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The Sky Is the Limit: Finance is Moving to the Cloud August 2013

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Presentation given by Accenture managing director Tamara Emerson at Host Analytics' 2013 roadshow discussing how the finance department is evolving towards the cloud.

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Page 1: Accenture SaaS Financial Applications

The Sky Is the Limit:

Finance is Moving to the Cloud

August 2013

Page 2: Accenture SaaS Financial Applications

2 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Agenda

Drivers of SaaS Adoption

Finance Technology Trends

Implementing SaaS

Accenture’s Point of View

Page 3: Accenture SaaS Financial Applications

3 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

• 43% of masters and 34% of non-masters Implementing or expanding their ERP systems in the next two years

• Medium to large global enterprises are now choosing Finance SaaS for Core Financials (accelerated

implementation, potential lower total cost of ownership, continual innovation, improved user interface)

• Leaders implement in conjunction with integrated business services or expand existing integrated business

services

Reliable (global)

harmonized

Financial systems

• Investing in standard and advanced enterprise performance management capabilities (43% of masters and 31% of non-masters)

• 39% of respondents Implementing or enhancing processes and systems to address governance, regulatory and compliance

• Continued focus on advanced and integrated risk management processes and technologies • Deploying new workforce management programs and related technologies

Add value through

strategic applications

• Growing demand for analytics and technologies to turn data into forward-looking insight that enable business

leaders to make fast, confident decisions

• Continued efforts to drive cost and productivity improvements across core finance operations equipping

them with the time, tools and information to be a valued partner to senior business executives

Harvest benefits

from technology

• 53% of Finance Executives indicated regulation as the most pressing environmental challenge facing Finance

organization in comparison to permanent volatility, data, and talent.

• 55% of Finance Executives devoting resources for technology and capability development to address

regulation challenges

Leveraging technology

to address new and

changing regulation

Source: Accenture 2011 High Performance Finance Study

Finance Technology Trends Accenture Finance Study

Page 4: Accenture SaaS Financial Applications

4 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Finance Technology Trends Finance IT Trends and Implications

© Copyright Gartner, Source: The Impact of the Cloud on Architecting an ERP Solution by Pat Phelan, August, 2012

Trends

demanded by Business Users

Implications

to the Finance IT Infrastructure

• The need to continually cost optimize the

operations

• Demonstrate value back to the business

– speed to market, service availability

• An infrastructure that can scale up and

down against business demand

• Move to a variable cost model rather than

static

• Intuitive, easy-to-use applications that

work anywhere from any device.

• The emergence of the Cloud creates a

significant challenge to existing

Governance processes

• Moving away from a single ERP solution to

selective ‘best of breed’

• There is a need for an end to end service

management function or integration

capability

• Financial Management is more complex

as a result of multiple ERP systems

Page 5: Accenture SaaS Financial Applications

5 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Finance Technology Trends Agile Applications

• Higher cost (pay up front)

• Specialization Availability (Region/Industry)

• Traditional solutions (Greater product functionality

depth and reference customers)

• Mostly In-sourcing

• Lower cost (subscription or “fixed”

pricing)

• Speed of implementation

• Emerging solutions

• Outsourcing

More

Internal Less

Internal

The new Business Transformation Themes:

Agile Finance Solutions bringing “lights-on” capabilities in less time than before.

Less internal and more reliance on external solutions and providers.

Global Enterprise

Finance Applications

Cloud Finance

Applications

SaaS Finance

Applications

Page 6: Accenture SaaS Financial Applications

6 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Agenda

Drivers of SaaS Adoption

Finance Technology Trends

Implementing SaaS

Accenture’s Point of View

Page 7: Accenture SaaS Financial Applications

7 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Cloud/SaaS Overview Why?

Efficient Many SaaS UIs are designed to

allow the user to complete the

tasks with a minimum of actions

allowing him to work with what he

knows

Engaging Users want to login to the

application and do his or her

tasks, Users feel in control and

comfortable using SaaS solutions

Accessible Many SaaS applications are available on

mobile devices, available when and where

users need it.

