CATEGORY: Analytic Applications
REVIEWER: Theral Mackey, director of financial management services for Mohawk Industries.
BACKGROUND: A public company since 1992, Mohawk Industries is the world's second largest producer of woven and tufted broadloom carpet and rugs for residential and commercial applications. Number one in brand recognition, the company's products are sold under the familiar names of Mohawk Carpet, Karastan, Bigelow, Aladdin, Galaxy, KidProof and Petagree. Last year, the company completed another record year with revenues of more than $3 billion, exceeding the industry growth rate by nearly six percent. Recently, Comshare MPC became part of Mohawk's strategy to keep costs in check.
PLATFORMS: A centralized Microsoft SQL Server database taps into the transaction data contained in Mohawk's AS/400 system.
PROBLEM SOLVED: In a mature market, cost reduction is important to our bottom line and to maintaining a good return to our shareholders. Mohawk chose Comshare to keep costs in check while growing the business. We grew so rapidly over the past several years that we outgrew our budgets. Today, we put more emphasis on actual results compared to budgets and view cost management as a significant element in maintaining profitability. We needed to move beyond traditional spreadsheet budgeting, capitalizing on the latest technology and industry knowledge, to make our operations even more efficient. This gives managers the tools necessary to be more aware of costs so they can make better management decisions.
PRODUCT FUNCTIONALITY: The new system, dubbed Mohawk Planning and Control, uses Comshare MPC to centralize information for its regional and divisional users and empower them with budget and cost information that will keep the company efficient and profitable. Accountability for lowering costs is given to the people responsible for that cost, and evaluation of their performance is tied to results. With Comshare, we can see what those costs are, be assured we are looking at the same version of information and act upon it. Over time, the use of the Mohawk Planning and Control system could move even further into our organization to our line-item managers.
STRENGTHS: Comshare MPC enables us to practice even better control over costs reducing those we may have overlooked in the past. Budget holders are given more decision-making power over their operations while accepting more responsibility for operational profitability. We use Comshare to report budget versus actual numbers and variances in both numeric and graphical form.
WEAKNESSES: The payroll-planning module does not provide a convenient means to locate an employee record other than a list of employees in each business unit. Additionally, transferring employees in the module from one business unit to another cannot be accomplished en masse; employees must be transferred one at a time. For companies such as ours with frequently changing organizational units, this can be very time-consuming.
SELECTION CRITERIA: Our goal was to identify and implement an enterprise- wide management tool that went beyond budgeting. Comshare's ability to connect remote users with minimal effort through the Web was a major attraction. Geographically dispersed budget holders have a means to efficiently gather budget data and formulate their budgets using a central database. The new system gives greater ownership and responsibility at the department level, where day-to-day decisions that keep operations cost-efficient and profitable are made. Its flexibility, built-in management reporting and analysis capabilities, and a variety of add-on capabilities make Comshare MPC even more valuable to us.
DELIVERABLES: The Comshare system has already had a positive impact on Mohawk's bottom line. With Comshare MPC, we started the process of finding extra savings at the operational level. Our goal is to move those savings directly to the bottom line, increase our shareholder value and push the stock value through the roof. Comshare is helping us do just that.
VENDOR SUPPORT: Everyone at Comshare has been extremely interested in our company and its success. What impressed me was their willingness to go the extra mile when we needed assistance. They listened to what we needed and approached everything with a consistent methodology that helped us define what we were trying to do and complete the task.
DOCUMENTATION: The documentation is available in an online format for both end users and developers. The end-user documentation is easy to understand and contains many links to additional information. The system administrator documentation is technical in nature and includes many examples and troubleshooting tips. An experienced user can run the product with the documentation provided.
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