Cloud Financials Survey Reveals Growing Adoption and Key Concerns

Copyright 2014 ǀ Saugatuck Technology, Inc. ǀ All Rights Reserved www.saugatucktechnology.com
Saugatuck Technology’s 2014 CFO / CIO Survey:
Cloud Financials – The Third Wave Emerges
B. McNee, B. Guptill, M. West, A. Bakker, C. Burns
December 18, 2014
1492SSR
Special Research Reprint
Courtesy of Tagetik:

Table of Contents
• About this Report
• Key Trends and Implications
• Saugatuck Insights – Summary
• Survey Findings
– Changing CFO Priorities: Importance
– Changing CFO Priorities: Effectiveness
– Status of Financial Management Systems
– Will Cloud Replace On-Premises Financials?
– Evolution of Financials Footprint 2014-2018
– Moving Financials to the Cloud: Key Concerns
– Moving Financials to the Cloud: Timing
– Statements on Financial Management Systems
– Statements on FP&A
• Appendix A – About the Survey / Demographics
• Appendix B – Research Reprint License
• About Saugatuck Technology
Page: 2

About this Report
• This document presents the comprehensive data and relevant analysis from Saugatuck's
2014 North American survey of enterprise finance and IT leaders regarding the evolution of
the Finance function, issues / challenges that may exist with current Financial Management
Systems, and preferences for deploying new business software – specifically related to
Cloud computing and advanced analytics.
• The survey was designed specifically to help understand how companies will acquire and
use Cloud-based business software solutions to help better manage their companies over
the next two-to-four years.
• In total, 317 finance and IT executives participated in the research, with 85 percent senior
decision makers with Director and above titles. The full survey methodology, population
and demographics are presented at the end of this document.
• Bill McNee is the lead author of this report, with contributions from Bruce Guptill, Mike
West, Alex Bakker, and Charlie Burns. All data, analysis, and other content herein was
developed by, and is the sole property of, Saugatuck Technology Inc. All content is
copyrighted by Saugatuck Technology Inc.
• This document is intended for distribution to, and use by, ongoing subscription research
clients of Saugatuck Technology Inc. Limited distribution and use by business and IT
media will be as expressly authorized by Saugatuck, or by clients who have purchased
reprint and distribution rights (see Appendix B).
Page: 3

Key Trends and Implications
• The third wave of Cloud Business Solution adoption – focused on Financial Management –
is gaining significant momentum.
– While discrete functional categories are leading the charge, including Planning / Forecasting,
Analytics / Performance Management, Payroll and Expense Mgmt. – pent up demand will shift
Cloud-based Core Accounting from “early adopter” to “early mainstream” status during 2015-2017.
– The rise of powerful Cloud-based analytics and mobility support have significantly advanced the
value proposition for finance buyers.
• But the shift from on-premises to Cloud Financials will follow its own path – as a more
complex set of deployment scenarios will play out vs. the experience of Wave I (CRM) and
Wave II (HCM, Marketing) Cloud solutions. These include “Sidecar” models, “Process-
specific” migrations, as well as several flavors of Public / Private Cloud redeployments.
• Driving demand is not only the power of the new Master Architecture to deliver better,
cheaper and faster outcomes – and addressing the highly fragmented nature of today’s
finance system deployments – but enabling the finance function to provide greater agility,
flexibility and value to the business.
– This is particularly relevant given the dual mandates of an evolved (and more strategic) mission for
finance, and the fundamental challenges of supporting the transition to Digital Business.
• At the same time, security headwinds will continue to dampen deployment scenarios for
Cloud Financials – even though the highly public recent breeches at Target, JP Morgan
Chase and Home Depot had nothing to do with the Cloud. Paradoxically, most Cloud
providers offer superior security to all but a handful of on-premise environments.
Page: 4

Saugatuck Insights – Summary (1 of 3)
• Changing CFO Priorities – Importance and Effectiveness:
– The good news is that both Finance and IT leaders see the same priorities in the same basic
order, only their emphasis differs – led by 1) effective planning, budgeting and forecasting, 2)
monitoring / measuring performance, and 3) providing input for strategic decision making.
– The survey response data bode ill for most current Finance systems – and for those selling or
manufacturing them. Hefty gaps between the relative importance, and relative system
effectiveness, among the top Finance priorities, instantly show us where the greatest
opportunities for improvement lie: FP&A, BI/CPM, and strategic business input.
– Outside of transaction processing, fewer than 50% of Finance and IT execs see current systems
as being effective. Even transaction processing is only seen as effective by 53% of the execs.
– While perceived ineffectiveness alone may not be enough to trigger replacement, it is a sign that
users (and their leaders) see massive room for improvement – if and where Finance groups and
leaders can be convinced of such improvement through the acquisition of better systems.
• Status of Financial Management Systems:
– Greater than 50% of current Financial Management systems are viable targets for replacement,
with users actively evaluating options to replace (21%), or having plans to replace in 6-12
months (15%) or 12-24 months (17%). IT executives are much more bullish than Finance
executives on the expected pace of migration.
– Respondents from mid-sized companies (1K to 3K employees) indicate the least satisfaction
AND the greatest propensity for evaluating replacement systems. This potentially results from
challenges of using tools implemented when the companies were smaller and suggests a
significant concentration of opportunity.
Page: 5

• Will Cloud Replace On-Premises Financials?
– Most Finance and IT execs believe that Cloud will replace on-premises financial systems. Small
and midsize companies and Aggressive adopters are already working on migrating systems
today, while larger firms are more likely to be targeting deployments 12-24 months from now.
Overall, IT is more positive that systems will move, while finance users have more of a wait-and-
see attitude.
– Saugatuck believes that the primary drivers are a combination of uncertainty and caution on
behalf of companies, which serves to retard immediate efforts to upgrade systems. This is
especially apparent in the larger companies, where process and existing technology both
represent significant investments and also significant challenges to upgrade/change.
– Despite this the footprint of existing financial software is aging. Many systems were designed for
an era when businesses didn’t have to meet increasingly complicated regulatory requirements
and also were not under such competitive pressure to be agile.
• The Evolution of Financials Footprint: 2014-2018
– The shift from on-premises to Cloud-based financials will be more complex than experienced in
early waves of adoption (e.g., CRM, HCM, Marketing). These include “Sidecar” deployments,
“Process-specific” migrations, and several flavors of Public & Private Cloud redeployments.
– By 2018, the on-premises footprint preference declines by more than half (58%  27%), while all
other categories grow, although the Sidecar footprint grows the least (15%  18%). Sidecar
implementations can probably be thought of as a complementary adjunct to core financials, as
they gradually deploy process-by-process (21%), function-only (16%) or all in (14%). SPP: CFOs
preferring the on-premises footprint will remain the largest of the five categories until 2020.
Page: 6

• Moving Financials to the Cloud: Key Concerns
– Despite mounting evidence of Cloud security, data privacy and security will likely always remain
the dominant concern, especially related to an organization’s financial aspects. Go-to-Market
strategy and messaging should primarily focus on it as well as data & process integration.
• Moving Financials to the Cloud: Timing
– Long-term use of primarily Cloud-based Financials tops out at between 55% and 65% of firms over
the planning horizon. The “Money” functions – Treasury, core accounting, and revenue
management – are the least likely to go to Cloud, while “Managerial” functions (e.g., Planning /
Forecasting, Analytics / Perf. Mgmt, Payroll and Expense Mgmt.) are the most likely to move. IT
leaders see an average of ¼ to 1/3 more Cloud-based Finance systems presence and growth from
2014 through 2016 than do Finance leaders.
• Statements on Financial Management Systems
– Although a majority of Finance and IT execs believe their systems are easy-to-use and timely (63%),
there are three powerful motivators for system replacement, upgrade or enhancement: 1) adding
Big Data analytics; 2) current systems are highly fragmented; 3) too expensive to run or upgrade.
At the same time, consolidations and complex regulations add to the burden of staying up-to-date.
• Statements on FP&A
– The data suggest a strong trend toward adoption and use of FP&A tools, which are seen as useful
and (increasingly) required, and are being applied to reduce errors and inconsistencies – i.e., to
address baseline Finance activity and costs.
– IT leaders indicate a significantly greater favor toward FP&A tools than even Finance leaders do.
Page: 7

