Data modelling gives 5,000% ROI for brewer

Brewer and pub chain operator Greene King has toasted a return on investment (ROI) of "5,000%" after installing financial...

Brewer and pub chain operator Greene King has toasted a return on investment (ROI) of "5,000%" after installing financial reporting software based on data modelling technology.

The software, supplied for £12,000 by Cognos, has been used to create financial reports which have allowed Greene King's The Pub Company to cross-reference all types of data. According to Peter Hawkins, Greene King's finance manager, the first three or four reports netted the company around £400,000 in savings.

Greene King's investment highlights the opportunities for firms to secure substantial returns on investment from technology - despite the economic gloom. Earlier this month Scottish Power announced a 400% return on a £7m investment to link its enterprise applications.

Greene King's project was based on open database connectivity technology. This has allowed the Cognos financial modelling application to query information from a variety of closed Unix systems, used in the old reporting system, and compare information. "Cubes" of data are created using online analytic processing (Olap) which can be looked at in different ways.

Whereas previously company accounts staff could only query the profit and loss database singly, they can now examine multiple databases, such as profit and loss by region.

Hawkins said, "The existing [Unix] software was good at its job but bad at reporting. We can now get hold of data that was impenetrable before and also the relationships between data. We found a £200,000 cost opportunity with our first report and were able to trim £100,000 off our phone bills. Overall ROI is near enough 5,000%."

The Pub Company's financial systems include human resources, accounts, payroll and electronic point of sale which registers up to three million transactions per day. The reporting software fits over the top of these systems and the company makes regular use of 200 reporting cubes.

The Pub Company has just completed rolling out a Web-based version of the reporting system.

Helena Schwenk, an analyst at Ovum, said The Pub Company's move was a good one. "Alternatives to Olap are unwieldy and inflexible," she said. "Using Olap tools is a good move, but to implement them you need to define business measures, though this can be a useful exercise for the business to go through - giving a picture of how the business is operating. The challenge comes in changing culture and training staff to use software which they did not previously have to use."

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