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Kaitlin Brunsden

Business Performance Management: Talking with Adaptive Planning

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What follows is my podcast with Bill Soward, CEO of Adaptive Planning. We discuss the benefits of SaaS and Cloud-based applications in the business performance management space. Bill will offer his insight on how the economy over the last 18 months have impacted companies planning and reporting requirements.

Listen to my 8:08 podcast below:

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KB: Can you please provide us with a brief overview of your company?

BS: Sure. Adaptive Planning is in the corporate performance management space and so that budgeting and planning, financial reporting, operational metrics and dashboards. We are a software service company so that means that we deliver our solution on-demand for customers. And the problem that we solve is that most companies today do all of their budgeting and planning and financial reporting in Excel and at some point their business becomes too complex to rely on a series of spreadsheets and they're looking for more of an enterprise class solution.

We typically target a mid-market size company so 100 employees to 2,500 employees. Typically, companies of that size cannot afford a big upfront license fee, and can't afford many months of implementations, and typically don't have a lot of IT resources around to support the solution. So Adaptive Planning is really a solution soft [indiscernible] for mid-market companies who want to get up and running quickly, want to pay as they go, get immediate value for the solution they put into production.

KB: Today's topic is Business Performance Management. How has the economy over the past 18 months impacted companies planning and reporting requirements?

BS: Well, we've really seen a "C" change I think in terms of the culture of organizations. If you go back to let's say the summer of 2008, typically, most companies when they're doing budgeting and planning think of that as annual exercise so they do their plan once. If they're not automated, it takes them two to three months to get that plan finalized in their organization. They lock it down and then maybe six months later they do a mid-year update and for many companies they view that as sufficient. Sure, they'd like to do it more often. They'd like to be more on top of the game but the organization wasn't able to support more ongoing forecasting and updating activities.

Well, then the economy crashed and all of a sudden the stakes were a lot higher. What we seen is a number of organizations that have moved into much more frequent reforecasting, in fact, doing that multiple times within a quarter. The reason they're doing that is that many cases they're very concerned about cash, their availability of cash, if their top customers are paying on time, how quickly can they convert a new piece of business into cash into their accounts. The bank may have cut their line of credit last year so they was liquidity crunch. So they're doing a lot of reforecasting and really understanding the impact of different external events on their business and really trying to stay much more on top of their game and to manage more day-to-day as opposed to quarter-to-quarter or year-to-year.

KB: What are some of the benefits of SaaS and cloud based applications like Adaptive planning in the business performance management space?

BS: Well, I think building on top of the last point in terms of companies needing to move more quickly and do more rapid reforecasting and what if scenarios and so on. The reality is that companies need to take advantage of these solutions very quickly. They need the answer now. They have to make decisions quickly, the situation is changing rapidly, there's a lot of uncertainty out there. And so, the advantage of a SaaS solution like Adaptive Planning is that we get our customers up and running anywhere from two to three weeks. And so a customer buys and three weeks later, they're in production already getting the value of our solution.

The on-premise alternatives that are out there from some of our high-end competitors take many months to implement and so it could be a long time before the company can take advantage of that. So I think time-to-value is a number one benefit. Number two, its pay-as-you-go so you can buy as many seats as you need. It's a subscription pricing models so you pay per seat per year. You only buy what you need. At the end of a year you don't think that we're providing value, you don't need to renew. The alternative, on-premise, big upfront license fee and so you've made a huge commitment upfront, a big outlay of cash at a time when you maybe don't have a lot of cash, and the relatively high risk in terms of whether you're going to see real value from that solution or not.

Three, no IT required. And so many organizations, particularly mid-market companies don't have a lot of IT resources, maybe even less this year than last. And so, a solution like ours can be deployed rapidly and not require any IT involvement. So I think the last key advantage of SaaS in our company's case, you can try before you buy so we have a 30-day trial of our enterprise version. You can go in, check out the application, see if it provides value, you know exactly what you're getting before you make a purchase decision.

KB: In what industry is Adaptive Planning achieving the greatest traction and interest?

BS: Well, I think the great thing about Adaptive Planning is that our solution itself is horizontal by the way that our solution includes Excel like experience, web based. You go in and you have the ability to set up your expenses for departmental level perspective. If you're the VP, you can setup your entire organization. Sales Ops can setup all of their quoted sales reps from the year, understand bookings from a quarter-to-quarter basis, week-to-week and so on. If you're the CFO, you see a consolidated view of the entire organization, income statement, balance sheet, cash flow, capital budget, headcount plan. All of these things tied together. Make a change once and have it be automatically updated across the organization so everybody that's a key stakeholder can see it.

That solution is easily adaptable to a lot of different industries. So we have today over 700 customers across a number of different industries, over 100 software companies, almost as many manufacturing companies, a number of national retail organizations, insurance companies, nonprofits, healthcare. So what you see is our application working in a lot of different vertical markets so we're I think pretty fortunate to have a very diversified customer base.

KB: How does Adaptive Planning technology benefit an organization's bottom line?

BS: Well, I think first and foremost, by getting all of your key stakeholders aligned around a common set of assumptions, a common plan, ongoing forecasting updates, really understanding how events are impacting your business. From a financial standpoint, using our reporting systems to bring in actual from your accounting system and compare that to your plan, understand what variances are there, be able to drill down and understand why you are ahead of plan or behind plan. All of these tools give businesses the ability to manage their business much more efficiently, to identify savings on the expense side, to understand the impact of hiring additional people, to understand the cash flows of within their business and what factors are going to impact cash flow going forward. So all of those I think have a very significant impact on business.

But in addition to that, if you're comparing our solution against some of the on-premise alternatives, we have a significant total cost of ownership advantage. We recently had a third party consulting organization do a study and compared our solution against a lot of our mid-market competitors and found that we were anywhere from a quarter to a third of the cost over time of the on-premise alternatives. And so not only do we provide great benefit through our solution, but when compared to against other competitors in the space, also, dramatic cost savings over time.

KB: What recommendations would you have for companies that are interested in learning more about performance management solutions?

BS: Well, I think there are number of great solutions out there, some very well know. And I think that we would encourage customers to look carefully at each of the solutions. Our approach I think is to be very transparent. We would expect the other companies out there to be as well. And so can you go in and try all the products first and make sure that it meets your requirements. Are you able to easily understand pricing? Is the pricing posted on the website? If it's a hosted solution, do you know what the uptime is on a monthly and annualized basis?

Are you able to get access to online training so you can see exactly how hard it is or easy it is to use the solution? Is the contract readable? Are you able to pay-as-you-go to buy only what you need? Are you able to cancel if you don't like what you get? I think all of those are critical and of course customer references. Are your customers happy when they go out and look at the analysts who do customer sat rankings for the segment? Who are the ones that are delivering the best solutions with the happiest customers? Do your homework to make sure that you understand the benefits of the different solutions and also what the risks are.

Keep up with what's hot in the world of business and IT integration.

Jayaprakash Kannoth

Jayaprakash Kannoth is Software Engineer at TechTarget. His areas of interest include business process management, enterprise architecture, business intelligence , cloud/infrastructure computing and technology in business.
The opinions expressed herein are my own and do not represent my employer’s views in any way.

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