Planning & Reporting

IBM Cognos TM1 Streamlines Finance Activities at Rayonier

July 30, 2017 by Lisa Minneci Leave a Comment

IBM Cognos TM1 streamlines finance activities for our client, Rayonier, when they transitioned from traditional, spreadsheet-based financial planning and reporting processes. But the company also realized some unexpected benefits of using TM1.

Rayonier is a real estate investment trust (REIT) and one of the largest private landowners in the U.S. The company owns, leases or manages approximately 2.7 million acres of timberlands in the U.S. South, U.S. Pacific Northwest and New Zealand, supplying timber to a wide variety of markets, including pulp, paper, lumber, renewable energy production and other wood products.

In 2014 the company spun off its manufacturing business, which marked a perfect opportunity for the finance group to consolidate the multiple budgeting, planning and reporting systems it had acquired over many decades in business. The company also decided to overhaul its entire chart of accounts. These changes set the stage for the organization to move off of various systems and consolidate its financials onto TM1.

Today, Rayonier relies on TM1 for many different aspects of its financial planning and reporting processes. The company sees many benefits from using TM1, including:

Streamlined processes with faster and more efficient close processes
Greater visibility, increased participation and more ownership of numbers
Significant hard and soft financial savings

“We now have a much more streamlined process than before,” said Bill Tan, senior accounting manager, Rayonier. “We’re no longer maintaining multiple systems. We estimate we’ve reduced our close process by 15%.”

It’s the soft financial savings that are the unexpected benefits of using IBM Cognos TM1. Moving off of multiple systems onto one universal solution has significantly reduced the amount of training new employees need to go through. “Activities that used to take several days can now be done in less than a day,” said Tan. “We have much more visibility, and we’ve pushed planning down to more individuals. People are now much closer to the process. And overall, people are much more productive.”

Another key benefit of moving to TM1 was that, according to Keith Tucker, senior accountant at Rayonier, “retiring legacy systems saved licensing costs and server costs.”

Read the full case study on how Rayonier is using TM1 for financial planning and reporting.

IBM Cognos TM1 for Capacity Planning in Manufacturing

June 28, 2017 by Dan Bernatchez Leave a Comment

We recently blogged about capacity planning in the oil & gas industry using IBM Cognos TM1. In short, by using TM1 for capacity planning, a business can better understand how to maximize the capacity it has on hand, how to plan for expected increases and decreases in supply and demand, and how to capitalize on market opportunities to increase physical capacity at the most optimal times.

One of our clients, one of the nation’s largest manufacturers of roofing materials, with nearly 30 plants and a large variety of products created from different materials, wanted to optimize and create efficiencies for the products it manufacturers. They specifically wanted a capacity planning model that incorporates each plant, the multiple lines each plant runs, the products per line and per hour, and the shifts in the plant, and the length of those shifts.

With TM1, the manufacturer can now reallocate back in time if the data reports that a plant’s capacity has been exceeded. It can also report if a plant is currently exceeding capacity, or if a plant is performing under capacity. The capacity planning model provides red flags when it sees plants underperforming, enabling management to make decisions around whether they need to add additional shifts to those lines, or to move manufacturing of a specific product to a different plant.

Read about capacity planning in the manufacturing industry.

Using IBM Cognos TM1 for Capacity Planning in the Oil & Gas Industry

June 20, 2017 by Dan Bernatchez Leave a Comment

Capacity planning is the process of determining the production capacity needed by an organization to meet changing demands for its products. Most people think of IBM Cognos TM1 and automatically think just of financial planning. They think of how organizations of all types and kinds use TM1 for budgeting, planning, reporting and various other office of finance activities. But as we have learned in our decades of experience in working with TM1, there are many other ways companies can use TM1.

Just one of these ways is capacity planning. In short, by using TM1 for capacity planning, a business can better understand how to maximize the capacity it has on hand, how to plan for expected increases and decreases in supply and demand, and how to capitalize on market opportunities to increase physical capacity at the most optimal times.

One of our clients who needed a capacity planning solution is in the oil & gas industry. We built a solution for them that uses TM1 for operational performance management data on their storage of oil and gas. The company has contracts with its customers to store petroleum products to be transported. By having greater visibility into its tank utilization, the company can both be more efficient, and be more proactive by driving more revenue when there is spare capacity available.

Read about capacity planning in the oil & gas industry.

Ovum: “Majority of CFOs aren’t happy with quality of financial planning and analysis”

May 10, 2017 by Brian Combs Leave a Comment

According to an Ovum report, a “majority of CFOs aren’t happy with the quality of financial planning and analysis and are looking for ways to make finance a more ‘inclusive’ and ‘insightful’ function.” And while the report discusses why traditional planning processes are broken and why certain trends gaining traction in analytics are set to disrupt these entrenched practices, it is not all doom and gloom about the office of finance and its practices.

