Hospitals and research centers across Brisbane rely on Mater Foundation’s Fundraising efforts to support their important work. With a target of distributing AUD 20 million in funds per year by 2021, the organization is now using IBM analytics technology to enhance governance and fine-tune its financial plans to help it achieve this ambitious goal.
In many countries, the role of philanthropy in healthcare funding is becoming increasingly important – and Mater Foundation, a not-for-profit organization that raises funds for the Mater Hospitals group in Brisbane, Australia, provides an excellent example of how successful this approach can be.
Over the past three years, donations from more than one million supporters have enabled Mater Foundation to provide almost AUD 32 million of funding to over 1,000 projects – purchasing life-saving medical equipment, improving patient care, ad ensuring that research teams continue to find better ways to diagnose, treat and ultimately cure life-threatening diseases.
For example, the Foundation supports the “Mater Little Miracles” program, which helps fund specialist care for more than 2,000 babies born seriously ill or prematurely every year. Researchers at Mater are developing potential solutions to a range of challenges these babies face. Meanwhile, the “Mater Chicks in Pink” program focuses on emotional, practical and social support services for women with breast cancer, both during and after their treatment.
In a world where the cost of healthcare services is rising year on year, hospitals and healthcare organizations need to find innovative ways to secure the funds they need to continue to provide outstanding patient care. As Mater Foundation’s philanthropic activities continued to grow, its existing spreadsheet-based planning processes could not provide enough control and visibility to help it reach its future goals.
Mater Foundation worked with IBM Premier Business Partner Bistech to transform planning processes with an IBM Analytics platform that provides better governance and deeper insight into financial data.
Vincent McFarlane, Chief Operating Officer of Mater Foundation comments: “The size and scope of our fundraising operations have grown considerably in recent years, and we have big plans for the future. Our goal is to achieve an annual distribution of AUD 20 million by 2021, all of which can be invested directly in patient care and research. To achieve this, we need to grow our three main strategic revenue streams: corporate and community events, gifts and bequests from major donors, and the sale of lottery tickets.”
With the scale of its operations set to increase, the organization realized that its existing financial planning processes would need to be upgraded.
Vincent McFarlane explains: “Our planning and budgeting systems were built on spreadsheets, which was fine when we were a smaller organization. However, as we grew, we needed more certainty around our financial returns – which meant we needed to apply more sophisticated controls and governance structures.
“We also wanted to be more confident in the way that we modeled our revenues and costs around lotteries and donations, and to be able to analyze acquisition, retention and lifetime value in a more detailed way. It became clear that unless we re-engineered our finance processes, the spreadsheets were going to limit our ability to achieve our goals.”
Picking the winning ticket
Arani Samorodny, Senior Manager – Change Management Processes at Mater Foundation, takes up the story: “We went to the market to find a more robust planning and budgeting solution, and IBM Cognos TM1 was the best choice for our requirements. It offered all major functionalities we needed, and the pricing was competitive. Moreover, since our parent entity was already using TM1, we saw the potential for synergy.”
To help with the implementation, Mater Foundation chose to work with Bistech, an IBM Premier Business Partner with considerable experience in enterprise planning and financial performance management projects.
Vincent McFarlane says: “We were impressed with Bistech from the beginning – the consultants who presented to us were clearly practitioners, not salespeople, which gave us confidence that they could deliver what they promised. This impression was borne out by our experience during the project: the Bistech team were real partners with our team and helped us get the project over the line.”
Since Mater Foundation was also engaged in a number of other large IT initiatives at the time of the project, the team decided to deploy the solution in phases. The first phase would implement the core functionality – a set of models for annual budgeting and five year planning – with subsequent phases focused on moving to rolling forecasts. This helped to deliver value to the business quickly and mitigate risk.
Arani Samorodny comments: “In the longer term, our plan is to integrate the annual and five-year plans, and move to quarterly rolling updates instead of having one large annual budget every year. This should help us be more flexible, and reduce rework.”
Vincent McFarlane adds” Although we see the current version as a first stepping-stone towards the final solution we’re ultimately aiming for, it already gives us some valuable new capabilities. For example, because the model is much more tightly controlled and the data is better validated, we can push the forecast horizon out to multiple years without worrying about errors influencing the results.
“We also appreciate the sandbox functionality, which will make what-if analysis much easier because all data is now in one place, not segregated in different spreadsheets.”
Securing a healthy financial future
By beginning the transformation of its finance processes from a spreadsheet-based model to the new IBM Analytics platform, Mater Foundation is laying a firm foundation for effective financial performance management.
Vincent McFarlane states: “The main objective of the project has already been achieved: the solution gives us a much more robust governance framework around our financial planning and budgeting processes. Unlike spreadsheets, where it’s easy to accidentally introduce errors or incorrect assumptions, IBM Cognos TM1 gives us complete control of our model and full traceability when any changes are made.
“As we continue to scale up our fundraising operations to meet our goals, we can be much more confident that our financial decisions are based on a solid and accurate understanding of our current position and forecasted future revenue and costs. This should make our audits easier in the future.”
Arani Samorodny comments: “At an operational level, the solution makes life easier for our finance team and for cost center managers throughout the organization. Instead of sending spreadsheets back and forth to collect and validate budget information, we have controlled workflow that allows contributors to input data directly into the model, and helps the finance team monitor the progress of the data collection process. The ability to validate data at the point of entry, and consolidate it automatically within seconds, saves many hours of low-value manual work.”
During the organization’s most recent budgeting cycle, the new solution saved the finance team approximately two weeks of work by eliminating their manual consolidation process. Moreover, as users grow more experienced with the new system going forward, Mater Foundation expects these time savings to increase.
Vincent McFarlane concludes: “The initial results with IBM Cognos TM1 have been very encouraging, and we’re keen to build on this foundation to add more capabilities in the future. In particular, deeper analysis of donation and lottery income should help us gain a better understanding of acquisition, retention and lifetime value of our supporters – helping us target our fundraising efforts more effectively to support even more ground-breaking healthcare projects across the Mater organization.”