Fortis Bank - more efficient budgeting system

Client

Fortis Bank has now been taken over by BNP Paribas Bank. At the time of establishing cooperation with Fild.NET (part of the Euvic Group), it was, however, part of the Fortis Group, which was established in 1990 through the merger of the largest Belgian insurance company AG 1824 with the Dutch group AMEV / VSB. The Group’s activities throughout the world comprise mainly two areas: banking and insurance.

In Poland Fortis Group operates chiefly through Fortis Bank Poland SA (FBP) but also through Fortis Securities Poland SA (former Polish Brokerage House) and the newly formed Fortis Lease Sp. z o.o. The Bank employs nearly 1,000 staff in 18 branches in Poland and has its headquarters in Warsaw.

Initial situation

Fortis Bank had a data warehouse covering the area of customer and product profitability based on Oracle and Cognos technologies since 2001. In this solution, however, there was no functionality that automated and streamlined the analysis and budgeting of costs. The bank dealt with the problem by extensively using Microsoft Excel and e-mail: vast quantities of sheets were sent via e-mail, and then they were discussed and verified. The whole process was very time-consuming and the greatest bane were the many versions of the documents that circulated among the employees, their reconciliation and delays in preparing the analysis.

Fortis Bank partnered with the Euvic Group in 2004. Its aim was to automate the reporting of the cost budget (transition from macros and e-mail to a multidimensional database and a web browser) and to improve the process of its creation. The cooperation resulted in the creation of Excelerator®, a solution which supports over 100 users.

Challenge

The Customer Profitability System was implemented in Fortis Bank Polska in 2001. Its objectives were, among others, to aggregate income statements at various levels, to determine the profitability of distribution channels and product profitability. Unfortunately, this solution did not solve the problem of budgeting. In the budgeting process Excel was used extensively – on average annually thousands of files in different versions were sent. While at the initial stage of the Bank’s operations such a solution seemed to be effective – at a later stage both the management of the budgeting process and its use by the users became more difficult.

The main problem was to control the changes – both in the budget estimates and in the budget itself. Changes in the structure of accounts or in the organizational structure resulted in poor distribution to accounts through the macros. In turn, many versions of the budget, the introduction of amendments at the last minute and difficulties with controlling one, the current version of the budget often resulted in the duplication of work and its extension. The whole process generated excessive administrative costs and made it difficult for the Bank to control the costs and budgets precisely.

As a result of this situation, the Bank began to look for a solution which could solve the problem in the simplest yet most effective way. The Bank considered several systems from different vendors but it seemed a natural step to expand the use of the technology which was the basis for the Banks’s current data warehouse – of Oracle or Cognos. Unfortunately, costs associated with the purchase of additional licenses and implementation were much higher than for a solution based entirely on Microsoft technologies.

During the analysis a few essential elements of the existing situation were noticed:

Employees liked the screen of Microsoft Excel. It turned out that the problem was not the software’s analytical possibilities and presentation of data, but data processing. To improve it, the Microsoft SQL Server database with multidimensional Analysis Services, for which Microsoft Excel was naturally suitable as a data browser, was used in the new solution.

Employees were familiar with the browser, so downloading a file from the intranet should not be time-consuming – as opposed to finding the next version of the budget in a stack of e-mails. Fortis Bank Polska has already obtained licenses necessary to implement the entire solution.

Solution

The solution is based on Microsoft SQL 2000 Server with Analysis Services as a place where all already used business rules, macros, functions, and budgetary estimates are saved. Data arrives in the database from two sources: implementation data is supplied by the Bank’s transactional systems through appropriately prepared files, while planned data is entered and edited manually by authorized employees. The user interface is Microsoft Excel which communicates directly with the database. This makes the data more consistent, always up-to-date and eliminates problems with e-mails and ever-changing versions.

The access system uses Active Directory (AD) as a source of information about the rights of individual employees to specific data and reports. With this architecture, each employee can only see his/her data and group work is accelerated. The data in the system is available for users in the form of PivotTable, so it is possible to generate reports in any format based on the available fields.

