Gartner Splits the Magic Quadrant for CPM Suites

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Corporate performance management (CPM) has been an established market and an important topic at Gartner and for its clients since 2001. 

The CPM (also known as enterprise performance management, or EPM) domain has always spanned multiple processes within the Finance organization, including FP&A functions such as strategy management, integrated financial planning, and profitability management – as well as accounting functions such as financial consolidation and reporting and disclosure management.     

Recognizing that CPM spans multiple Finance processes, and the evolution in the way organizations are deploying these solutions, Gartner indicated in July of 2015 that it would be splitting its view of CPM solutions into two segments: Financial CPM and Strategic CPM.  And now, in May 2016, Gartner has published two separate Magic Quadrant Reports for these two areas.

Download the Gartner Magic Quadrant Reports

Financial vs. Strategic Corporate Performance Management

Splitting of the traditional Gartner Magic Quadrants for Corporate Performance Management Suites was a bold move on the part of Gartner’s CPM analysts.  To our knowledge, it’s the first time Gartner has ever put products from different categories (e.g., Blackline, a close management system, and Host Analytics, an EPM platform) together on a single Magic Quadrant (MQ).  While visionary and aggressive, it is also somewhat confusing – particularly for people used to seeing a Magic Quadrant full of different types of apples (McIntosh, Golden Delicious, Honeycrisp) and not one that positions different types of fruit (oranges, apples, pears).

Gartner’s intent is clear – to demonstrate through the use of two separate MQs those systems they think are financial/tactical from those they think are strategic.  Since we agree that organizations should be focused on both operational and strategic excellence, we are on board with their intent.  Although we don’t fully agree with the approach.

Let’s see how Gartner defines each:

  • Strategic Corporate Performance Management (SCPM) Solutions – this includes Corporate Planning and Modeling, Integrated Financial Planning, Strategy Management, Profitability Management, and Performance Reporting.
  • Financial Corporate Performance Management (FCPM) Solutions – this includes Financial Consolidation, Financial Reporting, Management Reporting/Costing/Forecasting, Reconciliations/Close Management, Intercompany Transactions, and Disclosure Management (including XBRL tagging).

 

What This Means for Buyers

Splitting the Magic Quadrant for CPM Suites is a bold move by Gartner, designed to help Finance departments and enterprises to think more strategically about CPM solutions.  But it can also be confusing, as many organizations view all CPM processes as related and often prefer solutions that can integrate both the financial and strategic CPM processes.  They may start in one area initially, such as corporate planning, then expand into other areas such as financial consolidation and disclosure management.  So many buyers prefer vendors who can meet both their short-term and long-term needs.

decision_making.jpgIn cases where a buyer is looking strictly for a corporate planning and modeling solutions, or a financial consolidation and reporting solution, the new Strategic and Financial CPM Magic Quadrants may be helpful. But for those looking for a broader CPM solution, or one that can be expanded to meet additional needs over time, the new MQs only present a partial view of the CPM vendor landscape.  So buyers will need to identify vendors that offer solutions in both MQs.

For vendors like Host Analytics, who offer a comprehensive, unified CPM platform that spans Financial and Strategic CPM, this new approach by Gartner downplays one of our advantages and splits our capabilities across two different Magic Quadrant reports.

Where Is Host Analytics Positioned?

So you may be wondering where is Host Analytics positioned in Gartner’s new Magic Quadrants for  CPM Solutions?  The good news here is that, based on the broad range of capabilities we support with our cloud-based CPM/EPM platform – Host Analytics is covered in both the FCPM and SCPM Magic Quadrant Reports.  We’re positioned as a highly ranked visionary in both CPM Magic Quadrants and are the only pure-play cloud vendor included in both reports. 

This positions Host Analytics as a vendor that can address a broad set of customer needs that cross the FCPM and SCPM domains.  According to Gartner, Host Analytics was ranked as a visionary “due to its level of cloud experience, the customer satisfaction it delivers, and its products’ ability to support use cases of higher complexity.”

You can read both of the reports to see more details about how Host Analytics is positioned in the FCPM and SCPM markets. (link here)

How to Use the Gartner Magic Quadrant Reports

According to Gartner, the Magic Quadrant Reports present a global view of the primary CPM vendors from a market perspective. Vendors tracked in the Magic Quadrants vary in their capabilities to support different CPM processes and use cases.

More specific comparative product information can be found in another report titled "Critical Capabilities for Corporate Performance Management Suites."  This report provides a more detailed assessment of the features and functions supported by various vendors and matches them up to specific use cases based on company size.  The “Critical Capabilities” report for 2016 has not yet been published, but here’s a link to the 2015 report in case you’re interested.

woman-making-decision.jpgBuyers are advised to leverage both the Magic Quadrant and Critical Capabilities reports to identify potential vendors that provide solutions to meet specific company requirements.  In fact, Gartner now offers interactive editions of these reports to their clients, which allow buyers to specify their own criteria and better identify vendors who can best meet their requirements. But these reports are only a starting point to creating your short list of vendors.

As a prospective buyer, you should clearly document your requirements, contact vendors and perform a full evaluation of their solutions, and obtain a proposal on how the solution will be implemented to address your specific needs.  And you’ll want to check references before making a buying decision.

Host Analytics is pleased to be recognized as a visionary in both of Gartner’s Magic Quadrant Reports for  FCPM and SCPM, and we will continue providing high-value, cloud-based solutions for customers looking for a vendor who can meet their needs in both categories.  And we’re also happy to provide you with complementary copies of both reports. 

Download the Gartner Magic Quadrant Reports

Good reading, and please contact us if you would like to learn more about Host Analytics and how we can make your company successful in addressing your CPM/EPM requirements.

Posted by on June 1, 2016
Topics: CPM
John O'Rourke

John O’Rourke is Vice President of Strategic Marketing at Host Analytics. With a background in accounting and finance, John has over 30 years of experience in the software industry and 20 years of experience in EPM product marketing at Hyperion Solutions, Oracle and Host Analytics. He has worked with many customers and partners on financial reporting and planning initiatives and has spoken and written on many topics in EPM. John has also held positions in strategic marketing and product marketing at Dun & Bradstreet Software, Kenan Systems, and Decisyon. John has a BS degree in accounting from Bentley University and an MBA from Boston College.

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