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CASE STUDY

Innovia Films

ABOUT THE CLIENTInnovia Films is a leading global manufacturer and supplier of biaxially-oriented polypropylene (BOPP) and cellulose films for speciality packaging, labelling, graphic arts and industrialproducts. Innovia is headquartered in Wigton, Cumbria, with production sites in the UK, USA, Belgium and Australia. Total annual film capacity currently stands at more than 120,000 tonnes. It has recently acquired 100% of Securency pty Ltd, previously a 50% joint venture with the Reserve Bank of Australia.

INDUSTRY

Manufacturing BUSINESS CHALLENGE• Current System out of Maintenance• Distributed System - Remote Updates - Non Integrated• Data Integrity Problems

EOH SOLUTION• SAP BPC• Excellent Integration with SAP• Easy-to-use Reporting • Ease of Maintenance• EOH - Trusted Partner - Long Term Experience• Scalable Solution

BUSINESS IMPACT• “Doing things better”• More self-sufficient• More time spent on valuable activities

Innovia Films had been using Infor’s FDC consolidation system since the mid-1990s. Originally, the tool was implemented as a way of collecting actual, forecast and budget submissions from a number of entities based all over the world. The system worked well for a number of years, but it became apparent that the FDC application was not keeping pace with Innovia’s requirements. The following issues began to cause concern:

• The FDC application was no longer being actively developed by Infor and, as a consequence, it did not support newer technologies such as Office 2010 or Windows 7. This meant that, as the business unit upgrade cycle progressed, FDC could be run on only a dwindling population of older machines.

• Compatibility. As a distributed system, FDC required each subordinate business unit to maintain its own local copy of the application database. Different entities could be on differing versions of the software resulting in compatibility issues.

• Data integrity problems. Local offices sometimes changed their numbers after data had been submitted to head office, resulting in lengthy reconciliation exercises.

Similarly, maintenance of the application was cumbersome as software needed to be installed on remote machines which could be on different operating system versions or different language editions altogether. Furthermore, the finance team’s lack of FDC expertise meant that even relatively simple updates required costly consultancy time, resulting in a system that was both expensive to maintain and slow to react to organisational change.

As a consequence, Innovia Films started to consider replacing FDC. Theprocess of evaluating alternatives began in 2011, and after considering anumber of options BPC was selected. The process of migrating to BPC was initiated in April 2012 with the aim of a 2013 live date. When Innovia announced in February 2013 that it had signed an agreement to acquire the remaining 50% share in its joint venture, Securency, from the Reserve Bank of Australia (RBA), FDC effectively became redundant, and the consolidation in BPC was the only way forward. “At that point, the need to change the corporate consolidation platform became unavoidable,” explains David Horton, Company Secretary at Innovia, “since it would have been very difficult to support our reporting requirements in FDC once the acquisition had happened.”

The businesschallenge

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“We focused on a like-for-like requirement at first,” continues Horton, “so rather than specify a lot of additional reports, we wanted to implement a system that would provide solid foundations that we could build on. That said, there was clear room for improvement. For example, we wanted a product that would enable us to automate our intercompany transaction matching process, something which was manual in FDC.”

Consequently, the initial scope of the project contrived to avoid any significant redesign of the submission or consolidation processes and opted to reuse as much of the existing data entry and collection schedules as possible. Within these broad parameters, EOH worked with Innovia to compile a list of key requirements for the replacement solution. These included:

• Ease of maintenance. The new solution should be flexible enough that changes could be made to it by Innovia’s own finance team in a simple and timely manner.

• Reporting and analysis. The new application should provide reporting tools that enabled the multidimensional analysis of consolidated data. It should also support modern analysis techniques such as slicing-and-dicing and drill-down.

• A single centralised data store that would provide a “single version of the truth” for the organisation.

• Data validation tools. The new solution should provide inbuilt submission controls to improve the quality of the

figures submitted to the consolidation process.

• Support for modern technologies. The replacement should support Office 2010 and Windows 7 as well as enable

report compilation and distribution in Excel, Word, PowerPoint and Internet Explorer. It was envisaged that this would promote the development of a self-service reporting culture within Innovia and thus improve the efficiency and effectiveness of the finance team.

• Commitment to the development of BPC to retain compatibility with other software packages in the future.

• Provision of a workflow framework that would provide supporting doc

The overarching goal was that each of these requirements would reinforce each other and lead to a marked improvement in theconsistency, efficiency and effectiveness of the data that theInnovia finance team were able to provide to the rest of the business.