Changing CFO Priorities: Importance – Insight Summary
• Survey Question: Please indicate the level of importance that each of the following priorities and
responsibilities have in your organization today.
• Insight Summary:
– The good news is that both Finance and IT leaders see the same priorities in the same basic
order; only their emphasis differs – and those differences are explainable by each party’s
traditional roles and resulting perspective. The question remains: what, if anything, can or should
be done to enable a shift toward more strategic priorities and improvements for Finance? Can
improvements in systems themselves enable this?
– As the overall patterns of importance remain very similar, it can be safely assumed that these
needs and challenges of Finance leaders and organizations remain constant regardless of
company size. Provider go-to-market emphasis can be tailored to address size-based
differences while satisfying core needs with a standardized, core functionality.
– The role-based predictability of relative Finance priorities simplifies solution and provider
selection (and provider positioning and messaging) by providing a “message map” that
resonates with each group having input into Finance solution/system development and selection.
The bottom line is that Finance solutions still need to address a range of operationally-centric,
mostly non-strategic functionality.
– Despite statements regarding Finance leaders’ desire to play a more strategic business role, the
primary priorities of Finance remain tactical and managerial. A critical question for both Finance
leaders and for Finance systems providers is: How can/should Finance leaders, and
organizations, be enabled to shift focus to more strategic needs and abilities?
Page: 8

Notes on the Data
Source: Saugatuck Technology Inc. “Finance in the Cloud” (CFO/CIO) survey, N=317, North America (Dec. 2014)
Changing CFO Priorities: Importance – Summary
Saugatuck Insight: Despite statements regarding Finance leaders’ desire to play a more strategic business role, the primary
priorities of Finance remain tactical and managerial. How can/should Finance leaders, and orgs, be enabled to shift focus to
more strategic needs and abilities?
• Non-revenue, non-
strategic activities
top the list.
• Risk management,
revenue generation,
and cost avoidance
share middling
sentiment/
importance.
• Finance priorities are
mostly tactical and
managerial in nature.
Page: 9
35%
30%
41%
43%
38%
41%
42%
48%
39%
15%
25%
24%
25%
29%
30%
32%
30%
45%
0% 20% 40% 60% 80% 100%
Managing shareholder information / relations
Processing transactions
Drive continuous enterprise cost reduction
Improve revenue growth opportunity identification /…
Managing / mitigate business risk
Managing compliance / internal controls
Providing input for strategic decision making
Monitoring / measuring performance
Effective planning, budgeting and forecasting
Please indicate the level of importance that each of the following priorities and
responsibilities have in your organization today. (Only “Very Important” +
“Extremely Important” responses shown)
Very Extremely

Notes on the Data
Changing CFO Priorities: Importance – Finance vs. IT
Saugatuck Insight: The good news is that both Finance and IT leaders see the same priorities in the same basic order; only
their emphasis differs – and those differences are explainable by each party’s traditional roles and resulting perspective. The
question remains: what, if anything, can or should be done to enable a shift toward more strategic priorities and
improvements for Finance? Can improvements in systems themselves enable this?
• Rankings are similar
but with slightly
different emphases.
• Finance sees the top
priorities as more
important.
• IT leaders tend to
show some bias
toward traditional IT
management
priorities (i.e.,
transaction
processing, cost
reduction).
Page: 10
51%
52%
62%
68%
70%
70%
78%
81%
91%
51%
58%
68%
68%
66%
72%
72%
76%
79%
0% 20% 40% 60% 80% 100%
Improve revenue growth opportunity identification /…
responsibilities have in your organization today. (Only “Very Important” +
“Extremely Important” responses shown)
IT Finance

Notes on the Data
Changing CFO Priorities: Importance – Size
Saugatuck Insight: As the overall patterns of importance remain very similar, it can be safely assumed that these needs and
challenges of Finance leaders and organizations remain constant regardless of company size. Provider go-to-market
emphasis can be tailored to address size-based differences while satisfying core needs with a standardized, core
functionality.
• Top priorities remain
similar across
company sizes.
• At and above 3K
employees, the
middle priorities shift
significantly, with
substantial drop-off
from the top priorities
in 3K to 10K
employee size firms.
• The largest firms are
the most concerned
with risk and cost
management.
Page: 11
100 - 999
Employees
1,000 - 2,999
Employees
3,000 - 10,000
Employees
> 10,000
Employees
Effective planning, budgeting and
forecasting
86% 88% 84% 83%
Monitoring / measuring performance 86% 73% 78% 87%
Providing input for strategic decision
making
79% 80% 69% 78%
Managing compliance / internal
controls
74% 75% 69% 63%
Managing / mitigate business risk 74% 67% 66% 74%
Improve revenue growth opportunity
identification / tracking
65% 66% 70% 70%
Drive continuous enterprise cost
reduction
51% 63% 67% 74%
Processing transactions 53% 56% 57% 48%
Managing shareholder information /
relations
44% 51% 56% 43%
responsibilities have in your organization today. (Only “Very Important” + “Extremely
Important” responses shown)

Notes on the Data
Changing CFO Priorities: Importance – Title
Saugatuck Insight: The role-based predictability of relative Finance priorities simplifies solution and provider selection (and
provider positioning and messaging) by providing a “message map” that resonates with each group having input into
Finance solution/system development and selection. The bottom line is that Finance solutions still need to address a range
of operationally-centric, mostly non-strategic functionality.
• We see clear, role-
relevant rankings,
including:
– Analysts are
concerned most
about data – and
not about risk.
– Managers care
most about
managing &
planning.
– CEOs care most
about next year+.
Page: 12
C-level
EVP, GVP,
SVP
GM, VP,
Controller Director
Manager,
Supervisor Analyst
Effective planning, budgeting
and forecasting
92% 73% 85% 85% 75% 88%
Providing input for strategic
decision making
78% 82% 73% 78% 58% 75%
Monitoring / measuring
performance
83% 82% 86% 80% 50% 63%
Improve revenue growth
opportunity identif. / tracking
72% 73% 66% 68% 71% 50%
Managing compliance / internal
controls
73% 68% 71% 73% 79% 13%
Managing / mitigate business
risk
73% 73% 69% 69% 75% 0%
reduction
62% 64% 64% 72% 67% 25%
Processing transactions 57% 41% 49% 61% 71% 25%
Managing shareholder
information / relations
62% 55% 47% 47% 54% 13%
responsibilities have in your organization today. (Only “Very Important” + “Extremely
Important” responses shown)

Changing CFO Priorities: Effectiveness – Insight Summary
• Survey Question: Please indicate how effective your current Financial Management System(s) are at
helping your organization address each of the following priorities and responsibilities.
– The survey response data bode ill for most current Finance systems – and for those selling or
manufacturing them. Hefty gaps between the relative importance, and relative system
effectiveness, among the top Finance priorities instantly show us where the greatest
opportunities for improvement lie: FP&A, BI/CPM, and strategic business input.
– Even the smallest firms (typically having the least-complex organizations and models) show
substantial need for Finance system improvement. The overall view from both Finance and IT is
that there is substantial room for improvement in the ability of systems to enable an support what
Finance needs to accomplish.
– Outside of transaction processing, fewer than 50% of participants see their current systems as
being effective. Even transaction processing is only seen as effective by 53% of survey takers.
– While perceived ineffectiveness alone may not be enough to trigger replacement, it is a sign that
users (and their leaders) see massive room for improvement – if and where Finance groups and
leaders can be convinced of such improvement through the acquisition of better systems.
– The go-to-market challenge for solution developers and providers: Qualifying or quantifying the
likely scope of Finance improvement without over-emphasizing Finance’s existing less-than-
adequate performance.
– Addressing this needs to emphasize how Finance can improve its own value and performance –
without emphasizing that Finance may not be performing well or providing enough value.
Vendors need to focus on inadequate systems and technology without opening up their own
offerings, or previous customer IT practices, to criticism.
Page: 13

