I will explain how the name Partner for EPM was chosen. In this episode I will explain and cover the acronym EPM. In the next episode I will elaborate on the word Partner.
EPM stands for Enterprise Performance Management. EPM is according to Gartner the process of monitoring performance across the enterprise with the goal of improving business performance. In other words, it refers to methods and solutions to improve.
It is widely considered that EPM covers the following areas:
· Strategy formulation
· Business planning and forecasting
· Financial management
· Supply chain effectiveness
Too often the acronym EPM is used to refer to EPM systems. And people often interpret EPM systems solely as EPM software solutions. That is an extremely limited interpretation of EPM and doesn’t do justice to what EPM stands for.
The first synonym for Enterprise Performance Management (EPM) is Corporate Performance Management (CPM). CPM is kind of an umbrella term that refers to a framework of methodologies, metrics, processes and systems. Very similar to EPM. However, CPM has been rebranded into FP&A, see below, and for that reason we have not used the CPM acronym.
Another synonym for EPM is Business Performance Management (BPM). According to Wikipedia BPM refers to a set of performance management and analytics processes that enables the management of an organization’s performance to achieve one or more pre-selected goals. In general, the scope of BPM is wider than EPM and CPM. EPM and CPM are more the domain at corporate level. BPM is also operational and for that reason we did not use the BPM acronym either.
Several years ago, Gartner rebranded CPM into Financial Planning & Analysis (FP&A), the third synonym. Personally, I do not think it stand for the same. Firstly, it is a more narrowed down scope. Secondly, I cannot help to associate FP&A with departments or job descriptions and less with concepts and methods like CPM. For these reasons we decided not to use the FP&A acronym either.
For the above reasons we felt comfortable to use the acronym EPM. Next time I will explain why we use the word Partner instead of consultants or advisors.