With these requirements in mind the team began to evaluate the best-of-breed consolidation tools in the market place. “We decided early on that we didn’t simply want to just upgrade to FDC’s successor,” says Horton, “because that would have required just as much implementation effort as implementing anew product.” Indeed, the selection process narrowed rapidly to a shortlist of just two competing solutions.

The

requirement

“We wanted to implement a system that would provide solid foundations that we could build on.”It turned out that SAP’s consolidation product provided the best range of features at the most economical price point. It was alsoclear that the solution contained an enormous amount of potential. “We saw that we could easily expand it beyond simple consolidation into other business applications and forecasting,” says Horton.

With the solution selected, Innovia engaged EOH to design and implement the replacement solution in conjunction with Innovia’s own internal resources. “EOH are a longstanding and trusted partner,” says Horton, “We were confident that they could deliver the required solution to an agreed timetable.”

Consequently, the initial implementation of the BPC applicationwent ahead, incorporating the requirements compiled by EOH and focusing on delivering the following consolidation functionality:

• Currency conversion from locally reported currencies such as Euros, sterling, US dollars, Mexican pesos and Australian dollars into a base currency (Euros).

• Consistent conversion of data in different scenarios with different sets of rates, enabling actual figures to be viewed

at actual, forecast or budget rates.

The

solution

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About

EOHFounded in 1996 EOH UK has been making a tangible difference to the finance function for decades. We build trusted relationships by bolting deep business know-how and proven technology capabilities to our collaborative leadership values.

At the heart of our success is the recognition that building trust with clients is critical. We go to extraordinary lengths to understand the full picture, from current challenges to future goals, while inspiring clients to become more visionary across the system landscape.

Breaking away from legacy systems and streamlining processes is a bold and increasingly necessary step. Choosing EOH UK ensures you have a partner with you at every step of that journey.

Together we deliver the optimum technology solution – grounded in pragmatism but always with an eye on innovation. The result? A faster, leaner, smarter solution delivering returns as well as improved business performance.

Technology makes it possible, people make it happen.

• Consolidation of different scenarios (actual, budget and forecast) across single period, multiple periods and multiple year time intervals.

• Provision of an enhanced inter-company reporting,

matching and elimination process. • Easy maintenance of multiple group structures. • Automated upload of actual figures from the underlying SAP general ledger. • Automatic audit trail of journal adjustments

Working together, the combined Innovia and EOH team delivered the like-for-like system on time and within budget. Moreover, with the replacement application in place, the team were free to expand the system beyond its initial scope to include a 13 week rolling cash forecast. “Once the parallel runs had given us the confidence that BPC was functioning as we expected,” says Angela Whale, Innovia’s Group Accountant, “we were able to extend it with the cash forecasting module. We were impressedby how quickly we could enhance the system and how easy it was to do. The additional functionality only took about four weeks to develop and roll out.”

Similarly, as the BPC system has bedded-in, the in-house team have been able to assume more of the development andmaintenance tasks. “We adopted an organic approach with the report building,” continues Whale, “EOH encouraged us to play around with the tool in a structured way and gave us great guidance. As a result we now feel confident in our ability tohandle most of the tasks that the day-to-day running of the system requires.”

The new solution has been well received and Innovia has already begun to plan for future projects to increase the benefits of BPC.

Moreover, the modern web-based nature of the BPC system has removed all the issues that the finance team previously had with managing updates to remote machines. “We don’t have to worry about updating local databases anymore as we have a single version of the truth that all our submissions flow into,” says Whale, “and our overseas offices can just use a browser to access the system via web-forms. We no longer have to spend time doing unnecessary reconciliations or trying to troubleshootwhy we haven’t received submissions. It makes our jobs during the month end close much less focused on the mechanics of the process and enables us to be more proactive.”

Similarly, Innovia are confident in their ability to support the system in the future.

The

benefits

“We have a great relationship with EOH and they have worked to ensure that we feel comfortable managing the maintenance of the BPC application. During the early phases of development we had a consultant on site for 2-3 days a week,” says Whale, “but now I feel happy handling the reporting development or adding new lines into the chart of accounts myself. I’m by no means an IT expert, but I feel as though we are much more self-sufficient with BPC than we could have been with the old system.”

Additionally, the BPC application coped with the new post-acquisition organisation structure, providing a scalable solution that can take any new structural changes in its stride. “We simply couldn’t have managed the consolidation and divisional reporting process in the old system with the current business structure,” says Horton, “and although we haven’t significantly reduced the time taken to complete our month end close, you can’t really compare the way we did things in the past with how we do them now. The complexity of our consolidation process has increased such that it no longer compares to the previous version. BPC has been instrumental in providing a seamless solution.”

“We no longer have to spend time doing unnecessary reconciliations or trying to troubleshoot why we haven’t received submissions.”