Mitre10, New Zealand's largest and most iconic home improvement and garden retailer, needs little introduction to Kiwis. A national co-operative established nearly half a century ago, it’s a nationwide network of over 80 stores run by owner-operators and employing more than 6,000 staff.

Fusion5 works with Mitre10’s central support centre in Auckland to build out best-in-class financial software and process across departments, providing steady and sound guidance in governance, strategy and architecture.

New technology solutions designed by the Fusion5 team have led to better collaboration, data sharing and reporting. From finance to stock management to cloud services, Mitre10 are enjoying greater data integrity, easier and faster forecasting, all leading to a more transparent, efficient and agile business.

Transforming financial operations brings massive efficiency gains
A business of this scale requires the latest AI planning technology for optimum business performance. Yet budgeting and financial reporting at Mitre10 was being held back by legacy software and processes.

Mitre10 had tried an alternative solution in 2014, only to achieve mediocre results. While still trying to wrangle its complex data sources, it was back in 2016 that Irvine reached out to corporate performance management (CPM) expert Ben Schofield.

Schofield had been delivering enterprise-class CPM solutions for more than 20 years. Yet, “Mitre10 had been burnt with a previous solution, so were still a bit sceptical,” recalls Schofield. “They suggested to us ‘It might be harder than you think.’ And we replied, ‘We reckon it will be easier than you think.’”

“Each department was using spreadsheets, which brought the usual problems, such as version control, and laborious manual input. Reporting to stakeholders, or preparing forecasts for the CFO and CIO, was a painful, inefficient and time-consuming process.”

James Irvine | Mitre10, Finance Transformation Lead

Phase one:
Automating financial planning creates speed and accuracy

“We had to prove value to them really quickly,” says Schofield, “so we developed a lean proof-of-concept offering an automated financial solution.” The proof-of-value revolved around use of IBM’s renowned TM1, a multidimensional analysis application on which a complete planning, budgeting and forecasting model could be tailored uniquely to Mitre10’s needs.

The solution takes all inputs natively into the system — no data validation is required, so the incidence of human error is massively reduced. “We gave them a solution within a set of parameters for a really high-quality output,” notes Schofield. Benefits include speed and accuracy, staff satisfaction (people can focus on higher value activities instead of manual processes), as well as the governance benefit of being able to track the database.

Pulled off within just two weeks, the first phase convinced Mitre10’s CIO, Phil Coster, that this could transform financial reporting processes for the company.

Phase two:
Proof-of-value exercise

“At that point,” says Irvine, “with our criteria met, we got approval to proceed.” The solution was rolled out gradually, at a pace the Mitre10 team was comfortable with. In March 2017, the automated financial planning and budgeting solution for the support centre was implemented.

Integrating data from across the organisation, this provided profit and loss, balance sheet and cashflow functions. The solution has allowed all Mitre10 store owners to centrally plan and forecast, enhancing historical reporting with variance and trend analysis. Compared with the previous spreadsheet format, staff can rely on data accuracy, leading to more confidence and better business decision-making. Online data entry is easy, creating a smoother, faster workflow.

Critical to Mitre10 was the need for Fusion5 to work flexibly and with maximum agility. “Finance teams never sleep,” explains Schofield. “So we phased the work in short sprints, giving small chunks of progress for the client to test and use. This iterative approach gave them time to onboard and build up their own knowledge.”

Phase three:
Empowering the merchandise team with reliable, accurate data

In May 2019, working closely with Mitre10’s team, Fusion5 began designing a budgeting and forecasting solution for the merchandise team, who had been suffering the same pain points around spreadsheets and labour-intensive legacy software. Launched six months later, the IBM Planning and Analytics solution delivered major sales planning efficiencies.

The team can plan and analyse data by store, department, subdepartment and SKU. The have master and data automated from source, with configurable dashboards and views to ensure each user has easy access to the information they need to contribute.

Forecasts that had previously taken three merchandise team members up to five days could now be produced within hours, yielding far greater visibility on long-term projections. “It was a major win,” says Irvine.

Phase four:
Moving to the cloud brings capacity and security benefits

Following a benchmarking project in August 2019 — involving performance evaluation across all the Mitre10 and Mega stores — the on-premises system was migrated to the cloud. This latest version of IBM’s Planning Analytics handles everything from sales and forecasting to supply chain and people management, in a modern SaaS model.

Users gained significantly improved performance and a greater level of security, as well as the flexibility to scale the solution right across the enterprise. The project has removed capacity constraints of maintaining on-site servers, bringing a much higher level of infrastructure availability, while only paying for what they use. Higher service levels and better business continuity brings business resiliency.

A relationship based on partnership and trust

With the ongoing drive by the central support centre to add value for its cooperative members, Fusion5 are currently working on productising the financial planning and forecasting solution for stores. As well as handling multiple financial year-ends, the solution is being designed to consolidate information from various source systems into a single staging database then sourced to Mitre10’s IBM TM1 analytical processing tool.

“I’ve really enjoyed the consistency of the team members at Fusion5. They have been with us from the very start in 2016. They understand our teams and have become part of Mitre10. And the relationship is ongoing — we’re always looking at the roadmap together and deciding what we can do next.”

James Irvine | Mitre10, Finance Transformation Lead
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