CME case study
CME implements transparent top-to-bottom forecast process in record time
Central European Media Enterprises (CME) is a leading media and entertainment company that serves approximately 50 million people in six Central and Eastern European markets. Its three divisions (Broadcast, Media Pro Entertainment, New Media) create and deliver content over the Internet and across 33 commercial and subscription television channels. The local programming it produces is consistently the most popular in the region.
Bruce Dixon, vice president of financial planning and analysis, and Deborah Cleaver, senior manager, group FP&A, are responsible for forecasting and budgeting for the entire CME group. The task of creating a comprehensive and transparent forecast across three divisions, six regions, and dozens of locally managed teams is a highly complex operation that requires a 15-strong team of dedicated power analysts.
The Business Problem/Challenge
At the beginning of 2012, the FP&A Team was using a combination of Hyperion Enterprise and Excel spreadsheets to upload, consolidate, and retrieve data from each of their local stations to create the forecast. “We had the usual spreadsheet problems,” recalled Deborah, ”Excel would crash at the most inconvenient time. A change in one spreadsheet would have to be manually entered in the others. We wanted to move toward more stable, consistent and transparent forecasting.”
Even when things were going right, without a connected cash flow or balance sheet, the manual work required to tie up the numbers was prohibitively time consuming. ”I believe an FP&A team should be all about the analysis – but due to application limitations in our organization, my team was spending almost all of their time collecting and processing data.” said Bruce.
An additional challenge also lay on the horizon: CME was beginning a go live process for a new financial system undergirded by a “future-proofed” and complex data model. “The new data model was designed so that there would be a place for every single data point, both now and in the future, across our business,” explained Deborah. “We knew our already overloaded spreadsheets simply wouldn’t be able to handle the kind of dimensionality that would require.”
With spreadsheets not a viable long-term option, it looked like they were going to have to enter into a lengthy consulting and implementation process with their existing platform. “We had thought there were only two options,” said Bruce, “Excel, or the big implementation consulting route, which we knew was going to take a minimum of seven to nine months if all went according to plan. But we needed something ready in five.”
Curious about the alternatives, Bruce began investigating other solutions recommended by peers in the industry. “It was immediately clear that cloud was the way to go,” Bruce recalled. “It was going to give us the immediacy and control that the big EPMs couldn’t. Our business is constantly evolving, our data model is constantly changing, and we needed that flexibility to keep up.”
Amongst the many offerings, Anaplan stood out. “It was the pedigree,” Bruce said. “A lot of companies were riding the new technology wave, but Anaplan was the only one combining cloud-based in-memory computing technology with deep industry experience. It was obvious that these were people with an in-depth understanding of the business problems we were facing, and that they’d designed a platform to address them.”
CME Forecast & Budget Consolidation Structure
The challenge that Bruce’s team faced was not just to build a new forecast, but to build one under serious time pressure and integrate it with an ever-evolving data model. “Most implementations take place on top of relatively stable systems,” said Bruce. “We had to implement something on top of a lot of complex moving parts, and do it in just a few months. We had a lot of skeptics at the beginning of this project and it’s been very satisfying to see them converted over the course of the project.”
Bruce and Deborah began to believe it might be possible to “make a miracle happen,” after the first walk through with Anaplan. Deborah remembered “we took Anaplan through a complex piece of our sales model and within 24 hours they’d put together something that we could, with a few tweaks, effectively have used. That was when we began to appreciate that Anaplan had the flexibility to bring a model through several iterations in a very short period of time.”
Ease of Build
Anaplan’s user-friendly interface and natural business language was a quick study for CME’s Excel-savvy FP&A Team. After beginning the design with an on-site Anaplanner, they quickly graduated to self-sufficiency. “Our model builders started cross sharing and supporting each other, supplementing their efforts with remote support from Anaplan,” said Deborah. “The most important thing for us was to be in control of the project to deliver what management needed on time,” Bruce added. “Anaplan, and our team’s commitment, gave us that control.”
Even so, the implementation was a daunting undertaking. CME’s new data model had 18 different dimensions, four of which were consolidated in Hyperion, and that all had to be reflected in Anaplan. “We’re not just talking about a model with one line of revenue – when every data point has to map to 18 dimensions, things get very big and complicated,” said Deborah. “But Anaplan had the power and agility to handle it.”
Seven key model builders started their training at the end of April with no prior knowledge of the platform. They learned how to build, went away to design the models themselves (with guidance from Anaplan), and by late June had put together something that delivered totally connected forecast and financial statements each month. In just 12 weeks they went from training to live deployment and beat their deadline. “I don’t think there is another system out there that is capable of doing what we did with Anaplan,” said Bruce.
In difficult economic conditions, the need for transparency and precision planning has intensified. “In our business there’s value in doing analysis at an extremely detailed level,” said Bruce,”for example, analyzing the contribution of certain products within our broadcast schedules. That’s now a lot easier to do.” In fact, one of Bruce’s favorite things about the platform is the way it renders complex operations simply: “I think that despite the high level of detail that we require in our forecast models, a lot of our employees don’t realize the immense complexity of the data model we’ve built in Anaplan, which is great. The end result makes it easy for them to focus on the analysis that will provide the necessary business results to management. There’s a real sense of each individual contributing value.”
The finance team is already seeing significant improvements in productivity as a result of the switch to Anaplan. “To give you a concrete example,” offered Bruce, “our Board Report turn around time used to take six to eight working days. With Anaplan we’ve set a new record by turning the report around in two days.” That kind of efficiency has enabled the team to put the “A” back in FP&A. “We used to work reactively,” said Deborah, “but Anaplan allows us to work proactively, giving us more time to analyze the business.”
CME management has been “hugely impressed” with the progress the FP&A team has made with Anaplan in a few short months. Because of this CME has decided to deploy the power of the Anaplan platform down to the local level in each broadcast region. “Our goal is for Anaplan to be fully integrated into local planning processes so that it connects the whole organization from the bottom all the way to the top. That will give our forecasting process and operations the transparency and efficacy we’ve always wanted,” said Deborah.
- Complex forecasting process involves 18-dimension data model
- Implementation of planning system needs to be coordinated with the implementation of new financial systems
- Three month go live deadline
- Implemented Anaplan to replace spreadsheet and Hyperion combination with a single complex data model on the Anaplan platform
- Finance team and solution architect designed, built, and tested model successfully in three months to meet the go live deadline
Results at a Glance
- Replacement of disconnected spreadsheets and integration of disparate data
- More stable, consistent, and transparent forecasting from bottom to top of organization
- Board report turn around reduced from six to eight working days down to four