The Mauritius Commercial Bank Ltd (MCB) has reduced reporting time by half - from three to four weeks to between one and two - since implementing Hyperion Planning, Essbase and Analyzer.
In addition, having the right financial information at their fingertips has led people in the strategic business units to be more financially aware and cost-conscious, as they can now see the direct impact of revenue and costs on profitability.
Hyperion is locally represented by Global Technology Business Intelligence (GBI).
MCB was the first bank established in Mauritius, in 1838. For its year ended 30 June 2003, it achieved turnover of $185 million. Over the past five years it has seen a 75% growth in profit.
It is the largest retail network in Mauritius, with more than 42 branches and offices in Madagascar, Mozambique and the Seychelles, and among the top 10 banks in sub-Saharan Africa.
Bhavish Naeck, manager: financial management business unit, says MCB was the first bank to offer automatic teller services in Mauritius.
The bank decided to make a shift from core banking to non-financial services. In August 2001 it redefined its strategy, mission and core values to prepare it for the next era in financial services delivery, culminating in a business process re-engineering (BPR) project.
It identified a number of problems in its profit model process, and the way it reported and used that information. On the budgeting side, there was limited lower management input and accountability. Analysis by department on cost and revenue was historic and did not provide any forecasting capabilities.
All bonuses were spread across the board and linked to global performance - they were not based on business unit or salesforce performance.
It was difficult to make management information available timeously; there was limited analysis of cause and effect; and no capitalisation on strengths.
"There was information overload in some areas. Non-financial people were loaded with lots of statistics, but there was also little detail of what the salesforce or human resources were costing."
He adds: "As we developed new products and services, we needed to formalise the structure of pricing. The idea was to allocate costs and revenues across different offerings and come up with accurate pricing per product."
Along with internal and external consultants, it was decided to:
* Create revenue and support centres aligned with strategic business units to allow a coherent strategy to cascade down.
* Create a financial management business unit to improve and maintain the management information system, budget, transfer pricing, activity-based costing and support for non-financial business managers.
* Create more structure so the strategy can cascade from the top down and the bottom up.
It was decided to implement Hyperion Planning and Analyzer for use by the business unit management teams and the planning committee at a more strategic level. Analyzer provides first-level reports according to user needs and access rights.
Essbase is being used for analytical information regarding financials per business unit.
Since the roll-out, reports are generated in half the time previously achieved. More detailed information by business units has made each division more financially aware and cost-conscious about its figures, leading to innovative ideas on cost control being implemented, as users now directly see the impact on profitability of all their processes.
Previously, each business unit had to rely on the financial team for information relating to the division`s financials. All management teams bought into the Web functionality and user-friendliness of the Hyperion system, as it provides them with a high level of autonomy.
Access to information is now controlled, giving users more of a balance in terms of data they get to see - there is less information overload and access to the right type of detail at the right time.
Naeck says by next year the plan is to implement multi-dimensional profitability analysis by customer, customer segment, product, distribution channel (such as call centres and the retail network), account executive (making up 10-15% of the total number of employees) and business unit.
Also in the pipeline is product costing using activity-based costing and internal transfer pricing to allocate all services provided by the support centre to each business unit, in order accurately to cost new products, from when customer demand is first experienced until final delivery of the product.
MCB also plans to install a data warehouse to store information that can be manipulated by Hyperion for forecasting purposes.
Essbase will be used also for sales and marketing purposes to provide more personalised client information.
One of the expected benefits of these developments is an enhanced decision-making process, as the bank will be able to pinpoint problems and capitalise on the strong areas in terms of performance management.
Within three to five years the bank intends to have strategic alignment in terms of business objectives across the entire organisation.
Though the implementation rationalised a number of processes and improved efficiencies, there was no need for downsizing, says Naeck. Internal resources have been deployed elsewhere in the bank, primarily in the client services environment, following staff training.
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