Requirements Engineering for FP&A/EPM

Most FP&A/EPM "requirements" documents are:

• Vendor-influenced
• Feature-based instead of outcome-based
• Unprioritized
• 150-item checklists nobody reads
• Full of generic statements every vendor can claim
• Completely divorced from the company's bottleneck
• Impossible to use for scoring
• Loaded with irrelevant "nice to haves"
• Not testable in demos
• Not tied to architecture or performance requirements

This creates evaluation theatre instead of a real selection process.

The purpose of Phase 2 is NOT to create "a list of things the tool should do."

The purpose is to build a requirements architecture that:

• Eliminates 60–70% of vendors BEFORE demos
• Signals your level of sophistication
• Forces vendors to compete on your terrain
• Anchors every decision to measurable outcomes
• Prevents political fights internally
• Future-proofs the selection
• Directly aligns with your bottleneck class
• Upgrades Finance from "feature shoppers" to "system architects"

This is the difference between a shopping exercise and a strategic selection process.

The only requirements framework built around FP&A physics, not vendor claims

Your requirements are not a list—they are a hierarchy.

They must be engineered in this exact order:

1. Success Metrics (Phase 0)
2. Bottleneck Class (Phase 1)
3. Functional Requirements
4. Technical Requirements
5. Business & Industry Requirements
6. Internal Capability Requirements

Most companies invert this pyramid. They start with "features" and end with chaos.

You start with physics, then build upward. This is how elite CFOs do it.

This is the most important step in the entire evaluation.

Most teams get this backwards.

Example:

Vendors HATE this requirement, which is why it's correct.

Another example:

You convert aspirations into tests. That is S-tier requirements engineering.

This is where no analyst, vendor, or competitor can touch you.

Your bottleneck class (Phase 1) determines the physics of your evaluation.

You do NOT treat all requirements equally.

You elevate requirements that eliminate your bottleneck to Tier 1 (critical). Everything else is Tier 2 or Tier 3.

Here is the hard truth: If a tool cannot solve your dominant bottleneck, it cannot be your solution — no matter the price, UI, or brand.

⭐ A) Data Bottleneck → Data-First Requirements

If data is your bottleneck, the platform must have:

• Near-real-time connectors
• API-first architecture
• Transformation/mapping engine
• Late-arriving data support
• Automated data quality checks
• Lineage visibility
• Full drill-back drill-through
• Deterministic load performance
• Multi-source harmonization

This eliminates 50% of planning tools immediately.

⭐ B) Modeling Bottleneck → Engine-First Requirements

If modeling is your bottleneck, you require:

• True in-memory calc engine
• Multi-threaded recalcs
• Scenario inheritance
• Dependency graph visibility
• Modular model design
• Dimensional modeling (not formula sprawl)
• On-the-fly calc adjustments
• No model "rebuilds" to handle scale

This eliminates:

• Spreadsheet-based platforms
• SQL-backed pseudo-planning tools
• Any tool where models "slow down" with dimensional growth

⭐ C) Consolidation Bottleneck → Accounting-First Requirements

Your critical requirements are:

• Native consolidation engine
• Automated IC matching & elimination
• FX translation & remeasurement
• Ownership logic (direct, indirect, MI)
• Consolidation journals
• Legal + management consolidation
• Unified actuals/forecast cube
• Audit-ready logics

This cuts 70% of vendors in one step.

⭐ D) Reporting Bottleneck → Insight-First Requirements

Your must-haves:

• Pixel-perfect reporting
• Real-time dashboards
• Semantic metric layer
• Drillable management reporting
• Multi-version reporting
• Stable formatting (PowerPoint killers)
• Governance on metric definitions

If reporting is your bottleneck, you absolutely cannot adopt tools that push everything back into Excel.

⭐ E) Workflow Bottleneck → Governance-First Requirements

Critical requirements include:

• Submission workflows
• Role-based access
• Audit trails
• Validation rules
• Task assignment
• Real-time collaboration
• Guardrails for decentralized planning

This eliminates "Excel + cloud" tools instantly.

Functional requirements must capture how your business actually operates, not a vendor's marketing category.