In fact, in “Breaking the Barriers to Financial Planning with Exploratory Analytics,” Ovum declares that there’s an “ongoing evolution in data analytics infrastructure, processes, and techniques [that] has created a perfect storm that is disrupting the way the office of finance thinks about (and engages in) enterprise performance management.” The report also goes on to say that its analysts believe that “financial planning and analysis (FP&A) will be one of the first areas to be on the path to transformation with the emergence and adoption of cloud and exploratory analytics—that will not only help users explore new frontiers in performance management, but also make planning and analysis, ‘viral.’”

Here at Revelwood we think this report touches on a theme we’re seeing emerge quietly in several places. The theme that finance is starting to transform from just a mere accounting function, to one of equal business leadership, one that is the most advanced and well-versed in analytics, and one that is best positioned to be a disruptor in its organization. One that, if interested in rising to the challenge, can transform its organization.

The Role of Finance Reimagined: A Manifesto

April 12, 2017 by Brian Combs Leave a Comment

Our world is in the midst of a transformative technological revolution that is impacting every nation, industry, enterprise and human being on this planet. It is a revolution because it is radical and happening so fast. It is transformative because it is so pervasive and fundamentally changing the way we live.

We’re seeing changes in business and technology never before imagined. For example:

Ten years ago, the Internet of Things (IoT) consisted of approximately 500 million connected devices. Today that number is 9 billion. At the end of this decade that number is projected to be 50 billion. And, not long after that? One trillion.
Self-driving cars are no longer a dream. They’re real and very close to becoming the standard. Did you ever consider Google a car company? It is projected that the soon-to-arrive proliferation of self-driving cars will increase the capacity of our roads and highways by a factor of 10-15 times. Imagine the impact on safety, quality of life… even real estate prices.
Crowdfunding means that institutional investors are no longer needed to fund startups. In fact, you can now validate new products without even creating them yet.
The largest hotel company in the world—Airbnb—doesn’t own a single hotel room. It has disrupted the business model by reducing both the cost of demand and supply to next-to-nothing.
50% of all business ground transportation costs in the U.S. are paid to Uber. And, it doesn’t own a single vehicle.
Jeff Immelt, CEO of GE, said in a recent interview with McKinsey and Company, “We can’t be an industrial company anymore. We need to be more like Oracle. We need to be more like Microsoft.”

Given these changes—and those to come—what role must the Office of Finance play as organizations change? How can it best support corporate strategy and operational effectiveness? How can Finance be viewed as a strategic partner to the business in its quest to disrupt itself and transform organizational behavior?

We explore how the Office of Finance is changing in our Manifesto. We invite you to download it, consider how your organization is changing, and how the Office of Finance needs to transform to facilitate that change.

Consider what Charles Darwin told us, “It is not the strongest or the most intelligent who will survive but those who can best manage change.” Does your Office of Finance have a strategy for managing today’s—and tomorrow’s—changes?

My Mission to Transform FP&A

April 11, 2017 by Brian Combs Leave a Comment

After spending almost 13 years in various global, domestic and corporate FP&A roles at Hertz Rent-a-Car, I’m nearly one year into my position as a managing consultant at Revelwood. The turning of the year, if you will, into year two at Revelwood, gives me an opportunity to reflect on the state of FP&A in many organizations today.

When I first started at Hertz, I was a participant in the company’s Advanced Management Development Program. This was a six-to-nine month rotational “fast track” program that had me doing assignments with city managers, fleet operations, back office management, employee relations and customer service. The goal was that when I ultimately ended up working in the finance department, I’d have a “bigger” view of the organization than one that was just comprised of “numbers.” That experience helped shape my career, as it gave me a true appreciation of the importance of people and process. Throughout my FP&A career, I focused on the upstream and downstream impacts of my actions. It is difficult to add value without an understanding of the entire process. This is the essence of a FP&A professional.

At the beginning of my career, FP&A (then Business Planning) was all about numbers. It was largely reactive and, while many hours were (are) consumed working on it, the value it added, and still adds, could, and can, sometimes be questioned. After you gather the data, create/format/validate the fancy Excel charts, and complete multiple iterations, it is too late to enact change in any meaningful way. But that’s changing, and changing drastically, in many organizations.

What’s really exciting today is that FP&A is emerging as a proactive team that is an integral part of the business. As they gather data from all the siloed departments and units, they are being recognized as the single source of a potentially complete view of what’s going on in the organization, what the cause and effects of various actions are, and where strategic changes can be made for maximum impact. In fact, according to research from The Hackett Group, “more than 90 percent of finance organizations believe that digital transformation will fundamentally change the way finance services are delivered, including the way it serves internal and external customers, suppliers and partners, as well as the talent and leadership roles it must develop.”

