Cloud FP&A Solution Comparison Report
The financial planning and analysis software market is on fire. Even today, more than 85% of SMEs in the United States are still relying on spreadsheets for important financial processes including budgeting and forecasting. No wonder that this market has been growing rapidly everyone wants to move forward, adapt to new standards, and stay ahead of the game.
Here at FP&A Insider we’ve received numerous queries from our readers regarding “what is the best CPM solution” or “what is the difference between vendor X and Y,” and to date we had no answer to give as there was never a comparison done between the different solutions available in the market.
While there are many review sites such as G2Crowd and the Gartner network comparison sites including Capterra, they provide customers with reviews regarding different vendors - not a quality comparison.
There’s also the well known Gartner Magic Quadrant that does an amazing job at analyzing the different vendors that exist, but our readers mentioned more than once that despite the fact that it provides good coverage of different tools, it is still hard to compare between solutions. Long story short, we decided to take up the glove. We are proud to present to you a comprehensive 2020 CPM solution comparison report.
Our aim is to help you, technology buyers, understand the strengths and weaknesses of the different players in the market.
The comparison presented to you is based on thorough interviews conducted with current customers, technology evangelists, and industry thought leaders.
2. Vendors Overview
To date, there are approximately 200 different Financial Planning and Analysis and Financial Close solutions. Among them are industry specific solutions, local vendors in different countries, SOHO specific solutions, and more.
The price-tag of these solutions ranges from hundreds of dollars for the most basic solution targeted at small businesses, to hundreds of thousands and sometimes millions of dollars for high-end enterprise solutions developed by software giants such as Oracle and SAP.
In this report we decided to focus on solutions aimed at mid-sized enterprises — those with an annual revenue between $50 million and $1 billion, and between 100 to 2000 employees.
After long debates that lasted till the early hours of the morning, we decided to select 5 vendors that we believe to be market leaders or have the potential to become one in the near future.
Adaptive Insights: The Golden Boy
Adaptive Insights is probably the first name that comes to mind when talking about a CPM solution. After showing tremendous success in the past years, the company was acquired by Workday, the HR software giant. This step was definitely good for Workday, but it is still unknown if this was also good for Adaptive Insights. The latest customer feedback suggests anything between the existence of some small growing pains to a major change of focus.
Workiva: The Novice
The reporting giant that went public in 2014 is a platform that enables companies to create and file financial and compliance reports and documents to the SEC and other federal and state regulatory agencies. Over the past few years Workiva decided to step into the Financial Planning and Analysis field.
DataRails : The Rebel
After building a one-of a-kind solution based on patented technology that transforms complex spreadsheet data into a simple, structured SQL database, the company harnessed its technology to disrupt the market and present a new kind of FP&A solution. Its motto is “work smarter with an enterprise-grade solution that improves budgeting, forecasting, and planning processes without changing how you work.”
Jedox: The Square
Similar to its European origins, Jedox presents a strong, organized, yet slightly bland solution that manages to compete head-to-head with all its competitors. Recently Jedox entered the US market and is trying to appeal to large organizations.
Prophix: The Quiet Child
Like a fairytale, this software distributor has turned into a software vendor that is now one of the leading players in the CPM market. Prophix has a strong, solid solution with no flaws, but also with no shine.
Below you can find a list of features that all the selected vendors hold.
Imports trial balances, monthly P&L, balance sheets, and other types of financial data.
Defines budget structure elements and how they are linked hierarchically.
Keeps track of all versions of a budget and allows users to compare versions.
Includes budgeting formulas to estimate direct and indirect costs, operating and non-operating revenues.
Test the potential financial impact of business decisions on revenues and expenses.
Users can customize standard budget periods (3, 9, or 12 months).
Uses collected data to assist organizations in understanding what they can afford, both immediately and in years to come.
Creates a continuous and recurring planning process that can be calculated according to a specified and customizable timeline.
Leverages data from budgeting and forecasting processes to help corporations understand their financial reality and make decisions accordingly.
Consolidate multiple budgets from different departments or business entities.
Users with administrative access rights can modify budgets. Workflows
Are used to define the steps required to alter budgets and who needs to approve changes.
Offers methods of visualizing data via customizable dashboards, statistical graphs, and charts
Scours data for actionable insights.
Allows users to customize their own reports according to business needs.
Templates Provides pre-built reporting templates to organize data for payroll, manufacturing, and other company factions.
Allows for searchable communication within the tool via notes, checklists, and discussions to ensure clarity between users.
Reflects updates immediately, ensuring users have the most recent data while maintaining records of past performance.
Real-Time Data Updates
Updates varying factors in real-time, assuring forecasts and inferences are continually made according to the most recent information.
Displays and shares company performance data to increase transparency across the board.
Forecasting is based on past transactions and historical financial or operational data.
Ability to recreate forecasts to include new information that may impact budgets.
Supports multiple types of forecasts such as balance sheet and cash flow forecasts.
Used to review and update budgeting assumptions for a predefined period (usually one year).
Projects out as the year progresses to accommodate trends that affect key business drivers.
Compares Income Statement, Balance Sheet, and Cash Flow for multiple periods.
Forward-looking Balance Sheet and Cash Flow Statements are synchronized with GL data.
4. Solution Primary Aspects
Ease of use for nonfinance users
One of CFOs’ biggest fears when implementing a new financial planning and analysis solution is that the non-finance users (who input most of the raw data) will have a hard time doing so, which may cause unnecessary “noise” in the organization and jeopardize the success of the project.