Notes on the Data
Changing CFO Priorities: Effectiveness – Summary
Saugatuck Insight: The survey response data bode ill for most current systems - and for those selling or manufacturing
them. While perceived ineffectiveness alone may not be enough to trigger replacement, it is a sign that users (and their
leaders) see massive room for improvement – if and where Finance groups and leaders can be convinced of such
improvement through the acquisition of better systems.
• Outside of
transaction
processing, < 50% of
participants see their
current systems as
being effective.
• Even transaction
processing is only
seen as Very or
Extremely effective
by 53% of Finance
system users and
leaders.
Page: 14
33%
33%
35%
36%
37%
41%
44%
46%
53%
0% 20% 40% 60%
Improve revenue growth opportunity identification /
tracking
Please indicate how effective your current Financial Management System(s)
are at helping your organization address each of the following priorities and
responsibilities. (Only “Very Effective” + “Extremely Effective” responses
shown)

Notes on the Data
Changing CFO Priorities: Importance vs. Effectiveness
Saugatuck Insight: Hefty gaps between the relative importance, and relative system effectiveness, among the top Finance
priorities instantly show us where the greatest opportunities for improvement lie: FP&A, BI/CPM, and strategic business
input. The go-to-market challenge for solution developers and providers: Qualifying or quantifying the likely scope of
Finance improvement without over-emphasizing Finance’s existing less-than-adequate performance.
• The most important
priorities show the
greatest lack of
overall system
effectiveness.
• These can be
considered as
“target-rich
environments” for
Finance systems
providers.
Page: 15
36%
53%
33%
35%
37%
46%
33%
44%
41%
50%
55%
64%
68%
68%
70%
74%
78%
84%
0% 20% 40% 60% 80% 100%
Improve revenue growth opportunity…
Please indicate how important and effective your current Financial
Management System(s) are at helping your organization address each of the
following priorities and responsibilities. (Only “Very Effective” + “Extremely
Effective” responses shown)
Importance Effectiveness

Notes on the Data
Changing CFO Priorities: Effectiveness – Finance vs. IT
Saugatuck Insight: Both Finance and IT agree there is substantial room for improvement in the ability of systems to enable
and support Finance priorities. Addressing this needs to emphasize how Finance can improve its own value and performance –
without emphasizing that Finance may not be performing well, or providing enough value. Vendors need to focus on
inadequate systems and technology without opening up their own offerings, or previous customer IT practices, to criticism.
• IT leaders show
more faith in existing
systems – but also
mirror Finance’s
dissatisfaction with
those systems’
effectiveness.
• Systems pertaining
to strategic business
and Finance
improvement are the
least effective.
Page: 16
28%
29%
31%
31%
34%
38%
41%
46%
57%
39%
38%
40%
45%
38%
45%
48%
46%
49%
0% 20% 40% 60%
Improve revenue growth opportunity…
Please indicate how effective your current Financial Management System(s)
are at helping your organization address each of the following priorities and
responsibilities. (Only “Very Effective” + “Extremely Effective” responses
shown)
IT Finance

Notes on the Data
Changing CFO Priorities: Effectiveness – Size
Saugatuck Insight: While we see the same basic pattern of relative ineffectiveness regardless of size, the degrees of effect-
iveness change as companies grow. Compliance / internal controls seem to go through improvement-decline-improvement
cycles based on size; performance monitoring and management improves as companies get larger. The bottom line? Even
the smallest firms (typically having the least-complex orgs and models) show substantial need for Finance system improvement.
• The smallest firms
indicate the most
effectiveness in
immediate “getting
the money into the
system” – but the
least effectiveness of
Finance systems
overall.
• NOTE: Only “Very
Effective” +
“Extremely Effective”
responses shown.
Page: 17
100 - 999
Employees
1,000 - 2,999
Employees
3,000 - 10,000
Employees
> 10,000
Employees
Processing transactions 67% 55% 48% 50%
Managing compliance / internal controls 40% 49% 44% 52%
Monitoring / measuring performance 42% 45% 43% 52%
Effective planning, budgeting and
forecasting
35% 44% 42% 39%
Managing / mitigate business risk 33% 36% 40% 37%
Managing shareholder information /
relations
35% 37% 37% 33%
Improve revenue growth opportunity
identification / tracking
26% 44% 32% 35%
Providing input for strategic decision
making
30% 35% 32% 37%
reduction
26% 35% 34% 35%
Please indicate how effective your current Financial Management System(s) are at helping
your organization address each of the following priorities and responsibilities. (Only “Very
Effective” + “Extremely Effective” responses

Status of Financial Management Systems – Insight Summary
• Survey Question: Please select the answer that best describes the status of your current Financial
Management System(s):
– Greater than 50% of current Financial Management systems are viable targets for replacement,
with users actively evaluating options to replace (21%), or having plans to replace in 6-12
months (15%) or 12-24 months (17%).
– IT executives are much more bullish than Finance executives on the expected pace of migration.
Differences in perceptions between IT and Finance execs potentially indicate differences in
evaluation criteria. For example, IT execs are likely more concerned with operational costs,
support staffing, etc., whereas Financial execs are likely more concerned with richness of
functionality and system availability.
– Respondents from mid-sized companies (1K to 3K employees) indicate the least satisfaction
AND the greatest propensity for evaluating replacement systems. This potentially results from
challenges of using tools implemented when the companies were smaller and suggests a
significant concentration of opportunity.
– Two industry segments (Bus./Prof. Svcs, and CPG/Food & Bev.) represent a concentrated
opportunity.
Page: 18

Notes on the Data
Status of Financial Management Systems – Summary
Saugatuck Insight: Only 23% of respondents indicated satisfaction with current Financial Mgmt systems. Since this is 6
percentage points higher than those who had recently replaced their systems, we believe this may actually result from a lack
of recent focus and indicate additional opportunity for replacement systems. In total this would yield more than 50% of
current systems are potential targets for upgrade.
• 53% of respondents
(see red box) indicated
being unhappy with
current Financial Mgmt
systems AND have
budget to replace them.
• Only 5% of respondents
indicated dissatisfaction
but lack budget to
replace them.
Page: 19
5%
15%
17%
21%
17%
23%
We are unhappy with the system but have no
budget to replace
We are planning to replace the system (next 6-
12 months)
We’re planning to replace the system (next 12-24
months)
We’re currently evaluating options to replace the
system
We recently upgraded/replaced the system
We’re happy with the system; no changes
planned
0% 5% 10% 15% 20% 25%
Please select the answer that best describes the status of your current
Financial Management System(s):

Notes on the Data
Status of Financial Management Systems – Finance vs. IT
Saugatuck Insight: Except for the lowest ranked response (“unhappy but no budget”), Finance execs indicated they are
more satisfied than IT execs with their current systems. Differences in perceptions between IT and Finance potentially
indicate differences in evaluation criteria. For example, IT execs are likely more concerned with operational costs, support
staffing, etc., whereas Financial execs are likely more concerned with richness of functionality and system availability.
• Difference in IT vs
Finance response for
“planning to replace
in 6-12 months”
suggests lack of
coordination
between the two
camps.
Page: 20
6%
10%
14%
19%
20%
28%
4%
20%
20%
23%
15%
17%
0% 20% 40%
We are unhappy with the system but have no budget to
replace
We are planning to replace the system (next 6-12 months)
We’re planning to replace the system (next 12-24 months)
We’re currently evaluating options to replace the system
We recently upgraded/replaced the system
We’re happy with the system; no changes planned
Please select the answer that best describes the status of your current
Financial Management System(s):
IT Finance

Notes on the Data
Status of Financial Management Systems – Size
Saugatuck Insight: Respondents from mid-sized companies (1K to 3K employees) indicate the least satisfaction AND the
greatest propensity for evaluating replacement systems. This potentially results from challenges of using tools implemented
when the companies were smaller and suggests a significant concentration of opportunity.
• Respondents from
mid-sized companies
(1K to 3K
employees) indicate
the least satisfaction
with their Financial
Mgmt systems
Page: 21
100 - 999
Employees
1,000 - 2,999
Employees
3,000 - 10,000
Employees
> 10,000
Employees
We are unhappy with the system but
have no budget to replace
12% 6% 4% 2%
We are planning to replace the system
(next 6-12 months)
9% 16% 16% 13%
We’re planning to replace the system
(next 12-24 months)
12% 19% 19% 15%
We’re currently evaluating options to
replace the system
19% 26% 19% 20%
We recently upgraded/replaced the
system
23% 18% 16% 17%
We’re happy with the system; no
changes planned
23% 16% 26% 28%
Please select the answer that best describes the status of your current Financial