Supportive Provide effective support during

the task completion, and report

to the user what is happening in

a simple way

Intuitive Understand the application´s

users and their work context

Clear Structure Less complex and more coherent is the

navigation. SaaS applications follow web

design principles, which most people are

now comfortable navigating.

Simple Many SaaS UIs are designed with simplicity in

mind, so that the user doesn´t feel

overwhelmed with the amount and complexity

of content often present in ERP UIs.

Simple

Accessible

Clear

Structure

Efficient Intuitive

Engaging Supportive

Page 8: Accenture SaaS Financial Applications

8 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Cloud/SaaS Overview Adoption Trends

Second Movers Late Adopters First Movers

$750M - $2B > 2B Annual Revenue < $750M

Australia, China,

and Brazil

Most other

territories Region

North America,

Europe, Japan

Retail and

Healthcare Continuous process

manufacturing

Industry

Example

Software, Consulting

Services, Supplier

Networks, and Light

Manufacturing

Current

State

Page 9: Accenture SaaS Financial Applications

9 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Why are organizations considering the cloud for EPM?

Cost reduction

Elasticity/ scalability

Speed to market

High performance computing

• Lower capital and operational costs

• Lower maintenance and energy costs

• Pay as you go

• OPEX costs in place of CAPEX

• Capacity only when you need it

• Ability to handle sudden load changes

• Achieve high business agility

• Reduction of time to pilot and test projects

• Faster availability to customers

• Software updates included with service

• Increased capacity from your current physical infrastructure

• Avoid provisioning (and paying) for the peak

• “Infinite” computing capacity on demand

Page 10: Accenture SaaS Financial Applications

10 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Agenda

Drivers of SaaS Adoption

Finance Technology Trends

Implementing SaaS

Accenture’s Point of View

Page 11: Accenture SaaS Financial Applications

11 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

On-Premise and SaaS Compared Overview

SaaS (Software as a Service) Software On-Premise

Customers pay subscription fee per seat/user and module Customers pay perpetual license fee

No hardware and upgrade fees are incurred, and generally,

total cost of ownership is lower.

Customers own and must operate the software with their own

resources (or via a third party). Additional costs apply for

hardware, maintenance and upgrades of the system.

The vendor releases patches, functionality enhancements or

full upgrades, so that the customer solution will be

automatically updated at no additional cost

Enhancement patches and release upgrade must be done by

the customer or a third party

Technology platform is hosted and operated by the vendor

via Web access

Hardware and software are installed at the customer

premises (company asset)

The application is typically offered in a multi-tenant architecture

with all of the vendor’s customers accessing a single code

base

The implemented solution is supported and operated by the

customer

Lower one off implementation cost, quicker implementation

cycle

Higher one off implementation cost, longer implementation

cycle

Most Best of Breed providers follow a clear SaaS model Most “classic” ERP providers follow a clear “on-premise”

model

Page 12: Accenture SaaS Financial Applications

12 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Key Differences In SaaS Implementations

Tenant Management

Iterative vs. Waterfall Methodology

Configuration vs. Customization

Product Release Strategy

Implementation Team Composition

• Need strong project management to

control scope and timeline

• Business owners need to be clearly

identified and empowered to make

decisions on the spot

• More real-time involvement from the

business

• Increased Change Management

effort up front

Implications

Page 13: Accenture SaaS Financial Applications

13 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Key Differences In SaaS Implementations

Tenant Management

Iterative vs. Waterfall Methodology

Configuration vs. Customization

Product Release Strategy

Implementation Team Composition

• Can more readily drive adoption of

standardized processes and leading

practices

• Adopt the solution capabilities, or

create a work around rather than

customize

• Requires strong change

management discipline earlier in the

project

Implications

Page 14: Accenture SaaS Financial Applications

14 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Key Differences In SaaS Implementations

