3 / 8
© 2017 Strategic Treasurer.
All rights reserved.
| 3 |
TREASURY UPDATE NEWSLETTER - 2017 Q 2
forecasting operations through Excel. Using Excel,
historical data was exported from Chick-fil-A’s
ERP system and banking portals, and forecasts
were created for the company as a whole based
primarily on percentage of sales. This forecast
was constantly refined as fresh sales data became
available throughout the course of the year. Using
this method, Peterson’s team was able to achieve,
on average, less than 10% variability overall between
forecast-to-actual for short-term and medium-term
ranges.
This forecasting workflow is the one that
Chick-fil-A has utilized for years. However, as
Chick-fil-A grows, treasury has been confronted
with the need to find a solution that can automate
and streamline this increasingly complex process.
With annual sales from 2,000+ storefront locations
now exceeding $7 billion dollars, 10% variability on
forecasts no longer makes the cut. Ideally, Peterson
would like to see variability on forecast-to-actuals
come within 5%. At the same time, the reporting
tools available through Excel have outlived their
usefulness and Peterson would like to implement
a solution that allows for efficient generation of
automated forecasting reports based on specific
queries. In order to accomplish these objectives,
Peterson realizes that Chick-fil-A needs to find a
tool that can easily incorporate a wide range of data
points into the forecasts to improve accuracy and
also generate automated reports based on the data
for informative visualization and effective analysis.
CHICK-FIL-A’S TMS SKEPTICISM
At first glance, it would seem the predicament
that Peterson and Chick-fil-A face is one that could
be easily solved through the implementation of
a TMS with enhanced forecasting capabilities.
Furthermore, Chick-fil-A represents what most
treasury technology vendors would find to be an
ideal potential client as they prepare to make the
jump from Excel to a more sophisticated forecasting
solution. However, Peterson is admittedly skeptical
on the benefits that a TMS solution would provide.
Having seen numerous demonstrations in the past,
he remains unconvinced that today’s TMS offerings
have the capabilities he seeks.
According to Peterson, the treasury products he
has seen that offer forecasting provide little more
than what Chick-fil-A currently utilizes via Excel,
but are far more expensive. And while Peterson
acknowledges that progress along that front has
been made, he is still skeptical that the added
functionality is worth the investment.
AN ALTERNATIVE
FORECASTING APPROACH
Rather than adopt a TMS, Chick-fil-A’s treasury
department is instead considering the adoption
of two software solutions that are currently being
utilized in other areas of the organization. These
are Alteryx, a self-service data analytics platform,
and Tableau, a provider of business intelligence
software with a focus on visual data. While treasury
is already using these solutions in other areas, they
have yet to fully analyze how forecasting could
be enhanced through the predictive functionality
within these tools. However, Peterson asserts that
further integrating treasury operations with Alteryx
At first glance, it would seem the
predicament that Peterson and Chick-fil-A
face is one that could be easily solved
through the implementation of a TMS
with enhanced forecasting capabilities.
However, Peterson is admittedly
skeptical on the benefits that a
TMS solution would provide.
Chick-fil-A needs to find a tool that
can easily incorporate a wide range of
data points into the forecasts to improve
accuracy and also generate automated
reports based on the data for informative
visualization and effective analysis.
Until recently, Steven Peterson, Senior
Manager of Treasury at Chick-fil-A,
was content with handling the bulk of
forecasting operations through Excel.