JSE-listed mining company Exxaro Resources is now able to effectively demonstrate the cost of IT within the organisation. Exxaro Resources has complete transparency into IT costs following an end-to-end MagicOrange IT Financial Management (ITFM) implementation.
Its Information Management team can actively manage the total cost of ownership (TCO) of its IT services, and charge-backs to business units (BUs) have been fully automated, resulting in significant time-savings.
“This has been one of our most successful ITFM implementations to date, largely because of Exxaro’s total engagement and commitment,” notes Greg Guye, Group CEO at MagicOrange. “Our customer fully understands the importance of gaining full visibility into its costs with the view to grow the profitability and value of its business.”
Exxaro is a large South African-based diversified resources group, with interests in the coal, titanium dioxide (TiO2), ferrous and energy markets. It operates facilities and offices in Africa, Asia, Europe and Australia.
Its Information Management division faced time-consuming challenges, including manual allocation of shared IT costs to business units. This tedious, labour-intensive process involved complex spreadsheets and manual journals, and lacked the transparency to the business units.
Exxaro needed an ITFM solution to support and improve budgeting, accounting and charging disciplines within the Information Management division, as well as clearly demonstrate the value this division brings to the organisation.
MagicOrange was chosen as the platform to drive transparency and simplicity into the organisation’s IT costing process. A user-friendly MagicOrange Microsoft Productivity integration was used as the automation and transformation middle layer.
“As part of the solution, we assisted Exxaro to define its ITFM vision and develop a three-year roadmap,” comments Blake Davidson, Customer Success Officer at MagicOrange.
Exxaro has experienced numerous benefits following this strategy planning and implementation. Its entire IT recharge process is now automated, resulting in a transparent, defendable, robust recharge model.
Mariana Bredenkamp, Principal Architect Enterprise Applications at Exxaro and project custodian, says the value was immediately apparent, “even after only three months and while the project was not even officially implemented yet”.
“The MagicOrange team truly earned my trust, and nothing was ever a problem for them,” she adds. “That stands out for me in my 30 years of experience in the IT industry.”
All charge-backs are now supported with data down to invoice level, and BUs can obtain predictable, transparent and accessible IT bills through self-service. For the first time they can fully understand all their costs related to each ICT service and are able to identify where they can achieve savings.
Automation through MagicOrange has freed management accountants from mundane manual work to focus on analysis.
Information Management newly benefits from being able to allocate cloud costs to the various applications and services it offers, to build up TCO.
The MagicOrange team worked closely with Exxaro’s project and change management teams, and delivered comprehensive, face-to-face training across a number of locations. As Bredenkamp notes, “it felt as if we were one team.”
Adoption was easy as the change management process ensured users understand ITFM and can use the tool to access the information they require. In addition, the MagicOrange team developed system playbooks customised for two different sets of users: analysts and cost model administrators.
Finally, single sign-on ensures users can easily be added to the tool and have secure access to the information they need.
MagicOrange itself achieved several firsts during the implementation, which marked the most comprehensive ITFM project ever undertaken by this Gartner-recognised financial management solutions company.
“Following successful implementation of our cost transparency solution into a number of sectors including financial services, insurance, retail, FMCG and industrial,this was our first foray into the mining sector, and we hope to expand on capabilities and expertise gained through this implementation in all future project in this vertical,” says Davidson.
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