What is EPM ?

EPM or Enterprise Performance Management

- Is the process of monitoring performance across the enterprise with the goal of improving
business performance.
- EPM helps organization have a consistent accurate, scalable and reportable metadata within
one consolidated source.
- EPM helps organizations to plan, budget, forecast and report on the business performance.
- It also Typically includes the monitoring and managing of KPI’s

Companies who develop EPM systems

- Oracle “ the most well-known and popular among the market”
- SAP
- IBM

Brief History of EPM

- The concept of EPM has been around for many years and if we go back to the early days of the
industrial revolution, EPM processes were managed manually via paper. In meeting and
presentations and discussion.
- Year 1970’s commercial software applications began to take hold in many organizations, thus
the first EPM software application became available and accounting solutions began collecting
budgeting and financial information for reporting purposes
- In 1980’s the first spreadsheets software is introduced (lotus1-2-3 and visicalc) Spreadsheets
allows the finance team to automate the creation of budget and reports in order to replace
manual worksheets.
- In 1990’s the availability of emails allowed people to share the spreadsheets which help the
organization to form collaboration and collection of budgeting and reporting data.
- In 2000’s where technology has been greatly developed EPM software platforms has also
evolved from the windows-based client to internet-enabled/ web browser-based application.
- And lastly in 2010 where in there was an increasing demand for cloud based EPM, it became the
new standard. “In the cloud” means that the application or software is housed on a network of
remote servers. Instead of simply being in a company’s system.
EPM Business process

The EPM business process can be broken down into five functional areas; Stategic modeling, planning
and budgeting, consolidation and close, reporting and performance analytics.

Strategic Modeling

- It allows the users the opportunity to develop a long-range strategic forecast Models.
- Its useful for detailed forecasting and analysis of trends and frees up time spent on manual
gathering of data
 - It also gives out users a sense of confidence in the accuracy of their reports or projections and
audits.

Planning and Budgeting

- EPM software gives users a more “flexibility and scalability” with their forecasts.

Consolidation and Close

- EPM software can be used for streamlining financial close and consolidation
- It makes it easy for the users / organizations to report on their business with confidence.

Reporting

- With the Use of EPM software, financial reporting has been revolutionized
- It can also be used to consolidate briefs into executive reports, distribute report content to
stakeholders and integrate financial decisions among other functionalities

Performance analytics

- With EPM analyzing past performance had be made easier and more accurate
- It uses to conveniently analyze the trends across years, divisions, and against planned
performance
- The data creates a more holistic picture of the enterprise that is invaluable for leadership,
management and stakeholders

The Benefits of using EPM to business

Why does companies need to use EPM for their business?

3 main advantages of the process:

1. Enables more efficient management

2. Provides real-time analysis necessary to execute your strategy
3. Improves performance across different operational and financial metrics

Examples of how advantageous the use of EPM to business units

1. Sales team can optimize the sales funnel

- Since EPM systems do create forecasting, the sales team can update its sales target in real-time

- “Sales Funnel”- it’s where potential customers go through on the way to purchase, also it
depends onto the sales model of the company.
2. HR can manage employees better
- Since HR needs to identify the needs and the requirements of the enterprise and in order to
plan out new hires, The EPM system can help the HRs to define goals and compare there with
their existing data generated by sales tools, also that the EPM system can also help create
feasible budgets for the HR department
 3. Marketing teams can monitor marketing campaigns
- As for marketing teams since they work well when they have a blended view of the
performance of their marketing activities. The EPM system can help the marketing teams by
consolidating reports from its several data points in order for the marketing teams to decided
when to pursue, improve or reject such marketing ideas.
4. Procurement teams can control the supply network more efficiently
- EPM systems also provides an unbiased view of the capacities and qualities of the required
goods, thus it can help the procurement teams into improving cost structures and generate
transparency for procurement in the business. The EPM also can help the procurement teams
be informed and well-prepared to handle increase of prices

Conclusion

EPM system is a really powerful tool for the finance managers, CFOs and other management personnel
to have. If it’s implemented well then, the effective use of the EPM technology can fill in every aspect of
an enterprise and can gives leadership a better picture of the organization’s overall performance. But if
incase its being implemented improperly it can be too overwhelming to navigate and that it will not give
a good result.