Notes on the Data
Status of Financial Management Systems – Industry
Saugatuck Insight: Respondents from two industries (Bus./Prof. Svcs, and CPG/Food & Bev.) indicated significantly lower
overall satisfaction with current Financial Mgmt systems and indicates high incidence (52% & 73% respectively) of
evaluating or planning a replacement system (see red rectangle). This suggests a concentrated opportunity in these industry
market segments.
• With exception of
two industry
segments (Bus./Prof.
Svcs, and CPG/Food
& Bev.) respondents
expressed fairly
consistent
satisfaction with
existing Financial
Mgmt systems
Page: 22
Bus./ Prof.
Svcs
CPG /
Food &
Bev
Energy /
Utlty /
Chem
Fin Svcs /
Ins. / Bank
Health /
Pharm. /
Life Sci
Tech. /
Telco/
Media /
Ent.
Manu /
Logistics /
Retail
Pub
Sector /
Govt
We are unhappy with
the system but have no
budget to replace
7% 7% 0% 5% 7% 2% 4% 7%
We are planning to
replace the system
(next 6-12 months)
11% 7% 9% 11% 13% 26% 25% 0%
We’re planning to
replace the system
(next 12-24 months)
19% 33% 22% 16% 18% 14% 12% 14%
We’re currently
evaluating options to
replace the system
22% 33% 26% 31% 22% 14% 21% 7%
We recently
upgraded/replaced the
system
26% 13% 22% 16% 9% 23% 13% 36%
We’re happy with the
system; no changes
planned
15% 7% 22% 20% 31% 21% 25% 36%
Please select the answer that best describes the status of your current Financial

Will Cloud Replace On-Premises Financials? – Insight Summary
• Survey Question: Do you believe Cloud / SaaS Financial Management Systems will eventually
replace on-premise financials?
– Almost all Finance and IT executives feel that Cloud is going to replace on-premises financial systems. Overall,
IT responses are the most positive on the Cloud with only 6% indicating that they do not expect systems to move
the Cloud. Self-identified Conservative technology adopters are at the extreme end of the spectrum, where 18%
believe Financial software will always remain on-premises.
– The timing for deployment is spread out over the next 24 months. Smaller companies and Aggressive adopters
are already working on migrating systems today, while larger companies are more likely to be targeting
deployments 12-24 months from now. Overall, IT users are more positive that systems will move, while finance
users are more likely to adopt a wait-and-see attitude.
– Saugatuck believes that the primary drivers for these responses are a combination of uncertainty and caution on
behalf of companies, which serves to retard immediate efforts to upgrade systems. This is especially apparent in
the larger companies where process and existing technology both represent significant investments and also
significant challenges to upgrade/change.
– Despite this, the footprint of existing financial software is aging. Many systems were designed for an era when
businesses didn’t have to meet the increasingly complicated regulatory requirements and also were not under
such competitive pressure to be agile.
– This aging footprint ultimately must give way to new systems, designed from the ground up to take into account
the requirements of businesses to incorporate rapid restructurings, digital products and services, and increasing
scale of data.
Page: 23

Will Cloud Replace On-Premises Financials? – Summary
Saugatuck Insight: Despite hesitation on moving to the Cloud, very few respondents (9%) believe that Financial
Management will remain on-premises into the foreseeable future. The bulk of responses that indicate either 2 years away, or
“don’t know” are strong indicators that this category of applications is likely to remain very hybridized in the near future.
Where Financial management moves to the Cloud sooner, it is likely to be in a supplementary role to existing systems.
Page: 24
16%
18%
29%
24%
9%
0% 20% 40%
Yes, it’s happening today
Yes, it will happen within the next 6-12 months
Yes, but it will happen over the next 12-24 months
Don't really know, only time will tell...
No, I don’t believe Financial Management will ever move to
to the Cloud
Do you believe Cloud / SaaS Financial Management Systems will eventually replace on-premise
financials?

Notes on the Data
Will Cloud Replace On-Premises Financials? – Finance vs. IT
Saugatuck Insight: 71% of IT respondents believe that Financials will be in the cloud within the next 24 months, weighted
toward the end of that time-frame (See Slide 19). More work needs to demonstrate to Finance users of the need to
upgrade/migrate their financial solutions by focusing on business outcomes. IT buyers can more easily justify the operation
improvements garnered by leveraging the SaaS model, and will focus less on specific areas of business enablement.
• Overall, IT sees more
movement move toward
SaaS than Finance.
• IT is less unsure about
when this will happen.
• IT is also less likely to
believe that this
transition is already
happening today.
• Finance Users either
believe that more of this
is happening today, or
that it is much further
away.
Page: 25
19%
11%
26%
29%
13%
13%
26%
32%
20%
6%
0% 10% 20% 30% 40%
Yes, it’s happening today
Yes, it will happen within the next 6-12
months
Yes, but it will happen over the next 12-24
months
Don't really know, only time will tell...
No, I don’t believe Financial Management
will ever move to the Cloud
Do you believe Cloud / SaaS Financial Management Systems will eventually
replace on-premise financials?
IT Finance

Notes on the Data
Will Cloud Replace On-Premises Financials? – Size
Saugatuck Insight: Small companies are the most active in upgrading systems today, likely due to less existing software and fewer
users to train; Cloud applications also allow them to stretch resources. Large enterprises may be beginning the process, but have
complex integration and deployment challenges, especially as they rationalize hybrid Cloud strategies. The move to cloud is more a
question of timing than anything else.
• Larger companies with
more than 3,000
employees indicate that
the bulk of their efforts
are unlikely to happen
immediately, but will
begin to ramp up over
the next year, with the
bulk coming 12-24
months away.
• Smaller Companies are
much more able to take
advantage of the Cloud
now.
Page: 26
100 - 999
Employees
1,000 - 2,999
Employees
3,000 - 10,000
Employees
> 10,000
Employees
Yes, it’s happening today 35% 11% 15% 9%
Yes, it will happen within
the next 6-12 months
14% 22% 19% 13%
Yes, but it will happen
over the next 12-24
months
23% 33% 25% 39%
Don't really know, only
time will tell...
19% 27% 25% 26%
No, I don’t believe
Financial Management
will ever move to the
Cloud
7% 7% 13% 7%
Do you believe Cloud / SaaS Financial Management Systems will eventually replace on-
premise financials?

Notes on the Data
Will Cloud Replace On-Premises Financials? – Adoption Profile
Saugatuck Insight: The story here is not that adoption is happening more slowly for conservative adopters, but that it is
happening. Relatively few users expect the systems to stay on-premises forever, so again, the timing is everything.
Conservative adopters want more mileage out of their existing systems and are adopting a wait-and-see attitude toward the
evolution of their applications. Aggressive adopters have already began replacing systems in search of business advantage.
• Conservative adopters
are less likely to deploy
Cloud in the near term.
• They do indicate that
these systems will
eventually move to the
Cloud, though.
• Conservative adopters
also indicate a much
higher rate of believing
that the Cloud may
never be right for
Financial systems.
Page: 27
Aggressive Mainstream Conservative
Yes, it’s happening today 24% 16% 12%
Yes, it will happen within the
next 6-12 months
28% 22% 6%
Yes, but it will happen over the
next 12-24 months
24% 28% 34%
Don't really know, only time will
tell...
12% 26% 31%
No, I don’t believe Financial
Management will ever move to
the Cloud
10% 6% 18%
Do you believe Cloud / SaaS Financial Management Systems will eventually replace on-
premise financials?

