Interview of TAdviser with the area director of CPM of AT Consulting company Yulia Zakharova

Yulia Zakharova: The effective enterprise should make the maximum profit and solve other tasks set by the owner or the shareholder. Ideally all business processes of the organization should be directed to it. Processes should be controlled using the system of the interdependent indicators considered in a common information space. A CPM system allows to solve a number of the problems connected with creation of end-to-end model of measure calculations of efficiency, providing the tool answering a question as far as the enterprise is effective in terms of the internal purposes. Among detailed problems which are solved by SRM: planning of financial and operating activities, formation of the consolidated statements, management of profitability, regular check of the actual execution of the plan and adjustment of plans.

Yulia Zakharova: There is a feeling of saturation of the market CPM solutions in their classical option on large enterprises. There are no implementations from scratch, by my estimates, in a large corporate segment now and in the nearest future will not be. But when conditions of business change and new tasks of development of the company appear – it is regularly necessary "to doavtomatizirovat" planning and management accounting, to implement new functionality, to recustomize a CPM system, to develop it. The market moves towards medium and small business. Understanding of need of application of modern software products to the enterprises of this segment gradually comes. In the conditions of fast changing of the market situation and macroeconomic parameters there are not enough opportunities of Excel to plan activity.

Yulia Zakharova: Needs of the customer changed, first, regarding awareness of importance of methodology which in the Russian conditions always goes from real business processes of the enterprise and almost in each case is unique. The business environment changes – the methodology changes. Any CPM project begins with development or processing of methodology which is realized then in specific system configuration, its settings now. The second important feature of the current situation – all want to receive results from implementation therefore on project implementation deadlines are taken away quickly. And the third moment – projects become more interesting and more difficult as in most cases the basic functionality is already implemented, and now clients want detailing of management models efficiency.

Yulia Zakharova: It is noticeable. The Russian CPM products in the last two-three years develop rather violently so many customers prefers to work with domestic developments. It is characteristic that our software gains distribution both to SMB, and in a large corporate segment. The reason not only in state policy import substitution, but also that a number of the Russian developments already rather mature also have all set of necessary functionality. This fact is a key factor of the fact that already now on their base difficult and volume tasks in different sectors of economy are successfully solved. Besides, the Russian developments are cheaper than the western products, similar on a class, that is important. For support and development of a domestic CPM system it is simpler to find specialists that also reduces the cost of ownership of a system.

Yulia Zakharova: I would tell that, not all enterprises need broad functionality. Many enough main opportunities which are perfectly implemented, for example, in the domestic systems. And additional visualization and technology innovations often are not used at all, but at the same time cost much.

Yulia Zakharova: In terms of money I will not undertake to estimate the volume of the Russian market of CPM systems for 2015, at me is not present on hands of such statistics. Concerning dynamics I can tell that since the beginning of last year there was a serious recession in all directions, including CPM. Since the middle of 2015 the situation was aligned, but in general the market is significantly lower than 2014. This our common understanding of the market and those trends which we on it observe.

As for our company, despite all-market dynamics, we could strengthen the share, AT Consulting revenue in the CPM direction for 2015 grew in comparison with previous year more than by 20%.

Yulia Zakharova: In general we expect that year will be not simple and highly competitive. But at the same time, we are focused on strengthening the leading positions in the market, and we expect expansion of a client portfolio.

Yulia Zakharova: Trends in the Russian and world markets of CPM multidirectional. The world market of solutions of the class CPM actively moves towards cloud computing and simplification of performance management, leaving from difficult models, extremely labor-consuming and regarding their development, and regarding their further support. Processes of preparation of the reporting, budgeting, planning will allow to simplify and accelerate this leaving. The Russian enterprises, on the contrary, build the difficult models of assessment of own efficiency based on multiple factor analysis. It is easy to explain it – in a difficult economic situation in which our business is forced to work, similar approach helps to be guided and react to change of the environment of maintaining better. Cloud solutions in the context of performance management of the enterprises are yet not so popular in Russia.

Yulia Zakharova: Reasons of information security work. In a cloud the major business indicators, plans will be placed – it is rather difficult to take such step. The option which it will become possible to develop in Russia is private clouds. At the same time, except security, it is necessary to resolve an issue of integration of the CPM solution with other systems and synchronization of data with the general information landscape. One more important point constraining transition to a cloud in case of large enterprises – need of preserving of the investments made in the CPM project which is already implemented on the platform.

