What is enterprise performance management?

Managing business performance is more complex than ever. In fact, the Intuit QuickBooks Business Solutions Survey revealed that 95% of business leaders think integrating various apps and software programs is essential for growth. Without the right system, businesses struggle to track key metrics, identify risks that maximize returns, and make data-driven decisions.

That’s where enterprise performance management (EPM) comes in. It provides a structured approach to financial and operational planning, ensuring businesses can analyze performance, adjust strategies, and improve profitability. With advanced analytics and automation, it transforms decision-making by integrating data from multiple sources.

In this post, we’ll cover how EPM works, its key features and benefits, implementation best practices, and cloud integration.

Jump to:

• How enterprise performance management (EPM) works
• Key features of enterprise performance management (EPM)
• Benefits of EPM systems
• The transition from EPM to corporate performance management (CPM)
• Implementing EPM systems in 5 steps
• EPM and cloud integration
• Boost productivity and enhance profitability
• Enterprise performance management FAQ

How enterprise performance management (EPM) works

EPM helps businesses monitor and optimize performance by integrating financial and operational data. It ensures accurate planning, forecasting, and reporting, giving you the insights needed to make strategic business decisions.

Successful businesses rely on EPM to align corporate goals with day-to-day operations. By centralizing performance data, EPM eliminates silos and enhances collaboration. With predictive analytics, businesses can identify trends, mitigate risks, and optimize resource allocation.

In contrast, traditional spreadsheets and manual reporting lack the scalability needed to support growth. EPM automates these processes, reducing errors and freeing up time for strategic initiatives. As a result, companies can improve profitability, enhance agility, and drive long-term success.

One example of how EPM systems support this growth is through ERP data analysis, which integrates real-time data for more informed and timely decision-making.

Key features of enterprise performance management (EPM)

EPM systems offer a range of powerful tools that enhance financial visibility, drive strategic decision-making, and streamline operations. Key features like financial planning, cost analysis, and predictive modeling help businesses optimize their financial performance.

Financial planning and analysis (FP&A)

EPM enables precise FP&A by integrating revenue, cost, and profitability data. It allows finance teams to create accurate forecasts and develop optimized financial strategies. For example, a company can use EPM to forecast quarterly revenue by considering historical trends, adjusting for seasonality, and incorporating market data to fine-tune projections.

Cost and profitability analytics

Understanding cost structures is essential for profitability. EPM tracks cost drivers, identifies inefficiencies, and improves margin analysis. 

For instance, by examining costs at the product or regional level, a company might uncover underperforming areas where resources can be better allocated or pricing strategies can be adjusted to increase margins.

Scenario modeling and predictive algorithms

EPM uses AI-driven predictive analytics to model different business scenarios. This allows companies to plan for uncertainties and adjust strategies proactively. 

For example, a business might model the impact of a potential market downturn, simulating various scenarios to determine how to minimize losses or take advantage of growth opportunities.

Budgeting and forecasting

Accurate budgeting ensures financial stability. EPM automates data collection, improving forecast accuracy and streamlining the budgeting process. 

A company could implement EPM to automatically gather financial data from multiple departments, reducing manual errors and ensuring more accurate budgeting and financial planning across the organization.

Compliance management and regulatory oversight

EPM simplifies compliance by maintaining audit trails, ensuring accurate reporting, and reducing financial close cycle times. By automating compliance processes and providing transparent reporting, EPM helps businesses meet regulatory requirements efficiently, minimizing the risk of penalties and errors during audits.

Benefits of EPM systems

EPM systems centralize performance data, enabling businesses to make data-driven decisions and optimize strategic planning. With real-time insights into financial and operational data, organizations can:

• Improve decision-making and strategic planning: EPM centralizes performance data, providing real-time insights that improve decision-making. Businesses can identify trends, allocate resources efficiently, and adjust strategies as needed.
• Make data-driven decisions: With EPM, organizations gain access to up-to-date financial and operational data. This ensures that decision-makers have the most relevant information at their fingertips.
• Trust cost and profitability analytics: EPM helps businesses analyze profitability by product, service, or region. By identifying cost-saving opportunities, companies can improve their bottom line.

Beyond these benefits, EPM systems enhance collaboration by aligning financial and operational teams with a single source of truth. They also streamline reporting, reducing manual work and ensuring compliance with financial regulations. 

When integrated with enterprise resource planning (ERP) systems, EPM unlocks even greater efficiencies—offering businesses the advantages of ERP alongside powerful performance analytics for smarter, more agile decision-making.

The transition from EPM to corporate performance management (CPM) 

EPM has evolved into corporate performance management (CPM), which includes broader business functions. While EPM focuses on financial performance, CPM integrates operational and strategic planning, offering a more comprehensive approach to business management.

Historically, businesses managed performance manually using spreadsheets and disconnected reports, leading to inefficiencies and limited visibility. Modern EPM systems automate these processes, improving accuracy and efficiency. 

However, as businesses grow and market conditions become more dynamic, financial performance alone is not enough to drive long-term success.

Today’s CPM solutions build on EPM by incorporating advanced analytics and real-time data integration, enabling companies to make faster, data-driven decisions. By adopting CPM, businesses can align financial and operational goals, enhance agility, and maintain a competitive edge in an increasingly complex landscape.

How to implement EPM systems in 5 steps

Successful EPM implementation requires a structured approach. Follow these five steps to ensure a smooth transition.

1. Assess your company needs 

Before selecting an EPM solution, take a deep dive into your company’s current performance management processes. Identify inefficiencies, such as slow reporting cycles, data silos, or lack of real-time insights. Define clear objectives—whether it's improving forecasting accuracy, streamlining budgeting, or enhancing strategic planning.

2. Choose the right EPM solution

Not all EPM platforms are created equal. Consider factors like business size, industry-specific requirements, and the complexity of your reporting needs. Cloud-based solutions offer greater flexibility, scalability, and remote access, making them ideal for growing companies.

3. Implement training and quality control 

Even the best EPM system is only as effective as the people using it. Provide comprehensive training to ensure employees understand the tool’s features, reporting functions, and best practices. Establish quality control measures for data entry, reporting accuracy, and compliance.

4. Address integration challenges 

Seamless integration with solutions like an ERP system helps to avoid data silos and ensure a unified source of truth. Work with IT teams to configure system connections and automate data flows. 

5. Measure financial and operational results

Implement a performance tracking system to assess how EPM adoption impacts financial efficiency, decision-making, and operational performance. Use KPIs such as budgeting cycle time, forecast accuracy, and variance analysis to measure success.

EPM and cloud integration

Many businesses are transitioning to cloud-based EPM platforms for greater flexibility and cost savings. Cloud EPM solutions enable real-time collaboration and provide instant access to performance data.

Software as a service (SaaS)-based EPM platforms simplify implementation and reduce IT overhead. However, businesses must address data security and integration challenges when migrating to the cloud.

If you're considering a cloud-based EPM solution, explore this guide to understand different types of ERPs and how they can support your performance management goals.

Boost productivity and enhance profitability

EPM empowers businesses with the data and tools needed to optimize financial performance. When integrated with an advanced ERP system like Intuit Enterprise Suite, these financial insights and processes are seamlessly connected, driving even greater operational efficiency.

Intuit Enterprise Suite equips your business with the tools and insights it needs to streamline cash reconciliation, reduce errors, and enhance financial accuracy. See how a powerful all-in-one suite can help you drive efficiency and growth.