Published on 20-Apr-2010
"Business Performance Reviews are the icing on the cake. They give us highly detailed insight into areas such as turnover, profit, days outstanding, absence and stock value." - Martijn van der Woerdt, Controller Sodexo Food Services
IBM Cognos solution delivers better and more detailed financial planning capabilities at Sodexo Food Services
Sodexo was looking to increase the ease and reliability of its financial planning so that it could plan better and look ahead more clearly.
Using IBM Cognos Business Intelligence and IBM Cognos Planning the market leader in Food & Facilities Management Services created a linked environment for BI and planning and forecasting for its Food Services arm.
Allows business performance to be viewed simply and in detail for each customer location, providing a firm foundation for operating more efficiently; offers a simplified IT environment and lower license fees; provides single version of the truth; enables easy access to information via one-stop shopping; offers detailed insight into business performance, right down to the lowest level .
The Sodexo Group, of which Sodexo Netherlands has been a part since 1995, is the largest international Food & Facilities Management organisation in the world. Sodexo is listed on the stock market and employs 380,000 people worldwide, representing 132 different nationalities. Sodexo operates from 33,900 locations in 80 countries, generating a turnover of 14.7 billion EUR in the 2008/2009 financial year. Sodexo is the market leader in the Netherlands, with 6,500 staff.
The budget management layer in the Sodexo Food Services organisation is in the hands of the district managers. Every day, they analyze and report on the result from ‘their’ locations. Until recently, this was done in Microsoft™ Excel, with data extracted from SAP via a datawarehouse. But this approach no longer met the company’s requirements.
“The district managers were working with a sort of converted profit-and-loss account more suited to financial controllers who know exactly what they are doing in this area. Spreadsheets are also subject to error and you have to spend too much time checking on completeness and accuracy. Our organisation is listed on the stock market in France and has to comply with SOX (Sarbanes-Oxley) legislation,” explains Martijn van der Woerdt, Controller at Sodexo Food Services.
Sodexo Food Services also introduced a fast close system. “We shortened our closing cycle significantly,” says Van der Woerdt, “but SAP was overloaded because all of the district managers were also drawing on it for information. Worse still, the old data warehouse was past its sell-by date.”
Van der Woerdt knew what he had to do. He had previously worked at Sodexo Altys, a subsidiary of Sodexo Netherlands that specialised in Facility Management Services. After this division acquired KLM’s facilities organisation, it was contractually obliged to put a financial reporting system for invoicing in place quickly.
“At the time, we built a highly successful solution from scratch within five months using IBM® Cognos® Business Intelligence. So it also made sense to tackle the financial reporting issue at Food Services with IBM Cognos software. Particularly because our purchasing department was already working with them, and we could simplify our IT landscape,” he explains.
The project was named FBI (Financial Business Intelligence) and was approached in stages.
“In FBI 1, we used IBM® Cognos® BI to produce standard reports that gave the district managers a view of the financial results for their locations. The reports are updated every night from SAP, which also generates the necessary calculations. They’re available via a highly secure web portal that that is as easy to use as bol.com. The district managers were only given a written briefing, while a mini training course to offer support was sufficient for the controllers. It was very revealing to see that when we withdrew the SAP rights after three months, there were no comments,” says Van der Woerdt
In FBI 2, Sodexo Food Services worked on the monthly regional reporting. FBI 3 was run in parallel and involved the redesign of the budget and forecasting process using IBM Cognos Planning.
“We were still doing our budgets and forecasts in Excel,” says Van der Woerdt. “But that really was out of date. We first went live with the budget, then with the forecasts. We could run the budget immediately after entering the data. One good thing is that the software workflow forces you to enter data directly per profit center.” FBI 4 has now also been completed with the recent start-up of monthly Business Performance Reviews. These reviews provide a view of the financial and other performance indicators on a single A4 sheet and are located on a separate tab in the planning application.
Sodexo has seen benefits on a number of different fronts using FBI and IBM Cognos software. “The controllers can now be certain of one version of the truth,” says Van der Woerdt, “while the regional and district managers have access to information via one-stop shopping. They can use a single menu at the portal to call up data about profit and loss, absenteeism through illness, debtors, days outstanding and cashflow, all without having to produce any reports themselves any longer. All of the actuals, budget and forecast data are also in a single system now. This means we don’t have to put information together manually any longer, but instead simply run a report that we can be sure is right.”
According to Van der Woerdt, the most important ‘quick win’ so far was in FBI 1. “Getting the district managers to switch from SAP to IBM Cognos BI was so easy, and had a major impact,” he says. “We didn’t need to upscale our SAP environment, license costs fell and the IT environment became simpler, while access to information improved.”
He sees the Business Performance Reviews as the icing on the cake. “They give us fully detailed views of areas such as turnover, profit, days outstanding, absence and stock value. We can see in absolute figures and percentages how far we are deviating from planning and then we can click through to the underlying data in the accounts. The district managers can explain the reason behind a discrepancy and suggest action. These comments are bundled in the BI environment into a report that you can click through to with a link. We have to earn our money at 1,300 locations, which means we need to have our ducks properly in a row. The Business Performance Reviews will help us work even more efficiently,” concludes Van der Woerdt.
Products and services used
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