Deluxe Entertainment is a 105-year-old movie and television business with a storied history going back to the early days of Hollywood. Originally started in 1915 as a film lab when movies were still silent, Deluxe’s industry-leading post-production capabilities made an indelible mark on film and television production, with “Color by Deluxe” becoming the industry standard. However, all of that changed when film virtually disappeared overnight, having been replaced by modern digital formats. Deluxe had no choice but to transform its business in order to survive and thrive.
Streaming into the 21st century
After nearly a century as a photochemical film laboratory that created and shipped physical media around the world, Deluxe broke out and evolved into a global digital platform company. It offered services to address the complex digital supply chain of content – from ingest to delivery – with the goal of providing end-to-end services for content creators, owners, and providers.
Deluxe’s complete and phenomenal transformation occurred through the acquisition of over 30 companies and building new, forward-thinking products and services such as Digital on Demand, digital cinema, and streaming services. Today, leading content producers such as Amazon, ESPN, HBO, Netflix, Showtime, and Viacom all rely on Deluxe.
Deluxe’s ERP footprint
CIO Cindy McKenzie oversees IT, infrastructure, network, applications, and facilities, to name just a few of her responsibilities. McKenzie says that Deluxe is using a core ERP system across the United States, Canada, the United Kingdom, Australia, and India. Within its global business process scope are:
- Core financials
- Procure to pay
- Order to cash
- Asset management
- Capital project management
Deluxe’s ERP platform grew through acquisition and regional growth in a way that unfortunately did not support the company moving forward. For example:
- System foundation issues from not following leading practices led to parallel ledgers for local statutory reporting (among other related issues)
- Poor master data design and lack of governance at the enterprise level resulted in a proliferation of data across profit center, cost center, and more
- Users relied on spreadsheets to drive business and do financial reporting
- The company lacked guiding principles for master data creation and maintenance
- Global policies and procedures were not established
Clearly, the company needed to change in order to improve operational efficiency. Based on these challenges, Deluxe considered and assessed a number of options.
The right partner at the right time
According to McKenzie, Deluxe understood the need to find a knowledgeable partner early on and underwent the full RFP process, looking at a variety of potential partners. Deluxe selected Larsen & Toubro Infotech (LTI) – an organization they had not used before – based on strong recommendations, and it has proven to be a very fruitful partnership.
Journey to next-generation ERP
Deluxe did a deep dive into full due diligence of the options available in the marketplace – including fixing its current ERP platform, migrating to a central finance foundation, or installing a new implementation of next-generation ERP. McKenzie reported that they worked with LTI to do a full analysis. This produced a realistic estimate for what the implementation would be, with a detailed analysis of the costs and expected benefits.
In the end, the hard work and the analysis produced by McKenzie’s team showed that the third option was the right one. They were able to put together a full business case for Deluxe’s CFO, CEO, and the company’s equity investment company and decided to start their journey.
While Deluxe is not yet live with the new solution, here are just some of the new capabilities and benefits that the company expects to derive:
- Standard organization structure and processes that support company policies, controls, and consistent global use and reporting
- Single source of truth for fast closing, quick analysis, and better control
- Quick and easy integration of SAP or legacy systems for future acquisitions
- No more need to go through pages of obsolete data or workarounds
- Improved user experience and enhanced analytics capabilities
The future begins
With new streaming services being planned by Apple, Disney (Marvel Comics and Star Wars), WarnerMedia (DC Comics), and others, there is no question that more and more options from the world’s largest tech and entertainment companies will continue to proliferate. And once Deluxe has completed transforming its infrastructure to become an intelligent enterprise, the company will be ready to meet any future demand of this explosive digital entertainment industry.
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