Avanade defines its work with a simple yet profound three-word motto: “Do what matters.” Founded in 2000 by Accenture and Microsoft, Avanade’s 60,000 people in 28 countries provide IT consulting services on the Microsoft platform. The company has helped nearly half of the Fortune 500 to do what matters. “It’s a unique place on a tremendous growth ride,” says Sonia Webb, the company’s former CFO.
Profitability at Avanade, and the success of its projects, are both based on making effective use of people. “We want our technical workforce on the right jobs and delivering value,” explains Senior Director of FP&A Derek Wilson. “A ‘headcount-times-chargeability’ model drives the way we work.” Projects can come in waves, so understanding the pipeline of future projects and their impact on headcount is key to sustained, profitable growth and satisfied customers.
The importance of reliable data
Avanade’s finance team quantifies company performance in financial terms. The team formerly spent its precious time maintaining a legacy finance solution as old as the company itself. “For three months every year, 80% of our time was spent on system management and development,” Wilson recalls. “That took us away from our true role, which was providing analytics and CFO support.”
Getting data from Avanade’s HR and finance systems of record into the legacy financial planning tool required painstaking manual extraction and loading.
And in spite of their best efforts, the old solution couldn’t deliver what the business actually needed. “Avanade had matured to a point where we wanted global alignment, driver-based forecasting models based on actuals, scenario analysis, and other advanced capabilities,” recalls Senior Director and Business Portfolio Lead Erik Schlue. But much of the analysis was done in offline spreadsheets, and the output was unreliable. “We’d spend time trying to understand our data points when we were supposed to be discussing financial performance,” Schlue recalls.
A vision of connection and collaboration
So in 2022 — after a brief experiment with a different cloud-based planning solution — Avanade selected Anaplan. The team had an expansive vision, grounded in reality. “We saw this as an opportunity to retire multiple other tools, and we had an enterprise-wide view,” Schlue says. “But we focused on finance first because financial connectivity was the logical starting point, and we wanted to always be thinking about the cost and revenue implications of decisions.”
“I wanted to bring more than finance into our planning process,” Webb confirms. “I wanted operations, the growth office, HR, and our CIO’s inputs all in one place.”
Accenture worked closely with the Avanade team on the implementation and helped build the team’s confidence and skills. “We are thrilled to have delivered a true Connected Planning experience at Avanade, leveraging lessons learned across hundreds of implementations and our deep industry expertise,” says Leah Stinsa, Senior Manager, CFO & Enterprise Value at Accenture. “Avanade has embraced this transformational program, and will unlock more value across the organization in the future.”
“We didn’t want to lift-and-shift,” Schlue says of the implementation. “We wanted to reimagine financial planning and create a better, more connected way to generate a driver-based Profit & Loss.” To build that P&L, finance and its business stakeholders defined consistent, granular drivers and outputs while accounting for nuances needed by various global teams.
“Headcount is our biggest driver of both revenue and cost,” Schlue says, “so we needed both a financial headcount plan and an operational workforce plan.” The financial headcount plan is classic OpEx planning of salaries, benefits, taxes, and the like. The operational workforce plan, on the other hand, provides strategic supply planning by calculating the right resources, with the right skills, for current and expected client projects. “There are good reasons for them to be done separately, but we wanted to bring visibility and understanding between the two groups,” Schlue says. “In this way, Anaplan acts as a catalyst to drive better connectivity across our functions.”
The team also built a six-quarter rolling forecast that combines chargeability projections with revenue planning. “Rather than start and stop, I wanted planning throughout the year so we could see beyond the current fiscal year,” Webb explains. The forecast relies on rolling logic and fall-forward analytics to build that extended view. (For more about the logic driving Avanade’s rolling forecast, see “Building a better rolling forecast,” below.)
