Host Analytics World 2017 Keynote: EPM Past, Present and Future

DavesKeyNote_029_20170517.jpg

As a city and a culture, Nashville pays homage to history. From the Johnny Cash Museum to the Grand Ole Opry to the world's only replica of the Greek Parthenon, the city takes pride in the past.

So it's only fitting that Host Analytics CEO Dave Kellogg — entering the stage dressed head-to-toe in garb and gear from customers — paid homage to the legacy of enterprise performance management (EPM) in Wednesday's kickoff keynote at Host Analytics World 2017, held onsite in the Music City at the sprawling Gaylord Opryland Resort.

"If you want to undertstand the future, it helps to have a deep understanding of the present and the past," Dave said. His takeaway for the more than 600 in attendance? EPM was born from an unlikely marriage, has survived a difficult divorce, and is now maturing at a time of unprecedented data access that brings with it pressure to perform. He spent the next hour describing what's led us to this point, and how to prepare for the next shift.

Preamble: The Shift That Got Us Here

But he started with context and drawing a comparison. Host Analytics can look and feel like a startup, but it differs in a key way.

"The expression that venture capitalists have is that great markets make great companies. To me, Host Analytics plays in a great market: it's an established place, it's an established space. People know what it is and they budget for it," Dave said, noting that's common for startups to chase entirely new industries. Host Analytics, by contrast, is a "business model disruptor" that's aiming to replace on-premises EPM with cloud.

Or at least that's how it was a few years ago. Recent momentum has even analysts declaring that cloud delivery is the go-to model for EPM. Gartner, in particular, says the majority of new sales activity in the market is in the cloud., and Nucleus Research says cloud-based solutions get "twice the ROI of an on-premises deployment." Host Analytics is growing fast in response.

Company Update: Focusing on The Harder Problems

Host Analytics' annual recurring revenue has soared over the past five years as the footprint has grown to include over 700 customers, 45,000 users, and deployments in greater than 90 countries.

That kind of growth has fueled speculation, including scuttletbutt about Host Analytics filing for an IPO within two years. Dave didn't dismiss the idea, but he's also cautious not to over-emphasize any push for the stock market. "I joined Host Analytics because I thought it had public company potential," Dave said, noting that it can be rare to find that sort of pedigree.

DavesKeyNote_028_20170517.jpgMore often, startups indulge bad ideas or master a single feature.  Startups that become sustainable companies find a way to provide sustainable value. At Host Analytics, that means focusing on helping customers solve the harder problems in finance.  Oftentimes that means much more than just managing the budget process or closing the books.

"We understand that lots of departments have lots of interesting operating models. We want to tie those models back to the financial plans," Dave said, noting that the goal is always to create insight that leads to success and profitable growth — for customers and for ourselves. "We think that makes us a better partner to do business with and a safer company to transact with ... and in this market, that also puts us a little ahead of the curve," Dave said.

Whence EPM Came: A Shotgun Wedding, a Messy Divorce, and a Wild Web

Of course, it usually takes navigating a long, windy road to get ahead of the curve in anything. The history of the EPM market has more twists and turns than the Monaco Grand Prix. But it all started out well enough with business intelligence (BI) companies merging with budgeting and consolidation vendors, with the products and sales teams remaining distinct.  

Eventually, EPM became the new name for the once-more distinct category of companies making financial tools to serve the FP&A function. Cloud providers would alter the equation, Dave said.

With no hardware or software to maintain, or massive upfront costs, or annual upkeep charges "the cloud opened up EPM to a new range of buyers who had previously been condemned to Excel," Dave said, not to mention the large companies that switch to the cloud to "save a pile of money."  Technical richness and scalability has allowed Host Analytics to attract more and more of those larger businesses.  

Where EPM Is Going: Help Finance Be a Better Business Partner

For finance executives, Dave said the idea is to create room so that you don't get stuck with the tag "CF-no" or viewed as the roadblock to worthy investments in growth. Automation and good data can forge partnerships that produce results.

"You want to be a business partner? Go to the staff meeting. If you're at their offsite. If you're an honory marketer, like we did for our FP&A guy at Business Objects, that means you're business partnering," Dave said.

DavesKeyNote_046_20170517.jpgHost Analytics is building to help finance executives to become a right-hand business partner with operations teams, helping them automate to create time and better plan by leveraging forward-looking tools and data-driven analysis. It's a big vision and a far cry from the days when BI tools and planning, budgeting, and consolidations tools lived in different markets, blissfully ignorant of each other.

Demo: Finding the Flaw In Growth

Getting the right data from internal systems and external sources is going to become more critical in the years to come, Dave argued, and brought several members of the Host Analytics senior team on stage to demonstrate new features for finding the hidden source of an unexpected earnings beat and re-forecasting based on external factors. I encourage you to watch the replay of the livestream to see the full demo and integrations with two of our newest technology partners: Workiva for web filing of financial documents, and Prevedere for predictive analytics using external data.

Call it a first look at a new era in the rich history of EPM. "The last decade of transformation in EPM was the move to the cloud. The next decade will be about putting the 'A' in FP&A and increasing analytic workloads. You'll start seeing that in our product strategy and our partner strategy going forward," Dave concluded.

You needn't wait long to see what he's referring to. The first glimpses are available here, at Host Analytics World, so make sure you stop by the booths and explore as much you can. Thank you for being here, and for being a customer!

Watch Dave's Keynote

 

Posted by on May 18, 2017

Leave a Comment

Talk to us. Leave a comment on the article you just read. We'd love to get your thoughts.