Break them into five domains:

3.1 Planning & Forecasting

• Multi-scenario planning
• Driver-based forecasting
• Rolling forecasts
• Workforce planning
• OpEx modeling
• Revenue modeling
• Long-range planning
• Seasonality profiles
• Allocation logic

3.2 Consolidation & Close

• Actuals ingestion
• FX
• IC
• Journals
• Ownership
• Close automation

3.3 Reporting & Analytics

• Variance analysis
• Board reporting
• KPI dashboards
• Drill-through
• Narrative commentary

3.4 Workflow & Collaboration

• Task management
• Approvals
• Multi-level submissions
• Reviewer visibility

3.5 Data & Integrations

• Connectors
• Mapping layers
• Metadata governance

But here's the S-tier twist:

Every functional requirement must map back to:

• A success metric
• A bottleneck driver
• A measurable scoring criterion

No "fluff requirements." No "nice to haves" disguised as core needs. Everything must be anchored.

This is where your evaluation becomes impossible for vendors to manipulate.

Technical requirements separate toys from systems.

Break them into six technical domains:

4.1 Architecture

• Calc engine type (in-memory vs relational vs hybrid)
• Storage model
• Multi-scenario propagation
• Performance guarantees
• Concurrency handling

4.2 Performance

• Calc-time benchmark requirements
• Multi-user load testing
• Refresh SLAs
• Dimensional scalability
• Data volume ceilings

Demand real, numeric commitments — not adjectives.

4.3 Data Management

• ETL/ELT support
• Mapping rules
• Data auditing
• Transformation pipeline
• Lineage and validation

4.4 Security & Governance

• SSO
• Row-column security
• Permission segmentation
• Full audit trail
• User provisioning model

4.5 Extensibility

• APIs
• Event triggers
• Custom logic
• Integrations with data lakes
• Scriptability

4.6 Scalability & Future-Proofing

• Entity growth
• Scenario scaling
• Multi-currency expansion
• Acquisitions
• New revenue models
• Increasing granularity

This is where tools that "start great" fall apart within two years.

This is also where CFO Shortlist's expertise becomes invaluable.

This is what separates generic tools from tools that actually understand your business model.

Manufacturing

• BOM-based modeling
• Production planning
• Standard costing
• SKU-level forecasting

SaaS

• ARR/MRR modeling
• Cohort-based forecasting
• Headcount-driven sales capacity
• Renewal + churn logic
• Pipeline conversion modeling

Retail

• Location-level planning
• Traffic + conversion
• Store labor modeling
• SKU-level inventory

Healthcare

• Patient volumes
• Reimbursement modeling
• Physician-level planning

Professional Services

• Utilization
• Billable capacity
• Project P&L
• Staffing models

Industry logic determines modeling, dimensionality, and performance demands. It belongs in Tier 1 requirements — not as an afterthought.

This section is where grown-up evaluation happens.

Admins, skillsets, and operating model matter more than tool features.

If Finance is non-technical:

You need governed modeling, rigid structures, prebuilt frameworks.

If Finance is technical:

You need flexible engines, deep customization, open architecture.

If Accounting will be owners:

You need transparency and auditability above all else.

If IT owns integrations:

You need an API-first stack with minimal proprietary logic.

Selecting a tool that exceeds your team's technical capacity is the #1 cause of long-term failure.

Tools fail when teams fail to maintain them — Not the other way around.

After completing Phase 2, you should have a requirements package that includes:

Tier 1: Critical Requirements (15–25 items)

Non-negotiable. Failure = automatic vendor elimination.

Tier 2: Important Requirements (25–40 items)

Differentiators. Used for scoring.

Tier 3: "Great to Have" Requirements (10–20 items)

Tie-breakers between finalists.

Technical Requirements Matrix (10–20 items)

Cross-analyzed against bottleneck class.

Industry-Specific Requirements (5–15 items)

Defines modeling depth & architecture fit.

Internal Capability Requirements (3–7 items)

Aligns system complexity to your team's reality.

This is not a "requirements list." This is a requirements operating system.

Any vendor can satisfy a 100-line checklist. Only a handful can satisfy a requirements architecture built around:

• Success metrics
• Bottleneck class
• Architecture physics
• Performance criteria
• Industry modeling
• Internal capability
• Future-proofing
• Governance
• Scalability

This is not "selecting software." This is building the financial systems architecture that will support your company for the next decade.

Need Help Building Your Requirements Framework?

CFO Shortlist provides requirements engineering services that eliminate 60-70% of vendors before demos. We help finance teams build technical, defensible evaluation frameworks.