Feeding America Prophix Case Study

Automating Financial Processes
to Improve Performance for
your Not-for-Profit Business
Tim McCarthy
Finance Manager
Feeding America
INTRODUCTION
Feeding America
Feeding America is the
nationwide network of
200 food banks that leads
the fight against hunger
in the United States.
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Operating since 1973
Website: www.feedingamerica.com
Head office: Chicago, Illinois
Annual revenue: $2.1 billion
Number of employees: >200
ERP: Microsoft Dynamics NAV
VISION
MISSION
A hunger-free America
To feed America's hungry through a nationwide network
of member food banks and engage our country in the
fight to end hunger.
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Feeding America’s Impact
46 MILLION AMERICANS
served annually, including 14
million children and 3 million
seniors.
10 MEALS
sourced and distributed for each
dollar donated.
3.3 BILLION MEALS
1 BILLION POUNDS
sourced annually.
of fresh fruits and vegetables
sourced by our network in 2014.
202 FOOD BANKS
650,000 VOLUNTEERS
in our network, 61,000 agencies.
help carry out our vision for a
hunger-free America.
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
How the Network Operates
FOOD REACHES THOSE IN NEED
Donations are provided to people in need at food pantries, soup kitchens,
youth programs, seniors centers and emergency shelters.
FOOD IS DISTRIBUTED AND STORED
Member food banks ensure the safe storage and reliable distribution of
donated goods to local charitable agencies.
FOOD IS MOVED
Feeding America moves donated food and grocery products through member
food banks to where they are needed most.
DONATIONS ARE MADE
Feeding America secures donations from the food and grocery industries,
government agencies, individuals and other organizations.
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
TIM MCCARTHY
Finance Manager
Feeding America
Previously worked as a technology consultant
specializing in CPM software deployment –
focused on financial planning and reporting.
Responsibilities at Feeding America:
Budgeting/forecasting
Financial reporting
Data analysis
System development and administration
Financial process improvement
Product valuation
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
CHALLENGES
Challenges
Symptom:
Underlying problem:
Difficulty projecting future
performance, producing an
accurate revenue forecast.
Budgeting and forecasting in our
space involve unknowns. Our
data analysis doesn’t allow us to
evaluate future scenarios.
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Operating revenue:
5%
95%
Predictable operating revenue
Questions:
Will we
receive the
gift?
When will we
receive the
gift?
Will
the gift be
restricted?
What
happens if we
lose a major
donor?
All other operating revenue
Which
programs are
fundable?
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Symptom:
Underlying problem:
Wasted time beyond Finance,
across the organization.
Heavy reliance on Excel, and manual data
entry and review.
Those aren’t
my budget
numbers!
Can I just
divide by
12?
Finance
changed my
budget!
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
The organization’s growth meant we
could no longer operate like this.
Analysis
Report
creation
Data
validation
Spreadsheet
budget entry
Spreadsheet
aggregation
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Evaluation Process
Recognized the need for Corporate Performance Management (CPM) software as a
centralized reporting/planning solution. Still needed to prepare internally.
Internal pre-work to set out needs helped to define the evaluation process.
Business
process
assessment
Business
process flow
chart
Individual
responsibilities
RFP
issued
Vendor
demos
Vendor
evaluations
Contract
negotiation
Reference
checks
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Deciding Factors
Intuitive look
and feel
Cost
Robust
reporting
capabilities
Minimal IT
support
requirements
Financefocused
admin, not ITfocused admin
Future product
development
Based on
vendor
proposals and
demonstrations,
we selected
Prophix
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
RESULTS
Implementation Process
Internal deadlines required us to create an aggressive implementation plan.
10
4
DAYS
DAYS
Conduct Prophix
admin. training
15
Perform on-site
needs analysis
15
DAYS
Implement and
configure system
ONGOING
DAYS
End user
manuals
End user
system training
Implementation
included
Microsoft
Dynamics Nav
integration
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
First 100 Days
IMMEDIATE BENEFITS FOR THE ORGANIZATION
Less reliance
on Excel!
Easy access to data
as needed
Sense of
ownership
Simplified
budgeting inputs
Data integrity and
transparency
Reports on-demand
vs. on-request
Intuitive – short
learning curve
Minimal IT
support
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Automated and streamlined processes
Budgeting
Simplified, no longer relying on
distributing/collecting 40+
workbooks
Financial reviews
Enhanced Board and
Management reporting
Financial reporting
Strategic planning
Additional development of
financial reports
Development of a strategic
planning model with a 10-year
outlook
Ad hoc reporting
Software upgrade
Utilized Ad Hoc Analysis to
streamline PowerPoint reporting
Upgraded versions of Prophix with
no problems and minimal effort
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Improved Analysis
Feeding America produces analytics showing:
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Financial trends
Year-to-date against plan
Average expense per headcount
Average revenue generated per headcount
Helps to track performance and better manage resources:
•
In 2014, Feeding America had a large surplus
–
If this happened again, donors could misperceive this as Feeding America
mismanaging investments (and donate less)
Enables Feeding America to identify where donor dollars go:
•
Tracking and showing donors how donations led to a specific
number of meals served or pounds of food/produce delivered
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Data-Driven Decision Making
Feeding America’s executives use planning
information to make/justify their decisions
‘WHAT IF’ ANALYSIS ANSWERS QUESTIONS LIKE…
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What do we have to invest to get the results we want?
Which channels (e.g., retail, manufacturing, produce) have
the best opportunity to secure inventory to distribute to the
food banks?
Where can we best invest our money?
How do we obtain the highest ROI for our fundraising?
– Conduct scenario planning for various outcomes
– This is the key to the financial forecast and longer term
projections
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Data-Driven Decision Making in Action
Core question:
Springwire offers free
access to tailored
communication tools,
like cell phones.
Can Feeding America distribute
Springwire’s inventory (effectively
acquiring their business)?
 Using Prophix to evaluate
viability across an 18-month
R&D program through
December of 2015
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Data-Driven Decision Making in Action
PRODUCE PILOT
 At 5 food banks across the United
States
 Goal: evaluate the viability of running
food banks with far more produce
 Stock levels at an all-time high
 Seeking to understand why produce
doesn’t move at regular locations
 Problems with distribution? Lack of
interest? Inventory levels?
Prophix helps analyze
the financial viability
of running their
locations this way
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
KEY LESSONS
Symptoms to Watch for
Difficulty
projecting
future
performance,
producing an
accurate
forecast
Overreliance on
Microsoft Excel
+ wasted time
across and
beyond the
finance
department
Inability to use
all of your
valuable
information
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Preparing for the Software Solution
Review and document
your budgeting process
Map out your existing
financial processes
Assess individual
responsibilities in Finance
Evaluate CPM vendors
and request demos
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Getting the Most out of the Software
Automate your
financial
processes with
an eye toward
better use of
your
information
Ask yourself:
“What could
we accomplish
with improved
analysis and
insight into our
numbers?”
Build Executive
or Board
reporting that
allows senior
stakeholders to
leverage
insights
Your
imagination is
your only
limitation. If you
can measure it,
you can model
it with CPM
software
FEEDING AMERICA + PROPHIX SOFTW ARE INC.
Together, We Will Solve Hunger
Feeding the Nation, Leading the Movement and Strengthening the System