Marc Doumitt
, September 14, 2022
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As a consultant in the capital projects investment and delivery space, I see a significant improvement in capital delivery maturity, tools and close integration of company FP&A and project control teams. These platforms have created a deep integration using ERP and project delivery tools to synchronize capital project controls, governance, reporting, risk and change management.

The Challenge

Companies create a capital planning process and lifecycle to manage, prioritize and deploy investment resources. The drivers of capital investment models can be business landscape, competition, product life cycles, cost savings, technology, and asset management. Of the many ERP and project control tools available, no one tool is very effective at addressing the business needs to process and manage these capital requests from a functional end-user perspective.

In my interviews with clients, I constantly hear the same complaint:  “I need a tool that works for me to plan my capital spending long-term and is flexible enough to refine these plans resulting from various dynamic conditions. I don’t want to use a project controls tool or ERP platform to perform this cumbersome and iterative process." The typical project controls tools do not address this need very well or at all. Capital planning needs a longer viewpoint of 3, 5, 7, and 10 years to develop a long-term comprehensive strategy of the business's capital needs. These types of capital investments include maintenance, asset lifecycles (repair/replace), growth, retire or business growth initiatives. A capital planning application should have features to model variables that can impact investment strategies. These factors among many can include commodity prices, labor costs, interest rates, supply chain disruptions, technology, depreciation strategies and competitive advances.  

The first action I take is to assess a client’s capital investment strategic planning capabilities and resources. I usually find a person locked in the basement using complex spreadsheets, performing manipulations of capital planning initiatives, agendas, financial modeling based on equipment depreciation, asset lifecycles. tax incentives and investment credits. This creates a limited understanding of the big picture regarding capital budget strategies and is further complicated with unreasonable demands from key stakeholders. So much for investing in sophisticated capital planning and controls tools!

The business operation FP&A tools such as ERP are well-versed in managing and controlling capital investment budgets. The user community has a clear mandate and mission that relates to managing cash flow. They are compliant with FASB ASU 2014-09 for percent of completion, revenue recognition, forecasting, end-of-month closings, procure-to-pay and accruals.

On the other hand, the user community for capital project delivery systems has a broad range of backgrounds but focuses on a single goal:  delivering capital projects. Industry best practices are reflected in PMP, AACE and ANSI 748 EVM, for example.

The Solution

Alithya developed a capital planning tool that bridges the need for investment planning between operational ERP and business unit stakeholders. The Capital Portfolio Planning (CPP) tool allows stakeholders to input their capital investment needs into the CPP application in a Cloud environment for ease of visibility and strategic planning. The CPP tool can be used to model various capital investment scenarios based on variables and sensitivity criteria. Once a capital strategy is submitted for approval, a capital governance structure is engaged to provide approvals for capital budgets, funding requests and funding changes. This tool interfaces with any ERP platform and integrates with any project controls, delivery applications and BI reporting tools. The business units have a highly functional application that fits their needs for simplicity, workflows, accuracy and funding status tracking. The modeling features allow “what if” scenarios to be created for improved forecasting, insights and risk management.  


I have seen improved collaboration between the business FP&A and projects control teams with this CPP application – which is the holy grail of capital project governance, control and delivery. In this constantly competitive business environment, it is imperative that capital budgets are scrutinized heavily for business objectives, ROI and value. The CPP tool allows users to constantly evaluate their capital strategies, make priority business decisions and maintain stewardship of precious capital dollars.

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