Health & Science Products
This company manufactures and distributes a broad range of products for the life science research and clinical diagnostic markets. The company is renowned worldwide among hospitals, universities, major research institutions, as well as biotechnology and pharmaceutical companies and serves more than 100,000 research and industry customers worldwide through its global network of operations. The company employs over 7,000 people globally and had revenues exceeding $2 billion in 2011.
Maintaining a convoluted planning cost allocation model based on Excel workbooks was time-consuming and difficult to use. The company’s model covered:
- 30 individual cost pools, each with a different allocation basis
- 215 departments (both source and target)
- 5 allocation cycles (where many cost pools received allocations from prior allocation steps)
- Executing allocation cycles for each planning iteration took days to change and test
Senturus implemented a single, multi-dimensional allocation calculation model (cube) that both simplified and centralized cost allocations and dramatically decreased the time required for planning.
Key features of the model include:
- Dimensions: cost pool, allocation cycle, target department, and planning month.
- Central control table for all allocation bases.
- Central control table to define each cost pool.
- Multi-step, automated macro is able to automatically and quickly:
- Refresh source department planned costs (after each planning iteration).
- Refresh the latest allocation bases.
- Calculate the allocations for each cycle and hand-off to the next cycle.
- Post the allocations and their off-sets to both source and target departments.
Allocation changes which require a model structure change–such as including new target departments, changing allocation bases, and new cost pools–can now be made within an hour from start to finish instead of requiring days. This includes the time required to change allocation parameters, pull in most recent actual and planned expense data, and execute the allocation cycle program macro. The whole process can be managed centrally by finance staff with dramatically reduced risk of errors.
Complete allocation cycles can be performed by the program within ten minutes instead of the hours it took to accomplish this manually.