Evolution of Financials Footprint 2014-2018 – Insight Summary
• Survey Question: How would you best describe your current Financial Management System(s)
footprint, as well as your vision for what it will look like in 2016 and 2018?
– Over a four year period, the on-premises footprint preference declines by more than half (58% 
27%), while all other categories grow, although the Sidecar footprint grows the least (15% 
18%). Sidecar implementations can probably be thought of as a complementary adjunct to core
financials, as they gradually deploy process by process (21%), function-only (16%) or all in
(14%). SPP: CFOs preferring the on-premises footprint will remain the largest of the five
categories until 2020.
– IT takes a more aggressive view of Cloud migration than Finance, both in the general arc
through 2018 and in several specific instances. Examples include Process-specific (28% v 14%)
in 2016 and Functionally Cloud-based (20% v 12%) in 2018. IT’s view very likely concerns the
technology challenges of migration in strongly preferring Process-specific in 2016 and the
architectural and security advantages of a Functionally Cloud-based footprint in 2018.
– While there is a clear correlation between size and on-premises preference in 2014, by 2018 that
levels out for the most part, except for the 1000-2,999 which even in 2018 has a 33% preference
for On-premises. Another way to look at it is to view the Very Small (100-999) as distinct in
showing a steeper decline in On-premises preference and a sharper rise in Fully Redeployed
(12%-16%-26%) than other segments. By 2018, all sizes and footprints show double digits (11-
33%).
Page: 28

Evolution of Financials Footprint 2014-2018 – Question Detail
• How would you best describe your current Financial Management System(s) footprint, as
well as your vision for what it will look like in 2016 and 2018?
• Please select from one of the following five descriptive profiles (for each year):
– On-premises Completely: All of our core Financial Management System(s) are on-premises. This
includes our core accounting systems, financial planning / forecasting / budgeting systems, as well
as our performance management and advanced analytics / BI capabilities.
– Sidecar Approach: We plan to keep our core Financial Management System(s) on-premises but
are standing up new capabilities in the Cloud that help with our consolidations, financial planning /
forecasting / budgeting, and advanced analytic requirements.
– Process-Specific Migration to Cloud: We are in the middle of a process-by-process migration of our
Financial Management System(s) to the Cloud, assessing each financial process as to whether it
makes sense to leave it on-premises, deploy in a hybrid model, or move it to the Cloud.
– Functionally Cloud-based: On a step-by-step basis, we will be moving all of our financial processes
to the Cloud, but we are going to leave our financial data on-premises or in a private Cloud.
– Fully Deployed to Cloud: We have or will be moving all of our Financial System(s) and data to the
Cloud. This includes our core accounting systems, financial planning / forecasting / budgeting
systems, as well as our performance management and advanced analytics / BI capabilities.
Page: 29

Notes on the Data
Evolution of Financials Footprint 2014-2018 – Summary
Saugatuck Insight: By 2018, the on-premises footprint preference declines by more than half (58%  27%), while all other
categories grow, although the Sidecar footprint grows the least (15%  18%). Sidecar implementations can probably be
thought of as a complementary adjunct to core financials, as they gradually deploy process by process (21%), function-only
(16%) or all in (14%). SPP: CFOs preferring the on-premises footprint will remain the largest of the five categories until 2020.
• On premises drops
from 58% to 36% to
27% through 2018.
• Both Sidecar (15-
18%) and Process-
Specific (13-21%)
increase in 2016 and
remain at that level
through 2018.
• Both Functionally
Cloud-based and
Fully Redeployed
begin at 5% in 2014
and triple by 2018
(16% and 14%,
respectively).
Page: 30
5% 8%
14%5%
13%
16%
13%
21%
21%
15%
18%
18%
58%
36%
27%
0%
20%
40%
60%
80%
100%
2014 2016 2018
How would you best describe your current Financial Management System(s)
On-premises Completely
Sidecar Approach
Process-Specific Migration to
Cloud
Functionally Cloud-based
Fully Redeployed to Cloud

Notes on the Data
Evolution of Financials Footprint 2014-2018 – Finance vs. IT
Saugatuck Insight: IT takes a more aggressive view of Cloud migration than Finance, both in the general arc through 2018
and in several specific instances. Examples include Process-specific (28% v 14%) in 2016 and Functionally Cloud-based
(20% v 12%) in 2018. IT’s view very likely concerns the technology challenges of migration in strongly preferring Process-
specific in 2016 and the architectural and security advantages of a Functionally Cloud-based footprint in 2018.
• Both Finance and IT
show a similar
declining preference
for the On-premises
footprint, but IT
declines a bit more
steeply thru 2018.
• The largest gap
between Finance
and IT occurs in the
2016 in re Process-
specific (28% v 14%)
• By 2018 Finance
and It are aligned but
for the Functionally
Cloud-based (20% v
12%) preferred by IT.
Page: 31
4% 5% 8% 8%
13% 15%3%
8%
11%
16%
12%
20%
13%
12%
14%
28% 22%
20%
14%
15%
20%
17% 18%
18%
60%
57%
43%
30% 29%
25%
0%
20%
40%
60%
80%
100%
Finance IT Finance IT Finance IT
2014 2016 2018
How would you best describe your current Financial Management System(s)
On-premises Completely
Sidecar Approach
Process-Specific Migration to
Cloud
Functionally Cloud-based
Fully Redeployed to Cloud

Notes on the Data
Evolution of Financials Footprint 2014-2018 – Size
Saugatuck Insight: While there is a clear correlation between size and on-premises preference in 2014 (see Notes), by 2018
that levels out for the most part, except for 1,000-2,999 which even in 2018 has a 33% preference for on-premises. Another
way to look at it is to view Small (100-999) as distinct in showing a steeper decline in on-premises preference and a sharper
rise in Fully Redeployed (12%-16%-26%) than other segments. By 2018 all sizes and footprints show double digits (11-33%).
• in 2014 Smaller
(100-2,999)
organizations (60%
and 69%) strongly
prefer On-premises
versus Midsize
(3,000-10,000)
organizations (58%)
and Large (>10,000)
organizations (41%).
• By 2018, all sizes
prefer On-premises
between 21-33%
and the Very Small
(100-999) show the
greatest preference
for all-in to the Cloud
Page: 32
2014 2016 2018
On-premises
Completely
SidecarApproach
Process-Specific
MigrationtoCloud
FunctionallyCloud-
based
FullyRedeployedto
Cloud
On-premises
Completely
SidecarApproach
Process-Specific
MigrationtoCloud
FunctionallyCloud-
based
FullyRedeployedto
Cloud
On-premises
Completely
SidecarApproach
Process-Specific
MigrationtoCloud
FunctionallyCloud-
based
FullyRedeployedto
Cloud
100 - 999
Employees 60% 9% 14% 2% 12% 40% 16% 19% 5% 16% 21% 16% 21% 12% 26%
1,000 - 2,999
Employees 69% 12% 13% 1% 1% 40% 17% 20% 19% 1% 33% 16% 19% 15% 15%
3,000 - 10,000
Employees 58% 16% 8% 9% 6% 34% 20% 23% 11% 8% 27% 20% 23% 16% 11%
> 10,000
Employees 41% 22% 20% 7% 2% 30% 20% 22% 13% 11% 24% 20% 17% 22% 11%
How would you best describe your current Financial Management System(s) footprint, as well
as your vision for what it will look like in 2016 and 2018?

Moving Financials to the Cloud: Key Concerns – Insight Summary
• Survey Question: Of the following, please rank the top three (3) most important concerns that you
have with moving Financial Management Systems to the Cloud.
– Despite mounting evidence of Cloud security, data privacy and security will likely always remain
the dominant concern, especially related to an organization’s financial aspects. Go-to-Market
strategy and messaging should primarily focus on it as well as data & process integration, as it
continues to be a key concern.
– IT respondents indicated higher rankings for concerns in areas typically associated with IT with
“compliance” being highlighted for targeted marketing.
– Respondents from mid-sized companies (1K to 3K employees) indicated a requirement for a
more targeted Go-to-Market messaging.
Page: 33

Notes on the Data
Moving Financials to the Cloud: Key Concerns – Summary
Saugatuck Insight: Despite mounting evidence of Cloud security, data privacy and security will likely always remain the
dominant concern, especially related to an organization’s financial aspects. Go-to-Market strategy and messaging should
primarily focus on both of the top two groups of concerns, as data and process integration continues to be a key concern.
• Responses appear
to reasonably split
into three logical
groupings of
concerns (see red
lines delineating the
groups).
Page: 34
21%
22%
22%
27%
30%
35%
56%
74%
0% 20% 40% 60% 80% 100%
May not keep pace with changes in our
industry
Will not have ability to feed our company’s
financial dashboards
Will require extensive training for financial
users
Won’t be fully compliant with key regulations
Won’t meet our performance requirements
Our company requires customization not
offered by the Cloud
May be difficult to integrate with application
systems
Data privacy / data security
Of the following, please rank the top three (3) most important concerns that
you have with moving Financial Management Systems to the Cloud.

