Gartner customer you can find them here.
A picture is worth a thousand words but in this case you need the words too. Gartner has their own rationale for how they weigh the value of each vendor criteria but your prioritization may be very different than Gartner's.
2. Read the strengths and weaknesses of each vendor and match them up against your requirements and priorities. Don't keep a leader in the mix if their strengths don't match up with your needs and don't eliminate a vendor that matches up really well with your needs just because they aren't a leader.
Don't just Google Gartner CPM, click on images, and find a picture of this year's Magic Quadrants.
Identify the holes in the Leader's offering and map to your requirements. For example, Workiva is a leader in Cloud Financial CPM but is heavily focused on SEC reporting and performance reporting in the United States (94% of its revenue). If financial consolidation, close, and intercompany matching are part of your requirements Workiva, even though they are a leader, would not be a good fit.
A few years ago CPM Leaders had to have a comprehensive set of CPM capabilities across most of CPM. Today vendors only need to cover two components of CPM. This means that a leader may not cover the component of CPM that is most important to you.
Leaders do it all
Review the vendor strengths and weaknesses to identify which are more in line with the requirements of your organization. Do you see your processes as straight-forward or unique and complex? Identify several vendors whose strengths imply a good fit for your level of complexity. Also, consider that complexity can also impact other factors that Gartner measures such as vendor satisfaction, sales and implementation experience, and on-going consulting support.
Some vendors are best known for easy to use, quick to implement solutions that appeal to companies with fairly standard requirements. Others are designed to address complex requirements that may take longer to implement. It is difficult to compare vendors before you determine the level of complexity you'll need to support.
The impact of complexity
Don't just count on Gartner's assessment. It is a great resource that should be used but it should be a data point not a decision point. If you are a Gartner customer talk to the analysts and ask them to clarify their opinions. Read other analyst assessments like the Forrester Wave. Talk with your peers and network at conferences. Check out customer case studies and videos on vendor sites. There is plenty of information out there so don't just pick a couple of dots on the quadrant, do your due diligence.
You've heard the old tongue-in-check saying, "if its on the internet it must be true". We all know that is not the case and it isn't for the Gartner Magic Quadrants either. Evaluating this many vendors on this many criteria and trying to generalize it into relative placements of dots on grid is hard. Every year there's a "head-scratcher" on there that makes you say "really?".
If Gartner says it, it must be true.
If you are ready for cloud you should move to cloud. There is no real reason to wait. But if you are not ready yet a new on-premise solution can provide significant business value improvements over aging and in many cases unsupported solutions. But if you invest further in on-premise CPM, make sure your vendor has a clear cloud roadmap and an easy way to migrate you to the cloud. Several vendors' cloud solutions are completely different products from their on-premise solutions which means the cost and effort of a full reimplementation will be necessary. You don't have to move to the cloud now but make sure you have a clear path to get there.
Analysts are by nature forward-looking. Gartner is making a bold statement about the future by making this a Cloud-Only Magic Quadrant. But according to Gartner's own projections in the strategic assumptions section of the FCPM Magic Quadrant, 60% of the Top 1000 companies and 25% of small organizations will be using Cloud FCPM by the year 2020. There are plenty of organizations that are not there yet, so if you are not ready to move to Cloud CPM today you are not alone.
If the Magic Quadrant is Cloud-Only, I should only look at only cloud.
Evaluate the capabilities of any new cloud solution against what your current on-premise solution delivers. Do not trade the benefits of the cloud for compromises in capability. Cloud solutions have matured to the point that you should not have to make that trade, so don't do it. In architecture form follows function, the same should be true in CPM solutions.Choose the Cloud solutions that provide less capability than their on-premise predecessors
Technology architecture should support business function not the opposite. Cloud brings many benefits to the business there is no doubt about that. But moving to the cloud should not compromise business function. In other words, the business should not have to settle for less when moving from on-premise to the cloud.
Form over function.
Don't assume that a leader has the best solution and don't assume because they are a leader they are strong in your region. A vendor can be a leader due to strong marketing, sales execution, and business model but not deliver as robust a solution as a visionary or niche vendor. Some leaders are strong in one or two areas of CPM and virtually nonexistent in others. Being a leader does not equate to being the best at everything.
Leaders Lead, Visionaries Follow.
