Imagine this: you sit at the table with the CFO. It doesn't happen that often, but now you were sitting there for the wrong reason. This was a meeting where you'd rather not be found. The Performance Management package that was trumpeted six months ago turns out to be a mis-buy. Chances are you fell into one of the pitfalls of an EPM software selection. Now what?
Software selection: the 5 biggest pitfalls to avoid
Pitfalls in selecting EPM software
The solution, despite the shiny demos, seems unable to do what it should at a minimum. The vendor seems to have other priorities. Colleagues in other departments have already lost confidence and strategically distanced themselves in time. Now you get to explain it to the CFO. What could you have done to avoid this meeting? What five tips would you have liked to have had six months ago? What pitfalls should you avoid in EPM Software selection?
1. Don't stare blindly at analysts
'Magic Quadrants' or 'waves' seem to be a signpost to a safe choice of a new solution. After all, who could get in trouble for choosing a solution labeled a leader by an analyst 'with standing'? Unfortunately: many analyst reports are nothing more than false security for choosing an EPM solution. A Magic Quadrant by Gartner is based almost 75% on research among users in the United States. Unfortunately, crucial conditions for such a solution in the Netherlands are not relevant in the US. A 'leader' according to 'US-standards' can therefore not even meet the basic conditions in the Netherlands.
2. Don't make your choice in an EPM software selection alone
With the rise of cloud solutions, buying a new EPM software seems to have become as easy as installing a new app on your phone. That makes it tempting to purchase a solution for planning and budgeting, for example, with your controller team. Such a purchase with your own team is often the recipe for misery and one of the pitfalls during an EPM software selection. Other functions look at solutions from other perspectives. They ask the questions that need to be asked. A good IT department checks data security and data ownership. Procurement knows how to bring hidden costs to the surface. All issues that can surface later as nasty surprises and cause major problems.
3. Look beyond the features of a solution
In many selection processes, prerequisites are neatly mapped out. RFIs are sent out asking if vendors can meet these conditions. A familiar best practice that unfortunately provides little useful information and fails to capture the real difference in the solutions.
A common pitfall during EPM software selection is looking too much at the features. It is precisely by looking deeper that you really get a view of solutions. For example, look at vendor features. How are they financed? If there is private equity on board; how long have they been on board? If the vendor was previously acquired; are the key figures who are the spiritual father of the solution still on board or have they since cashed in and are under a palm tree? These types of questions will tell you more about the future of a solution. Don't fall into this trap and look broader than features that are often no-brainers if you are in the right category of solutions.
4. Don't automatically follow the market
Following the lead of your industry peers is a common phenomenon. Consequently, you see certain EPM solutions recurring across an entire industry. In a market where solutions came with a major new release every few years, this seemed like a safe route. During EPM software selection, you quickly fall into this trap and quickly let the market lead you too much. However, the world has changed. Some cloud solutions come out with a new release four times a year. New features and new integrations four times a year. With change occurring at this rate, automatically following an industry choice is choosing to lag behind. Do your own research and map out why you choose an EPM solution.
5. Don't outsource EPM Software Selection to ICT.
Software and package selections are choices that are sometimes seen as risky. After all, you don't want to end up in the situation we outlined in the introduction to this article. 'Passing on' the choice to an IT department is then sometimes a tactic that is applied. It is a tactic that almost never yields a happy choice. The biggest problem is often not the actual choice, but the lack of commitment to that choice by future end users. If they don't believe in it and if they won't stand for it, then it becomes difficult to make it a success.
The will to make it a success
There are a thousand reasons why an Enterprise Performance Management project would fail. There is one reason they do succeed: the will to make the new solution a success. That will must grow from day one in a package selection. And it must be shared by everyone involved.