Tenant Management

Iterative vs. Waterfall Methodology

Configuration vs. Customization

Product Release Strategy

Implementation Team Composition

• Highly likely to experience a mid-

implementation product release /

upgrade

• Need to determine strategy to

understand impacts of frequent

product releases and determine how

to address

• Plan to incorporate as part of iterative

proto-typing where key functionality

is anticipated

Implications

Page 15: Accenture SaaS Financial Applications

15 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Key Differences In SaaS Implementations

Tenant Management

Iterative vs. Waterfall Methodology

Configuration vs. Customization

Product Release Strategy

Implementation Team Composition

• “New” activity for many teams –

similar to traditional on-premise

landscape management

• Need up front Tenant Management

strategy to coordinate prototyping,

integration development activity

Implications

Page 16: Accenture SaaS Financial Applications

16 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Key Differences In SaaS Implementations

Tenant Management

Iterative vs. Waterfall Methodology

Configuration vs. Customization

Product Release Strategy

Implementation Team Composition

• May have greater vendor

involvement due to newer solutions,

need for vendor to accept configured

solution for support

• Outside prototyping, typically more

remote work due to ease of access of

cloud based environments

Implications

Page 17: Accenture SaaS Financial Applications

17 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Agenda

Drivers of SaaS Adoption

Finance Technology Trends

Implementing SaaS

Accenture’s Point of View

Page 18: Accenture SaaS Financial Applications

18 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

What is right for my business? Key Considerations

Time to Reevaluate Existing Solution?

• Financial systems are not providing the information necessary to make solid

business decisions

• Financial systems cannot easily adapt to changing business requirements

• Delivered SaaS business processes that fit business needs

• No current solution exists or financial systems are on an unsupported version

• Financial systems support is difficult to maintain and the skillsets needed are

not readily available in the company / marketplace

• Processes and capabilities fall behind industry benchmark

Page 19: Accenture SaaS Financial Applications

19 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

What is right for my business? Accenture’s PoV

• The CFO’s role will continue to transform into one of a change enabler to better partner with other

areas in the business and influence the selection of supporting tools

• Determining the path forward will require the a Financials ERP Roadmap, driven by an analysis of

various factors and a clear vision of IT strategy

• On-Premise solutions currently provide the most functionality for large, multi-national companies

with well established, robust products but SaaS ERP players are rapidly emerging

• Ensure a Financials ERP business case considers all factors, explicit and implicit costs

• A Financial ERP choice should be driven by needed functionality

– If the organization is able to adopt the business processes prescribed by a SaaS vendor or has a

simpler business model, SaaS solutions may be faster and cheaper to deploy

– If an organization has unique or complex requirements, an On-Premise solution may be more

appropriate

• SaaS ERPs will continue to gain market share and become prevalent in all businesses across

industries and regions over time

Page 20: Accenture SaaS Financial Applications

20 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

What is right for my business? Accenture’s PoV (Continued) The Financials ERP SaaS market will continue to evolve rapidly in the next 12-24 months for

several key reasons:

• SaaS players are investing heavily in Financials to address current challenges with functionality, global

options and scalability

• Fierce competition in the SaaS market will continue to lower cost

• SaaS vendors will continue to make their products more transparent and secure to gain market share

against On-Premise competitors.

• The Two-Tier model will gain popularity to help implement tools quickly for M&A, divestures and

subsidiaries

• Integrations will be a major priority for SaaS releases and implementations

• On-Premise providers recognize the SaaS threat and are beginning to compete in this space but at a

slower pace than startups

• SaaS solutions should be seriously considered in all finance strategies to determine if they can provide

the necessary capabilities

Page 21: Accenture SaaS Financial Applications

21 Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

Thank You

Tamara Emerson Managing Director

Global F&P Finance & Enterprise Performance - Enterprise Performance Management SaaS Lead

818 Stewart Street

Suite 400

Seattle, WA 98101

email: [email protected]