Roberts Wesleyan College says,
“It is hard to get a budget spreadsheet that
you can have total reliability and total
confidence in. But budgeting is mission
critical in today’s higher education world.”
The Customer
Roberts Wesleyan College is located just outside Rochester, N.Y.
It is a vibrant private institution that has been educating “for
character” since 1866. The college has an enrollment of nearly
2,000 students and offers more than 50 undergraduate and
graduate academic, professional, and pre-professional programs
from which to choose. RWC started as a seminary (the functional
equivalent of a high school), eventually evolving into a 4-year
institution after the end of World War II.
At its heart, RWC is a small liberal arts school, with traditional
undergraduate programs accounting for 60% of tuition revenue. In
addition, RWC offers degree completion and graduate programs
designed for the working adult student. While the traditional
semester-based program budgets can be known with relative
accuracy, variability in enrollment and offerings of the modular
programs can present budgeting challenges. This is particularly
true when the programs are tied to employer reimbursement plans,
as Rochester has been hit especially hard by the economic
climate.
Bob Rood is the Associate Vice President of Finance and has been
with RWC for 12 years. Bob, a Certified Management Accountant,
has a varied background including banking and Not For Profit. He
has a degree in accounting from Canisius College, as well as an
MBA and a PhD in Higher Education Administration from SUNY at
Buffalo. Bob says, “Higher education is a great place to work. You
are around people who are smart, interesting, and always in the
pursuit of knowledge.”
RWC uses Great Plains for both their general ledger system and
human resources systems.
The Problem
Bob says, “RWC has similar challenges to many higher ed
institutions in the Northeast. It is a mature industry faced with
declining demographics and increased competition for students.”
In RWC’s case these students are geographically dispersed
between Rochester and Buffalo, putting additional pressure on
recruitment, retention and discounts. “It is a challenging time to be
in higher education,” Bob says. “There are lots of stresses. In
today’s economy, people are increasingly critical of the cost of
higher education, so we need to be sharper.”
When prompted about why higher education is rushing to replace
their budgeting process, Bob says, “Budget managers, who are
sometimes also faculty members, are not always numbers people
by nature. Spreadsheets intimidate them, but they do want to own
their numbers. We needed a better way to collect their best
estimates for enrollments and expenses. Budget managers who
are also faculty tend to focus more on process than results—at
least when it comes to budgeting! They prefer to work in a process
that has steps – like, ‘Step 1 do this,’ ‘Step 2 do that,’ and so on.
We wanted to provide our budget managers with something that is
more intuitive than spreadsheets and provides real control over the
process. BudgetPak does that for them. This is a big selling point
and a natural fit for higher ed and, in particular, Roberts Wesleyan.”
In addition to simplifying the process for budget managers,
spreadsheet errors were another key concern driving Bob’s
decision to replace the existing budgeting system. He explains, “In
my day, it all started with VisiCalc. We always used spreadsheets.
Spreadsheets can be useful but are prone to errors.” He quotes a
recent presentation from the Institute of Management Accountants,
which states that spreadsheets are 95% prone to errors. “It is hard
to get a budget spreadsheet that you can have total reliability and
total confidence in. But budgeting is mission critical in today’s
higher education world.”
Of course, an ideal budgeting solution would have fewer errors and
require less effort. Bob recalled the significant workload associated
with past efforts: “So we had gone through the budget process,
collecting spreadsheets and importing them into yet another
spreadsheet…and then we loaded the data into the general ledger!
Obviously, it all took way too long and there were errors. In addition
to the delays in getting information into the system, there were also
delays in reporting and collecting data. So we further automated
the collection of data, with e-mails and routing functions – but we
still ended up creating a ‘Frankenstein spreadsheet.’ It worked OK,
but some budget managers ‘went rogue’ and changed rows, cells,
columns, further complicating the data integration. There were
instances where lines were lost or merged into something else.
This made for a great deal of manual checking. And documenting
the thought process of the budget manager was inconsistent, with
some providing unnecessary levels of detail, while others provide
little to none. In short, the process was onerous and error prone.”
Roberts Wesleyan College Case Study
The Evaluation
Bob thought that there simply had to be a better way to budget
than using a ‘Frankenstein’ spreadsheet. He conducted a thorough
analysis of budgeting products, even to the point of investing in one
that seemed promising. “When it came time to implement, we
found that the ease of implementation was not true to the promise
in the sales pitch. They were not user-friendly. They required
much more IT support. These products were not written by and for
accountants,” says Bob. BudgetPak stood out as having a much
more intuitive feel to it. He liked the TurboTax-like approach to
corporate budgeting. So he said “OK, I understand that. Let’s see
if it works.”
