Immersion in other cultures is a key part of EF Education First’s philosophy – but the need to co-ordinate accommodation and staffing for thousands of students makes financial planning complex.
EF has gained unprecedented control over and insight into its finances with IBM Analytics solutions, collecting and consolidating budget figures from hundreds of employees with ease.
Fastermore flexible implementation of comprehensive models and calculations
Savestime on budget creation, enabling users to focus on analysis and decision-making
Boostsdata quality and standardization, creating greater trust in plans and metrics
Business challenge story
Researching a better way
Every business needs to be able to manage the balance between costs and pricing. It gets even more complicated when you are working in multiple countries, and with costs that vary significantly over time.
EF Education First (EF) provides language tuition around the world, often by immersing students in another culture. As student numbers fluctuate in different markets and destinations, the company must manage a dizzying array of costs relating to staffing, accommodation and educational materials, and price its offerings to maintain healthy profits while also maximizing sales. With thousands of employees influencing its budgets and financial plans, the company had difficulty ensuring a consistent approach to calculating costs and collecting data.
Equally, a study destination might attract more students at certain times of year, or might grow or wane in popularity over time – which means that the number of permanent and temporary teaching staff required needs to be carefully planned. To maximize sales, defend profit margins and maintain a high level of service for its students, EF needs its pricing model to take all of these factors into account.
Olivier Bonomini, Head of Business Engineering at EF Education First, explains: “EF has always been a very successful, sales-driven company, which means the organization has naturally grown faster than the systems that support it.”
A principal part of EF’s unique offering is educational programs abroad, which involve accommodation, staffing and other costs which vary from country to country and over time. For example, a student from Germany who wants to study Spanish in Costa Rica might have a very different cost and revenue profile compared to a student from China who wants to study English in California.
Historically, EF had relied on spreadsheets to collect and compile financial and operational planning data from employees. As a highly decentralized organization, this was no easy task, and it was difficult to ensure a standardized approach to calculating figures and creating accurate budgets.
“Our financial controllers were so focused on gathering and verifying data that they had little time to run analyses,” says Bonomini. “For the largest division alone, we maintained 250 spreadsheets. If we wanted to achieve the top-down target-setting essential to our business strategy, it was clear that we needed a change.”
Making the grade
To transform its business planning processes, EF chose to deploy IBM Planning Analytics (formerly IBM Cognos® TM1®), working with IBM Premier Business Partner Attollo AB to ease the transition to the new system.
“We selected Planning Analytics because we felt that the IBM solution was more flexible and versatile than the competition,” comments Bonomini. “We were also impressed by the number of companies willing to act as a reference because of their successful adoption of Planning Analytics.”
EF began by rolling out the solution to one division, gradually replacing spreadsheets until it was possible to build a full profit and loss statement (P&L) in Planning Analytics. Since then, the solution has been rolled out to four other divisions and a total of 800 users, with plans to extend it further.
“Everything is now customized according to the business role of the user – each business function has its own template for calculations within Planning Analytics, which are then combined to form the full P&L,” says Bonomini. “For example, our sales department can enter marketing and office costs, while our school directors maintain the school production budgets, and so on. Planning Analytics helps us manage complexities such as cross-allocations between divisions, and employees who work for more than one function.”
Although it is still early days, EF has already begun investigating scenario modeling with the solution, which will help the company to take better decisions than ever before.
Bonomini elaborates: “For example, we can simulate different student traveling scenarios and different price strategies to find the optimal pricing for each specific market and school.”
Top marks for insight
With Planning Analytics, EF is gaining greater control over and visibility of the calculations behind its budgets. As a result, the company can trust the figures more than ever, and rely on the insights gleaned from them.
“By transforming our approach to budgeting with Planning Analytics, we have boosted data quality at EF,” says Bonomini. “It is now possible for us to enforce standards from the top down, something that was very difficult to achieve before.”
By saving financial controllers time and effort on compiling plans and budgets, the solution is also helping to foster a culture of more analytical decision-making at EF. Bonomini adds: “We estimate that Planning Analytics will save each of our controllers around two weeks during every reporting cycle – valuable time that can be invested in analyses to support better strategic decisions.”
Above all, the ability to price and re-price its offerings, faster and more accurately than ever before, is helping EF stay in tune with its ever-changing markets.
EF Education First
EF Education First Ltd. is an international education company founded in 1965 and based in Luzern, Switzerland. It offers a wide range of educational programs, from language training, educational travel and academic degree programs to cultural exchanges, serving people of all ages. The company operates approximately 500 schools in more than 50 countries, employing 15,000 full-time office staff, 3,500 full-time faculty and 16,500 part-time teachers, leaders and tour directors.
- Cognos TM1
- Educ: Effective and Efficient Administration
- Planning Analytics
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Attollo AB is a consultancy company specializing in business intelligence and corporate performance management. Based in Stockholm, Sweden, the company employs more than 40 people, averaging ten years’ professional experience in these fields. To learn more about products, services and solutions from Attollo, please visit attollo.se