African Rainbow Minerals Benefits from a Leading Financial Management IT Tool

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Background

One of South Africa’s leading diversified mining and minerals companies, African Rainbow Minerals (ARM), now has a single source of truth for its total IT spend across the organization.

Fact sheet

Solution: ITFM Solution

Industry: Mining

Vendor: MagicOrange

User: African Rainbow Minerals

Following the implementation of MagicOrange’s end-to-end IT financial management (ITFM) solution, ARM benefited from the reduction in effort required to run a monthly reporting cycle, including forecasting. This gave their team visibility into nine years of budget information within the first two weeks of the project, allowing them to bring all the data together in an analytical view.

Thanks to MagicOrange, ARM can now break down those nine years and compare monthly actuals to the budget figure, whereas before they only had to work with totals.

Challenge

ARM has interests in a wide variety of mines, including platinum, platinum group metals, iron, coal, copper and gold. Having a wide range of mining operations and IT costs, which are split between business managed expenses (services used across the enterprise) and operationally managed expenses (costs managed by the individual mines themselves), contributed to the challenge of understanding total spend is across ARM, despite the fundamental divide between centrally and operationally managed costs.

As a result of the split, there was no centralized general ledger (GL) that could be used to identify business and operating expenses in one place. The current GL provided limited information to support ARM in its IT financial management, such as streamlining the monthly invoicing process.

“Most of the data was always available and visible to ARM, but it was housed in various files that weren’t accessible to everyone,” notes Tian van der Walt, Customer Success Senior Manager at MagicOrange.

The data ARM had access to was also stored in an unstructured and unpresentable format prior to using MagicOrange, which prevented CFOs from speaking a common language with executives.

Solution

ARM needed an ITFM solution to improve the capture process for GL to streamline the monthly billing process and gain transparency into the individual costs of each mining operation. The solution also needed to improve communication between different mines as they gain a better understanding of how costs are allocated to each operation. MagicOrange was selected as the tool of choice to bring transparency and simplicity to the organization’s IT cost allocation process. A user-friendly integration of MagicOrange and Microsoft Productivity was used as a middle layer of automation and transformation to provide ARM with a solution that will help the company plan for the future of the organization and improve business operations.

Advantages

African Rainbow Minerals has experienced many benefits as a result of strategy, planning and implementation of MagicOrange.

  • the all GL is now automated resulting in a transparent and defensible GL that can support the organization in financial decision making.
  • Cost transparency has enabled ARM to reduce manual effort necessary to run a monthly cycle of budgeting and forecasting because it was no longer necessary to divide each invoice per mine, but rather to centralize them and process them all simultaneously via MagicOrange.
  • Another benefit realized by ARM was the improved relationship and visibility between mine sites and IT, through greater transparency of their spend and a fairer distribution of costs between the sites involved.

ARM can now make strategic decisions about future business plans and easily run what-if scenarios if anything needs to change. Additionally, implementing ITFM enables ARM to future-proof and modernize business operations away from legacy workflow systems. MagicOrange’s ease of use also allows ARM to get all of this information in an analytical view in a short time, giving the company the ability and tools to perform trend analysis across the entire enterprise. organization. Information is now presented by an industry-leading tool that leverages an integrated instance of Microsoft’s Power BI, providing cutting-edge analytics to information consumers. Self-service analytics is also available to all users, ensuring they can present information in a format that makes sense to them and their role.

Conclusion

“After successfully implementing our cost transparency solution across a number of industries including financial services, insurance, retail, consumer packaged goods and manufacturing, it was our second foray into the mining sector and we hope to extend the capabilities and expertise gained through this implementation into all future projects in this vertical,” says Van der Walt.


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