The problem

Ballance Agri-Nutrients used to base its budgeting and forecasting on an Excel spreadsheet system. With 254 interconnected spreadsheets, this system was becoming increasingly unreliable, says Ballance Agri-Nutrients’ financial planning and analyst manager, Bruce Harris. “It gave us a result we really didn’t know the integrity of,” he says.

The company had rolled out an SAP ERP system in 2009, and the plan was to add a budgeting and forecasting module a bit further down the track. When that time came around, Ballance investigated SAP’s forecasting solution, BPC, and got as far as developing a comprehensive blueprint for the system. However, unable to reach an agreement on price with SAP and concerns over the maturity of their product, Harris decided to bring in Ernst & Young to review Ballance’s requirements. Ernst & Young came back with two options — BPC or TM1, says Harris, and that was when he got in touch with Fusion5.

“Fusion5 came in very late in the process,” he says. “What swung us over were the user-friendliness of the IBM Planning Analytics (formally TM1) product; the capability of it; and, more than anything, the people.”

The fact that Fusion5 was New Zealand-based, and had a 15+ year track record of implementations, was reassuring, he adds.

“Fusion5 gave us numerous reference sites here in New Zealand. We took advantage of that and everywhere we went people couldn’t speak highly enough about the IBM Planning Analytics (formally TM1) product.”

Bruce Harris, Ballance Agri-Nutrients’ financial planning and analyst manager

The Solution

Simply put, the IBM Planning Analytics (formally TM1) solution rolled all 254 spreadsheets into one model. “This model has given us a much more robust process,” Harris says. The solution consists of a number of modules, including HR; Sales; Inventory; Balance sheet; Profit and Loss; Cashflow; and Capex, with Inventory being the core component.

Benefits Gained

One of the top benefits of the solution is the integration with the SAP ERP system, Harris says. “We can take our demand forecast and production planning forecast directly out of that module.” We are now able to give a financial face to our S&OP process which significantly enhances the decision making on the businesses critical path.

Integrity of the data is also high on the benefits list.

“We know that we have integrity of the data,” he says. “That’s one thing that you don’t get with spreadsheets.” In the past, there were always some doubts around the budget — that is not the case anymore, he says. The solution is also very user-friendly, he says. The system was initially rolled out to 45 managers to do their budget uploads. “They were cringing and thinking, ‘not another system that we don’t know how to use’,” Harris says. “But after the training, they were very complimentary of it.”

Another strong benefit is the ability to do reliable forecasting for the future. In the past, forecasting was haphazard, he says.

“We’ve got the ability now to routinely forecast going forward by changing assumptions, such as changes in exchange rates and supplier prices. We just let it flow through and see what the impacts are.”

Bruce Harris, Ballance Agri-Nutrients’ financial planning and analyst manager

The new solution will also help save time. The yearly budget round usually takes six weeks end-to-end — Harris expects it will take around two weeks with the IBM Planning Analytics (formally TM1) solution in place.

“Fusion5 has been amazing,” Harris says. “They are incredibly obliging people. Nothing is ever too much for them. Whatever we have asked for, they have delivered.”

Ballance is now about to embark on phase two of the project, which involves bringing two further companies onto the system. These Waikato-based companies will be able to remotely change their assumptions and drive their own budget processes, Harris says.

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