Team Satisfaction
Compliance06 mei, 2021

Ferrero & TeamMate+ Audit

Sweet success

Global confectionary group Ferrero planned to upgrade from TeamMate AM to TeamMate+ in March 2020. The onset of the coronavirus pandemic created an impetus to complete audits faster and more flexibly, while working remotely, so the new system was put to the test immediately.

Since its founder famously added hazelnuts to chocolate cream and created bottled joy in the form of Nutella in 1946, Ferrero has expanded from a small Italian confectioner to a global purveyor of treats from Ferrero Rocher to Kinder and Thorntons. Now a multinational company employing almost 40,000 people across 38 trading entities, it produces around 365,000 tonnes of Nutella each year and operates 18 factories.

However, while the Nutella recipe is unchanged and the company is still owned and run by the founder’s descendants, Ferrero, like any large food manufacturer with complex supply chains and distribution networks, requires sophisticated modern risk and governance processes. Its group internal audit team of 21 people is based in in its international headquarters in Luxembourg and its members normally spend up to 40 per cent of their time travelling worldwide to conduct audits across its entities.

In 2020, of course, business travel was grounded by the coronavirus pandemic, so robust processes and controls and an efficient automated system that supported planning, secure document sharing and rapid reporting became even more essential. This was one reason why Ferrero’s audit team continued to implement a planned upgrade to TeamMate+ in the first months of the health crisis. The move demonstrated their confidence in both the company’s robust governance structures and in the software. It paid off and the system has supported the ongoing developments precipitated by the crisis.

It helped that the company was already in a strong position with well-established audit procedures. Francesca Labricciosa, Ferrero’s audit supervisor, explains that the team conducts integrated IT and operational audits across all the group’s brands and regions, while compliance assurance is provided by a dedicated team in the second line. A rolling three-year audit plan establishes the geographical and operational spread of the audits required in this period, but this plan is then revised and confirmed annually.

“We conduct risk assessments between March and June each year, mixing qualitative research, such as benchmarking against external surveys, ‘hot topics’ and emerging risks, with internal discussions with the compliance function and interviews with the members of the executive committee responsible for key business areas,” Labricciosa explains. “We collect and identify risk indicators for each business process and then combine the findings and create a proposal for the audit committee and executive committee. They then input their views on the organisation’s strategic plan and any specific requests for audits based on their view of business risks.”

“We collect and identify risk indicators for each business process and then combine the findings and create a proposal for the audit committee and executive committee. They then input their views on the organisation’s strategic plan and any specific requests for audits based on their view of business risks.”

Accelerate and learn

This well-oiled system was put to the test when the Covid-19 crisis struck. After identifying the controls that the pandemic was likely to put at risk and analyzing the potential impacts of delays to imports and exports, interruptions to raw material supply chains, ongoing health and safety developments and other commercial concerns, the team developed and communicated contingency plans. They then focused on finding ways to work more effectively remotely.

“The company did not stop even one day of production, apart from briefly in one area of China,” Labricciosa says. “We never stopped following our audit plan, but we had to adapt and be more flexible to adjust to new needs and strains in the system.”

The crisis created opportunities as well as risks. It enabled the team to accelerate or put to the test existing projects – they were already exploring ways to improve how they used their tools to scan operational data remotely and to identify, collect and use documents. They shifted resources to focus more on cyber security and cloud risks and accelerated a drive to increase digitization that had already begun, but now had a new impetus.

The flexibility and support of the whole internal audit team was vital, Labricciosa recalls. They learned important lessons that helped to speed up audits, introduce flexible working and allocate staff to audits more effectively. “We understood that we needed to invest more in the performance of our tools and speed up and improve the ways we used them,” she explains.


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On time, on schedule

The audit team had identified a need to transition from TeamMate AM to TeamMate+ two years ago and decided to carry on with this despite the extra work and complications created by the crisis. They allocated five weeks to the project and freed up auditors to get to know the new system.

The team had delayed the upgrade until 2020 because they realized they could not benefit from the full capabilities of the newer system until they addressed some of the issues affecting their use of TeamMate AM. They were aware they had never used it to full capacity and wanted to improve and develop their risk library. Labricciosa was keen to start afresh.

In addition, they were reluctant to change their software before they went through an external quality assessment in January 2020 and gained insights from that. They therefore agreed that they would refresh their IT software and processes in March 2020. The emerging pandemic and a new need for remote working and faster reporting only increased the urgency for this switch.

“One problem with the last system was that in some regions the servers and connections were slow and we depended on the IT team for support. We hoped that a solution hosted on the cloud would help this – we needed it to be consistent and supported wherever we were in the world,” Labricciosa says. “We needed to review our risk library and generally reset at zero so we had a clean start with the new software.”

Time was short. They allocated five weeks and wanted the whole team to be involved so that everyone could feel confident and would understand how the system worked and how they could use it. It was essential that it was ready to go so that the team began work for the next fiscal year and audit plan entirely on the new system.

Their major requirements were a smoother, simpler user experience and greater, more joined-up efficiency that would prevent any issues “falling into the cracks”. “One key aim was the usability of the system because we found in the past that auditors were choosing to use Word documents in the field and then uploaded these to the system when they got back into the office,” says Isaac Donkoh, senior IT auditor in the group internal audit team.

“Another major driver was the new reporting capabilities that TeamMate+ gave us. The flexibility of the configuration was also helpful – we could immediately see how easy it was to set up dimensions and configure the system to work the way we wanted it to, so that it worked best for us,” he adds.

Labricciosa agrees. “A challenge for us was that we wanted to adapt the system to suit our established way of doing audits, which is not the same as in every other organization, and that has worked well.”

Surveys before and after the implementation show a significant increase in user engagement and in the ways in which people use the new system. They also rate it as easy to navigate.

“The functionality of the working papers is really useful and the straightforward documenting procedures make these easy to use,” Donkoh says. “The reporting function is one of the greatest gains because we can now use the same system end-to-end for reporting and documenting progress against issues.”

The fact that the entire implementation took place in the early stages of the pandemic may not have been what the team’s managers originally envisaged, but it meant that they could immediately test how people used the system from home. “Migrating to TeamMate+ made a real difference to how we responded to the demands of the COVID crisis,” Labricciosa says. “It helped us achieve the greater flexibility we needed, while retaining consistency, just when we needed it most.”

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