The Boston Beer Company, a US craft brewer, has streamlined its budgeting process through the acquisition of Hyperion Planning, distributed locally by Global Technology Business Intelligence (GBI), a division of JSE Securities Exchange-listed Global Technology. The solution reduces the time it takes salespeople to project data and the finance department to validate it, and keeps the process in line with the calendar code stamped on every bottle of Samuel Adams beer.
The company decided on Hyperion Planning because of the broad range of features it offers, and its user-friendly front-end and robust back-end to address finance and IT requirements. The implementation took less than six weeks and required a minimal number of consulting hours. There are currently 60 users deployed over the Web, eight in finance and the rest in sales, and their initial feedback is positive.
"The sales force likes Hyperion Planning," says Richard Lindsay, Boston Beer CFO. "The planning process is much smoother and the reporting is more flexible than prior solutions. Non-financial people like it because it is easy to learn and efficient to use."
Much of Boston Beer`s budgeting process relied on manual input, making it time-consuming and prone to inaccuracy. Salespeople entered data into customised Access databases. That data was exported to Excel and then imported into a budgeting software program. With so many data transfers, data integrity was compromised.
In addition to ending manual data input, Boston Beer required a new planning solution that would shorten the planning cycle - including budget collection, consolidation and finance review - from five weeks to three. The system would have to enable the sales force to enter data into a system that would provide an instant profit and loss statement, provide faster contribution margin feedback to sales managers and deliver better pricing and revenue information. Finally, it also had to be a Web-based solution that was easy to learn and use.
Says Lindsay: "If it wasn`t going to be easy for the users, it wasn`t going to work. Our salespeople know the business best so we wanted to get them involved in the process."
The planning process has been reduced to three weeks and is more accurate, enabling financial analysts to spend less time on the process and more time on analysis and decision support. Last year, 70% of finance time was spent gathering and organizing data, and 30% analysing it. Those figures have been reversed.
"There are definitely fewer finance hours spent making sure data integrity is high enough," says Lindsay. "Analysts have more time to do their job. They can spend more time looking at what is in the plan, and it is easy for them to pick up errors, which are much more transparent."
Hyperion Planning is also bringing new efficiencies to the revenue side of the business by allowing for better resource allocation. With timelier, more detailed information available, planners can perform more thorough pricing and product mix analysis. For example, they can optimise the production of kegs or cases of beer as opposed to six- or 12-packs.
Boston Beer is now doing enterprise-wide planning once a year and finance re-forecasting monthly, but that may change. "While the brew masters pursue the perfect beer, the financial team strives to streamline budgeting and planning," says Lindsay. "The sales force has played with Hyperion Planning, and they are suggesting ways to get better data. We see opportunities to improve our process by moving to rolling six-quarter forecasts and focusing on key drivers versus budgeting at a low level of detail."
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