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You support finance at a mid-sized government contractor that runs monthly forecasts, annual operating plans, and program cost reporting. The CFO is considering expanding use of an enterprise planning stack built around Oracle Hyperion and Deltek Cobra because the current process still relies heavily on offline spreadsheets and manual reconciliations. You have been asked to quantify the finance case using labor savings, forecast accuracy improvement, and implementation cost. Assume the benefit of improved forecast accuracy is measured as avoidable unfavorable spending decisions captured in the next year.
| Metric | Value |
|---|---|
| Finance staff using current process | 18 |
| Average fully loaded hourly cost | $62 |
| Hours per month spent on manual consolidation and reconciliation | 210 |
| Current annual forecast error on managed cost base | 4.8% |
| Expected annual forecast error after upgrade | 3.6% |
| Managed annual cost base | $85,000,000 |
| Share of forecast error reduction that translates into avoidable cost | 6% |
| One-time implementation and training cost | $420,000 |
| Annual software and admin cost | $160,000 |
How would you evaluate whether the planning-tool upgrade is financially justified, and what would you recommend based on the first-year and steady-state impact?