The most important phases of the implementation project included the conceptual development and testing the solution. The conceptual development phase determined the whole shape of the solution. For this reason a relatively long time was devoted to this phase by both Fortis Bank Polska and the Euvic Group. This resulted in a relatively short time needed to create the solution thanks to the agreed upon system logic and specified business rules. The stage of testing and adjusting the system was the second most important element of the implementation project. This translated into the quality of the solution which enabled the Bank to develop the budget for 2005 already using the new tool.

The implementation was completed within a few months, making available an integrated system of reporting and budgeting making use of analytics, supporting over 100 users throughout the Bank.

Business benefits

Improved the efficiency of the Bank’s operational activities

The solution has improved the efficiency of the Bank’s operational activities (e.g. shortened the time of report handling and cost budgeting by 80%) and has allowed keeping some financial indicators at the desired level by avoiding significant capital expenditure on new IT solutions. In the context of the Bank’s further development plans, solutions that maximize the available resources represent the preferred course of action.

Better control of financial indicators

Because of the centralized process of collecting controlling information, the data obtained is of better quality than before which enables employees to make better decisions. This is mainly related to the fact that by automating some repetitive elements of the process human errors have been eliminated to a significant degree.

In addition, the introduction of access privileges to certain groups of data increased the transparency of responsibility for data quality. At the same time the risk was removed of erroneous data being entered at the wrong place or by unauthorized staff.

The solution also enables faster and more accurate calculation of financial indicators. With the access privileges introduced, it is possible for multiple users to work on the budget and after the data is entered it is immediately available for analysis. This enables a much faster performance of “what-if” analyses or preparation of e.g. forecasts for subsequent periods based on budget implementation data. In this situation the information needs of the Board are satisfied to a much larger extent.

The most economical system to solve the problem

Contemplating the choice of the best budgeting solution Fortis Bank faced the alternative: to buy a system with ready-made business logic (for controlling) which then would be adjusted to the Bank’s needs – or to choose a technology partner who would implement the Bank’s existing business rules in a new system.

Fortis Bank decided to develop its own system because of several factors, the most important being:

Knowledge of Microsoft Excel among the Bank’s employees– including not only the ability to navigate the software but also practically minimal user training costs, minimal maintenance costs of the system and removing the perennial problem of all financial departments: “how to move data from my system to Excel?”.

At least several times lower implementation costs compared to other, ready-made controlling systems – due to the fact that many licenses needed to create the solution were already in the Bank’s possession.

A reliable partner, the Euvic Group, equipped with appropriate technology and having vast experience, guaranteed the execution of work in accordance with the specifications and requirements of the Bank. Crucial factors also included Euvic’s flexible approach to changes in the course of the project and communication skills in the conduct of the whole project.

A user friendly interface

With the new solution Microsoft Excel gained “a new face”– the employees discovered that the familiar tool offers a much richer functionality than they originally thought. What’s more, new capabilities include not only analytical ones (data mining) but also support group work on a jointly created document which is the budget plan. Thanks to the new system for collecting and accessing the data it is no longer necessary to download hundreds of files and reports from the stack of e-mails. Instead of that, data is available from a single location for all participants of the process in an efficient and simple way.

Reducing employees’ workload

Following the implementation of the budgeting and reporting system the employees of Fortis Bank’s controlling department spend less time on meeting the company’s needs as regards reporting, modifying already defined sets of report and their distribution.

SQL Server 2000 Analysis Services provides a managed reporting environment with a defined level of protection, caching, distributing, accessing and reporting of usage. An integrated set of tools enables the IT department staff to centrally manage the creation and delivery of reports.

The budgeting and reporting system implemented in Fortis Bank is scalable – it can be expanded with the growth of the Bank.

Excelerator®

Excelerator is not a product licensed separately in the strict sense – it is the brainchild of Fild.NET that makes it possible to create a data warehouse or an analytical system or a system supporting the budgeting process using only commonly available Microsoft technologies: SQL Server 2000 or 2005 with Analysis Services and Reporting Services for the processing and data analysis, the Office suite – in particular Office Web Components for SharePoint product group collaboration and information management.