Week 3: Start Gathering Data
There are a few major deliverables that we’ll need to hit during the delivery phase. In addition to turning the assessment-grade model into implementation-grade, we’ll also be building a profitability model for another piece of the business. We begin by meeting with a series of subject matter experts on the client side to get a […]
Week 4-5: Loading Transactional Data
This week, we’ll focus on pulling together a workable transactional data set. With the help of the finance department on the client side, we isolate the relevant data from the general ledger and map it together with other financial reports to add dimensional detail to the numbers. At each step of the process, we reconcile […]
Week 6-7: Sorting Out the Variances
One of the more challenging pieces of profitably modeling involves investigating variances and gaps between the transactional data and the reported P&L figures. Generally, if the variance exceeds 1%, we’ll look into what’s driving the difference. This week, the focus is on revising our model to account for these variances.
Week 8: Validate the Model
After we’ve built out an initial cut of the model, it’s time to focus on client input and validation. This will involve socializing the profitability model with key stakeholders on the client team, collecting feedback and revising the model accordingly.
Week 9: Review with the Client
It’s time for our kick-off meeting with the validation team. After reviewing the profitability modeling process with everyone, we begin to demonstrate the capabilities of the model. The client seems impressed at the detailed visibility that the model provides. They’re able to select specific sites, customers and products and view the associated P&L right down […]
Week 10-11: More In-Depth Validation
We meet individually with each member of the validation team to gather feedback. Each team member represents a different business area and provides specific insight into the minutia of his or her operations. We learn of more one-off adjustments that we’ll need to make in order to improve the accuracy of the model.
Week 12: Debating Allocations
One of the most intensely debated areas is the methodology by which overhead costs are allocated down the transaction level. Our assessment-grade models primarily utilized transaction/volume based allocation rules; something that the client was not entirely sold on. This week, we incorporate the work of the Accunomics team focused on OPEX reduction. They provide us […]
Week 13: Put It to Use
Another round of validation/revision with the client. As people begin to utilize the model to perform profitability analysis on their own customers/sites/terminals, it brings to light other tweaks that need to be made.
Week 14: Powering the MOS
The profitability model data is “blessed” and ready to feed into the Accunomics MOS tool. The MOS front-end will allow users to run reports, conduct customer-level analysis, and develop and track plans. We’ll continue to run monthly updates to the model, but the MOS will now serve as the main interface to the client.