Therefore, product ease of use takes its place as the most important criteria for CFOs when selecting a new CPM solution
DataRails wins by a long shot as this attribute truly sets them apart. End-users have been working for years with the same old spreadsheet templates, and DataRails allows them to continue working without any change. Essentially, with this solution most of the organization won’t even feel that there’s a new system in place.
All other solutions require the non-finance endusers to learn how to work with new web-based user interfaces. This is usually a daunting, exhausting, and challenging endeavor. Or, they require working on a new Excel template while using a cumbersome Excel add-in. Either way, from the solutions we looked into, DataRails aside all other solutions require some degree of adaptation.
When it comes to financial planning, there’s no “one size fits all” solution, which is why flexibility wins. From a user’s perspective, the ideal product should be flexible enough that it is effective and allows for the customization of the solution to fit a variety of business needs. This ideally means that they have a certain degree of control over their models while concurrently maintaining the quality and integrity of all models involved.
Given that spreadsheets are the most flexible software that exist, DataRails’ technology wins this title. DataRails’ front-end is your native spreadsheet, as the solution can connect and understand any spreadsheet regardless of complexity. As such, DataRails users enjoy endless flexibility exactly as they do with their typical use of Excel.
Runner-ups: Adaptive Insights, Prophix, Jedox
The 3 runner-ups offer the standard inside-thebox architecture, requiring customers to adapt to the vendor model. Their models are quite flexible but require expensive professional service costs and can take weeks to implement.
Workiva disappointed us as it failed to deliver the required flexibility for different models.
Analytics and Decision Support
When done right, FP&A analytics involve deep-diving into data to examine critical issues, advanced collaborative models, and the investigation of various scenarios. These capabilities must be made available to any end-user. Analytics and decision support features can help teams observe key drivers of performance and identify how best to address or change operations in order to enhance performance.
This section is the only one where we could not identify any advantage for any specific player. They all possess an impressive set of analytics and decision support tools However we were disappointed that none of them implement AI or ML within their product.
Integrations are the Achilles' heel of FP&A solutions, and often prevent them from fully delivering on their performance management promise. The reason for that is simple- there are endless amounts of 3rd party solutions. These include anything from industry specific ERPs & CRMs, to self developed models, to old, outdated GL’s and more.
Integrating with each requires putting a lot of work in development, which is why most companies prefer to integrate with leading systems only.
Both vendors realized the importance of integrations and as such designed their solutions accordingly to allow for integrations with the leading ERP and accounting systems. DataRails has a slight advantage as it can automatically import data from any system with an “Export to Excel” feature due to its patented technology that can understand spreadsheets automatically without requiring a dedicated development.
Runner-ups: : Jedox, Prophix, Workiva
The three have limited integrations with some of the leading ERPs, however per our analysis they don’t meet the required criteria.
Implementation and Support
The “weakest link” of FP&A solutions has always been the implementation process. Migrating complicated processes with complex models can take months, and throughout the years we’ve unfortunately heard our fair share of implementation horror stories.
The main cause of long implementation processes is rooted in the model migration process. For companies that wish to keep existing financial models, extensive professional services are required.
Due to its innovative and unique approach, DataRails has managed to win this one by a landslide. By maintaining original customer spreadsheets, and therefore keeping their original financial models, DataRails is practically a plug-and-play solution.
The other four solutions offer excellent professional services support that is happy to adjust their models towards the customer original model for a fee. Additionally, most customers are asked to adapt to the vendor model at the risk of losing the intellectual property that they amassed over the years.
Regardless of how dynamic, powerful, or beautiful vendor analytics or insights modules are, at the end of the day, in any management or board meeting the CFO always presents results using a good old-fashioned Powerpoint. Classic.
Workiva was the first to coin the term “Connected Reporting” when they connected different data points from numerous systems to Word and Powerpoint, setting a new bar for reporting. It is by far the leader in this category, despite the fact that many of their features are tailored for public companies and will not be used by CFOs in a standard meeting room.
DataRails again proves that smaller companies can bypass larger companies thanks to superior technology. They offer a feature similar to that of Workiva’s connected reporting and deliver all the features that a CFO would require, including a live connection between Powerpoint and Word with their cloud database.
Losers: Jedox, Adaptive Insights, Prophix
When it comes to reporting, these three are left far behind as they don’t deliver a meaningful reporting solution. Rather, they all recommend that their customers use their generic webbased dashboard for reporting.
DataRails leads the pack.
When we started this comparison report, we had no clue what the results would look like. In a market that is dominated by giants, we did not expect a fairly young and small company to be able to compete with them. Some of us even thought adding such small companies to the comparison would be a waste of time.
However, as in any other technology market, innovation wins. DataRails, which is the only technology led company, has amazed us with its superior product, swept away the competition, and ranked in first place by a long shot.
Their combination of thorough market understanding together with their unique technology has allowed DataRails to present a “best of both worlds” approach.
On one hand, end-users can continue to work in Excel, which is what users want. And on the other hand, they deliver an enterprise-grade solution that competes head-to-head with the biggest of players in the market.
Runner-up: Adaptive Insights comes in a solid second place.
No surprise here. Adaptive Insights, the most familiar brand in this market, is definitely the choice for organizations looking for a well-known product with a strong backer (Workday). Adaptive has managed to develop a solid, web-based solution that just does what needs to be done.
We can only hope the acquisition of the company won’t damage the positive trend the company has witnessed in recent years.