This article is part of an Essential Guide, our editor-selected collection of our best articles, videos and other content on this topic. Explore more in this guide:
3. - SaaS financial management software adoption and implementation : Read more in this section
- Adopting SaaS doesn't have to mean saying good-bye to Excel all together
- Furniture retailer finds value in SaaS financial management software
- Parsons Electric saves reporting time with upgrade to SaaS financial management
Explore other sections in this guide:
- 1. - Security and SaaS applications for financial management
- 2. - Benefits of SaaS financial management applications
It was ironic that The Container Store Inc. didn't have a budgeting, forecasting and reporting process that was efficient and easy to use. After all, the nationwide retailer sells storage bins and other products to help people get organized, and prides itself on its employee-first culture.
But when Michael Lambeth arrived in early 2008, he knew it was time to take budget planning to the next level. "We are pretty darn good at doing budgets," Lambeth, the director of finance, said. "Our process is pretty robust. The vehicle to get it there is what I was trying to address."
In fall 2011 -- just in time for fiscal 2012 planning -- the company implemented corporate performance management (CPM) software from Mountain View, Calif.-based Adaptive Planning Inc., replacing Microsoft Excel spreadsheets with SaaS CPM tools that run in Web browsers.
Corporate performance management software as budgeting tool
Approximately 25 employees in the company's Dallas-area headquarters had been using Excel for sales and expense planning. "Everyone had their own [Excel] template," Lambeth said. He compiled the templates himself, which took around 10 hours for each budget cycle. The unwieldiness of the spreadsheet was also a problem. "Once I put everybody's reports together, we probably had 10,000 rows of data," he said. "We plan at a very granular level."
When it starting looking for CPM tools in 2008, the company put a high priority on ease of use, Lambeth said, because it needed budgeting to be accessible to non-specialists. Users were spread across functional areas, such as marketing, IT and procurement, and weren't confined to budget experts in the finance department, which is the case in many companies. Then the global financial system crashed, sparking the Great Recession, and the project sat on hold for 18 months until the company restarted it in late 2010.
Lambeth researched CPM software vendors, including Oracle and IBM's Cognos division, talked to a few, and asked for demos. The eventual choice was something of a surprise. "With Adaptive Planning, I didn't find them -- they found us," Lambeth recalled.
Though Adaptive Planning was the only Software as a Service (SaaS) vendor considered, it wasn't chosen for its SaaS features. "That wasn't a goal in our minds," Lambeth said. "We were open to any solution."
Ease of use is what gave Adaptive Planning the edge, he said. It also helped that it could go from requirements to deployment in the handful of months leading up to fiscal 2012.
Modeling an Excel rollup in SaaS CPM
The vendor worked with Lambeth and his deployment team to customize an instance of the standard SaaS toolbox, adding logic to create a "model" that would allow The Container Store to roll up individual store plans into a single plan like it did in Excel, according to Keli Forsman, Adaptive Planning's vice president of professional services. "There's nothing that we do during an implementation that the customers can't do themselves. It's all through the UI [user interface]. There's nothing behind the scenes."
Although Adaptive Planning provides best-practice models, The Container Store found it unnecessary to change its business processes to fit the software. "There's certain structures already in place -- they're just not defined," Forsman said. "There's always customization."
More on CPM tools
Learn about trends in SaaS CPM
Read a similar case study on scrapping Excel
Understand other issues of cloud-based financials
Most of the work went into making sure the spreadsheet-style UI presented budget data how the users preferred it, she said. "They wanted to present the data to the district managers in a familiar format. Expenses are done by district; revenues are done by store. They have very decentralized planning."
The actual development work was done off site, Lambeth said, with The Container Store providing raw data and account information needed to build the model. "We really hit the ground running," he said, and the CPM system was ready by early September.
Adaptive Planning delivered a couple of training webinars on the generic aspects of the system -- what Forsman called administrative tasks, such as adding stores and customers to the system. "The trainings are all done remotely," Forsman said. "We don't go to the [customer] site. [Doing so] is a little counter-intuitive to the SaaS model." Lambeth then taught an in-house class about The Container Store's specific needs.
SaaS CPM coexists with Excel
Lambeth is happy with the result, and describes the benefits of the SaaS CPM tool almost entirely in terms of previously unavailable functions and ease of use that make the budget workflow run more smoothly. He said it is too early to say if the system has led to more accurate forecasts at the privately held company, which expected 2012 sales to reach $700 million, according to a press release.
"What we have with their solution is real-time consolidation," he said. "I can go in and see -- depending on where we are in the budget process -- where we are in a rollup report. With Excel, I had to wait for everyone." The Adaptive Planning system also lets The Container Store update its budget whenever it needs to, rather than waiting for the scheduled budgeting cycle.
Lambeth also likes how the software helps calculate credit card fees and supports payroll planning better than the Excel templates the company was using. Before, managers had to manually add employees to the template, but now their information is imported directly from the third-party payroll system.
While The Container Store's experience with SaaS CPM might sound like more Excel bashing, Forsman is quick to put it in perspective. "We're not going to replace Excel," she said. "We're just going to replace it for budgeting, forecasting and reporting." She noted that all of the import templates are Excel-based, and the software can link directly into Excel and use templates created in it.