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Great Expectations: SaaS Strategies in the Finance Organization
Document: SSR-561
Date of
Publication:
February
11,
2009
Number of Pages:
32
Lead Author(s):
B.
McNee, M. West, B. Guptill
Contributing Author(s): M. Koenig and C.
Burns
Price: $1,295.00 USD
(Single User License)
Report Overview:
The Finance organization sees SaaS as increasingly critical
to their evolving business goals, and is increasingly investing in
SaaS for point financial processes as well as core systems of
record. CFOs and other senior Finance executives within all types
and sizes of user firms expect to use Software-as-a-Service (SaaS)
to improve their abilities to meet critical business goals,
including Finance’s abilities to play a more strategic role in
business. In fact, Finance executives expect SaaS to enable
improvement in all aspects of core and non-core Finance systems and
operations.
This
significant shift in the attitude and actions of senior Finance
executives toward SaaS as strategic to business is a key aspect of
Saugatuck Technology’s newest research study on SaaS,
titled “Great Expectations: SaaS Strategies in the Finance Organization".
The
report presents data, analysis, and recommendations from two
research programs: Saugatuck’s 2008 annual web survey of user
executives’ SaaS and business strategies and activity; and an
additional 2008 web survey of Finance executives, conducted by Saugatuck in partnership with the
Finance Executives
Research Foundation (FERF). The
research also includes interviews with survey participants and
leading SaaS providers.
Press Release / Media, BLOG and Podcast Coverage:
Executive Summary:
Great Expectations: SaaS in the Finance Organization
(Freely available. Registration Required)
Read this report to learn:
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Where,
how, and why is SaaS expected to change how Finance
organizations deliver value to their firms, and the importance
of Finance to the firms’ strategic and operations management?
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What
are the most important reasons why Finance executives, from CFOs
to VPs to controllers, are even considering SaaS – and are
they considering SaaS as adjuncts to, or replacements for,
existing core Finance systems? How does SaaS change “the
rules” when it comes to replacing legacy systems?
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What
SaaS-delivered applications are seen as delivering the most
value to Finance executives – and how does this compare to the
value expected of SaaS by non-Finance executives? What drives
the differences between the two camps?
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Research Highlights:
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Finance executives see broad-based value in the use of SaaS across both tactical point solutions (i.e., sales & use tax management) and core finance systems, functions and roles.
Saugatuck believes that core and non-core financial systems will follow a similar adoption profile to the general market adoption of SaaS and on-demand solutions – albeit with a slight lag, especially among larger
companies |
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Nearly sixty percent of Finance executives indicated that their firms are using SaaS for mature business applications categories such as Payroll, which will continue to grow approximately five percent or more in account penetration over the next two years. |
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While starting from a much lower account penetration base, SaaS adoption of key financial functions and processes such as electronic billing, cash management, core financial accounting, tax management (both state and sales), budgeting, governance risk and compliance (GRC) and business intelligence (BI) will experience explosive growth of 40 percent to more than 100 percent by the end of 2010. |
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It is increasingly clear that the terms “suite” and “best of breed” may not be especially descriptive, nor do CFOs necessarily prefer one approach or the other. |
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CFOs see SaaS as a way to bridge many of the “effectiveness gaps” that exist relative to how well current on-premise systems address their evolving mission and goals.
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The four business goals that CFOs believe SaaS can most improve the effectiveness of Finance include improving ROI,
managing performance in the context of risk, reducing process inefficiencies, and optimizing business processes. |
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SaaS is seen not as a cross-Finance panacea, but as a means to enable better, more cost-effective operations. |
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SaaS is seen as a cost-effective means of getting Finance out of software and systems management, enabling it to focus more on being a Finance department. |
About The Research:
Since
2002, Saugatuck has performed a series of user executive and vendor
executive research programs, including web-based surveys, telephone
interviews, and briefings, on the most disruptive and influential IT
developments in the marketplace, including: IT Virtualization, cloud
computing, Software-as-a-Service, and Open Source software. In
addition, Saugatuck annually surveys more than 3,000 business and IT
executives as part of its annual user IT trends research program.
This
report presents data, analysis, and recommendations from two
research programs: Saugatuck’s 2008 annual web survey of user
executives’ SaaS and business strategies and activity; and an
additional 2008 web survey of Finance executives, conducted by
Saugatuck and developed with input from the Finance Executives
Research Foundation (FERF).
The research also includes interviews with survey
participants and leading SaaS providers.
The
survey research was supplemented by interviews with Finance
executives with SaaS experience, and briefings with leading SaaS
providers of core financial systems of record. Participating SaaS
providers include: Business Intelligence – LucidEra,
SAP/Business Objects; Finance and Accounting – Intacct,
NetSuite, Workday; Expense Management – Concur; Human
Capital Management – SuccessFactors, Workday; Procurement
– Ariba, FusionOps; Risk and Compliance – EthicsPoint; Sales-
and Use-Tax Management – Sabrix; Sales Compensation
Management – Centive, Xactly.
Table Of Contents:
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Introduction |
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Research Highlights |
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Saugatuck Planning Positions
(SPPs) |
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SaaS, Core Systems and Finance Executives |
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Defining the Systems |
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SaaS Adoption Among Financial Executives |
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The Business Benefits Expected of SaaS |
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Suites versus Best of Breed |
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The Buyer and Business Roles:
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CFOs and Other Finance Executives |
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From Roles to Business Goals |
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Concerns About Using SaaS |
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Conclusions |
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Key SaaS Actions for Finance |
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Appendix: Research Methodology and Demographics |
List of Figures and Sidebars:
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Figure 1: Market Adoption Scenario – SaaS and Finance Systems |
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Figure 2: SaaS Adoption Approaches |
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Figure 3: Current and Expected Uses of SaaS |
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Figure 4: Expected Timeframes for SaaS in Core Financial Systems |
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Figure 5: Top Business Benefits Expected from SaaS |
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SIDEBAR- Early Adopters: Three Financial Executive Insights |
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Figure 6: What is a Suite? |
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Figure 7: The CFO’s Evolving Role over Time |
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Figure 8: Relative Importance of Key Business Goals |
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Figure 9: Effectiveness of Current On-Premise Solutions |
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Figure 10: Expected Effectiveness of SaaS v. Current On-Premise Solution |
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Figure 11: Expectations for SaaS in Meeting Business Goals |
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SIDEBAR- Early Adopters: Three Financial Executive Insights |
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Figure 12: Comparing FEI Members to the General SaaS Buyer |
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Figure 13: CFO Concerns about Using SaaS |
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Figure 14: Expectations for SaaS to Improve Financial Management |
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