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Planning Tools: Comparing Software & Negotiating Contracts

  • By Bryan Lapidus, FP&A
  • Published: 6/23/2020

FP&A Planning System

When implementing a planning system, it’s important that you don’t lose sight of what you really need as you near the end of the process. A recent FP&A Guide looked at what you should consider as you compare potential tools and enter into negotiations with a vendor.


Keep your goals clearly in front of you and revisit the requirements to ensure the functionality you want. Each tool has differing strengths, approaches and costs to solving your challenges that will require compromises or creativity.

Mitch Max, partner at planning system consultant BetterVu gave an example of a client that found itself at a crossroads: one tool excelled at reporting and the other at model building and calculations. How to choose? “This client ranked and prioritized what mattered most to them and looked for alternatives to buttress the total system. They created a blended solution that brought in another product to handle the business intelligence piece while maximizing the modeling.”

Similarly, customers should consider whether their requirements conform to standard, out of the box implementations, simple configuration, complex configuration, or a custom build. For example, customers may need to trade off what is in-scope for the solution versus remaining in an outside model that feeds the solution.

Another type of tradeoff is the durability of the solution designed. “People want to solve a problem based on the pain in front of them. But the differentiation among product sets is in the opportunity down the road,” Max says. Some “use case” solutions are narrow and solve a specific problem, while others are platform solutions that can support additional buildouts and growth. The platforms will do more, cost more upfront, and be more complex, but provide greater functionality and scalability.

Philip Peck, vice president, transformation and advisory services at Peloton Consulting, summarizes the trade-off discussion as follows: “It is key to balance the potential complexity of a solution that would handle 100% of all requirements versus a solution that will satisfy 90% of the requirements while minimizing unnecessary complexity and making the solution far easier to administer, maintain and support.  There is always the danger of creating a ‘nuclear powered mousetrap’” that is overengineered and introduces operational risk.




There are likely to be two parties in the process and at the negotiating table. The costs and services are negotiated separately, and the key price elements and leverage points differ. The vendor or implementor will need to create a statement of work and may conduct a needs analysis or a project scoping exercise. The level of detail and diligence in their questions is an indicator of their understanding of the project and may introduce ideas you had not considered. Here are various elements to contemplate:


  • Model a three-year cost of ownership to understand the total costs, and negotiate all points as part of the complete package, including:
    • Pricing options—perpetual, cloud, subscription, unlimited, etc.
    • Initial and maintenance costs (ask for a three-year pricing outlook)
    • Review the “terms of use” to understand service level agreements
    • Cost per number of users of varying type (hint: sometimes, an unlimited user license option is cheaper and easier to maintain)
    • Usage cost: data transfer, data storage, data location
    • Additional modules or connectors needed for buildout
    • Training by levels (admin, read write)
    • Support terms
    • Potential for hidden fees, i.e., contracted price increases
  • Consider potential impact of quarter and year-end sales cycles
  • Data ownership. This is especially important in the event of termination with the vendor; specify upfront how to reclaim and export your data to a new provider.

    Implementation Partner

  • It is challenging to get a comparison of implementation costs on an equal basis; some companies trade off upfront costs for change requests.
  • The statement of work should include detail design, data discovery and management, solution build, testing, training, and migration. Consider:
    • Training—admin, read-write levels
    • Support—what level of resources is ongoing?
    • Post-go live support—in case some bugs persist after implementation
    • Resource mix—level of expertise and seniority on the project, onsite vs offsite, onshore vs offshore
    • Define the change management process and costs
  • Cost structure—time and materials versus fixed price contract, travel expenses
  • KPIs for implementation (objectives, deliverables, benchmarks, and cost structure with the vendor)
  • Hold back a portion of payments until final deliverable.
For further insights, download the AFP Guide to Implementing a Planning System: Part 2, Selecting the Software.
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