By Michael Burns
*This is an expanded version of a column that appeared in the November 2003 print edition of CAmagazine.
Buzz
By now you have probably heard of business intelligence (BI) -transformation of data into information that is useful for decision-making. BI solves a problem shared by many organizations that have implemented an expensive accounting or enterprise resource planning (ERP) system but have no easy way to get at the data locked up in a database.
However, BI is only one component of what many organizations require to make decisions. Organizations are now turning to business performance management (BPM), which includes not only BI, but also strategic planning, budgeting, forecasting, consolidation and scorecarding (linking goals and objectives to corporate-wide key performance indicators, or KPIs). BPM will often replace multiple systems and unwieldy spreadsheets, thereby fulfilling different needs within an organization.
The Sarbanes-Oxley Act, which became law on July 30, 2002, has created an even greater need for BPM. If a company is listed on a US stock exchange, CEOs, CFOs and senior officers must personally certify the accuracy and completeness of financial reports. Management is also responsible for establishing and maintaining an adequate internal control structure and procedures for financial reporting. And companies must file their annual and quarterly reports on an accelerated schedule. Many accounting and ERP systems lack the functionality to comply with Sarbanes-Oxley.
There has also been a big shift in decision-making since the dot.com meltdown. In the recent past, decisions were made for competitive reasons, especially when it came to technology. Today, business is back in the driver's seat and you will hear a lot about ROI, alignment with corporate strategy, balanced scorecards and performance improvement. But getting the right information can be tricky across an enterprise that is decentralized. BPM includes the ability to break down the silos and provide metrics that will show whether strategic objectives are being attained.
There are a number of products that offer BPM, including Hyperion, Comshare, Cognos and OutlookSoft. Here we'll focus on one of the newer BPM products: OutlookSoft.
The product
Founded in 1999 and headquartered in Stamford, Connecticut, OutlookSoft Corporation (http://www.outlooksoft.com/) develops, markets and supports BPM software. OutlookSoft has 140 employees, and about 120 customers worldwide (including Dell Computer, Bank of America, Prudential and Winn Dixie), with five in Canada (including the Four Seasons Hotel and Resort, Source Medical and Intrawest). It has recently opened a Canadian office operating out of Toronto.
OutlookSoft targets companies with revenue greater than $100 million or with the potential to reach this amount in the next few years.
The price
The package will cost you about $4,000 per user. From a licensing perspective, OutlookSoft does not distinguish between power users and regular users. A typical OutlookSoft customer will have 50 users. The implementation costs will vary widely depending on your requirements and resources. Some companies want OutlookSoft to build a custom KPI system, since they don't have the internal resources. But this solution costs a minimum of 30% of the licence costs.
Assets
OutlookSoft is a single application that combines all BPM functionality mentioned above. It includes strategic planning tools, scorecarding, budgeting, forecasting, distribution of reports in multiple formats, including PDF, Excel, and HTML, and integration with many ERP systems.
It is also a web-based system with one central database (Microsoft SQL Server). This means anyone anywhere can use the system; all you need is a browser on the workstation. OutlookSoft uses Excel as the user interface but you're still using only your browser on your workstation. It is possible to save your work on your computer, do some manipulation and later synchronize with the central system.
OutlookSoft's system includes consolidation with intercompany eliminations. As long as all the intercompany accounts are set up in each subsidiary, OutlookSoft will do the eliminations automatically and identify subsidiaries that are out of balance. OutlookSoft will also allow you to re-allocate costs from one account to a number of other accounts (cost centres, divisions, etc.) based on allocation rules. Other features include attaching dimensions to accounts for additional analysis and security by user or by any dimension.
Liabilities
Although the Excel user interface has many advantages, it is not as flexible in changing rows and columns as some of the other BI or BPM products. In other BI or BPM products, you just need to drag and drop another dimension to be analyzed to the rows or columns; you can then slice and dice on a different dimension. With OutlookSoft, you would set up another spreadsheet view with the dimensions you want to slice and dice.
OutlookSoft has extensive consolidation features but it will require customization if there has been a change in ownership. Consolidation of companies that change ownership is tricky. The system needs to track the percentage ownership effective dates. Things get even trickier if there are indirect relationships where company A owns company B which owns company C.
Despite its relatively small size, OutlookSoft has grown quickly in this market. It is competing with much larger companies, which continue to get larger through acquisition. In the past few months, many BI and BPM companies have been bought out. Business Objects acquired Crystal Decisions, Hyperion acquired Brio Software, Geac acquired Comshare… who's next?
Bottom line
BPM needs more than good software. Standards are required to achieve data consistency and management must break down the silo attitude of managers who pursue individual goals rather than corporate objectives. Once standards and shared performance goals are in place, OutlookSoft will have the power to bring the decision-makers across a large, sprawling organization under one roof.
Michael Burns, MBA, CA, is President of 180 Systems (http://www.180systems.com), which provides independent consulting advice in the selection and implementation of business systems. Michael can be reached at 416-963-1296 or by email at mburns@180systems.com | 
