Authored by:
Robert Kugel;
January 31, 2005 - Cognos and Hyperion have pointed to accelerating sales of their dedicated budgeting and planning solutions in their recent financial results (without citing specific numbers). Ventana Research expects continued adoption of dedicated software as companies focus on making budgeting and planning more of a Performance Management tool. Standalone spreadsheets make it difficult to use planning more effectively because their inherent limitations stand in the way of implementing process enhancements. Spreadsheets force companies to spend too much time simply pulling the numbers together. They do not have enough time to analyze them and prevent adequate collaboration. Frequently, to lessen the administrative burden, organizations that use spreadsheets limit participation in the process and cannot re-plan or re-budget easily at any level of detail in response to business changes.
In our detailed research study on this topic published in 2004, we found 64%
of all companies use spreadsheets to manage the process. We believe this number
declined during 2004, particularly among Global 2000 companies, and we expect
it to fall even further in 2005. With the distraction of the initial Sarbanes-Oxley
Section 404 compliance behind them, we see more finance organizations having
the time to focus on improving their effectiveness in this area.
About the Author
Title:
CFA, VP & Research Director - Financial Performance Management
Robert Kugel heads up the Financial Performance Management practice at Ventana Research, which covers the application of IT to financial processoptimization, analytics and advanced planning. Before joining Ventana, he worked at First Albany Corporation, Morgan Stanley and McKinsey. Mr. Kugelearned his B.A. in economics at Hampshire College and an M.B.A. in finance at Columbia University and is a CFA charter holder.
