Hong Kong Housing Society optimizes financial reporting and planning with IBM Cognos

The pace of change in the property market and the population however has constrained HKHS’ ability to manage financial planning and reporting due to limited resources. Preparing reports using their legacy spreadsheet-based process could require up to ten days a month. It also lacked agility and the ability to accommodate changes.

HKHS, for instance, found that the old system could not meet the demands of their planned and active projects which often span many years, from the time of land acquisition, right up until sale and continuation of maintenance services. Such issues also applied to report preparation for individual estates and managed properties, each of which has its own requirements: they span different financial years, encompass different facilities, and operate under different Owners’ Corporations – the demands of which could vary significantly from case to case.

“Each Maintenance and Management report has to be tailored to the specifics of the managed property,” says Helena Hsu, Senior Manager, IT Solution Delivery, HKHS. “It’s not something to which you can apply a one-size-fits-all approach.” Functionally restricted standard reporting resulted in ad hoc analyses, difficulties in implementing new tasks, and complicated operation for many users.

HKHS’s requirement was clear. It needed a central planning solution to run its monthly financial reporting process to significantly reduce the time required while managing financial performance in a very dynamic environment. To address this need, HKHS decided to build their financial datamart with IBM Cognos.

Through this financial datamart project, HKHS could drive process improvement through a redesigned processes; capture data at source to minimize duplication of efforts and increase accuracy; and transform data into the executive dashboard to better facilitate fact-based decision making.

“With only fifteen employees managing the accounting requirements for the entire business, we needed a high-performing financial reporting system, one which would also be transparent and flexible enough to dig out more insights for property management,” Hsu says.

The challenges faced

IBM identified several key challenges for HKHS with its financial reporting process. The first was consolidating data from different systems. Apart from its Accounting and Integrated Property Management Systems, the organization was using historical data stored in Excel spreadsheets dating back 18 years. It was an obvious issue with data storing in so many different places, and HKHS knew that it needed a far stronger platform to base any further solutions on.

The second challenge was the sheer volume of report types which the accounting department dealt with. In total, HKHS required more than 150 different types of reports, with accounting personnel having to source data from different departments and prepare tailored reports.

Furthermore, the volume of data that HKHS was dealing with was growing at a substantial rate. HKHS had about 16GB of data covering a period of 18 years, and this was growing at about 100MB a month. “In and of itself, this wasn’t a problem – but what it meant for the accounting team was that they were faced with an ever-increasing amount of raw data to sort and sift through. We had to find a way to manage that data so that the team could easily find what they need and turn it into financial reports,” Hsu says

Delivering financial reporting twice as fast

After research involving the reports’ end users, HKHS put forward three main criteria for the solution: that Excel would remain the primary interface (since users were already familiar with its operation); that the system would allow dynamic grouping to cope with the different types of reports needed; and that strong performance was required to cut back on report lead-time. The HKHS team ultimately chose Cognos TM1, with IBM not only implementing the system, but also providing professional training and consulting throughout the delivery process. “What we’ve done is creating a financial datamart on IBM Cognos from which anyone can pick the data they’re looking for,” Hsu says. “This solution has proved highly beneficial to us. Our users take up to 50% less time to prepare monthly reports, and the time saved means they have the capacity to deliver other services to both internal and external stakeholders, meaning everyone is both more efficient and happier as a result.”

“It’s faster for reporting, and it’s transparent – Cognos gives you drilldown options and a clear audit trail – and it’s flexible in an easy-to-use manner,” says Hsu. “What this means is that we can now create reports however we want and when we want, without having to go through the onerous and manual processes that we had to before.”

Cognos delivers various key technical aspects such as allowing temporary or permanent adjustments, financial data commentary, synchronization of meta-data, as well as various auditing requirements. This added functionality has proven especially useful for HKHS, not least because of the user-friendly interface and training provided by IBM.

The organization now has a far more transparent view of all financial-related activities across development projects, rental estates, managed properties and its individual departments. The resulting decision-making knowledge is therefore supporting HKHS’ cost management strategy to increase efficiencies and help identify and exploit new potential.

“IBM’s experience in the property management market was clearly evident when they were delivering the system,” Hsu says. “They were not only able to offer us a highly flexible and powerful reporting solution, but did so in a way which left us in no doubt as to how we could use it to our best advantage.”

Finding a right partner

The project kicked off in September 2009 and was divided into three phases. The first phase focused on managed properties reports and was completed in May 2010. The second phase which centered on division and consolidation of reports, and the third phase of management reporting, were completed in March 2011.

“For a project of this size you really need an experienced partner who can help foresee potential pitfalls and come up with solutions,” says Hsu. “We have been working with 20 years of data so you need to be realistic about what kind of hardware setup you need to be able to handle all that data. Starting out with a clear definition of the project and your expectations is critical to success, as is an honest evaluation of both the technical and human resources at your disposal. Having an open dialogue with a partner up front definitely helps eliminate problems down the road.”