Cheat Sheet for Gartner’s “Magic Quadrant for Cloud Financial Planning and Analysis Solutions” Report

by | Sep 5, 2019 | Financial Planning & Analysis, Reporting | 0 comments

Don’t have the 71 minutes allotted to read the full version of Gartner’s “Magic Quadrant for Cloud Financial Planning and Analysis Solutions“? We’ve broken down each section into the need-to-know info and highlights to help you navigate the report to get the most out of it. Here’s how to best navigate the report to make it digestible for and applicable to your business. 

Market Definition/Description

When it comes to cloud-based financial planning and analysis solutions, “users tend to primarily value functionality over technology,” the report states. Users lean toward software-as-a-service solutions that reduce application support costs, increase application flexibility, and shorten time to value. Gartner classifies three types of cloud service vendors for the purposes of this report: cloud-only vendor solutions, traditional on-premise vendors with cloud capabilities, and on-premise vendors that use third-party cloud capabilities. What’s more, Gartner defines the sizes of enterprises that adopt these solutions, as well as the FP&A components in terms of planning, modeling, and reporting. 

Vendor Strengths and Cautions

An alphabetical list of the top-15 FP&A solutions is broken down into a veritable pros and cons list. While no one solution is called out as the frontrunner, it is up to the reader to decide which stands out in terms of functionality, flexibility, and implementation. Recognizable names like Oracle and IBM share table space with more niche offerings such as Workiva and Kepion. Additionally, each vendor features a bio for users to learn more. 

Inclusion and Exclusion Criteria

If users want to learn more, Gartner includes a breakdown of the criteria on which each vendor was evaluated in order to be eligible for inclusion on the Magic Quadrant. This included product capabilities, market presence, and vendor viability. Two vendors — Centage and Longview — received “Honorable Mentions” as not qualifying for the report but still worthy of consideration. 

Evaluation Criteria

Simply put, vendors were evaluated and weighted on their ability to execute. This not only included the product or service, but also overall viability, sales execution and pricing, market responsiveness and record, market execution, customer experience, and operations. Specifically, respondents were asked to rate overall satisfaction with sales experience, ease of implementation, ease of use, ease of maintenance, solution flexibility, performance, analytics, application governance and life cycle management, overall experience with the vendor, meeting needs, and meeting needs versus money spent. 

Completeness of Vision

At a higher level, vendors were rated on their market understanding, marketing strategy, sales strategy, offering or product strategy, business model, vertical and industry strategy, innovation, and geographic strategy. As with all weighting of the FP&A solutions featured in the report, it is important to note that not all criteria applies to each user. 

Quadrant Descriptions

A visual presentation of the Magic Quadrant introduces the report, but the quadrants aren’t defined until the bottom half. Because this topic deserves a deeper dive, a thorough breakdown of each description will be covered in a future blog post. For now, it’s important to understand the chart is divided by Leaders, Challengers, Visionaries, and Niche Players that are placed based on their ability to execute compared to the completeness of their vision. 

Context

Survey participants agree the reasons to evaluate a new FP&A system include to create internal and operational efficiencies, improve business process agility, and enhance decision making. The results aptly reflect the role of the financial institution to wear many hats, including to “govern and guide.” The reports adds that “45% of the respondents using FP&A solutions for planning used their solution to conduct integrated financial planning.”

Market Overview

The results of the survey cover the bases of both small- and medium-size businesses, as well as large organizations. Of the 426 respondents, 51% of respondents reported annual revenue of less than $1 billion, 44% reported annual revenue of over $1 billion, and 5% were from government or nonprofit entities. The results concluded that prospective customers are frustrated with their current on-premise solution, relying too heavily on Microsoft Excel, and find the barriers to entry for implementing a new system have been lowered. 

Market Evolution

According to the survey results, “approximately 75% of enterprises seek ways to improve the accuracy and strategic impact of financial planning and analysis data, when combining them with data from multiple operational divisions or business units.” This stresses the importance of four primary aspects of the market evolution: ease of use, maintenance, and solution flexibility; platform; integration; and analytics and decision support

Differentiating Technologies

While technologies such as artificial intelligence, robotic automation, and blockchain are on the rise, they were not a factor in this year’s report. Gartner predicted that by 2020, “embedded AI will become a key differentiating factor in finance systems evaluations” and recommended reviewing your current technology to make sure it’s headed in the right direction, as well as identifying ways to adopt the technology as it becomes available. 

Evidence

Gartner reports that the 426 respondents who were surveyed between February and April 2019 were reference customers nominated by each of the vendors in this Magic Quadrant. Survey participants were represented from North America, Europe, the Middle East, Africa, Asia-Pacific, and Latin America and were asked to rate their levels of satisfaction with their particular vendor service. 

Evaluation Criteria Definitions

Gartner closes the report by further examining the ability to execute and completeness of vision that represent the sliding scale on which the Magic Quadrant is based, leaving no stone left unturned by the exhaustive report.  

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