The M.Video retail network started operation of a budgeting system

The retail network of electronics M.Video and consulting company CIBER completed the project on automation of budgeting based on the information system SAP BI-IP NetWeaver 7.1.

Background

Premises of implementation of the information solution in the field of budgeting for M.Video company was the fact that earlier creation and tracking of investment plans, consolidation of plans and reports on budgeting were very labor-intensive processes. In retail network there was no uniform IT system for management of this process, and all calculations were made in the MS Excel. The lack of uniform rules, standards and methodologies of budgeting for all departments significantly complicated work of specialists of M.Video.

Solution

The project is begun in the second quarter 2010. In October, 2010 the first project phase within which the basic functionality of planning and calculation of master budgets was implemented was complete. In February, 2011 the productive start of the second project phase which included process automation the plan fact of the reporting and forecasting of budget implementation took place.

Result

"Before BI-IP SAP implementation automatic consolidation of budgets took a lot of time as all departments used different formats and rules. With new IT solution we aimed to reach bigger transparency and to reduce time spent for comparison and the data of budget plans between departments. Automation of budgeting in SAP gives us this chance in full", – Chris Parks, the director of finance of M.Video company says.

The solution includes:

1. Automation of annual budgeting:

• budgeting from top to down (goal-setting);
• budgeting from below-up in all divisions of the company and consolidation of budgets;
• document flow of budget process in the STS system, including development of a control board for tracking of the status of process;
• tax and treasurer planning;
• formation of master budgets,
• balance estimation,
• income and expenditure budget,
• budget of cash flow (direct and indirect),
• budget of the working capital (working capital);
• budgeting of income and expenses by on shops;
• plan/fact reporting;

2. Automation of investment planning of opening of new shops;

3. Automation of process of review of the budget (Reforecast) and process of the sliding forecasting (Rolling Forecast).

Opinion

According to Dina Popova, the Head of Department of financial accounting and budgeting of M.Video: "Now the company had an opportunity of implementation of fast, reliable and transparent collecting of budget data, their consolidation and calculation of master budgets and also a monitoring system of budget process. Also the company has a technical solution for support of the sliding forecasting and review of the budget now. Introduction of uniform standards of budgeting in retail network is other important project deliverable".

"Maintaining the budget and automation of the reporting will help specialists of M.Video to use profitable a situation in the market and changes in the company for deduction of the leading positions in the market, business developments and eliminations of financial risks", – Mark Roytenberg, the deputy CEO of CIBER, the project manager of M.Video says.

M.Video received the reliable tool for processes of budgeting, review of the budget and the sliding forecasting and also for investment planning of opening of new shops and the plan fact of the reporting of the company.