Integrating 'foreign' costing information and providing full gross-margin reporting
Multiple legal entities with different functional currencies challenged the business reporting system at this MFG/PRO manufacturing site. CornerStar Business Intelligence transformed the way they access their information.
Problem: A large percentage of the client’s cost comes from software royalty agreements. These royalties are tracked in a separate custom system. Reporting on gross-margins on a detailed level became nearly impossible.
Solution: CornerStar consultants solved this problem with a small modification to the CornerStar Sales Mart. The modification pulls the royalty cost into a separate cost component “user field” within the Data Mart. Because the Financial Data Mart is fully integrated with the Sales Mart, information users are now able to see royalty costs as part of their full financial picture. Users can evaluate cost and gross-margins with or without the royalty cost component. Users can generate gross-margin reports by product, by customer, by salesperson, etc. Best of all, with the aid of Cognos PowerPlay and Impromptu, information users can construct these reports themselves without the aid of an analyst.
The CornerStar Sales Mart captures cost components from multiple systems resulting in meaningful margin analysis.
Outcome: A more accurate cost picture has lead to better product profitability reporting and aided strategic decisions about new product introductions.
In addition to these benefits the solution provided:
- Ability to distinguish between profitable and non-profitable products and services
- Ability to evaluate cost and gross-margins with or without royalty components
- Improved negotiation interactions with technology suppliers
- Improved financial reporting
- Sharp improvement on speed of reporting delivery
- Freeing of analyst and programming manpower