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Customer Perspective: Building a transparent audit trail

April 18, 2007

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De Alliantie was created in 2001 via a merger of four housing corporations and a project development company. After a wave of mergers in the sector and the government's decision to withdraw as financier, the competition in the housing sector was intense.

Housing corporations were required to find new activities outside of the traditional scope of business in order to help them remain profitable.

A new business model

"We were required to switch from a budget-based business model to strategic planning to help further develop into an effective and professional real estate company," says Arnold Pureveen, Group Manager, Finances and Information Services for De Alliantie.

"The difficult part was maintaining the right balance between attaining a good return on our investments while providing affordable social housing for our customers.

We needed to maximize the return on our project development and sales activities, and optimise the return on social leasing. We need to be able to really focus in on what we were able to sacrifice concerning return and what would we gain back in terms of meeting our objectives."

De Alliantie went in search of a suitable management information environment. "We wanted to support our management cycle with a single solution that could link strategic information, financial information, and risk profiles to help obtain optimum insight into the activities," says Pureveen. "For us this meant Cognos."

Up and running in a mere nine months

De Alliantie opted for a performance management solution based on Cognos 8 BI and Cognos 8 Planning. Within only nine months they were able to create an integrated platform for planning and budgeting, consolidation, reporting and analysis, and scorecarding.

The platform makes direct use of data from the SG| Tobias ERP system. Personalised Web portals with standard reports give the users – budget managers and controllers of the subsidiaries and management at group level – access to the required information.

In addition, OLAP cubes make it possible to analyse core areas such as ownership, maintenance, finances, and collection policy.

Soon the link with a risk management system will follow, and risk management will be added. A scorecard with 10 key performance indicators (KPIs) allows management to measure and fine-tune the performance of the strategic objectives.

A single, integrated system

"A major reason for choosing Cognos software was that it was the only platform that truly offers a total solution for Performance Management," says Pureveen.

"Not separate modules, but a system in which all parts communicate directly with each other and make use of unambiguous data and definitions. With Cognos we can now view information from different points of view, always based on the same data."

Faster budgeting and a transparent audit trail

People across the organization at De Alliantie have enjoyed immense benefits from the performance management platform. In addition to enhanced reporting, analysis and scorecard capabilities, the planning and budgeting process has been substantially improved.

"Budget managers communicate the current state of affairs via standard reports, so that at group level we have clear insight into the financial results," says Pureveen.

"If there are deviations with respect to the yearly prognoses, we can make timely adjustments. The budget managers and controllers of our offices analyse the figures and justify the findings that are visible in Cognos.

This ensures an extremely transparent audit trail. This new clarity into the business has also meant that budget managers who perform well can be rewarded in order to motivate continued good results."

With Cognos, the consolidation process has also been accelerated considerably. The creation of a consolidated quarterly report can be done in three days as opposed to six weeks. The annual accounts are now ready within four weeks, less than half the time it used to take.

In addition, the chance for error is minimal because the controllers no longer have to retype data into spreadsheets. The scorecard ensures that De Alliantie not only is managed based on financial results, but performance can also be evaluated from other points of view.

For example, to what extent was the organisation successful in making available a suitable level of housing, and what is the status of the dynamism among the personnel or of maintenance?

"Together the KPIs constitute an early warning system. We can see whether we are achieving our objectives, measure the effectiveness of measures taken, and manage in an integral way," says Pureveen.

Next steps

Currently, De Alliantie uses Cognos scorecards at the group level, but soon the subsidiaries will also begin working with them. They also plan to integrate the performance management platform with the back office, and transform the system into a shared service center.

"Invoicing data, for example, will then be directly entered into the financial administration component of the ERP system using OCR technologies. This information will then be available in digital form to all working locations," says Pureveen.

"This will mark another major improvement in efficiency for the organisation."

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