The EY team’s goal was to visibly demonstrate the speed, accuracy and forecasting capabilities offered with digital and advanced technologies by developing modeling tools. These modeling tools used a shadow copy of Caterpillar’s own data, along with selected external sources, to run forecasting models — validating and proving the functionality of the solution. Big differentiators for these tools included the EY Data Fabric solution and EY Intelligent Forecasting and Scenario Modeling.
These solutions, coupled with a human-centric approach transformation approach, provided a path for Caterpillar to scale new capabilities quickly while offering leaders new insights throughout the process. Caterpillar’s finance organization established an advanced analytics team and EY professionals worked alongside the team to build their initial capabilities.
Those insights also sparked inspiration for the EY teams — including a bold, experimental way of sourcing and querying finance data using a program originally created for other business uses.
“To help Caterpillar see the possibilities using their own data, we tried a completely new approach for finance,” said Kevin Tollison, EY Data and AI Partner, Ernst & Young LLP. “While the forecasting tool was being developed, we had discussions with Caterpillar about data sources, data management and lineage. Because the forecasting techniques were data-driven, the client’s data needed to be digestible.”
Once the EY team had demonstrated the modeling tool’s capabilities, a pilot was created connecting forecasting accuracy and insights to business operations within one of Caterpillar’s business units. This process showcased how improved accuracy and understanding could be gleaned from the new system. The pilot ran in parallel with Caterpillar’s current process, allowing the team to test the new technology without disrupting current operations. Next, statistical models were developed and deployed to better support the forecast and a scenario planning process was created.
A newly designed custom user interface allowed the team to execute more planning scenarios and establish a global repository capturing the critical data. The interface was able to demonstrate multiple finance scenarios and allow for overrides to the predictive models when new information was available that was not yet reflected in the system.
“This is a great example of a global manufacturer encouraging innovation across its finance organization and pointing the way forward for other Finance teams,“ said, David Herbert, Americas Finance Transformation, Vision and Strategy Leader, Ernst & Young LLP.
