NEC Europe has signed up to use Host Analytics’ financial planning service as part of an effort to better integrate its 2010 acquisition of its former joint venture with Philips, now called NEC Unified Solutions.
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Gavin Johnston, the financial director with NEC Europe, a subsidiary of the Japan-based global company that focuses on IT services, also anticipates better support from the finance function for the company's growth plans in cloud, femtocell and smart energy.
Before signing on with Host Analytics, the company had two systems, which were “not fit for purpose,” Johnston said: Microsoft PerformancePoint Server and Web Focus from Information Builders. “Neither had been set up as business planning systems,” he said.
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Johnston confirmed that the company signed a contract with Host Analytics at the end of March for the vendor's workforce planning and revenue planning modules and its reporting suite. They are not taking its consolidation module.
“Planning and what-if [scenario building] was very poor within our existing systems,” Johnston said. Although Host Analytics's functionality is not much different to Oracle Hyperion’s, according to Johnston, it was more cost-effective and could be implemented quickly.
NEC Europe has a strong SAP environment, but using SAP for financial planning would have entailed engaging consultants and taken more time. Johnston declined to say how much less expensive the Host Analytics option was compared with SAP.
The company will go live with a pilot group of countries in July, and it will be live on its entire European infrastructure by September. “So six months to get a dozen reporting entities up and running,” he said.
In its March 2012 Magic Quadrant for Corporate Performance Management Suites, Gartner cautioned that “Host Analytics is a small company, although growing in revenue year over year, and carries with it the viability concerns that firms have with companies of this size.”
This was not a concern for NEC, Johnston commented. “Our conversation was more about how realistically they could support a European operation out of the US. But the references were reassuring. It is good that there is now a local office [in Uxbridge],” he added, but the main contact will be with the vendor's customer service centre in Oklahoma. He cited the SaaS [Software as a Service] vendor's high renewal rate and the presence in its management team of experienced industry people, such CEO Jon Kondo, formerly of Oracle and Hyperion, as factors in the choice.
In the short term, the Host Analytics cloud service will “enable us to do a more efficient budget,” Johnston said. NEC Philips used to have its own systems, and while it was legally integrated with NEC Europe last year, all financial reporting has been done in Excel and [the work] offline. “It was a real nuisance to compile all that data,” he said.
“Of course, Host Analytics is not the only way of doing more real-time planning,” Johnston said, “but that is valuable when you are trying to move finance up the food chain from being bookkeepers to being business advisers.”
With a cloud business of its own, NEC is happy to beat the drum for the model and is limiting its own use of on-premises technologies, Johnston said. "We are not looking to tie ourselves down to a heavy infrastructure.
“People may still be scared of the cloud due to data privacy issues, but there is no need,” he said. “Look at Salesforce.com. If you can trust your sales leads to the cloud, you can certainly put your financial information there.”