Grupo Colón Gerena (GCG) is a Puerto Rican restaurant management company founded in 1979. GCG owns 113 restaurant franchises including multiple locations of Wendy’s, Applebee’s, Famous Dave’s, Sizzler, Longhorn Steakhouse, Olive Garden and Red Lobster across Puerto Rico. GCG has more than 6,500 employees.
In 2016, after multiple acquisitions and mergers, GCG consisted of 15 different legal entities run across two completely different accounting systems. Every time GCG needed to run a company-wide report, it had to pull data for each legal entity out of the system where it resided, reconcile divergent accounting processes and re-input data into the organization’s primary system to run a company-wide report. This process was both time-consuming and costly in terms of FTEs.
GCG decided to consolidate and standardize its financial systems using Oracle’s ERP cloud solution. GCG took a long-term view of the costs and benefits of moving to the cloud. While in the short term the move would be more expensive for the organization, over the long term, there were multiple sources of potential cost savings.
As Ramon Vazquez, IT Director of GCG, explains, a move to the cloud meant less money spent over time on hardware, servers, software upgrades, deployments and consulting services for those upgrades. Moving to the cloud also meant that GCG did not need to invest in on-site disaster recovery systems. Ramon believes that GCG will break even on its move to the ERP cloud in only three to five years.
Moving all of GCG’s legal entities to the Oracle cloud system allowed the organization to standardize accounting practices across legal entities and realize a significantly streamlined consolidated reporting process. As part of that process, the organization standardized fiscal year calendars, general ledger accounts and accounting and reporting processes. Impressively, GCG managed to complete this major upgrade in only six months, and went live with a unified system in January 2017.
As Ramon explains, GCG’s Oracle cloud solution saved its IT department from having to administer on-premises hardware and software solutions. At the same time, Oracle offers GCG the security of a huge, multinational company with extremely sophisticated data centers and “backups of their backups of their backups."
The company was also able to integrate its new cloud solution with their restaurant management software, allowing it to directly integrate restaurant sales and inventory data into the accounting system without human intervention.
In addition to accounting, GCG has moved several other functions onto cloud-based solutions. Today, finance, purchasing and inventory are all in the cloud. The back-of-house systems for all 113 stores are on a cloud system which runs inventory, sales and point of sale data. Employee time card data runs on a cloud-based HR system. In the past year, GCG has moved its disaster recovery system to the cloud as well. Finally, GCG is currently launching a business intelligence project in the cloud using Microsoft’s Power BI solution.
GCG has seen numerous benefits from its new cloud solutions. In the area of accounts payable, the Oracle ERP automates invoicing, saving the work of four to five FTEs. Suppliers are now able to easily access the status of their purchase orders and payments, saving time spent importing invoices into a database and handling supplier inquiries. And, of course, the standardization of GCG finance data on a single solution has vastly increased efficiency in the organization’s financial planning and budgeting processes.
Reductions in transactional entry requirements have also allowed GCG to foster job growth for its finance employees. Rather than entering data all day, finance personnel are able to prioritize value-added activities for the organization. Additionally, as finance FTEs naturally attrite over time, GCG is able to identify new hires accomplished in data analysis and insight, bringing a different skill base to the company.
Having their systems in the cloud also allowed GCG to get up and running quickly despite extended power outages following Hurricane Maria in September 2017. Carlos Garcia, EVP and Chief Administrative Officer for CGC explains: “As soon as the electricity comes up, we’re up and running on our cloud. It doesn’t matter if all of my local servers are still booting up, the cloud solution is running 24/7, and we can start working immediately. So even with a major hurricane, on the financial side, we are never actually down. And we are sure that our data is safe and everything is up and running in the cloud.”
After Hurricane Maria, despite numerous power and communications breakdowns across the island, GCG quickly reopened restaurants, often with portable generators and limited menus. During this time, finance employees went out to restaurants and used cellphones and laptops to get online, upload point of sale data to the cloud and kept the central office informed and able to make the best possible decisions during the island’s difficult recovery period.
Looking toward the future, Grupo Colón Gerena is planning to open nine new restaurants in 2019. As a result of its cloud solution, GCG foresees doing so without adding to the main office headcount at all. Due to the efficiencies and standardization offered by its cloud ERP solution, GCG is well prepared not only for the next hurricane, but also to tackle future company growth.
This profile is part of PwC’s 2019 Finance Effectiveness Benchmarking reporting. PwC would like to thank Ramon Vazquez, IT Director for Grupo Colón Gerena, and Carlos Garcia, EVP and Chief Administrative Officer for Grupo Colón Gerena, for their insights.
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Director of Finance Effectiveness, PwC US
Brian J Furness
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Finance Benchmarking Lead, PwC United Kingdom