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Quantrix in Corporate Budgeting


Spreadsheets are what most organizations rely upon for their enterprise budgeting needs. Companies often have initial success using spreadsheets in budgeting as it is easy to get started, the application is on everyone’s desktop, and it has a wide acceptance with non-financial personnel involved in the budgeting process. However, using spreadsheets for complex budgeting tasks creates problems later on. Extending or adapting spreadsheet planning models to reflect changing business conditions can be painful in a two-dimensional grid. To support operations spread across many divisions, or to understand the spreadsheet model after an analyst has left the company, are just some of the problems that can be encountered when using spreadsheets in a complex forecasting environment. A technology tool should allow the budgeting process to work seamlessly and efficiently. Like a spreadsheet, this tool should be lightweight, easy to deploy and maintain, but also very powerful in its capabilities. Quantrix is such a technology tool.

This set of budgeting models shows a simplified example of a multi-division forecasting model in Quantrix. There is a ‘Master Consolidated Model’ that contains all the divisions’ actual information. (Actuals may be populated through DataLink - see DataLink Modeler Note: Using a Database to Perform a Sales Analysis). There are also three separate models for division A, B and C. The division managers would use these models to pull in the actual data from the master model and to enter their forecast data. This forecast information is then pulled back into the Master Consolidated Model. All of this is accomplished through inter-model formulas. The following formula was taken from the Master Consolidated model.

 



Forecast= !Division-AFinancials.model!Financials::Forecast skip Gross Profit,Net Income

The file location and name of the model is contained within the exclamation points. In this case, the Forecast item in the Master model is populated by the forecast data in the Division-A model. New data can be easily updated by choosing ‘Tools > Calculation > Update Links’ from the Quantrix menu. A similar set of inter-model formulas can be found in each Division matrix that pulls the actual data from the Master Consolidated Model. Adding or subtracting divisions is easy and quick with Quantrix, as it is just a matter of adding or deleting a division matrix in the master file and adding or removing the division model associated with it. Edit a couple of formulas and you are done! Quantrix models are inherently self-documenting in that they use plain English-language formulas, which are few in number and easy to understand. This allows other users to quickly get up to speed and see how the model works. To read about a real-world implementation of Quantrix utilized in a multiple division forecasting environment, please read the Cimpor success story.

New with Quantrix 3, you can create a report of the data in the consolidation model that is clear and professional to present to management as demonstrated in this screen shot:



Download the models used in this Modeler Note using the link below:

    >> Quantrix Budgeting models

 


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