How has the market for Corporate Performance Management Suites changed? Each year, Gartner shares (at a cost) its yearly Magic Quadrant for CPM Suites. This analysis is a key decision factor in purchasing, investing, and valuing a company and software based on its ability to perform in the wake of a vastly shifting market.
We would like to share with you some of the basics of the 2015 Gartner Magic Quadrant for Corporate Performance Management Suites, courtesy of our friends at Host Analytics.
Market Overview: CPM Suites
The corporate performance management suite is a mature market focused mainly on large and midsized organizations ($100 Million+), but there is an increasing amount of platforms focused on smaller organizations ($10-100MM).
What is a CPM Suite?
Corporate performance management suites (CPMs) facilitate efficient, compliant and transparent processes within the office of finance. They enable CFOs and other business leaders to effectively guide strategic direction and increase organizational agility.
Other Names for Corporate Performance Management
Vendors may use one of many terms to define a their CPM suite, but most are limited to the following names:
- Enterprise performance management (EPM)
- Dynamic performance management (DPM)
- Performance Management (PM)
What Processes Does a CPM Improve?
CPM Suites focus on improving one of two processes:
- Office of Finance (OOF CPM): largely involves the improvement of financial processes
- Strategic CPM: Supports overall organizational transformation and growth
For more information on the differences and definitions of maturity of each model, see Gartner’s report: Getting More Value from CPM: Strategic vs. Office-of-Finance CPM.
Two Key Focuses of CPM Suites
Aside from some specialty software, a CPM focuses on three key areas:
- Financial budgeting, planning and forecasting (BP&F)
- Financial consolidation and reporting
See how a full corporate performance management suite works in Complete Suite CPM.
Five Components of a CPM
Gartner defines the components of a CPM suite as follows:
- Financial consolidation and close management (FC&C);
- Financial and management reporting and disclosure
- Financial BP&F
- Strategic planning and forecasting and strategy management
- Profitability modeling and optimization (PM&O).
How does a Vendor Make the Magic Quadrant?
There are many judgement areas in Gartner’s analysis, which included surveys of 449 companies and reference visits to many of the respondents.
In essence, a vendor is judged by its ability to execute and its completeness of vision.
Ability to Execute
There are seven components in Gartner’s criteria:
- Product or Service
- Overall Visibility
- Sales Execution
- Market Responsiveness
- Marketing Execution
- Customer Experience
Completeness of Vision
Eight components go into the completeness of vision judgements.
- Market Understanding
- Marketing Strategy
- Sales Strategy
- Product Strategy
- Business Model
- Vertical/Industry Strategy
- Geographic Strategy
What Does This All Mean?
Remember, these are the best of the best—many are nominated but don’t make the cut for reasons discussed in the Magic Quadrant. Each vendor that makes the list is defined as one of the following:
- Leader: Higher Completeness of Vision, Higher Ability to Execute
- Challenger: Higher Ability to Execute, Lower Completeness of Vision
- Visionary: Higher Completeness of Vision, Lower Ability to Execute
- Niche Player: Lower Ability to Execute, Lower Completeness of Vision
The Graph Worth a Thousand Words: 2015 CPM Magic Quadrant
Host Analytics: Visionary in 2015
Another big year for Host Analytics, who once again was labeled visionary by Gartner. Formerly the only pure-play cloud vendor in 2009, 2010, and 2011; HA has grown both in completeness of vision and ability to execute over the years.
Adding to its completeness of product, the company has introduced Modeling Cloud, an in-memory modelling engine that will undoubtedly help organizations to better manage finances, budgeting, forecasting, and reporting.
- Free Webcast Download: Host Analytics Budgeting, Forecasting, and Reporting in the Cloud
- Analyst Whitepaper: How to Justify the Business Case for EPM
- Analyst Whitepaper: Battle-tested Best Practices in Planning and Budgeting
- Analyst Whitepaper: No More Spreadsheets
- Analyst Whitepaper: Host Analytics adds finance and sales
- Host Analytics Case Study: Groupon
- Host Analytics Case Study: Otis Spunkmeyer