About the Client
The client, a leading mobile technology company in EMEA, faced significant challenges with their cost allocation methods. Operating in various global territories, the company relied on spreadsheet models that were not fit for purpose, leading to issues with transparency and accuracy.
The Challenge
The customer previously used a spreadsheet model to allocate costs to its diverse subsidiaries in EMEA and other global territories. This approach caused several issues:
Complexity and Errors:
As spreadsheets grew larger and more complex, they produced inconsistent results, leading to mistrust.
Inefficiency:
Excel models were time-consuming and unable to efficiently calculate costs due to large file sizes.
Lack of Transparency:
The model did not provide a clear understanding of what was driving the costs of shared services, leaving businesses unable to make fact-based decisions.
The company needed to track costs per product, segment, channel, and device to understand which were most profitable. However, the cost and usage data were contained in two separate, non-integrated systems, complicating the process of handling more than one month at a time using a multitude of spreadsheets.
The Solution: MagicOrange Platform
The telecom company turned to MagicOrange, a Gartner-recognized cost transparency platform, to provide an intelligent, cloud-native solution for achieving full cost transparency.
ITFM Framework:
MagicOrange helped establish an IT Financial Management (ITFM) framework, enabling the client to understand profitability and costs, utilise assets efficiently, and reduce manual effort.
Unified Interface:
The platform incorporated multiple drivers behind costs and enabled shared services cost allocations to be completed quickly and easily in one convenient interface.
“Telecommunications is a high-paced, fast-changing industry where costs vary enormously month-on-month. Now our customer is able to see this in real time and can be proactive by running special promotions to secure more business in a certain area,” said Blake Davidson, Chief of Staff at MagicOrange.
