Strauss Water gets financial information flowing

Transforming business planning with faster, more accurate budgets and forecasts

Published on 16-Apr-2013

"We can design robust contingency plans that will help us expand our position in international markets, where changing local situations can often require rapid response at a strategic level." - Guy Tal, AVP Finance, Strauss Water

Customer:
Strauss Water

Industry:
Consumer Products

Deployment country:
Israel

Solution:
BA - Business Analytics, BA - Business Intelligence, Information Integration, BA - Performance Management

IBM Business Partner:
Biconix International

Overview

Strauss Water is a member of the Strauss Group, Israel’s second-largest food and beverage company. Established in 2009 following the acquisition of Tana Industries Ltd. and its Tami 4 water system, it has enjoyed strong growth in Israel, and is now expanding into China and the UK. To date, the company has sold water systems to nearly 500,000 consumers in Israel alone, and estimates that more than two million people drink Strauss Water daily.

Business need:
As business boomed at Strauss Water, the company needed to transform its ability to react to rapidly changing international markets with fast, accurate budgeting and forecasting.

Solution:
Seeking a tool that could empower its business units to take control over financial management, Strauss Water joined forces with IBM Premier Business Partner Biconix to harness the power of financial analytics.

Benefits:
Provides a single source of trusted information that enables fast, accurate budgeting and scenario planning. Delivers a clear picture of company-wide performance, supporting better decision-making.

Case Study

When you’re planning for the future of your business, how can you be sure that your best guess is good enough?

Strauss Water, a rapidly growing company that develops innovative drinking-water solutions for homes and businesses, wanted to make sure that its business plans were not only robust and accurate, but could also take multiple scenarios into account.

This would enable the company to develop contingency plans for each area of its business in case market conditions changed or forecasts proved inaccurate. In short, it would help the business expect the unexpected.

Setting the scene
Strauss Water is a member of the Strauss Group, Israel’s second-largest food and beverage company. Established in 2009 following the acquisition of Tana Industries Ltd. and its Tami 4 water system, it has enjoyed strong growth in Israel, and is now expanding into China and the UK.

To date, the company has sold water systems to nearly 500,000 consumers in Israel alone, and estimates that more than two million people drink Strauss Water daily.

Tackling the challenges of growth
Strauss Water’s business model is highly integrated – the company manages every step in the lifecycle of its products, from design and manufacture to marketing, sales and service. While this high level of integration allows the company to keep tight control over all aspects of operations, it also introduced a significant degree of complexity as the business expanded.

Guy Tal, AVP Finance at Strauss Water, states: “Originally, we used a spreadsheet-based system to handle the financial planning and budgeting for our different business units. This worked fine when the company was small, but as the business grew larger and more complex, it became unworkable.

“Each business unit used a different planning model and it was difficult to arrive at a global picture of the company’s financial performance. Consolidating the data in spreadsheets meant that budgeting was a slow, error-prone process.”

More responsive business planning
To transform its business planning capabilities, Guy Tal’s team replaced its spreadsheet-based processes with a new solution based on IBM® Cognos® TM1® software, which provides a single, robust, central source of financial data and analytics.

“The solution makes it almost impossible for users to introduce errors into the budgeting process, so they don’t need to spend so much time checking the data,” explains Guy Tal. “Instead, they can focus on creating new types of analyses and forecasts that help the business execute its plans more effectively.

“As an example, we’ve been able to develop a weekly rolling forecast, which gives us a better ability to track our financial performance. We can look at performance from week to week, instead of waiting for the end-of-month reports – so if any area of the business is missing its sales or budget targets, we can take action much more quickly to identify and fix the problem.”

Faster, more accurate scenario modeling
As another example, an analyst might want to assess what would happen if sales of a certain product were 20 percent higher than expected over the next six months. By increasing the sales figure by 20 percent and re-running the model, it is possible to predict the effects on inventory levels, production processes, the supply chain, staffing requirements, and so on.

If the increase in sales seems likely to cause a problem – such as running out of stock – the business can create a contingency plan – for example, raising staffing levels and scheduling additional production.

In the past, it could take up to two days to create each scenario, which limited the number of possible situations that the company’s analysts had time to model and analyze. Now, users can simply enter the parameters they want to examine, and the TM1 engine will run the scenario in just a few seconds.

Guy Tal says: “The advantage is not just the speed of calculating scenarios, but the confidence we have in them. We can design robust contingency plans that will help us expand our position in international markets, where changing local situations can often require rapid response at a strategic level.”

Finding the route to better analytics
With its powerful analytical engine and modeling capabilities, IBM Cognos TM1 was the ideal platform to support Strauss Water’s analytics journey. The company engaged Biconix, an IBM Premier Business Partner, to help design and deploy a solution that would unite all the company’s business units into a single planning model.

Guy Tal elaborates: “It was vital for us to work with an implementation partner who understood both IT and finance, and could build a bridge between the two functions. We chose Biconix because they really understood our needs and had the know-how to deliver the right solution. They were the most valuable asset that we brought to this project.”

About Biconix International
With more than a decade of hands-on experience in diverse fields, Biconix offers a full range of wholly integrated financial performance management and business analytics solutions. These solutions bring value to the comprehensive planning, reporting and analytical needs of organizations – turning data into information, and knowledge into wise decisions.

To learn more about products, services and solutions from Biconix, please visit www.biconix-intl.com

About IBM Business Analytics
IBM Business Analytics software delivers data-driven insights that help organizations work smarter and outperform their peers. This comprehensive portfolio includes solutions for business intelligence, predictive analytics and decision management, performance management, and risk management.

Business Analytics solutions enable companies to identify and visualize trends and patterns in areas, such as customer analytics, that can have a profound effect on business performance. They can compare scenarios, anticipate potential threats and opportunities, better plan, budget and forecast resources, balance risks against expected returns and work to meet regulatory requirements. By making analytics widely available, organizations can align tactical and strategic decision-making to achieve business goals.

For more information
For further information please visit ibm.com/business-analytics

Products and services used

IBM products and services that were used in this case study.

Software:
Cognos TM1

Legal Information

© Copyright IBM Corporation 2013. IBM Israel Ltd, 94 Derech Em-Hamoshavot, 49527 Petach-Tikva, Israel. Produced in Israel. April 2013. IBM, the IBM logo, ibm.com, Cognos and TM1 are trademarks of International Business Machines Corp., registered in many jurisdictions worldwide. Other product and service names might be trademarks of IBM or other companies. A current list of IBM trademarks is available on the web at: www.ibm.com/legal/copytrade.shtml. IBM and Biconix International Ltd. are separate companies and each is responsible for its own products. Neither IBM nor Biconix International Ltd. makes any warranties, express or implied, concerning the other’s products. This document is current as of the initial date of publication and may be changed by IBM at any time. Not all offerings are available in every country in which IBM operates. The client examples cited are presented for illustrative purposes only. Actual performance results may vary depending on specific configurations and operating conditions. THE INFORMATION IN THIS DOCUMENT IS PROVIDED “AS IS” WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING WITHOUT ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND ANY WARRANTY OR CONDITION OF NON-INFRINGEMENT. IBM products are warranted according to the terms and conditions of the agreements under which they are provided.