Gartner Inc., the world’s leading information technology research and advisory company, recently released their latest Magic Quadrant for Cloud Core Financial Management Suites for Midsize, Large and Global Enterprises.
This is the first Magic Quadrant for cloud core financial management suites. The market is still evolving so the definition is broad, covering midsize, large and global organizations across all geographies. Gartner defines core financial management suites as:
- The core functional areas of general ledger, accounts payable/receivable, fixed assets and project accounting/costing/billing.
- Financial analytics and reporting, including provision of financial information and the ability to provide financial information such as KPIs to managers and executives.
The market for core financial management suites has been static for many years, however, over the last 12 to 18 months, cloud core financial management suites have matured to such an extent that they have disrupted this static market, according to Gartner. This reflects the increasing prevalence of postmodern ERP strategies.
The report doesn’t cover vendors that only sell cloud core financial management applications as part of a broader Enterprise Resource Planning (ERP) suite (as financial applications are always sold with operational ERP capabilities). The 11 vendors analyzed in the Magic Quadrant report are evaluated on their capabilities of their core financial management applications as well as their ability to market, sell and support solutions targeted at finance organizations.
Gartner identified four types of cloud service that met the inclusion criteria (product capabilities, market presence and cloud service attributes):
“Born in the cloud” solutions
Existing solutions that have been substantially re-architected as cloud services
Existing solutions delivered as public cloud SaaS
The 2017 Magic Quadrant for Cloud Core Financial Management Suites evaluates vendors based on their ability to execute and completeness of vision. Each has been placed on the quadrant as either Leaders, Challengers, Visionaries and Niche Players.
The following solution vendors were evaluated and analyzed in the report: Acumatica, Deltek, Epicor Software, FinancialForce, Intacct, Microsoft, Oracle (NetSuite), Oracle ERP Cloud, Ramco Systems, SAP and Workday.
According to Gartner, cloud core financial management applications should be deployed as part of a broader postmodern ERP strategy. ERP is the single largest category of enterprise software spend, at $31.4 billion in 2016 and growing at 7% per annum through 2021 (on a constant currency basis).
For market sizing purposes, Gartner’s definition of ERP includes the categories of administrative ERP: financial management software (FMS), human capital management (HCM) software, operational ERP (manufacturing and operations software, and enterprise asset management (EAM) software. The ERP market is undergoing a generational technology shift, driven by this adoption of cloud computing.
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