Case in Point: Attention to Details
BPM Magazine: How many business intelligence and BPM software products do you use?
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Countrywide Financial Corp. is an enormous company that runs an array of business performance management (BPM) applications. Keeping tabs on how all of its various divisions are doing is a huge job -- but one that's made easier through management reports that let the business units dissect revenue down to the individual loan level.
Rod Nonato: We use a lot of tools. In fact, Countrywide owns pretty much every tool. We have a lot of companies, and among those companies we have about 3,600 consolidating divisions. And all the major companies and divisions have their own IT group and their own accounting and analytic group. So everyone basically buys their own tools.
BPM: What are the challenges in getting so many systems to work together?
Nonato: It is tough. Not only is it very costly, but data integrity and data consistency are two big issues. Just recently, we formed what we call our enterprise reporting committee and BI steering committee. What we're trying to do right now is centralize much of the financial data under PeopleSoft EPM and then develop a reporting strategy. We know that there is not one tool that will be able to solve everyone's problems, but if we reduce the number of tools to a more manageable chunk -- maybe two or three -- we achieved our goal.
BPM: Is management reporting centralized at Countrywide?
Nonato: Yes. For reporting to the production divisions -- which are our big revenue-generating units -- we use OutlookSoft. This encompasses a lot of their management reporting, as well as their bonus reporting. Production accounting, a subgroup within our mortgage accounting area, produces the production divisions' monthly management "flash" reports, while the finance group within each of the production divisions produces their branch's bonus reports. The flash reports are loan economic P&Ls. If the divisions want to further analyze their loan economic P&L, they can go to the system and slice and dice the financial information in the flash reports any which way. We currently have about 18 dimensions (mostly loan attributes) available in OutlookSoft, and the divisions can slice and dice revenue down to the loan level.
BPM: What are the benefits of being able to drill down that far?
Nonato: The benefit of that for Countrywide is the ability to measure the production divisions' performance against their established goals and also measure the effectiveness of their strategy. Also, since they have a lot of information down to the loan and loan attribute level, they can look at what product generates the biggest bang for them. In fact, they have the ability to analyze their P&L down to the actual ZIP code level, if they want to. The divisions also have the ability to continuously monitor both the top-producing branches and nonperforming branches within the same geographic area.
BPM: What's an example of an action that Countrywide divisions have taken based on the results of a low-level P&L analysis?
Nonato: They've revisited their strategic plans, reorganized branches, and entered into several joint-venture businesses. What these BPM tools have provided them is the ability to centralize analysis in one place, so they've pretty much provided all the arsenal the divisions need to analyze their P&L.