BudgetPak delivered on the promise of simplicity and ease of use,
while providing flexibility for users and the controls required by
finance. While these demonstrated features played a key role in
the purchase decision, reference calls were also important to the
RWC team. “Higher education is a separate animal,” Bob says.
“People like to challenge here – sometimes just for the sake of
challenging. So having reference accounts within higher education
is extremely important to us and should be to others.”
Higher ed can also be an industry that wants to preserve the status
quo of processes. But in this case, Bob said the budget managers,
including faculty department heads, really liked BudgetPak. “They
embraced it. It provided them control over the budget steps and
they had much greater comfort with it than with spreadsheets.”
This aligned with Bob’s personal belief that budgeting should never
be “top down” and department heads should own both the process
and the numbers.
Bob also shared that XLerant behaved with integrity. “The
company made sure that the product was a good fit for us. That
was important to me.” He adds that the philosophy was not high
pressured sales, saying: “It was more around making sure that you
have something that I want to buy rather than something you want
to sell.”
The Implementation
Bob states that the implementation went smoothly. He was
impressed that the product behaved as advertised. XLerant
handled most of the implementation including setting up the
account and unit structure, loading the historical data, setting up
drivers, and all of the salary planning information. It took very little
time to train the users.
According to Bob, the fundamental positives were that the product
worked as promised and the people understood it quickly. “It lived
up to all of our expectations. Not all vendors do that. And the IT
support is minimal –I can maintain this application myself with IT
only loading upgrades and enhancements as they became
available,” Bob says. “It is simple and there is not much
maintenance involved, which is good. You do not have to be a
computer scientist…and I am not a computer scientist.”
The Solution
“The budget managers loved BudgetPak. The internal feedback
was positive. After the implementation, department chairs, who are
not necessarily accountants, said ‘This is best thing since sliced
bread.’ BudgetPak is more intuitive for them,” says Bob. “That
was precisely what we were hoping for. We were able to better
document their thought process. Everyone loved the workflow.”
With BudgetPak, Bob could tell who hadn’t started the budget, who
was having trouble completing, who had submitted, and what was
approved. He adds that “There was a night and day difference
from spreadsheets. This was a very positive experience and that is
not easy with enterprise software.”
Of the RWC budgeting need, Bob says: “Our decision was as
much about budget mechanics, confidence, and process as it was
pressure on the college to do more with fewer resources.
BudgetPak handled both sets of challenges.”
Across the board, BudgetPak was a great value for RWC, Bob
says. “Higher ed is always pressed to reduce costs. People now
spend more time thinking about numbers and less time putting
numbers in. This is much more effective and makes time more
valuable. BudgetPak does the right things that are fundamental to
the budget process and does it very well.” Because of this, RWC
expects to now be able to budget to their strategic plan better. Bob
recognizes that there is always a challenge between linking the
operating plan to the strategic plan. But he adds that since the
organization is using less time on data entry they can spend more
time thinking through strategy. This helps facilitate the process of
tying these things together.
Bob was pleasantly surprised by features like annotation,
documentation, and ActionPaks. He plans to use them more in the
future. “There are departments like the Cultural Life Center that
budget by event rather than line item. BudgetPak is especially nice
for that.”
Salary planning is another helpful feature at RWC. In the past, HR
was not totally comfortable using spreadsheets. They needed more
confidence in salary information, accuracy, and confidentiality.
With the old process, HR would sit down with each individual
budget manager and go through personnel planning.
Now
managers may budget for themselves and HR will just review the
results – putting the responsibility and control in the right places.
Reporting has played a key role in end-user satisfaction at RWC.
Bob explains: “People love the reports. They have what they need,
when they need it. If there is a question about a number, it is right
there. We can show what they did and their explanation. And we
get a better audit trail as to what went into the budget.”
To sum it up, Bob says that with BudgetPak, “People can budget
their business the way they think about their business. This is why
it was so well embraced.”
He adds the benefits derived include increased control over the
process, better confidence in the numbers, better comparison
reporting, and more budget manager independence. “Better
controls and improved independence is a hard balance to achieve.
There are no more rogue spreadsheets,” says Bob. He adds:
“What XLerant said in the sales process was true. It worked as
advertised. The company understood edu and that was essential.”