Data Analytics Class Project

Pixystems Toys Information

Pixystems Toys is a leading manufacturer and distributor of children’s toys across the globe through third party distributors (non-company owned stores) and through their flagship store located in New York.  The company is headquartered in Cleveland, Ohio, and has manufacturing locations in Brazil, China, Mexico, and across the United States. Product development is also done in Cleveland with new products released every six months.  The majority of the toys manufactured by Pixystems are top sellers that are sell outs during holidays.  Some of their most well-known products include: toy cars, plush dolls, and electronic games.

The company does all back office processing at their headquarters where they have shared service centers for accounts payable (AP), payroll, and inventory management.  These shared service centers handle processing of transactions related to these processes across the globe driving a consistent process and controls.  Customer sales are managed at the flagship store by the local sales team while online sales and sales to distributors are handled at headquarters.  

Pixystems recently hired a new CFO who is focused on improving the financial performance of Pixystems and improving operational efficiency in AP, payroll, inventory, and sales.  She has challenged each of the managers of these business processes to identify areas for improvement and quickly address errors.  Internal audit has also been working closely with the CFO, managers, and external auditors to identify control gaps, areas of non-compliance, and operational efficiencies.

The CFO has also engaged your team to review these business processes using Pixystems’ data and performing analytics.  She would like you to make any necessary recommendations, identify data issues, and provide her and the managers with insights gained through your analytics.  During your last meeting, she shared the following information with you:

Payroll:

• Majority of employees working at headquarters and managers at the manufacturing locations are salary employees and not entitled to overtime (twice hourly rate) payments.  All other workers should be paid hourly.
• Payroll is paid to salaried employees on the 1st and 15thof each month through direct deposit.  Hourly employees are paid bi-weekly (every two weeks).
• Executive team receives an annual bonus each year which is paid at the end of the year.  The amount is dependent on the employees overall performance ranking and Pixystems’ performance as a whole.  
• Average annual employee pay increase is between 3-5% for salaried employees.
 

Group Assignments:

You will work with your team and leverage the data provided by Pixystems (see the Data Overview above for a high-level explanation of data provided) and information obtained from the CFO to identify areas for financial and operational improvement, address issues and errors found in processing or data, and confirm the information that the CFO shared with your team.  To do this your group will pick at least one process and must create analytics that will assess the validity of data and provide the insight the CFO is looking for.  You should also conduct between 2-5 additional analytics that will add additional insights or that you feel would be of interest to the CFO, managers, or auditors. Overall, you should provide analysis on no less than five concerning areas.

You will meet again with the CFO to deliver your results.  She is expecting that you have a Tableau visualization representing the analytical procedures you performed and assumptions you made.  You (each group) will submit a written report. Your report should outline the following:

1. Insight that the analytics provided management. For instance, current control failed to prevent duplicated AP invoices from data input, or, current system structure does not support the vouching system.
2. Recommendations your team has for improving Pixystems’ processes efficiency and / or controls. (For instance, establish certain edit check to send alert when AP invoice number is repeated. Please be specific as which edit check should be used in which activity link of the process flow.