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Wine and spirits giant Maxxium drives global expansion with Hyperion

In 1999, four of the world's largest liquor manufacturers banded together to form Maxxium, with the goal of creating a centralised sales, marketing, and distribution organisation. Today, Amsterdam-headquartered Maxxium is the world's fifth largest and fastest growing premium spirits and wine company, and an organisation with complex internal management, reporting and financial requirements. To ensure it could meet these requirements, Maxxium decided upon using Hyperion Enterprise for financial reporting and Hyperion OLAP for commercial reporting. As Maxxium evolved and grew, it had become clear that the company needed a single, integrated financial tool. The answer was Hyperion Financial Management (HFM), and in late 2001, Maxxium became the first HFM site in the Netherlands, and the sixth in Europe.

Maxxium was formed through the decision by Remy-Cointreau (France), Jim Beam Brands (US), Highland Distillers (UK) and Vin & Sprit (Sweden, which joined in 2001) to pool resources. The four companies represent such household brands as Famous Grouse whisky, Absolut vodka, Remy Martin cognac, Cointreau, Bols liqueurs and Jim Beam bourbon. Maxxium has grown to 1700 people, with gross sales of ?1,8 billion and operating profit of ? 52 million. Its sales volume is 20 million cases, or roughly 170 million litres.

The scope of the challenge faced by Maxxium was extreme:

• It has 35 local distribution companies and sales into 65 countries in Europe, Latin America, Canada and Asia-Pacific, serving domestic and duty-free markets.
  
  
• While it employs 1 700 people, just 35 work in Maxxium HQ, of whom 10 are in Finance, and only three maintain all financial reporting systems, which indicates the level of automation and IT support needed.
  
  
• Maxxium HQ keeps track of 675 different products and 50 global customers, such as airlines and retailers.
  
  
• 5% of sales are generated on an inter-company basis.
  
  
• It has 275 ledger accounts, and generates earnings in 23 local currencies, which must be translated into Euros.
  
  
• It has multiple scenarios to work with: actual, budget, forecast, long-term planning, and cross-currency flexing.

"HFM gives our business analysts more time to perform actual analysis," comments Eelco Spiker, Brand Consolidation Manager for Maxxium. "We have a narrow window for reporting, having to produce a detailed sales flash by four key dimensions - product, market, country and customer - on the third working day of each month. With HFM we can both fulfil this and extract segmented data to forward to our brand owners, who require detailed sales figures for their own production planning and consolidation.

"HFM has improved our interaction with our shareholders, making it quick and easy. It has saved us a full day in the reporting deadline due to its 24x7 accessibility, it has enhanced our transparency, and because it's completely Web-based and zero-footprint - meaning no software on the local clients - the maintenance effort is vastly reduced. "HFM's centralised metadata also makes it easier to update the product-portfolio or other dimensions, a regular requirement." adds Spiker.

The Maxxium experience holds many lessons for retailers:

• Enhanced brand management, especially with regards to individual brand and line item profitability;
• The company can optimise on growth opportunities;
• Financial consolidation leads to overall time savings in key activities;
• Access to the database can be provided to brand managers for interrogation and to other interested parties, such as those in the supply chain, therefore improving forecasting and fulfilment.

Maxxium's HFM application automatically feeds into a Hyperion Essbase cube configured with 13 dimensions, 12 of them reflected in HFM. It's a fully automated routine that runs overnight, resulting in less manual processing required by HQ staff, who now spend more time examining figures rather than just processing numbers.

Future plans for HFM at Maxxium include a treasury application and a budgeting model, and possibly allowing shareholders to access HFM directly through an OLAP browser like Hyperion Analyzer. HFM can also serve as a proven template for Maxxium's next big implementation project: global SAP R/3.

HFM has been implemented on two dual-Xeon Windows 2000 servers, and runs against a SQL 2000 database."The investment in HFM has been easy to justify," summarises Spiker. "Given identified cost of ownership over five years, and in light of our shareholders' rigorous data and reporting requirements, it has been well worthwhile."

"Global organisations within the retail industry, such as Maxxium can gain serious advantage over far larger and better established competitors through a business performance management suite such as HFM," says Marc

Scheepbouwer, acting CEO of local Hyperion distributor GBI. "We expect many of Maxxium's South African equivalents to follow suit."

* GBI is the business intelligence specialist in the JSE Securities Exchange-listed Global Technology group. Eelco Spiker presented on the success of Maxxium at Solutions 2002 Africa, the annual user conference held jointly by Hyperion and GBI at Sun City.

Contact
Tanya Furniss, GBI, (011) 319 9800 tfurniss@glotec.co.za
Nicolette Venter, FHC, (011) 608 1228 nicolette@fhc.co.za