A Portal Based Approach to Enterprise Performance Management
Business or Corporate Portals, or to use the official industry term: Enterprise Information Portals have had their 15 minutes of fame and vanished into the sunset. However, like a lot of these fads, there is usually a valid, underlying value proposition. Take the Internet and the dot com boom as an example, after the dust settled; we had strong viable "pure play" online businesses: Google, Amazon.com to name two. This article looks at the legacy left behind by the hype surrounding Corporate Portals and how the concept can be applied to the Enterprise Performance Management (EPM) industry.
A corporate portal is a Web-based concept that serves as a single gateway to a company's information and knowledge base for employees and other stakeholders. It enables the capture and distribution of structured and unstructured data. This is a particularly useful approach for the EPM market for reasons that range from a simpler selling story to ease of use from a customer perspective.
So how might this work in practice? Take a new financial analyst for the marketing department who has just joined a large organization. She has her HR induction course and is told she needs to go setup her personal web page on the corporate portal. So she goes to her desk, logs in and based on her profile she is given a list of options that could appear on her personal web page. They might include, her HR information: Time & Expenses template; as well as Performance Management information: the marketing budget, department driven analytics etc. On selecting from this menu tray, she automatically creates her own personal portal. The various applications that produce her budgeting and operational information, as well as the accompanying analytics are concealed from her. She doesn't need to learn three different applications to get the information to do her job.
The real value of a portal based approach as it applies to EPM is that the information delivered to the user is targeted and profile driven. So the right people get the right information at the right time. The CFO for example could select from her list of options, the weekly sales figures, monthly management profit and loss statements and the corporate dashboard showing the performance of the company across all of its markets and products. The performance can be color-coded and presented as graphical, intuitive, analytic icons showing green for above performance, yellow for meeting performance and red for below performance. The VP of Budgeting could customize her personal portal so she could run the budgeting application directly from her portal, set up the appropriate drivers, consolidate the numbers and distribute the relevant reports to specific departments.
One of the advantages of portals is that it can bring down the cost of training. Most users are familiar with a web-based interface as they surf the Internet regularly. A portal based EPM means that consumers of EPM information need not necessarily have to learn about the different packages for strategic planning, budgeting, BI reporting, analytics etc. Why should the CFO for example need to learn how to run a report from her budgeting application and yet another one from her consolidation tool. She should be able to select the reports she needs from her menu, indicate what frequency she needs and get it delivered to her personal portal automatically. If however, she had the inclination to delve into the software (some CFOs like to do their own what-if analysis for example) she would always have the option to launch the software from her portal.
Portals advocate user-defined workspaces and encourage collaboration. Incorporating some of the collaboration tools from Microsoft, for example, it is possible to do specific EPM tasks in real-time within the corporate portal. For example, a strategy-driven organization can do their strategic planning with their senior leadership team online and see the effect of the different scenarios on their forecast operational numbers, all in real-time.
A challenge for the current EPM tools today is combining structured and unstructured data. EPM tools are typically designed to deal efficiently with structured data stored within standard databases, however a lot of the EPM tools out there struggle to cope with unstructured data. So for example, how does one capture data like competitor analysis of a web site or industry reports and make it available within the budgeting process? The new financial analyst mentioned above might have prepared the marketing budget and come across some interesting research that helped her determine her figures for the cost and type of seminars within the budget. She might want to share that research to the rest of the budgeting team from across the world. A portal is an easy and effective way to share this research beside her budgeting numbers.
Some of the vendors have undoubtedly created portals based around their products. So for example, some vendors have portals from which you could run all their installed products. This however, in this authors view is a limited approach to portals. If a customer had products from two leading vendors, they could potentially have two separate EPM portals. This in one sense defeats the purpose of a corporate portal. The overriding aim of an Enterprise Information Portal is that all of the information required for the company to do business should be accessible from the single portal. Undeniably, this is very difficult to do correctly. It requires significant resources, expertise and data integration to get it right. However, the expertise and software exists today to make this a reality. It is quite possible, regardless of the EPM vendor and application, to provide the relevant information to the pertinent stakeholder, seamlessly, from a common and central gateway.
Now that portals are no longer flavor of the month, how does an organization get to embark on such an ambitious project? A good approach is to make it EPM driven. The key decision makers for most EPM projects are the CFO and CEO. This is because by their nature, true EPM projects tend to be expensive, strategic and demand significant resources. They also affect almost every department of the company. During the course of a truly integrated EPM project, questions are asked such as how we measure the performance of each area of our business. What are our drivers as a business? What are our Key Performance Indicators? These are strategic questions that permeate every level of the organization. Consequently, finance, where most EPM projects originate from tends to run some of the biggest, most visible and influential projects within the organization. It gives the opportunity therefore to leverage the resources and mind share within the organization to create corporate portals that not only benefit all other departments, but enable them tell a compelling EPM story.
For a large retailing organization, that story might be: from a central portal we can tell the daily sales numbers store-by-store across the country during the "Black Friday" weekend. We can also compare that data against that same weekend, last year. By the way, we can also do a forecast over the next 3 weeks based on trends from last year, and while we are doing that we can see how our competitors did during the same weekend. Oh, we don't have to worry about running and distributing the reports to the leadership team either. They signed up for the reports when they created their profile, so they get them delivered to their email box everyday at 9am. The story goes on. We have a section of the portal that graphically illustrates the performance of the company across the different regions, with yellow, green and red indicating the performance of each region against their budgeted numbers, and you can click on the map and drill down from the region to the city, to the individual store. Also, for budgeting these days, you don't need to run a separate application, just click on that link and enter your numbers. The computed budget gets emailed to each department head for review before it's finalized. The story goes on….
So the finance department and the CFO start changing the perception of finance as a cost center to finance as a key strategic partner within the business. Finance stops being just a center that churns out numbers weekly, monthly, quarterly, but a strategic business unit that drives growth, performance and competitive advantage.
Having espoused the virtues of Portal-based EPM, it is important to acknowledge that it is fiendishly difficult to execute. It requires the amalgamation of a series of technology (e.g. EPM, data warehousing, Enterprise, Information Management, Portal tools etc.) with specific expertise in search, categorization, collaboration, personalization, profiling, application integration, and security. The future for EPM however, will be inevitably portal-driven. This can be seen by the acquisition strategies of the larger software vendors. The vendors are increasingly bundling their products into a cohesive package that enables them tell the type of story indicated above. Companies like Oracle with it's powerful database, as a common platform will one day offer all the necessary tools: from HR to EPM to tell that compelling portal story. The biggest and most underrated player however, is Microsoft who has been intelligently buying several EPM vendors and tools (e.g. FRx) as well as financial transaction systems (e.g. Great Plains) that service large and small companies. With the ubiquitous Microsoft Office and Windows operating system as well as its expertise in portal technology, it is not a giant leap for the company to provide a portal solution for the business users that comprises a full set of EPM information as well as other business critical information.
In conclusion, while portal-based EPM is a great idea, it is very difficult to accomplish. There have been success stories however. These projects tended to take enormous resources and several years to complete. The benefits for these successful companies have been enormous. Their users have seen their productivity go up, management has seen improved speed of decision-making as result of having quick and ready access to key business information. While there's little doubt that portal-based EPM will eventually be the norm, it is still a few years away, and when it does arrive it will driven by the vendors.
This article was written by Bernie Akporiaye, Practice Manager, Performance Management. During the month of January, Bernie will be available to provide free advice to any of your Performance Management questions. He can be reached at:
