151: How IT Mojo Gave a Preschool Franchisor Its Operations Edge, Bob Scopinich, CFO, Goddard Systems, Inc.

The following is unedited abstract* from the CFO Thought Leader podcast featuring Robert Scopinich, CFO, Goddard Systems, Inc. and Jack Sweeney, co-host of MME Thought Leader.

CFOTL: So can you now share with us an ah-hah moment, a moment of strategic insight that you experienced along the way here, your 13 years where perhaps you suddenly saw the organization in a different light and understood what needed to change to be successful?

SCOPINICH: Sure. In the early years when I was here, when I first joined, we were really experiencing a rapid unit growth and seemed like we went from 100 schools to 300 schools in a blink of an eye. We hit about 400 million of system-wide revenue and realized we don't have access to all the data at the school. The schools were keeping data at their local facilities and it wasn't really getting consolidated up in a good way other than financials, but all of the business data was at the school level and somewhat siloed. So, we took a look at that and sort of undertook to fix that issue and really start consulting that data internally and it really led us to develop our own system. We looked externally, none of the systems that were in the market, the technology solutions in the market at the time would really deliver on what we thought were our unique needs as a large franchise provider in the industry.

So we built our own solution from scratch. We have a proprietary code and create the system that now all the schools use and it's housed here so the schools can use it wherever they're at. The franchisees can use it wherever they're at. They can work from home, on a plane if they need to but they can access their information anytime and we also have access to that information. We've already seen some wins with that in being able to use the data and to make data-driven decisions and we weren't able to do that a handful of years ago because the data was dispersed so widely throughout the organization. And that ah-hah moment as you called it of realizing that we were becoming a big system but not able to make database decisions really presented a challenge for us that we've since overcome.

CFOTL: We'd love to hear some more about the decision-making around this platform that you built. Clearly there were probably packaged applications that companies would have like to have sold you. However, you took the path of internal development and we'd love to hear how that decision and some of the challenges that perhaps you faced with that decision.

SCOPINICH: Sure, and times were certainly different when we started working on this in 2008, 2009. But we did have a lot of people trying to sell us their system and at the end it really came down to the fact that we felt we were in a bit of a unique position in the industry. As I mentioned, it's a highly fragmented industry and most of the software is designed for either local providers who may have one, two or three facilities and they don't need to consolidate it and do a lot of analytics with it and they don't really need the system to be that open to other third party systems. And then there are the really big corporate providers who don't have the need to break it down individually by school and allow schools to get access to all their own individual information. So since we straddled that by being a franchised organization, there really wasn't anything that existed in the education space that readily worked for us and everything that we looked at that might be designed for a franchise system was for a different industry and it would require expensive customizations. And then anything we looked at in the education field, so to make it work for us also required extensive customizations.

We really got to the point of making a decision that we still have to invest significant resources into making the customizations but then wouldn't really be in control over the path that that software would take in the future so that those customizations have to be rebuilt time and time again. So, by building our own system, we certainly made a larger upfront investment but now as we've experienced the system and as it become more pervasive throughout our organization, we've used that now to integrate multiple third-party vendors and really get benefits in areas we never thought we'd be able to get benefits or we haven't even thought of at the time. Now there are third party tools that have come out that are great solutions for a very particular function that we bolt on to our system. So now we just build a link and our systems can talk and our franchisees have the ability to use these sort of one-off systems or solutions for a particular function but all doing it through our main system and I think it's given us an enormous amount of flexibility that we wouldn't have had otherwise.

*Note: This unedited abstract may contain electronic transmission errors, resulting in inaccurate or nonsensical word combinations, or untranslated symbols which cannot be deciphered by our transcription process. This abstract may differ from an edited transcript of the same interview in content, page and line numbers, punctuation and formatting.