Are Those Planning Apps Too Good to be True?

Often when we visit a prospect for the fist time we are asked if we offer apps or templates or pre-built models for budgeting or planning, or for a dashboard or a standard set of reports. Apps that do capital planning or opex forecasting, or rolling forecasts, or demand planning or HR budgeting, or revenue forecasting.

Now I know that some vendors do exactly this. I also know that often after a vendor has enticed you with their pre built apps and, say, a 15 day project to build your entire budget complete. And then they start to learn about your requirements and reframe the project to a custom build that takes considerably longer. But you’re hooked and need to justify it cos you’ve signed off on it. And they know it.

The Problem with Prebuilt Applications

But you, the customer, need to really think about this when you’re being shown the glossy demo and told all about their apps and head start packages, or their pre built models for your industry.

Ask yourself questions like:

1. How long did it take you to build your current model in Excel or whatever tool you currently use? And how much of that do you want in your new planning tool?
2. Can you really use a vanilla tool and try to shoehorn your budgeting into it?
3. What are the quirks to your business? Is it the cost centre structure, the allocations, the gross profit calculation methodology, the way you forecast inventory and demand planning, how you plan your factory and manufacturing, do you use driver based forecasting.
4. Then think about labour planning. Do you plan by person or by role? Are people get split across cost centres? Do you use driver based labour planning? What are the inclusions to the way you plan labour that are not in the provided model?
5. Then move onto Capex. Does capex cover a single asset in a single month, i.e. simple capex planning. Or does capex need to have multiple periods of expenditure and then capitalise it and start depreciation at the end of the spend?
6. Allocations – do you use them? If so how and then how will they be planned and are they covered by the new solution?

These are just a few of the things to think about when you’re being tempted by an off the shelf planning solution or prebuilt apps. A tool where the vendor says they can implement in what seems too good to be true.

What You Can Do?

Test them out. Take a highly complex budgeting exercise (like multi step dynamic allocations, for example) and ask them to prove it on site (so you can monitor everything) in a proof of concept. And do it for multiple vendors simultaneously.