Sacred Heart Mission adds MAGIQ budgeting and sees immediate payback
Melbourne’s Sacred Heart Mission is a multi-million-dollar Not For Profit organisation with about 400 employees who work in areas as diverse as feeding the homeless, running op shops and delivering services in aged care, health, housing assistance and women’s support. Early in 2019, Sacred Heart Mission transformed its budget-building process by choosing Evolution Business Systems (EBS) to deploy the MAGIQ budgeting system. As well as empowering program managers to plan for their own areas, MAGIQ has saved Sacred Heart Mission at least one month a year in preparing its budget, dramatically reduced the stress of budgeting and improved both transparency and accountability.
The challenge: Preparing annual budgets was a “nightmare”
Established in 1982 to feed homeless people in the Melbourne suburb of St Kilda, Sacred Heart Mission has grown into a multi-million-dollar Not For Profit organisation during the following four decades. Today, Sacred Heart Mission employs about 400 people and generated 2018-19 revenues of more than $32 million to deliver community services that aim to provide support, care and nurturing to alleviate and prevent homelessness, poverty and social isolation regardless of race, religion, sex or age. Services include its Meals Program, which fed more than 125,000 people during the 2018-19 year; confidential counselling for people in crisis; aged care services; NDIS assistance; women’s support services; and assistance with housing, mental health, legal, medical, and social and life skills. Sacred Heart Mission fulfils its agenda of confronting poverty, enhancing human dignity and advocating for a more just society through funding from a range of sources, from sales at its op shops to various State and Federal Government programs.
Their NFP expertise is gaining wider recognition. At our EBS user group, we started with only about five NFP organisations, now we have about 30 NFPs around the table. You need to get there early to get a place.
Sacred Heart Mission
General Manager, Business Services
Sacred Heart Mission General Manager Business Services, Cathy Branigan, described budgeting before MAGIQ as “a nightmare”. “It was very stressful as everything was based on Excel,” she said. “During the first year I was here, we had this huge linked spreadsheet for budgeting. I had more than 40,000 lines in Excel over 12 months. You could do integrity checks and then a link would break. It was just a nightmare. It was not appropriate for our level of business anymore.”
“Eventually we chose Microsoft Dynamics NAV from EBS, which was recommended by one of our partners. As well as being half the price of one SAP quote, NAV fitted with our move to Microsoft Office 365.”
The first step for Sacred Heart Mission was, in 2017, to replace its aged Great Plains accounting software with the Microsoft Dynamics NAV financial management system, installed and configured by Melbourne-based business software specialist Evolution Business Systems (EBS). Ms Branigan said Sacred Heart Mission needed a more automated system. “We don’t have a big back office, so we needed to make it more automated,” she said. “We went to market after talking to partners like Vinnies. From my background in disability services, I had experience putting in systems like SAP and Sage. We evaluated four systems all up. We were looking for user-friendliness, its ability to support our growth and I was keen to use OCR (scanning and Optical Character Recognition) for purchase invoices.
The journey: EBS added MAGIQ to NAV on time and under budget
After the successful deployment of Microsoft Dynamics NAV in 2017, Sacred Heart Mission set about planning how to improve associated systems such as budget preparation. “While NAV made it easier, Finance was still doing all the work,” said Ms Branigan. “The problem was that the finance team was totally tied up trying to do the budget, rather than the program managers who were responsible for the expenditure, which was impossible. I was keen to get responsibility back in the hands of the program managers, which is why we started to search for a system that would allow us to do that.”
The three non-negotiable requirements for Sacred Heart Mission’s budgeting solution were:
1. Easy to use – to allow program managers with varying IT skills to use the budgeting with minimal training and support
2. An integrated organisation view – to allow the simple aggregation of individual budgets into a single organisation-wide view, which enabled analysis by exception and simple drilldowns
3. Integration with NAV – to minimise manual logistics and enable the increased automation of the financial management of Sacred Heart Mission.
Eventually, Sacred Heart Mission settled on the MAGIQ budgeting solution proposed by EBS, which was deployed in March 2019.
Ms Branigan said EBS had introduced the MAGIQ budgeting software in just one and a half days.
Ms Branigan said EBS was very responsive in tailoring the MAGIQ budgeting software to the needs of Sacred Heart Mission. “For example, after a couple of our executives exited the system without saving the budgeting work they had done, EBS gave us a big green Save button,” she said.
“We were up and running very quickly, we were on time and under budget,”
“Finance picked up using MAGIQ quickly while our program managers, who are not particularly IT-savvy, found it easy to use.”
The outcome: Empowered program managers, one month saved and immediate payback
Ms Branigan said that budget planning was split almost evenly between Finance and program managers during the first year of using the MAGIQ budgeting software. “We have easily saved over a month of work in the budget preparation process, not to mention greatly reduced stress,” she said.
“It has also improved accountability because when you are in MAGIQ, you can drill right down to what is happening this year. The various dimensions offered by MAGIQ allow you to add granularity to your reporting, for example on op-shop sales, without adding to the size of the GL (General Ledger).”
“In 2018-19 the split in responsibility for budget planning was about 50 / 50, with Finance doing overheads while program managers did their own budgets. I think it worked really well.
“We had actual YTD figures sitting in there along with the budget from last year. We allowed people to add things in. We could see the overall entity at any one time and we could see trends, so if the cost of Maintenance blew out in one area, we could drill down to see what that cost related to.
“It also delivered greater ownership to program managers. After all, it’s their budgets, not ours, so we’re saying ‘this is your budget, you need to take ownership’. Now if a manager says their budget is wrong, we can easily look to see who last updated that.”
Ms Branigan said the MAGIQ budgeting software had already paid for itself at Sacred Heart Mission. “I reckon it paid for itself in its first year,” she said. “I applied the unused budget from our initial MAGIQ rollout to implement labour forecasting functionality in early 2020. About 80 per cent of the cost in our organisation is wages, with complex planning due to three EBAs (Enterprise Bargaining Agreements) and five awards. If we can use MAGIQ to simplify that process, it will be amazing.”
Ms Branigan said EBS stood out because it understood the needs of Not For Profit (NFP) organisations. “They are very responsive,” she said. “EBS is very proactive about a lot of things. For example, I was whingeing from day one about the budget process, so EBS recommended MAGIQ. “Their NFP expertise is also getting wider recognition. At our EBS user group, we started with only about five NFP organisations, now we have about 30 NFPs around the table. You need to get there early to get a place.”