The Magic Quadrant evaluates the vendor as much as the solution. Market share, growth, and sales execution can contribute as much to being a leader as the product meeting customer needs and product strategy.
Read and understand Gartner's vision for CPM but retain your own. Balance your needs of today with your vision for the future state of CPM in your organization. Most organizations only change CPM solutions every five to ten years, so select the right solution for today but that you can also count on to be your platform for next 5-10 years.
Every Finance organization has its commonalities and differences. Many of the challenges are similar across organizations and many differ significantly. Gartner cannot build the needs of everyone into their assesment of CPM vendors and they cannot know what your particular vision is for CPM in your organization.
Gartner's Vision Equals Your Vision.
How can you navigate all of this to identify the best solution for you? This list of questions will help guide your journey.
Is your need for a better planning and forecasting process? If so, will you be doing expense and revenue planning only or also capital, cash flow, workforce etc? Think not only about what you need today but also what you will want in the future. Some companies make the mistake of focusing only the pressing need and getting a solution up and running as quickly as possible. This may inadvertently limit their ability to extend to other needs and wants in the future. Whether your need is for Financial CPM or Strategic CPM, document not only your initial pressing needs but also what you would want to take on next after those initial needs are met. Match this against vendor strengths and weaknesses to ensure that your shortlist includes solutions that will meet your needs for the long-term. Then ensure vendor demos focus on your needs rather than "shiny bells and whistles".
What is your cloud strategy for business applications?
What CPM processes do you want to address?
How aggressively is your business moving applications to the cloud? What is the timeline for executing the cloud strategy? What financial applications are already deployed on the cloud? These questions will help you determine if you are ready to implement Cloud CPM now or later. Whether you are ready for cloud now or not, confirm that your selected solution is either cloud or cloud-ready so that you don't have to do a reimplementation when it's time to move to this solution to the cloud.
Vendors vary greatly in these areas and these are not consistent across vendors in a specific quadrant. Gartner will typically mention if a vendors customer base is primarily in its home market or on a specific CPM component. It is a good idea to check how many global locations a vendor has and during the sales cycle ask for number of employees are located in the countries most important to you. Financial viability (profitability, rounds of funding) of many vendors is publicly available. Continuity of executive management, consistent growth, frequency and number of funding rounds can all be measures of stability.
What are the issues with your current processes that motivated you to invest in a new CPM solution?
How important is vendor viability, stability?
Get specific here. The answer should not be simply, "we outgrew Excel" or "our consolidation solution is 10 years old." That won't help you navigate your way to the right solution. What were the specific shortcomings? Unable to meet new reporting requirements, constant performance issues, couldn't handle our allocations, multiple versions of data etc. are answers that will help you identify the solutions that best meet your needs.
Most vendors in the Magic Quadrants have customers with users multiple countries, if that is the extent of your global requirements most vendors can handle it. Some vendors handle currency conversion and elimination, and others complex ownership structures, and a few global regulatory requirements. Whatever level of global requirements you have, be sure to have vendors provide references with similar requirements as some global requirements are demonstrable but very difficult to implement.
How global will your CPM deployment be?
Do you prefer customized, configured, or standardized?
Some solutions, especially those targeting the lower end of the market tend to be more standardized. They are easier to implement but allow less configuration to specific needs. Most solutions fall into the configured category meaning they have pre-built functionality that can be configured by consultants or administrators. Configuring typically does not require programming, scripting language or a technical skill set. Customized solutions are more built than bought. These are sometimes referred to as Toolkits for developing custom CPM capabilities. They often require scripting or programing performed by a technical implementation resource. Customized solutions tend to demo very well but can be more resource intensive to implement, maintain and upgrade.
Your Vendor Tool Kit
The Gartner Magic Quadrant is an important tool but it’s not the only tool! Here are other resources you should use when evaluating CPM vendors. Take a look at how Tagetik’s CPM solution measured up in all of them:
Thanks for reading our e-book! We hope you’re better equipped to use the Gartner CPM Magic Quadrants strategically so that you find a solution that matches your unique needs. To learn more about how CCH Tagetik can fit your CPM strategy, book a demo.
2016 Forrester Wave
2017 Gartner Magic Quadrants for Cloud FCPM and SCPM
2016 Gartner Critical Capabilities