If you pay any attention at all to what you eat, you’re probably aware of the benefits of omega-3, a fatty acid found in many foods, but particularly in fish. At Ocean Nutrition, a supplier of omega-3 supplements and ingredients, years of explosive growth had left the company’s reporting and performance management functions in need of a little nutritional booster. BPM Magazine talked to Megan Harris, CFO of the Dartmouth, Canada-based manufacturer.

BPM Magazine: Tell me a little about Ocean Nutrition. You seem to be in a booming industry!

Megan Harris: It has had significant growth. There are two segments to our business. We have the dietary supplement side, which is essentially the omega-3 encapsulated side of the business. It’s very mature and has had tremendous growth essentially every year since I’ve been here and even before that — anywhere from 10 percent to 20-percent-plus volume growth in those years, exclusive of whatever currency and everything else is doing.

And then we have a second segment, which is a healthy food ingredient, and it’s just at the toddler stage of the lifecycle. We’re looking at putting omega-3 as a food ingredient into CPG [consumer packaged goods] companies’ products. Companies have spent a great deal of time taking all the bad items — saturated fats and so on — out of food, but now they’re also putting some good things back in.

BPM: Looking back to the period before you implemented the Clarity Systems performance management system, what were the main business challenges you were up against?

Harris: The CFO role was new when I started, and when I first entered we didn't have any reporting structure, in my opinion. We had little to no analysis or understanding of the data points. As far as budgeting, we’re not any different from any other manufacturing firm; we have some risk drivers around cost, prices, currency and so on. A lot of it for us was understanding sensitivity around assumptions: Was the U.S. currency going up or going down? What does that mean from a P&L viewpoint? Would there be a dramatic increase in the cost of our commodity oil?

With the new system we have the ability to do some pretty quick scenario recalculations. For example, this year we did it on three different currencies, and in the past we did it with different currencies as well as different oil costs, and that gave us a perspective as to EBITDA impacts and so on.

BPM: How does your budgeting process work?

Harris: We budget at the customer and the SKU level; we analyze on a monthly basis. Going out, we look at the deviation at the sales dollar level, at the volume, at the margin and at the SKU level based on each specific account, with some exception reports built in. We’re now more forecast-driven on a monthly basis, and we project out to the end of the fiscal year. We can see at a fairly high level where sales might be sinking, whether customer accounts are up, down, sideways or in the tank.

BPM: So it’s basically a rolling forecast?

Harris: It is. We have a budget that's fixed, but we also have a forecast that gets laid over the top of that and we can compare. To me that budget is just another version or scenario as we're looking at the data that comes in; you have actuals, you know what the forecast is, and how that forecast compares to the budget.