One of the UK’s largest construction companies, Taylor Wimpey (TW), has opted for a cloud-based tool to fulfil its long-term financial planning requirements, rejecting bids for on-premise solutions from both Oracle and IBM during the selection process.
TW opted for Anaplan, a cloud based financial planning tool, which it implemented during a major IT infrastructure refresh the company was carrying out at the same time.
Anaplan is used by the group to carry out its annual budget forecast, which takes place every year in October over a six to 8 week period, and allows financial directors to assess TW’s key performance metrics for the next four year period.
Prior to using the software-as-a-service tool, TW was using a complex mesh of spreadsheets that were dispersed across twenty UK business units, which accounted for the equivalent of 80,000 stock keeping units (each stock unit being a physical house the company is planning to build).
Computerworld UK spoke to David Nicholson, Taylor Wimpey’s business systems manager, who explained that the construction company needed to upgrade its processes due to its refresh plans.
“Our hand was forced somewhat when we decided to upgrade. During the economic downturn we decided that we were going to sweat our assets for as long as humanly possible, but now the market is showing signs of turning around, we have decided to do a refresh of our infrastructure and desktop estate,” said Nicholson.
The refresh means that TW was moving to the newer operating systems and apps, Windows 7 and Office 2010, for example. However, the spreadsheets it had been using were developed in 2003, so it was facing an end of life support issue. Alongside the infrastructure refresh, TW was also upgrading its legacy ERP to a construction specific system provided by COINS.
“That was another thing we had to think of – not just the end of life issues, but the changing application and process landscape that was required to tie into the new ERP system,” said Nicholson.
In April 2011, faced with the challenge of needing a new solution to draw data from all these new systems, TW engaged with the top vendors in financial planning and held a technology open day. Attending the open day were IBM, Oracle (both offering on premise alternatives) and Anaplan with its cloud offering.
However, Nicholson said that the team were not always certain the choice was going to be cloud based, and initially made comparisons based on functionality.
“When we appraised the separate vendor offerings we tried to keep it very much on a functionality footing – how close a fit was the functionality to our business requirements?” he said.
“What we found was that there wasn’t a huge difference between all the parties on this basis. So, as a team we though started to consider some of the non-functional aspects, such as deployment times, ongoing cost of ownership, support, ease of change etc.”
He added: “It was when we started bringing these considerations to the front that we favoured Anaplan. When you start to look at on-premise the costs start to rise – particularly in terms of having to buy the hardware to host it.”
TW outsources its IT, and because of this, getting the hardware in place would also have meant adding two to three months to the deployment timeframe, as well as the additional up front capital costs.
Nicholson added: “Anaplan is extremely keenly priced compared to the other top providers. Taking those hardware costs out, plus the ongoing support costs, really helps – it makes a significant difference.”
TW signed with Anaplan at the end of April 2011 and had implemented the tool and carried out its first, full P3 budget by the end of October 2011.
Nicholson explained that the finance directors in each business unit are able to now input their data into a centrally hosted tool, which is then reviewed by a central reporting team and then uploaded to Anaplan. However, Nicholson is looking to streamline this process in the future by integrating an API that allows finance directors to instantly upload data to the cloud. This will also allow the business units to upload data throughout the year, rather than just over the intense six to eight week reporting period in October.
“Ideally, going forward, what we are working on is a mechanism so that when the end user, the finance director, wants to extract data he can just click a button that takes the data from the COIN ERP and pushes it straight up to Anaplan,” said Nicholson.
“The infrastructure and technology exists, in terms of the API connect functionality, it just requires some internal development to put a nice front end on fit to make it a one click experience.”
He added: “This would give us a more accurate forecasting data, because you are constantly rebasing your actuals.”
Finally, Nicholson explained that the business and technology teams were both very concerned with putting sensitive financial data into the cloud, as this was TW’s first step into shared, externally hosted infrastructure. However, he said that companies should look at risk categories and assess them individually.
“This was our first foray into cloud solutions, and we were obviously concerned about the security of data. We were concerned about where it was physically hosted, general support, and also we were worried that if Anaplan grew with popularity, what that would mean for our resources on the multi-tenanted infrastructure,” said Nicholson.
“However, we asked ourselves: if someone got hold of our data, could they gain a competitive advantage? We concluded that they probably couldn’t. In terms of SLAS we asked: if Anaplan went down for a couple of days during that intense budget period, could we still hit our targets? We probably could”
He added: “It’s about breaking down all those concerns and looking at them in isolation.”