Business Case Philips
Philips relies on Runbook
Period-End Closing without errors and in days instead of a week!
Runbook has been a winner since day one, as Rob Segers, the assistant controller of Philips Medical Systems Benelux's Dutch branch explains: "In the initial months the project team used Runbook to optimize the closing process, and from the start the system is performing to everyone's delight". "It used to be a constant challenge to compile the right data in a timely manner because the process involves a range of departments and financial coworkers whose priorities are not necessarily the same", says Rob Segers. "For us it is crucial, as part of a larger organization, that our monthly balancing procedures run according to plan. Not just where the statistics are concerned, we have to be certain that the information is reliable". It is not that Philips didn't have a well-defined closing process. They did. Like many companies, Philips managed closing tasks in Excel spreadsheets. These were distributed via email or network servers and rigorously monitored to verify that each item was completed in time and according to plan. Philips' monthly closing process took an average of more than one week to complete. No reliable evidence was available that tasks, particularly internal control tasks, had been completed correctly. It was for all these reasons that Philips chose to implement Runbook for SAP, a task-management solution specifically designed to help SAP teams manage their period-end closing and internal control processes. Runbook adds new and missing SAP functionality to the SAP ERP system.
Achieving visibility, ownership, and accountability
Reflecting on their original, Excel-based process, Rob cited a lack of global visibility, ownership and accountability as among the largest challenges they faced: "Our monthly balancing procedure involves a range of departments, such as Finance, Logistics, and the Project Office. Before Runbook, only the controller kept track of the information", he said. "Today everyone can see for themselves what they need to deliver, by which deadline and view the result when it is completed. By including all closing steps in Runbook, end users simply have no
choice but to complete the tasks. This new modus operandi has made it a lot easier to hold those involved accountable." Runbook Director of Business Development, Herman Heller, adds: "The shift towards a user-driven, easy-to-use system has not only created a culture of ownership at Philips, but it also has greatly reduced errors and task completion duration. Our experience is that if you set clear expectations and arm users with convenient tools to eliminate paperwork, users will come on board."
Managing task dependencies
One of Runbook's key features, which enabled Philips' success, is its design of a task dependency functionality. "With this, individual tasks can be defined as prerequisites of other tasks", explains Herman Heller. "The execution icon will only appear in front of a task after all its dependencies have been completed and only to users who are authorized to execute the task. The process is further enhanced by handover messages being sent automatically to the relevant person(s) when a task is ready for execution". "At Philips, this has greatly cuts down the volume of calls and emails, as users always know precisely where they are in the overall process, and which tasks are eligible for completion. This ensures that all steps are completed, adds Rob". "This has enabled potential problems to be identified at an early stage. Failure to complete a step often leads to downstream problems." Another feature is Runbook's built-in document repository, which enables Philips users to attach SAP reports and external documents to tasks with a mouse click, building documentation quickly and easily. All documents are immediately available to Philips managers because these are embedded in the system. They become a permanent part of the closing record for audit purposes. For many companies, electronic data storage also offers enhanced security over file cabinets and shared drives.
Monitoring and boosting process efficiency
Perhaps the single largest impact Philips has experienced, has been in terms of efficiency of data collection, task monitoring, and follow-up. "The switch to Runbook has transferred part of the responsibility to the departments whose job it is to supply the relevant data, so that all of the information is available at the start of the monthly closing exercise", says Rob. Asked about the impact on monitoring and follow-up (historically the largest source of closing delays), Rob cites a sharp contrast to the old days of endless emails and phone calls. "Today all that the controller needs to do is monitor whether everyone has lived up to their promise and, if not, send an e-mail message or make a phone call to communicate with them quickly". Philips makes full use of Runbook's cross-company status dashboard to monitor the closing process for 13 company codes, and populates contact information for primary and secondary responsible parties for each task, making the follow-up a snap. 
The Excel-based task lists (historically placed on network servers) have been replaced by electronic, personalized task lists that users view and execute right within the Philips'SAP ERP system.
Summary of implementation experiences
Having implemented Runbook in less than 3 months, Philips is both happy and surprised with what they were able to achieve in such a short timeframe. "The great thing about the new system is that whenever an additional step is necessary, you can simply make the change yourself", explains Rob. Having a central process repository and detailed closing tasks has also enabled ongoing process improvements, as recurring bottlenecks can be detected and process improvements made centrally. When asked for advice that Rob would offer future Runbook users, "Runbook is actually a process enhancement tool, this makes management endorsement of its roll-out an absolute must. The initial months were a period of procedural optimization. Runbook is performing up according to our high standards, and to everyone's delight". Having taken their closing process from one week to mere days without operational errors, his feelings are understandable.
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