Financial reporting is changing. Organisations are no longer content with management reports delivered five days after month end. Nor do managers want to spend time arguing about the accuracy of information or waiting for finance to rework complex spreadsheets. Managers want access to real time information; they want analysis in multiple dimensions; and they want immediate comparison of actuals versus budget. For NTT Europe, which runs multiple business units across several countries, consolidating multiple NAV databases required a massive manual overhead. Reporting by customer or product and comparing performance against budget was complicated and time consuming. The adoption of the PrecisionPoint Focus Business Intelligence solution has transformed the Dynamics NAV reporting process. Not only has the company reduced the reporting overhead by 100 hours each month, but managers now agree on figures and are leveraging real time insight into performance by multiple dimensions – and against budget – to drive significant business change.
Pan European Business
NTT Communications is the international and long distance service arm of NTT (Nippon Telegraph and Telephone Corporation), one of the largest telecommunications companies in the world. Wholly owned subsidiary NTT Europe offers a wide range of customised enterprise solutions across EMEA – from UK to Poland and Scandinavian to UAE. In 2011, NTT Europe merged NTT Europe Online, its managed hosting subsidiary, into the core business. This created the need to consolidate multiple business units across several countries onto a single financial solution, Navision, and a single billing platform. At the same time, management flagged the need for faster access to more detailed information that would enable them to manage the business on a day to day basis rather than waiting for month end management reports. However, as Aad Schrader, Management Accountant Europe, NTT, explains, the move to Navision changed the way the financial information was structured, creating separate databases for each country. While this supported country by country reporting, it was extremely difficult to create reports by business units which span multiple countries and currencies – an essential requirement of the newly merged organisation.
Flexible, Fast Reporting
“In the first months, the finance team was just surviving – running reports, checking and double checking information. It was certainly not easy. NTT Europe needed a different solutionAad Schrader, Management Accountant Europe, NTTNTT faced two key problems. Firstly, it was impossible to consolidate the databases into one tool to deliver reporting by business unit. Secondly, while Dynamics NAV reporting supports multiple dimensions within the finance database, it can only report on two dimensions. The company therefore faced a huge manual overhead to meet the business unit reporting requirements, from creating consolidated information to analysing performance by department, by customer and by product. The only option was to run multiple reports which were then placed into one huge Excel spreadsheet to create the consolidated numbers. In addition, while the consolidated financial reports for the overall company could be produced quickly, NTT Europe was not able to undertake rapid comparison of performance against budget. Schrader confirms, “It took four or five working days to do the financial close and the finance team then had to undertake a huge amount of manual work to get the results across to the business units. The numbers were then checked against previous months, human errors were spotted and changes had to be made.” Schrader continues, “In the first months, the finance team was just surviving – running reports, checking and double checking information. It was certainly not easy. NTT Europe needed a different solution.”
However, after extensive research, Schrader’s team was struggling to find a business intelligence tool that could meet NTT Europe’s needs for in depth financial reporting and analysis. On the recommendation of the company’s IT Manager, the finance team evaluated PrecisionPoint Focus, a solution that manages the ‘Close to Report’ cycle so that companies achieve more timely, accurate and transparent reporting and in doing so, creates a foundation for evaluating performance, supporting business decisions and satisfying external reporting requirements.
“This means managers can check variance to last month at any time, in any way we want to see the numbers. As a result of being able to check the numbers throughout the month, by country and business unit, any potential problems are immediately raised, ensuring month end figures are already accepted by the business before they are published.”Aad Schrader, Management Accountant Europe, NTTDesigned specifically to deliver the right accounting intelligence to the Management team through a single reconciled view of the whole enterprise, PrecisionPoint enabled NTT Europe to collate all into a single reporting database. Critically, PrecisionPoint Focus supports multiple dimensions enabling all senior finance personnel to view business performance across all time zones and regions, in both local and common currencies. Schrader confirms, “This means managers can check variance to last month at any time, in any way we want to see the numbers. As a result of being able to check the numbers throughout the month, by country and business unit, any potential problems are immediately raised, ensuring month end figures are already accepted by the business before they are published.”
The ability to report in multiple currencies was also critical for an organisation that operates in GBP and Euro. As Schrader explains, whilst NTT Europe uses an average exchange rate for management reports, performance targets are set in the local currency making it important to reflect exchange rate fluctuation. “Dynamics NAV reporting could not support this multiple exchange rate analysis,” Schrader says. “Using PrecisionPoint Focus, NTT Europe can report on several exchange rates and look at the results in multiple ways. Management reports are produced in the average exchange rate, whilst specific business unit reports are created in consolidated currencies to support internal discussions regarding responsibility and performance.” In addition, the model is highly scalable, supporting NTT Europe’s plans to add several new Regions/Countries/Companies to the business, “Adding a business unit or company to the PrecisionPoint cube is simple,” Schrader says.
Schrader estimates the investment in PrecisionPoint Focus has saved upwards of 100 hours per month previously spent by the finance team hand crafting reports, checking and double checking numbers. “In the original business case, it was estimated that a saving of just 30 hours would deliver a fast pay back,” Schrader confirms. While the time saving in financial information reporting and analytics has more than justified the investment in PrecisionPoint, Schrader insists it is the reliability of the financial numbers that is the critical benefit. “In the past, finance had to prove the numbers were correct. Now, there is no debate, no argument. Everyone, in every country and every business unit, agrees the information is accurate.” Indeed, by using PrecisionPoint Focus to provide management with access to the figures before they are published, the company has radically improved confidence in financial reporting. As a result, Schrader says, “The discussion has moved completely towards how the business can use this information to understand performance and make changes.”
In addition to the high level numbers, the introduction of PrecisionPoint Focus has also enabled NTT Europe to provide country and business unit finance managers with the ability to drill down through the data to gain real insight into the underlying performance drivers. “Managers can now see not only revenue numbers but revenue by customer and by product. They can compare the numbers with previous months because the information is available throughout the Month,” Schrader confirms. NTT Europe has built on this foundation to provide business managers with a real time view of actuals versus budget. “In the past there was no value in asking managers to upload Excel budgets into Navision because it would have been too much work to compare actual versus budgets,” Schrader says. “Now managers can upload budgets, refresh the PrecisionPoint cube and immediately see actuals versus budget by month and by year to date, before they receive month end reports. For budget holders this real time performance insight is incredibly valuable.” This financial insight is increasingly driving business direction. “NTT Europe now has the capability to understand the financial performance of the business and also the implications of business change. Now managers can track escalating costs area’s and link those costs to trends in revenue. In the past the information was there, but making the link was difficult. PrecisionPoint Focus is enabling managers to make far better, more informed decisions,” Schrader concludes.
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