That probably sounds very lofty and hard to achieve in many places – especially in established businesses with codified processes. But I believe it is achievable, and that it starts with examining, understanding, and changing (where needed) processes. Not simply for the sake of change itself, but because of the importance of continuous improvement and its impact on the business and the team.

I believe the FP&A group can and should be the most empowered group within an organization. When they have access to analyze the right data, they can uncover the root cause of not just finance issues, but operational issues and stumbling blocks. They are able to do this since they understand the synergies between various aspects of operations, and how process changes or process inertia create ripple effects or institutional bottlenecks. Armed with this knowledge, they can create and execute corrective action plans.

So you might ask, why would this passion lead me to a company known for its stellar reputation as an implementation and consulting firm for IBM analytics technology? After all, I’ve not said a single thing about technology.

Analytics technology is the enabler for the transformation of FP&A. Here at Revelwood, we’re working with our clients to help them make this transformation. And it’s certainly an exciting time for all of us. I look forward to speaking with you about your processes and how Revelwood can help.

Revenue Recognition’s Technical Aspects Make Adoption Difficult

March 14, 2017 by Stu Fisher Leave a Comment

This is a guest blog post by RGP Director of Client Service, Stuart Fisher.

It’s official. The adoption of ASC 606 – the new Revenue Recognition accounting standard, is not going to be fun. Forty percent of finance professionals surveyed by Intaact would rather stand in line at the DMV than go through the process of preparing and implementing the new standard. The technical aspects, which are enough to make anyone cringe, raise many questions. Among them:

How many performance obligations do you have?
What are the impacts of contract modifications?
Will you recognize revenue over time or at a specific point in time? Which recognition method is appropriate for your organization?
What is your stand-alone selling price?
Are you the principal or the agent?

Beyond these technical uncertainties, plenty of implementation challenges may affect a number of functions within your organization. For example … How many contracts need to be reviewed? Are current systems sufficient to accommodate the new requirements? How will reporting disclosures be affected? Is the data needed to comply available, and if so, is it available to the appropriate users? How will internal controls be revised or implemented to accommodate the need for new data and calculations? Who in your organization has the time and skillset to meet the aforementioned needs?

While there are a number of activities we would rather do, implementing the new revenue recognition standard is something many of us will need to do. In fact, the SEC has publicly stated that they are expecting more robust disclosures in upcoming filings. Through impact assessments, companies have learned how the standard will affect their organizations and will be sharing this information in their filings to update investors. To facilitate transparency and the timely absorption of the information by market participants, the SEC suggest incorporating an impact discussion into investor outreach activities.

If you have any questions about how your company should handle the new standard or how RGP can help you, please contact me at 973-401-2565 or stuart.fisher@rgp.com.

Stuart Fisher is the director of client service at RGP, a global consulting firm that provides advice and execution to clients of all shapes and sizes in more than 70 countries—including 87 of the Fortune 100. With a Big Four heritage, its 3,000+ accomplished professionals offer deep expertise across a broad range of integrated services. RGP provides its clients the agility to expand capacity and increase capability. And the support they rely on to help them achieve all that’s possible.

Introducing IBM Planning Analytics Local

December 15, 2016 by John Pra Sisto Leave a Comment

IBM Planning Analytics Local, the convergence of TM1 on-premise with Planning Analytics on the cloud is now available! This new release brings many of the great enhancements and performance improvements that IBM has been making in the cloud environment available to on-premise TM1 customers.

I recently hosted a webinar with Dan Bernatchez, our FPM practice leader and Chief Solutions Architect for TM1, to review the new features of the solution and provided a live demo of Planning Analytics Local.

One highlight of the webinar included Dan showcasing Planning Analytics Workspace, which is a completely transformed user experience. This new “face” of TM1 provides a rich, interactive workspace that is visual, intuitive, insightful, social and mobile.

Dan also explained how Planning Analytics Local uses hierarchies for deeper analysis of TM1 data. Essentially it turns attributes into virtual dimensions, saving RAM, increasing query performance and adding flexibility. This enables users to have smaller, faster cubes, to introduce hierarchies to queries as needed, and to do dimension versioning.

Since Planning Analytics Workspace is the one new component that comes at an additional cost, IBM is offering a special 75% discount for existing TM1 customers who purchase it before year-end 2016. For information on this pricing deal, contact me and I can help you.

This webinar was the first in a three-part series showcasing IBM Planning Analytics. Stay tuned for the dates and topics of the next two webinars coming in early 2017.

IBM Cognos TM1 Streamlines Finance Activities at Rayonier

Read more about how IBM Cognos TM1 is used by REITs:

IBM Cognos TM1 for Capacity Planning in the REIT Industry