Notes on the Data
Moving Financials to the Cloud: Key Concerns – Finance vs. IT
Saugatuck Insight: IT respondents indicated higher rankings for concerns in areas typically associated with IT (i.e.,
customization, performance, feeding dashboards, and compliance). The significantly higher concern about “compliance”
suggests a targeted marketing approach focusing on this area.
• Except for the lowest
ranked concern
(“compliance with
key regulations”)
there is reasonable
alignment between
the perspectives of
IT and Finance
respondents.
Page: 35
19%
21%
23%
26%
29%
33%
59%
76%
35%
23%
19%
19%
32%
38%
55%
73%
0% 20% 40% 60% 80% 100%
Won’t be fully compliant with key regulations
Will not have ability to feed our company’s
financial dashboards
May not keep pace with changes in our industry
Will require extensive training for financial users
Won’t meet our performance requirements
Our company requires customization not offered
by the Cloud
May be difficult to integrate with application
systems
Data privacy / data security
Of the following, please rank the top three (3) most important concerns that
you have with moving Financial Management Systems to the Cloud.
IT Finance

Notes on the Data
Moving Financials to the Cloud: Key Concerns – Size
Saugatuck Insight: Respondents from all sized companies indicated similar rankings for concerns. Respondents from mid-
sized companies (1K to 3K employees) indicated the broadest range of rankings for concerns, suggesting that this market
segment requires a more targeted Go-to-Market messaging.
• Respondents from
mid-sized companies
(1K to 3K
employees) ranked
concern about data
privacy/security
significantly higher
than respondents
from other sized
companies.
Page: 36
100 - 999
Employees
1,000 - 2,999
Employees
3,000 - 10,000
Employees
> 10,000
Employees
Data privacy / data security 67% 81% 72% 76%
May be difficult to integrate with
application systems
63% 54% 59% 52%
Our company requires
customization not offered by the
Cloud
37% 37% 33% 41%
Won’t meet our performance
requirements
30% 34% 29% 24%
Won’t be fully compliant with key
regulations
30% 21% 28% 30%
Will require extensive training for
financial users
23% 22% 24% 17%
Will not have ability to feed our
company’s financial dashboards
19% 20% 25% 20%
May not keep pace with changes in
our industry
14% 19% 22% 26%
Of the following, please rank the top three (3) most important concerns that you have with
moving Financial Management Systems to the Cloud

Moving Financials to the Cloud: Timing – Insight Summary
• Survey Question: Please indicate when each of the following applications or systems are expected to
be (primarily) Cloud-based in your enterprise.
– Long-term use of primarily Cloud-based Financials tops out at between 55% and 65% of firms
over the planning horizon.
– “Money” functions – Treasury, core accounting, and revenue management – are the least likely to
go to Cloud, while Managerial functions are the most likely to go to Cloud (e.g., Planning /
Forecasting, Analytics / Performance Management, Payroll and Expense Mgmt.)
– IT leaders see an average of ¼ to 1/3 more Cloud-based Finance systems presence and growth
from 2014 through 2016 than do Finance leaders.
– As has been the case throughout Saugatuck's Cloud business software research history: The
closer we get to the money functions, the less likely we are to involve Cloud. That doesn’t mean
No Cloud at all; it just means the systems upon which the enterprise relies to make and manage
money are the least likely to be found in Cloud. Rightly or wrongly, this is mainly due to
traditional culture and practices regarding control over money and related core data.
– A continuing trend among participants in Saugatuck’s research on Cloud-based business
management solutions, regardless of enterprise business group or area of responsibility, is that
adoption patterns and actions are strongest or more expected one to two years in the future. A
lack of enterprise- or even department-wide Cloud strategy and planning means that the growing
adoption - happening right now throughout the enterprise - is rarely noticed until after the fact.
Page: 37

Notes on the Data
Moving Financials to the Cloud: Timing – Summary
Saugatuck Insight: As has been the case throughout Saugatuck's Cloud business software research history, the closer we
get to the money functions, the less likely we are to involve Cloud. That doesn’t mean No Cloud at all; it just means the
systems upon which the enterprise relies to make and manage money are the least likely to be found in Cloud. Rightly or
wrongly, this is mainly due to traditional culture and practices regarding control over money and related core data.
• Long-term use of
primarily Cloud-
based Financials
tops out at between
55% and 65% of
firms.
• “Money” functions –
Treasury, core
accounting, and
revenue
management – are
the least likely to go
to Cloud.
• Managerial functions
are the most likely to
go to Cloud.
Page: 38
6% 7%
12%
19%
8% 6% 6% 7% 8%
4%
6%
10%
7%
4%
3% 5% 5% 7%
15%
16%
17%
17%
20%
15%
14% 10%
19%
17%
21%
15% 10%
21%
20% 20%
17%
19%
15%
12%
12% 12% 13%
12%
15%
14%
11%
0%
10%
20%
30%
40%
50%
60%
70%
Core
Accounting
Procurement Expense
Mgmt.
Payroll Analytics /
Perform.
Mgmt
Revenue
Mgmt.
Asset Mgmt. Treasury
Mgmt.
Planning /
Forecasting
Please indicate when each of the following applications or systems are
expected to be (primarily) Cloud-based in your enterprise
Already Primarily in Cloud By YE 2014 By YE 2015 By YE 2016 By YE 2017+

Moving Financials to the Cloud: Timing – IT vs. Finance
Saugatuck Insight: IT leaders see an average of ¼ to 1/3 more Cloud-based Finance systems presence and growth from
2014 through 2016 than do Finance leaders. We see two factors at work in this: (1) IT leaders external to the Finance
organization likely have a more complete view of all Finance-related systems, and (2) IT leaders tend to be more positive
regarding Cloud adoption and use within the enterprise, frequently acting as Cloud evangelists to business units like Finance.
Page: 39
Please indicate when each of the following applications or systems are expected to be (primarily) Cloud-based in your
enterprise

Notes on the Data
Moving Financials to the Cloud: Timing – Company Size
Number of Employees
Financial Mgmt Application/System Timeframes 100 - 999
1,000 -
2,999
3,000 -
10,000 > 10,000
Core Accounting (e.g., GL, AR/AP)
Thru 2015 16% 8% 11% 7%
2016-2017 28% 33% 35% 26%
Beyond 2017 21% 16% 13% 20%
Procurement
Thru 2015 19% 9% 13% 20%
2016-2017 37% 39% 37% 33%
Beyond 2017 2% 17% 14% 9%
Expense Management
Thru 2015 26% 18% 19% 28%
2016-2017 37% 34% 32% 24%
Beyond 2017 5% 15% 13% 11%
Payroll
Thru 2015 47% 18% 22% 28%
2016-2017 16% 35% 29% 17%
Beyond 2017 12% 12% 12% 15%
Data Analytics / Performance Management
Thru 2015 21% 8% 13% 9%
2016-2017 40% 45% 39% 39%
Beyond 2017 5% 12% 16% 15%
Revenue Management
Thru 2015 12% 6% 11% 7%
2016-2017 40% 40% 29% 33%
Beyond 2017 7% 11% 14% 15%
Asset Management
Thru 2015 16% 10% 11% 9%
2016-2017 35% 37% 33% 24%
Beyond 2017 7% 16% 15% 22%
Treasury Management
Thru 2015 12% 13% 12% 11%
2016-2017 33% 31% 25% 20%
Beyond 2017 12% 8% 18% 17%
Saugatuck Insight: A continuing trend in Saugatuck’s research on Cloud-based business management solutions, regardless
of enterprise business group or area of responsibility, is that adoption patterns and actions are strongest or more expected
one-to-two years in the future. A lack of enterprise-wide or even department-wide Cloud strategy and planning means that
the growing adoption - happening right now throughout the enterprise - is rarely noticed until after the fact.
• The greatest growth
in the use of Cloud-
based Finance apps
is expected in the
2016-’17 timeframe
(as shown in red %).
• A majority of survey
participants do not
expect any Finance
app category to be
mostly Cloud until
beyond 2017.
Page: 40
Please indicate when each of the following applications or systems are expected to be
(primarily) Cloud-based in your enterprise