The Anaplan solution also includes IT cost planning, which delivers an estimated 10–20% improvement in Avanade’s IT cost optimization, and a Predictive Evaluation Tool (PET) that provides an experimental test bed for complex analytics. An end-to-end suite of sales performance management (SPM) models are also in the works, with Avanade testing the Anaplan Territory & Quota Planning (T&Q) Application in an Early Access (EA) program. Schlue and his team provided real-world feedback to Anaplan, and based on their experience rearranged their SPM priorities: they moved T&Q to the top of the list (ahead of Incentive Compensation Management, or ICM) because of the T&Q App’s rapid implementation and tailorability. The increase in sales effectiveness from SPM is expected to be 25–35%.
The Avanade team has established an Anaplan Center of Excellence (CoE) charged with supporting the Anaplan platform and continually improving functionality as the business changes. The solution uses Microsoft technology for both its data inputs (with automated data integrations and multiple daily data refreshes) and for reporting with Power BI. (For more about Power BI reporting, see “Consistent reporting saves time and empowers users,” below.)
Hundreds of users in 25 countries use Anaplan regularly at Avanade. The use cases are diverse, with a common thread tying them together. “The focus has always been on driving better connectivity and collaboration across functional areas,” Schlue says. “We have strong alignment from our leadership team — specifically our CIO Ron White and our COO Amy Wright.”
Business results across functions
The Avanade team has learned valuable lessons in its move to Anaplan. (See “Change management lessons,” below.) The business results fall into several categories:
Global consistency provides a reliable source of truth. “Avanade is a global company, and we need to be consistent,” Webb explains. “We have one source of truth in Anaplan, and I don’t have to worry about one team or another working with different data.” Thanks to consistent, timely data, Avanade’s new rolling forecast is estimated to be 15–25% more accurate.
Time savings repurposed for business use. “We probably have freed up 50% of the time that we used to spend on development with our old tool over the course of a year,” Wilson says. Freed-up time is used to create reporting and analytics for the business. “We don’t have to say, ‘Hey, let’s pause while I write this macro script,’” Wilson notes with a smile.
Self-service creates empowered leaders. Webb says she and her C-Suite peers can now base their decision-making on direct access to key data in Anaplan. “Sonia’s in Anaplan all the time, looking at things she never could see in our former solution,” Wilson says. “It’s great when you have leaders like that who can answer questions for themselves.”
Better decisions where they have the greatest impact. With both the financial headcount plan and operational workforce plan in Anaplan, the company can make impactful people decisions that yield 20–30% improvement in project delivery efficiency. Connected workforce planning also makes hiring more strategic: “Our leaders can see what happens to chargeability when they hire at one level or another,” Wilson explains. “They can make decisions in real time and see what the results will be.”
Improved corporate performance across the company. “The way we connect data in Anaplan shows our chargeability performance, which has a direct connection to revenue and profitability,” Wilson explains. But improvements aren’t limited to the top line. “Anaplan helps us control costs because having all the data together reduces the number of meetings,” he says.
In short, everyone at Avanade is empowered to follow the motto to do what matters. “Finance and the business talk as one community using aligned metrics and transparent drivers,” Wilson says. “Ultimately, that means we have a meaningful P&L that the business can manage to and that supports our commitments to the Board of Directors.”
A payoff that grows over time
The Avanade team has big plans for the future of Anaplan use, including an integrated business planning (IBP) capability that is well into development. With representation from finance, HR, talent acquisition, operations, and sales, the IBP model enables the team to calculate the financial impact of adjustments in hiring, reskilling, sales incentives, and other factors. “This is where connectivity comes to life,” Schlue says. “It’s a cross-functional scenario planning model that identifies gaps between talent supply and demand — and the levers we can pull to maximize revenue.”
As experts in the Microsoft technology ecosystem, the Avanade team foresees a day when they leverage Microsoft Copilot and Fabric technologies in conjunction with Anaplan for even better collaboration, efficiency, and agility in finance and reporting. “My vision is to have Anaplan as a platform that everything comes through,” Webb says. “That way, if sales expects a problem in one region, we can forecast how that will impact our revenue, and feed that into our hiring plan. Everything is a closed loop.”
And the payoff for this ambitious vision will only increase with the pace of change. “Given the speed the business is moving, we need real-time insights to drive decisions and help everyone do what matters,” Webb says.
