Tracking finances on the rails

Getting trains to run on time is simple enough; Mussolini accomplished that back in the 1930s. Getting financial data on time is much harder, but US-based BNSF Railway is managing to do that, too. BNSF is the result of the merger or acquisition of 390 railway companies dating back 150 years. It has 40,000 employees running 6,300 locomotives pulling 220,000 freight cars over 32,000 miles of track.

BNSF's financial reporting system was just as complex as its web of tracks. It was based on more than 2,000 Excel spreadsheets and required extensive manual entry, and not all managers were relying on the same set of numbers. Worse than the complexity, the data they were operating on was at best a month old.

To resolve these issues, BNSF built a business intelligence dashboard called OnTrack Forecasting and Budgeting.

"Requiring all budget managers to use the OnTrack tool for all of their forecasting and planning activities enforces the BI standards," says Bart J. Boudreaux, BNSF's director of BI. "Rather than having multiple numbers in multiple spreadsheets, the numbers now all originate from the same source."

Now, regional managers receive data daily on costs such as payroll, travel and entertainment. They see where there are variances from predicted expenditures and take fast action to bring spending in line.

Based on Essbase from Hyperion Solutions, OnTrack gives managers immediate access to 43 operational metrics and the ability to drill down into the underlying data. Previously, when an analyst entered data, the legacy system would process it overnight before the analyst could see if there were errors in the plan. Now an answer comes back within minutes of loading a plan. It used to take a week to set up the spreadsheets for the next forecast; the new system takes three hours.

"It took us a long time to put together a forecast or any reporting we wanted to do," says Scott Jimison, BNSF's general director of planning. "Now we are able to push a couple buttons and spit something out."

This has translated into two key benefits for BNSF. By working with information in near real time, executives can make operational adjustments midstream, rather than waiting for the end of the month. And by freeing up the time spent gathering and entering data, users can spend more time analyzing it and taking actions that improve operations. According to Jimison, this lets BNSF generate models for target-setting and provides management with more-robust information.

"Configuring spreadsheets as interfaces to centralized data, metrics and business logic helps companies improve the speed and quality of decision-making," says Dan Everett, a BI analyst at Ventana Research.

"When you take that manual effort away, you turn it from finger power into brain power," says Jimison. "Putting the power back in the hands of the user is an important feature."

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