Statements on Financial Management Systems – Insight Summary
• Survey Question: Please rate each of the following statements about your Finance Management
System(s) – Agree and Strongly Agree Shown.
– Although a significant majority of Finance and IT execs believe their systems are easy-to-use
and timely (63%), there are 3 powerful motivators for system replacement, upgrade or
enhancement: 1) adding Big Data analytics; 2) current systems are highly fragmented; 3) they
are too expensive to run or upgrade. At the same time, consolidations and complex regulations
add to the burden of staying functionally up-to-date. Yet, despite these challenges, urgency has
not yet been perceived or established.
– From an operational point of view, the greatest challenge to IT is consolidating subsidiaries,
although Finance must not be aware of the challenges IT has to deal with because it is one of
their least concerns. It may be a point of tension consequently. On the competitive side of
Finance, enhancing financial systems with Big Data analytics is something both IT and Finance
agree strongly about, although IT is significantly more positive. Analytics is clearly a motivator.
– If we assume the very small enterprise (100-999) is a special case and focus on the other three
size segments, it is easy to see that Big Data analytics is a hot button across the board,
consolidation is a shared challenge and new regulations have universally complicated financial
reporting. Yet as organizations grow in size there is a decline in agreement that systems are
easy-to-use and timely. The very small enterprise is the least satisfied with its financial systems
and a clear opportunity.
Page: 41

Notes on the Data
Statements on Financial Management Systems – Summary
Saugatuck Insight: Although a significant majority believe their systems are easy-to-use and timely (63%), there are 3
powerful motivators for system replacement, upgrade or enhancement: 1) adding Big Data analytics 2) current systems are
highly fragmented, 3) too expensive to run or upgrade. At the same time, consolidations and complex regulations add to the
burden of staying functionally up-to-date. Yet, despite these challenges, urgency has not yet been perceived or established.
• A significant majority
of respondents
believe their systems
are easy-to-use and
timely (63%).
• Nevertheless, an
ever greater number
(71%) value the
enhancement of Big
Data analytics.
• Two negatives were
expressed:
– Highly-fragmented
systems (54%) and
– Too expensive to
run or upgrade
systems (48%).
Page: 42
48%
54%
58%
59%
63%
64%
71%
0% 20% 40% 60% 80% 100%
Our core Financial system is too expensive to
run and/or to upgrade.
Our Financial systems are highly fragmented
with too many disparate interfaces btw them.
Our Financial systems easily support rapid,
flexible and timely changes in the business.
Consolidating subsidiaries is a major challenge
today
Our Financial systems provide an easy-to-use
and timely "single version of the truth".
New regulatory requirements have significantly
complicated our financial reporting.
We believe our financial systems would be
enhanced by Big Data analytics.
Please rate each of the following statements about your Finance
Management System(s) – Agree and Strongly Agree Shown

Notes on the Data
Statements on Financial Management Systems – Finance vs. IT
Saugatuck Insight: From an operational point of view, the greatest challenge to IT is consolidating subsidiaries, although
Finance must not be aware of the challenges IT has to deal with because it is one of their least concerns. It may be a point
of tension consequently. On the competitive side of Finance, enhancing financial systems with Big Data analytics is some-
thing both IT and Finance agree strongly about, although IT is significantly more positive. Analytics is clearly a motivator.
• IT is even more
positive about Big
Data analytics than
Finance (81-63%).
• In every statement
but one, IT is
significantly more
positive than
Finance.
Alignment is close
on finance systems
being easy-to-use
and timely (65-62%).
• The greatest gap
between IT and
Finance (72-48%) is
Consolidation.
Page: 43
39%
46%
48%
53%
59%
62%
63%
58%
63%
72%
65%
71%
65%
81%
0% 20% 40% 60% 80% 100%
Our core Financial system is too expensive to
run and/or to upgrade.
Our Financial systems are highly fragmented
with too many disparate interfaces btw them.
Consolidating subsidiaries is a major challenge
today
Our Financial systems easily support rapid,
flexible and timely changes in the business.
New regulatory requirements have significantly
complicated our financial reporting.
Our Financial systems provide an easy-to-use
and timely "single version of the truth".
Please rate each of the following statements about your Finance
Management System(s) – Agree and Strongly Agree Shown
IT Finance

Notes on the Data
Statements on Financial Management Systems – Size
Saugatuck Insight: If we assume the very small enterprise (100-999) is a special case and focus on the other three size
segments, it is easy to see that Big Data analytics is a hot button across the board, consolidation is a shared challenge, and
new regulations have universally complicated financial reporting. Yet as organizations grow in size there is a decline in
agreement that systems are easy-to-use and timely. The very small enterprise is the least satisfied with its financial systems.
• Consolidation is a
major challenge in
Large enterprises
(72% v 44-63-57%).
• Big Data is a strong
positive in Large
enterprise (70%).
• Large enterprises do
not feel their finance
systems support
rapid, flexible, and
timely changes.
• Big Data analytics
and new regulatory
requirements are hot
buttons in the SMB
space (1000-2,999).
Page: 44
100 - 999
Employees
1,000 - 2,999
Employees
3,000 - 10,000
Employees
> 10,000
Employees
63% 75% 72% 70%
New regulatory requirements have signi-
ficantly complicated our financial reporting.
49% 75% 65% 61%
Our Financial systems provide an easy-to-
use and timely "single version of the truth".
53% 69% 64% 59%
Consolidating subsidiaries is a major
challenge today
44% 63% 57% 72%
Our Financial systems easily support
rapid, flexible and timely changes in the
business.
53% 60% 63% 48%
Our Financial systems are highly
fragmented with too many disparate
interfaces btw them.
37% 53% 60% 54%
Our core Financial system is too
expensive to run and/or to upgrade.
37% 51% 47% 57%
Please rate each of the following statements about your Finance Management System(s) –
Agree and Strongly Agree Shown

Statements on FP&A – Insight Summary
• Survey Question: Please rate each of the following statements about your Finance Planning &
Analysis (FP&A) capabilities and tools (only “Agree” + “Strongly Agree” responses are shown).
– The data suggest a strong trend toward adoption and use of FP&A tools, which are seen as
useful and (increasingly) required, and are being applied to reduce errors and inconsistencies –
i.e., to address baseline Finance activity and costs. It appears that FP&A tools / solutions have
not – yet – been implemented or leveraged into strategically-advantageous Finance capabilities,
likely because Finance must first “clean house.”
– IT leaders indicate a significantly greater favor toward FP&A tools than even Finance leaders do.
The most likely explanation of the stronger IT response is that the IT group tends to see more of
the systems in use overall but also tends to be more focused on system/tool performance than
on system/tool use and value in the Finance management and operational context. We have
seen similar perception/vision of IT vs Finance and other business units in previous research.
It’s very likely that communications gaps exist between Finance and IT leadership.
– There’s a tipping point at about 1,000 employees where FP&A needs and value seem to shift,
and firms begin outgrowing current tools/systems. Provider value propositions should likely shift
at this point as well, from emphasizing the basic functional improvement and utility of FP&A to
emphasizing systems growth, adaptability, and error/cost reduction.
– Generational factors don’t seem to be factor in FP&A use and satisfaction, but they do seem to
factor into the perceived value of FP&A tools and systems. Gen-Y leaders are significantly more
likely to be moving beyond spreadsheet-centric Finance cultures and operations toward modern
FP&A tools.
Page: 45