Yulia Zakharova: We trust in cloud computing. At the correct organization they help to save money of the enterprise and to optimize process. But it is a little offers on work with CPM from a public Russian cloud. Therefore at this stage of formation of the market we offer the companies creation just of the private cloud allowing to optimize equipment expenses, software and maintenance. CPM is not a transaction system for daily use therefore the expensive equipment is not always reasonable to buy especially for the CPM solution.

Yulia Zakharova: At the moment not. We several times considered cloud solutions, but after detailed consideration of requirements and the client's requests, jointly came to the conclusion that traditional implementation on a customer site is necessary. And not only from security reasons, but also because of too simple data models and calculations implemented in cloud proposals of providers. The In-house-solution gives the chance to configure the program under the specific customer, does not impose restriction and allow to implement rather difficult models.

Yulia Zakharova: Sometimes the companies underestimate importance of performance monitoring of activity based on modern software products with ample opportunities. Therefore CPM systems often do not carry to discharge of IT solutions, crucial for business. The companies occasionally are concentrated on automation of the current activity and do not look in tomorrow. It is considered that financiers have enough Excel opportunities. But actually the organization can automate the business processes as much as necessary, but if at the same time the management has no detailed understanding, the company how effectively works, on the separate directions of business the probability of wrong investments is high.

Yulia Zakharova: Strategic planning is not too demanded. Tell that in the nearest future the situation will change, probably, it would be wrong. Though problems of decomposition of the strategic plan on the level of annual, quarter budgets already meet, and it is possible to assume that such, complex approach to performance management will extend further. The second functionality which did not gain due distribution in the market yet, but at which players actively look narrowly, – calculation of profitability for the directions of business development taking into account all factors and based on different methodologies. The corresponding requests to us come, the companies began to think of it.

Yulia Zakharova: We the multivendor company, are partners of most foreign and Russian vendors. From foreign is, first of all, a big three (Oracle IBM SAP) and also the solution on calculation of profitability of the company SAS. From the Russian vendors we cooperate with the companies "1C" and "Galaktika". At the same time historically it developed so that the majority of projects in our portfolio are implemented for today on Oracle Hyperion Planning. I will note also that the implementations, largest in Russia, based on a product of Oracle are executed by our company.

Yulia Zakharova: The western systems historically develop much longer, than Russian therefore they have sometimes broader functionality, accumulate considerably bigger experience. Fundamental difference of foreign developments from Russian also that the western CPM is a designer using whom it is possible to collect a system under the specific customer. And the opportunities put in CPM in respect of accumulation of functionality and adaptation under specific business very big. The Russian systems which were more closed it is possible to configure them under unique needs of the customer, but it can demand more efforts. Though on the other hand we see now that domestic manufacturers of software actively develop the solutions, and we consider that in the nearest future the existing lag will be eliminated.

Yulia Zakharova: Of six months, on average – year. In my practice there were projects when the budgeting system on rather large enterprise was unrolled in three months. A lot of things depend on degree of readiness of methodology and whether its processing, adaptation under the client joins in time frames of the project. In most cases processing and adaptation of methodology is required.

Yulia Zakharova: Among our projects I can note creation of a budgeting system in Dixy Group, System implementation of budgeting and calculation of profitability and the system of transformation in Evrotsement company. Among large projects of development of CPM-solutions it is also possible to note projects in VimpelCom, Rostelecom, Cherkizovo group.

Yulia Zakharova: Is more whole a little. The main goal of any CPM project – to learn it is correct to calculate the efficiency, spending at the same time smaller resources and receiving the big detailing allowing the owner to make the correct decisions. The purpose of financial consolidation is decrease in terms of preparation of the reporting (as shows experience, decrease in terms from a month to several days is achievable). Budgeting allows to reduce, respectively, the term of preparation of budgets, having increased quality of the data obtained from one "source of the truth" and calculations for the account of repeated automated verifications. As for quantitative indices of efficiency evaluation, their two – reduction of a set-up time of the reporting and quantity of report versions (budgets) in unit of time. So, at one enterprise several months were spent for preparation of one version of the budget, after implementation of CPM there was an opportunity to collect every week according to the new version.