Budget overhaul opens a new chapter in the history of LexisNexis
The Organisation
Leading Australian publisher LexisNexis® has streamlined its budgeting and continuous forecasting capabilities and upgraded the security of its financials by implementing the advanced corporate performance management solution, Mondelio.
Anton Colenbrander, Regional Business Systems Manager of LexisNexis Asia Pacific, said the publisher wanted to approach its budgeting and forecasting from a customer-based, rather than product-based, perspective and needed a solution to facilitate the overhaul.
“We’re a subscription-based company which is different to the way most companies operate,” Mr Colenbrander said. “We forecast our revenue based on current subscribers and we allow for some attrition as well as some growth. Mondelio allows us to use a unique formula to do our revenue forecasts.”
“We also have another side where we use our various costs to forecast our profit margin and we use Mondelio for each of these - budgeting revenue costs and margin.” Mondelio allows medium to large organisations to more effectively develop and manage budgets, run “What if” scenarios and set up detailed reporting and forecasting systems. Mondelio supercedes spreadsheets and business intelligence products. Its power lies in its automation and ability to utilise historical data to manage both the past and the future in one software solution.
The Challenge
As well as the challenge of changing the focus of the budgeting process, LexisNexis sought a planning solution with greater integrity and ease of use than the spreadsheet system the company had previously been using.
“We’d been using spreadsheets for many years and it was a system which was frustrating for the users and prone to error,” Mr Colenbrander said.
Ian MacGregor, LexisNexis Business Analyst, said his company had outgrown the spreadsheet system and its integrity became questionable.
“We’ve been doing forecasting for the entire history of our organisation but as we’ve grown larger and more complex that task of forecasting has become a much more complicated exercise.”
“We were using numerous spreadsheets and each of those had numerous spreadsheets behind them - more than 40 separate spreadsheets - and they were open to many people in the organisation who were using them. We had major issues about how we could make those spreadsheets secure yet open for people to go in there and change them when they needed to”.
“The other issue was integrity of information. We could never be sure that someone hadn’t gone in and changed a field or a formula knowingly or unknowingly and affected the result.”
Mr MacGregor said LexisNexis also sought a more effective way of bringing the information together for analysis and reporting purposes.
“We needed a better way to consolidate that information across all parts of the business,” he said. “All our Divisions had separate spreadsheets and to consolidate all that information was a monumental exercise.”
The Process
LexisNexis initially implemented Mondelio with a view to streamlining the revenue forecasting process but has since rolled out the system across the organisation.
“Since we started on the project we have extended the boundaries of what we thought Mondelio was going to cover and have brought in lots of other areas of forecasting,” Mr MacGregor said.
“We were looking at it for revenue forecasting and it has met those obligations of integrity, security and efficiency 100 per cent so that we’re a million miles from where we were.
“We’ve since brought in payroll, HR and costs so basically all our financial forecasting is done through Mondelio.”
LexisNexis uses Mondelio for its overall annual budget then for three budget reforecasts throughout the year. On a monthly basis it is used to upload personnel figures and on a Divisional level by Human Resources, Finance and Publishing.
LexisNexis Legal Publishing Manager, Dean Corkery, said Mondelio was vital to the operation of his Division in that it facilitated careful analysis of budgets on a monthly basis, to give the Division a clear picture of its financial position.
“Mondelio is used for reporting and analysis of actual versus forecast budgets, paying particular regard to profit and loss, overheads and FTE (Full Time Equivalent) reports to see what actually occurred for the month and build variance explanations.”
“It has enabled us to bring a greater analytical focus to our monthly result in particular because of the form of reporting Mondelio uses. It’s far in advance of what previously existed which was a bit chaotic.”
Michael Ronai, Director with Mondelio, said the LexisNexis implementation used ‘smart’ consolidation methodology for multi-level data entry.
“It has a multi-level data entry system and the levels all impact each other at different stages so we developed a smart consolidation which takes place even while everyone’s still in the system,” Mr Ronai said.
For example, if a staff member is making entries in Revenue and another staff member at a higher level is working in Overheads, the changes flow through to that Department’s Profit and Loss and flags the changes in the database. This cues the updating process once both staff members have completed their data entry and exited that part of the system. Mr Ronai said the budgeting and forecasting had been realigned to operate from a customer perspective rather than being product-based.
“Previously, information was entered on each single product – a subscription product, for example, the number of subscribers to that product, the price and cost, so it works out the profit on a product basis,” he said.
“Now, that information is transferred back and calculated per customer so it builds a product profile for the same total budget but reflected by customer, sales rep and market segment. That shows what each customer is worth to the company and what each sales rep and market segment is generating in terms of profit.”
LexisNexis is also using Mondelio extensively in its Human Resources Division in budgeting for personnel costs. Gemma Leitch, LexisNexis Human Resources Advisor, said Mondelio allowed her to upload details of employment packages for each of the company’s 320 full time and 200 casual staff. She said Mondelio’s reporting capability had given LexisNexis excellent visibility across budgets in HR tracking employment and labour costs and saved many hours in ‘number crunching’.
“We have reports that tell us our actuals, our month to date, our year to date and comparisons to our reforecast budgets,” she said. “That gives us clear figures right across so we can see exactly how we’re tracking.” Mr Ronai said the Personnel functionality within Mondelio allowed LexisNexis to budget for each individual employee, making allowances for salary increases across the board, individual pay increases above standard, salary sacrificing and forecasting for additional staff.
The Solution
Anton Colenbrander said the reporting capability of Mondelio has given LexisNexis far greater visibility across its Divisions than it had when using a spreadsheet-based system.
“Mondelio has got a lot of reporting capability we didn’t have with spreadsheets,” he said.
“Everyone’s using the one interface as opposed to all those diverse spreadsheets. Our Finance team consolidated the spreadsheets after the numbers were put in and now it is all automatic.
“Plus, Mondelio directly interfaces with our HR system and our fulfilment system so it’s adding information which all contributes to the budget which means we now have a more holistic budget than we used to have.”
Integration
Mondelio integrates with Bookmaster, an Australian developed industry-specific ERP system for extensive product and financials data and National Payroll Services, the company’s payroll system.
Key Users
Approximately 65 users including Department Heads in Finance, Human Resources and Publishing plus all managers with revenue, overhead and/or staff responsibilities.
Business Benefits
Mr MacGregor said LexisNexis had achieved significant efficiency gains with Mondelio as well as advances in data integrity and security.
Contact
Learn why thousands of users rely on Mondelio to manage and optimise their business planning and reporting processes. Call us on 1300 851 260 or email us at info@mondelio.com
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