Notes on the Data
Statements on FP&A – Summary
Saugatuck Insight: The data suggest a strong trend toward adoption and use of FP&A tools, which are seen as useful and
(increasingly) required, and are being applied to reduce errors and inconsistencies – i.e., to address baseline Finance activity
and costs. FP&A tools/solutions have not – yet – been implemented or leveraged into strategically-advantageous Finance
capabilities, likely because Finance must first “clean house.”
• FP&A systems/tools
are widely regarded
as useful and
integral to Finance –
but there’s room for
debate as to whether
or not they are as
useful as
spreadsheets.
• Only a slim majority
of firms have been
able to integrate
FP&A throughout
Finance, let alone
the enterprise.
Page: 46
49%
55%
59%
60%
62%
66%
67%
0% 20% 40% 60% 80% 100%
We have not been able to get our organization to
buy into FP&A tools
We have not found FP&A tools to be as intuitive
or as versatile as spreadsheets
Inconsistent data has been a problem that we are
trying to solve with FP&A tools
We are happy and successful with our current
FP&A system.
Our planning culture has readily adopted FP&A
tools with some training required
The use of spreadsheets, while helpful for spot
analysis, has lead to time-consuming errors
We have outgrown the limitations of
spreadsheets for FP&A
Please rate each of the following statements about your Finance Planning &
Analysis (FP&A) capabilities and tools (only “Agree” + “Strongly Agree”
responses are shown)

Notes on the Data
Statements on FP&A – Finance vs. IT
Saugatuck Insight: The most likely explanation of the stronger IT response above is that the IT group tends to see more of
the systems in use overall but also tends to be more focused on system/tool performance than on system/tool use and value
in the Finance management and operational context. We have seen similar perception/vision of IT vs Finance and other
business units in previous research.
• IT leaders indicate a
significantly greater
favor toward FP&A
tools than even
Finance leaders do.
• The size of the IT-vs-
Finance gap may
indicate a lack of
communication/
understanding
between the two
groups.
Page: 47
45%
52%
53%
57%
57%
61%
63%
53%
59%
66%
63%
69%
73%
73%
0% 20% 40% 60% 80% 100%
We have not been able to get our organization to
buy into FP&A tools
We have not found FP&A tools to be as intuitive
or as versatile as spreadsheets
Inconsistent data has been a problem that we
are trying to solve with FP&A tools
We are happy and successful with our current
FP&A system.
Our planning culture has readily adopted FP&A
tools with some training required
The use of spreadsheets, while helpful for spot
analysis, has lead to time-consuming errors
Please rate each of the following statements about your Finance Planning &
Analysis (FP&A) capabilities and tools (only “Agree” + “Strongly Agree”
responses are shown)
IT Finance

Notes on the Data
Statements on FP&A – Size
Saugatuck Insight: Smaller firms are more likely to have less-complex finances and therefore experience fewer data errors,
inconsistencies, etc. There’s a tipping point at about 1,000 employees where FP&A needs and value seem to shift, and firms
begin outgrowing current tools / systems. Provider value propositions should likely shift at this point as well, from emphasizing
the basic functional improvement and utility of FP&A to emphasizing systems growth, adaptability, and error / cost reduction.
• The smaller the firm,
the more likely they
are to be happy with
their FP&A (and less
likely to have a
planning culture).
• The larger the firm,
the more likely they
are to reach FP&A
system limits – and to
see data errors
(typically as a result
of inconsistent
spreadsheet use).
Page: 48
100 - 999
Employees
1,000 - 2,999
Employees
3,000 - 10,000
Employees
> 10,000
Employees
The use of spreadsheets, while
helpful for spot analysis, has lead to
time-consuming errors
60% 70% 65% 72%
53% 76% 66% 70%
We are happy and successful with
our current FP&A system.
65% 60% 60% 57%
Our planning culture has readily
adopted FP&A tools with some
training required
49% 65% 66% 61%
Inconsistent data has been a
problem that we are trying to solve
with FP&A tools
44% 60% 61% 63%
We have not found FP&A tools to be
as intuitive or as versatile as
spreadsheets
42% 63% 57% 46%
We have not been able to get our
organization to buy into FP&A tools
30% 58% 50% 46%
Please rate each of the following statements about your Finance Planning & Analysis (FP&A)
capabilities and tools (only “Agree” + “Strongly Agree” responses are shown)

Notes on the Data
Statements on FP&A – Generation
Saugatuck Insight: Generational differences don’t seem to be factor in FP&A use and satisfaction, but they do seem to
factor into the perceived value of FP&A tools and systems. Gen-Y leaders are significantly more likely to be moving beyond
spreadsheet-centric Finance cultures and operations toward modern FP&A tools.
• Gen-Ys are much
more likely to be fed
up with
spreadsheets and
associated data
quality challenges.
• Otherwise, FP&A
sentiment and
experience is very
similar across age
groups.
• It’s not clear if
Boomers are much
less likely to require
training or to have a
planning culture.
Page: 49
Gen-Y / Millennials Gen-X Baby-Boomers
79% 68% 73%
The use of spreadsheets, while
helpful for spot analysis, has lead to
time-consuming errors
79% 67% 68%
Inconsistent data has been a
problem that we are trying to solve
with FP&A tools
76% 59% 59%
Our planning culture has readily
adopted FP&A tools with some
training required
79% 66% 48%
We are happy and successful with
our current FP&A system.
62% 63% 55%
We have not found FP&A tools to be
as intuitive or as versatile as
spreadsheets
56% 57% 59%
We have not been able to get our
organization to buy into FP&A tools
59% 49% 52%
Please rate each of the following statements about your Finance Planning & Analysis (FP&A)
capabilities and tools (only “Agree” + “Strongly Agree” responses are shown)

Appendix A – About the Survey / Demographics
• The data in this report come from a Web survey conducted by Saugatuck in November 2014.
• The research focused on North American Finance and IT leaders at companies with greater than 100
employees, with the focus on upper-mid and large enterprises. In total, 317 executives participated in
the research – with the responses equally split between the two functional groups.
• Approximately 85 percent of the responses came from senior decision makers with Director and higher
functional title levels, as follows: 37 percent were C-level, EVPs, SVPs or GVPs; 19 percent VP, GM or
Controller level, and 29 percent Director level.
Page: 50
By Employee
Size
100 – 999 14%
1,000 – 2,999 28%
3,000 – 10,000 42%
>10,000 15%
Total 100%
By Title
C - Level 30%
EVP / SVP / GVP 7%
VP / GM /
Controller
19%
Director 29%
Manager 8%
Analyst 3%
Other 5%
Total 100%
By Industry
Business / Professional Services 9%
Consumer Packaged Goods / Food & Bev 5%
Energy / Utilities / Chemicals 8%
Financial Services / Insurance / Banking 17%
Health Care / Pharmaceutical / Life Science 14%
High Technology / Telecom/ Media / Enter. 14%
Manu / Supply Chain / Distrib. / Retail 16%
Public Sector / Government 4%
Other, please specify 13%
Total 100%
By Function
Finance 51%
IT 49%
Total 100%

Appendix B – Research Reprint License
About This Research
• This independently developed research was published as a deliverable of Saugatuck's
Continuous Research Services (CRS) subscription research program. Tagetik Software
has been granted the right to reprint and electronically distribute this Saugatuck Strategic
Research Report (1492SSR) through its website, through September 13, 2015.
• Entire contents © 1999-2015, Saugatuck Technology Inc. All rights reserved. Opinions
reflect judgment at the time and are subject to change.
About Saugatuck:
• Saugatuck Technology, Inc. provides subscription research and management consulting
services focused on the key market trends and disruptive technologies driving change in
enterprise IT, including Software-as-a-Service (SaaS), Cloud Infrastructure, Social
Computing, Mobility and Advanced Analytics, among others. Founded in 1999,
Saugatuck is headquartered in Westport, CT, with presence in metro Boston, Silicon
Valley, and Frankfurt, Germany. For more information, please visit
www.saugatucktechnology.com, or call +1.203.454.3900.
• To request a briefing with our analysts, contact Chris MacGregor at
chris.macgregor@saugatucktechnology.com.
Page: 51

About Saugatuck Technology
Page: 52
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