Say "fast food" and McDonald's springs to mind. With over 22,000 outlets in 106 countries, 1996 annual revenues of $31.82 billion and a vision to dominate the global food service industry with consistency, value and execution, the company relies on its franchisees to carry out its mission. Franchisees such as Sutherland Management of Bonita, CA must live up to McDonald's quality, efficiency, and cost benchmarks.

The Challenge

In the summer of 1996 Sutherland Management Company, a McDonald's franchise since 1979 with 14 retail outlets in San Diego county, CA, over 500 employees and $18 million in annual revenues, had outgrown its DOS-based accounting software. The program was taking far too long on month-end closings and lagged in check writing because paperwork from individual stores had to cycle through one master bank account. Most vexing was its inability to meet McDonald headquarters' mandate for monthly transmission of financial statements and sales data via a secure Intranet interface.

Allan Kodicek, Sutherland's Vice President and CFO, knew in mid 1996 that it was time to make changes in his accounting system. He approached his software vendor, who, with only DOS capability, strongly recommended that Kodicek consider Atlanta, GA-based Navision Software's Navision Financials package. "We needed to upgrade to a Windows-based platform on an NT server. The new software had to maintain individual store data, be fast, accurate, and easy to use," says Kodicek, who, with two administrative assistants, oversees the franchise's reporting system. Purchases from over 300 McDonald's approved vendors for food, paper products and equipment used in each restaurant - had to be tracked monthly for compliance with McDonald's rigorous standards. Finally, the software had to mold to Sutherland's practice of maintaining separate GL and AP accounts on paper while operating out of one master bank account, and handling cash flow quickly and efficiently.

Bruce Ciarleglio, CEO of Adventures in Automation of San Diego, a Navision Solution Center (VAR) since 1995, saw Sutherland's task of meshing its financial tracking and reporting needs with McDonald's headquarters' requirements as "darn close to impossible with other software programs but no problem for Navision." Even so, confronting Ciarleglio was the task of fashioning a system both simple and complex, straightforward and convoluted. Macdonald's proprietary cash registers tracked vital data of sales by item, by time of day for inventory purposes. But Sutherland still had to tend to its business of tracking the cash flow, payables, and other basic accounting functions while meeting corporate's reporting mandates. "What they do is very simple but very ugly because they have so many stores that have to be tracked by one system," adds Ciarleglio.

A Clear Choice

"Our original software vendor sent us to Bruce Ciarleglio for a demo of Navision Financials. When we saw Financials' flexibility, power, scalability to our needs, and drill down capabilities, we were sold. We didn't look at any other package," says Kodicek. He describes Ciarleglio as: "Brilliant, he just exudes confidence. We gave him our laundry list of applications and he said 'yes, yes, yes.'"

Underlying Ciarleglio's sense of confidence was access to Financials' source code, which allows all Navision Solution Centers to customize at a level impossible with other packages. He explains: "Navision Financials is the best thing I have seen in my ten years in this business. Before Financials I'd invest time and energy pre-selling a client. Then there would be a customized application they'd need, something essential to their business. When we couldn't do it that was a real deal killer. With [Navision] Financials, I never have to say no to a client's requirements for getting their accounting and business management software to accommodate how they do business."

After approximately two months for customization, installation, training, and running the old and the new systems in tandem to ensure data integrity, Sutherland Management was up and running with Financials.

Two Systems, One Solution

With Accounts Payable and General Ledger installed Kodicek put the new system to its test the myriad challenges of running a successful local franchise of a global enterprise. That meant data reporting, aggregation and analysis on several levels. On the one hand, major chunks of the accounting function such as inventory were centralized at corporate headquarters, while Sutherland outsourced payroll to ADP, an extremely efficient provider. On the other hand, the software handled the unique demands of the restaurant business, i.e., dealing with hundreds of vendors and having to micro-manage item costs that can run to a fraction of a cent. The ability to manipulate data easily on vendor categories, subtotals by stores, and inventory categories simplified Sutherland's accounting system significantly. Kodicek still gets weekly and monthly financial paperwork from the stores but uses Navision's drill down capabilities to easily access and analyze sales and cost data. Recurring journal entries also make life faster and less error prone. Kodicek feels so comfortable with Financials now that he uses the program's capabilities to create new data fields and reports as needed. He also incorporates statistical information from Excel, thanks to Financial's ODBC (Open Database Connectivity) functionality.

Although Kodicek can't name a dollar figure for how much Navision Financials has saved Sutherland Management, he's gotten something equally important: "Before Navision all of our accounting processes were terribly labor-intensive. With Navision Financials we do things swiftly and accurately. This gives us time to think, to strategize, and to constantly improve our business."

Navision solutions are built and sold to meet individual clients' needs and as Sutherland Management discovered, Navision has a unique approach to making sure they got exactly what they wanted.

Navision Financials is sold through a worldwide network of Navision Solution Centers staffed with certified professionals dedicated to providing customized solutions, training, support and service. There are more than 800 Navision Solution Centers worldwide. Pricing for Navision Software's products is based on a scalable, usage-based model that enables customers to purchase only the features and system capacity they actually use. The Navision Software solutions are built and sold to meet individual clients' needs through "granules" (macro and micro functions).