Cost Management and Financial Management plugins - what's the difference?

[michaelcassidy]

I can see both of these plugins in the product documentation, but I can't seem to find any info about which plugin/product is most appropriate for various use cases. Or do they work together?

I'm curious about:

• Subscription costs - seems like Cost Management is free with standard ITSM... but Financial Management requires ITBM licensing?
• History & purpose - what came first? Is one designed to replace the other? Eg Cost Management replaced by Financial Management within ITBM? What are the major differences or limitations of each product?
• Can a customer begin using Cost Management, then migrate to Financial Management if required? Looks like they both make reference to Expense Lines.

We're in early days of considering using ServiceNow for IT cost reporting & chargebacks/showbacks and looking for advice on plugins related to achieve that.

Thanks!

[Sunil B N · Accepted solution]

Hi Michael,

Licensing: Cost Management and Financial Management work together. Cost management is free with Platform. The Financial Management Core (com.snc.financial_management) plugin requires a separate subscription from the rest of the Now Platform.

History & Purpose: Cost management helps to track associated to CI(configuration items) and create related expense lines and allocations to Business Units and cost centres. Financial Management includes Financial modelling(formerly known as Cost transparency) which provides fiscal periods, allocation engine, workbench and reports and dashboards. It also includes Financial Charging(formerly known as Service Charging/ Showback) which helps in reporting the financial aspects of a business service to the various stakeholders in the organization that consume this service.

Plugin Detail: Financial Management Core (com.snc.financial_management) plugin activates the following applications:

• Financial Modeling: Activates Financial Modeling application, formerly known as Cost Transparency.
• Financial Charging (com.snc.service_charging): Activates the showback and service charging features of Financial Charging application, formerly known as Financial Reporting.
• Cost management

Read more here.

For chargeback/showback Financial Charging Plugin is something you may be interested in.

I hope I was able to give some glimpse on what you are looking for.

Best Regards,
Sunil B N

[michaelcassidy]

Thanks Sunil, that's very helpful!

[Kohei4]

Hi, Sunil

I came to this article coming up the same confusion with the author and your answer helped me to understand the difference.

In my understanding, Cost Management needs CMDB implementation beforehand as it is to calculate cost based on CI and cost rate for each CI. On the other hand, Financial Management just needs expense records to import.

Both can create reports on how much each business unit consumed but Financial Management does not have a budget planning feature.

Is my understanding correct?

By the way, Project Portfolio Management has a cost management feature as well but it is for planning and managing costs on each project, right?

I wish you will tell me if my understanding was incorrect.
I would appreciate if there is any other material to learn about Cost Management.

BR
Kohei

[Sunil B N]

Hi Kohei,

Your understanding is correct.

Would like to mention this point though - Project Portfolio management has cost plans feature which is for tracking costs and actuals for project/project task. 
You can read more about it here.

Best Regards,
Sunil B N