Building Visibility Through Enterprise Integration Accruent Customer Case Study: Sempra Energy

Based in San Diego, Sempra Energy is an energy holding company operating primarily through subsidiaries in southern California and throughout North America, Asia, Europe an South America. With annual revenues of $7,143 million, the company logs as #259 on the Fortune 500 list. Sempra has experienced rapid expansion since the 1990’s, including the 1998 merger of Pacific Enterprises and Enova Corporation. This growth highlighted significant challenges with the company’s operations workflow including an expansive property portfolio. Sempra’s portfolio resided in 4 unconnected databases that were managed in separate locations for different business purposes, none of which shared information. Neither management nor personnel had visibility into these isolated data islands.

Sempra spends over $102M annually on rent and as much as $80 million more on other occupancy expenses such as maintenance services. Simply processing these payments consumed a disproportionate amount of resources. This routine task had to be performed manually, each month. “We had no visibility. Every month we felt like once we had made the payment, it went ‘over the wall.’” remembers Sempra executive Pete Aubrecht. “We had no way of knowing if payments were accurate, based on terms we’d negotiated.”

In 2001, Sempra selected Accruent over solutions from SAP and Peregrine. “After carefully evaluating the options, we chose Accruent because of its ease of use, granular financial detail and superior management reporting,” said Jay Shephard, director for Sempra Energy. “We believe that automated portfolio management and consolidated reporting are key to the broad-based strategic analysis and planning that will contribute to our overall objective of improving cost-efficiencies.”

The Challenge: streamline and coordinate workflow, unify corporate processes and systems

Before implementing Accruent, Sempra’s real estate department functions were uncoordinated and operated in a vacuum from the finance department. Many people were performing the same lease management functions, but in completely different ways and according to different philosophies. Rent had been paid in one of two ways: a) input manually or b) entered directly into SAP, as a recurring routine. Neither of these labor-intensive processes included a way to verify whether the correct amount was dispersed, or to follow up once the payment was sent. The department had no way to determine if it had paid too much, or not enough. Rent payment was a blind process without the means to factor in late payments or credits accurately.

The Solution: an integrated, automated process

Accruent implemented a solution to improve the workflow and strategic value of Sempra’s real estate department. Accruent’s Professional Services group coached Sempra’s internal team through conversion of their many disparate datatbases. A single, centralized database run over Sempra’s intranet captures and tracks all lease data, including complex rent details such as credits and escalations. This overview gives managers new visibility into the trends and direction of the lease portfolio. Management reporting provides analytic tools that can demonstrate the department’s strategic value to the company’s overall success.

To improve the workflow for daily users, Accruent’s Professional Services group integrated the lease management software with Sempra’s existing ERP systems – CAFM for uploading location drawings and SAP Accounts Payable for automated rent payment. The core solution can thus reconcile invoices and payments against the actual lease terms – and in real time – which contributes to the increased accuracy. “Accruent’s solution smoothly links our human processes with our ERP systems.” said Aubrecht.

Results: dramatic gains in efficiency, control and accuracy

Accruent’s solution encourages best-practices behavior in the organization. The “right way” to perform tasks becomes the easiest way. For Sempra, routine tasks that used to be cumbersome, time consuming and executed in different ways by other people are now performed according to standardized, automated procedures. The automation enabled by Accruent’s rent payment module is not only faster but also more accurate than the manual methods Sempra had previously employed. As a result, Sempra’s real estate department has more control and authority over its responsibilities. After just three months of using the solution, the department has become more efficient.

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