RESEARCH & RESOURCES

CASE STUDY - Global Hyatt Corporation Consolidates 200+ Business Units

Commentary by Gebhard Rainer, Vice President for Hotel Finance and Technology, Hyatt International Corporation

Summary

Hyatt uses Hyperion for global consolidationof 200+ business units,reducing month-end closing time from 15to 2 days, and cutting the forecastingprocess from five months to six weeks.Hyperion also assists with improved dataaccuracy and compliance. Palladium,AnswerThink, and Hyperion assistedwith implementations.

About Global Hyatt

There are 211 hotels and resorts (over 90,000 rooms) in 44 countries around the world operating under the Hyatt®, Hyatt Regency®, Grand Hyatt®, and Park Hyatt® brands.

Spreadsheet-Based System Obsolete

With the establishment of Global HyattCorporation, there arose a need to morequickly and efficiently consolidate thehotels’ financial data and streamlinethe planning processes throughout thebusiness units worldwide. “Our manualaggregation of financial data had becomefar too time-consuming,” said GebhardRainer, vice president for hotel financeand technology at Hyatt InternationalCorporation. “We consolidated operatingresults from a management perspective, togauge our hotels’ operating performanceon a monthly basis, which typically took15 days. And then we had to consolidatethe results from our legal entities intothe corporate structure, which took anywherefrom 45 to 75 days. Plus, our old budgeting process took anywhere fromthree to five months.

“In addition to the amount of timeneeded, we had issues with the accuracyof the data,” Rainer continued. “Using theExcel spreadsheets for consolidation was ahighly error-prone process. So putting thetwo concerns together, we needed a systemthat would automate these processes andallow us to do global consolidation acrossall of the business units.

“The second equally, if not moreimportant, driver in our purchasing decisionwas that we looked at many Fortune100 companies, and found that a greatmajority use Hyperion,” Rainer adds. “Forthese reasons, combined with our sharedvision of business performance management,we felt Hyperion offered the rightsolution for us.”

We have achieved our goals in the area offinancial consolidation and global financialplanning, significantly reducing the timeneeded for both while greatly improving theaccuracy of our data.
Gebhard Rainer, Hyatt International Corporation

Hyperion Standard Assistswith Compliance

Global Hyatt Corporation launchedHyperion company-wide in August of2004. Says Rainer, “Some of the selectionprocess, in terms of choosing which applicationsto roll out first, was dictated byour business processes. We knew GlobalHyatt Corporation was going to becomean active company in January of 2005.That meant that for the first quarter, wewould need to have systems in place thatwould allow us to do our global consolidationaccurately and in a timely fashion.With Hyperion, we easily met that objective.”Hyatt now pulls and consolidatesits source financial data from over 230 locations, where it resides in an Oracledatabase and several local data marts.“Every Hyatt-managed hotel in the Americas,Europe, and Asia is using Hyperionfor budgeting and forecasting, and Hyperionfor financial consolidation,” Rainernotes. “Since we’re a global corporation,we must deal with a lot of variation in ourgeneral ledgers and accounts—we have tomaintain an extended set of accounts forlocal requirements. And we actually followboth U.S. and local GAAP [generallyaccepted accounting principles].”

Faster Closes, Higher-Quality Data

Additional benefits of Hyatt’s Hyperionimplementation include a greatly reducedtime frame for financial consolidationand significantly improved accuracy inthe forecasting process. Rainer says thisreduction has been dramatic: “Thanksto the Hyperion application suite, we’vemade a huge improvement in our corporateclose and reporting, which now iswithin 30 days from quarter-end, over theprevious 50 to 75 days.”

Rainer says that the single mostimportant benefit of adding the Hyperionsolution—including its powerfuldrilldown capabilities—has been thatHyatt executives can now track their datadirectly to its source.

Financial Scorecards in theFuture

“In the years ahead, we will extend ourHyperion solution into the whole businessintelligence area, in order to makeother, non-financial information availableto Global Hyatt Corporation management,”Rainer predicts. “That will lead usto a scorecarding approach, where we willbe able to compare the results with targetsand key performance indicators, and getalmost real-time feedback on our financialresults from the business units. In thisway, Hyperion will help us respond in amuch more proactive fashion than hasever before been possible.”

This article originally appeared in the issue of .

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