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Enterprise Planning
with Oracle Hyperion
Agenda
About Ranzal
Challenges in Typical Current State Planning
Processes
Enterprise Performance Management
Enterprise Planning Module Components
Core Planning Functionality
Capital Planning Functionality
Workforce Planning Functionality
Workforce Planning Demo Screenshots
Case Study: Catalina Marketing
Q&A
Session: Enterprise Planning
Typical Planning Process Challenges
Session: Driving Shareholder Value with Customer Profitability
Budgeting Process is Highly Inefficient
• Time – takes too long,
results obsolete
Senior Management • Quality –
political/negotiation, not
reflective of business
• Cost – many wasted
resources, dubious
FP&A Group
benefits
• Flexibility – lack of
responsiveness to
changes
Dept B Dept C
Dept A
Slide Courtesy of Oracle
Typical Challenges in Integrated Planning
• Black Boxes
Multiple areas of the organization each have their own solutions creating
silos of information and multiple versions of the truth
• Disconnect Between Finance and Operations
Numbers drive Finance, Events drive operations. Budgeting models linking
numbers to those events is key.
• Predictability
Its not just planning, and its not just reporting. Its about using the past to
help accurately predict the future, and use operational drivers to make
sound financial decisions.
• Transparency
Making sure stakeholders throughout the organization have visibility and an
understanding of the numbers and their source. This allows people to own
the financial results by understanding the drivers they are managing to on a
daily basis.
Other Challenges….
• Business & Environmental change
• No linkage between operational & financial plans
• Aggressive Forecasting/planning
• No strategic/exec. Direction
• Inaccurate/no data used in plan
• People don’t understand the budget
• Process too long
Typical Current State Planning Solutions
2/13/2012 Copyright © 2006, Hyperion. All 7
rights reserved.
Other Current State Planning Practices
2/13/2012 Copyright © 2006, Hyperion. All 8
rights reserved.
Enterprise Planning Architecture
Session: Driving Shareholder Value with Customer Profitability
Oracle Enterprise Performance Management System
EPM Workspace
EPM Workspace
Performance Management
BI Applications
Applications
BUSINESS INTELLIGENCE FOUNDATION
Common Enterprise Information Model
Essbase BI Server Real Time Decisions
Fusion Middleware
OLTP & ODS Data Warehouse OLAP SAP, Oracle, Siebel, Excel Business
Systems Data Mart PeopleSoft, Custom XML Process
* Slide courtesy of Oracle
Hyperion System 9 – Financial Performance Mgmt Apps
1 Enterprise Data Sources
System 9 includes:
2 Foundation Services
• EPMA 1
Shared Services 5
3
• Security
• Life Cycle Management
4 Workspace
• Web Access
• Smartview for Office 6
Oracle EPM Offerings:
5 Applications
• Hyperion Financial Management
• Hyperion Planning
- Addl: Capex, Workforce 3
• Strategic Finance 7
• Performance Scorecard
8
6 BI Tools & Technology
• Essbase
• Financial reporting
• Web Analysis
• Production Reporting
• Interactive Reporting 2
7 Data Integration 4
• FDM (Upstream)
• HAL (Vignette)
• ODI (Sunopsis)
• DIM (Informatica)
8 Master Data Management
• MDM (DRM)
Integrated Business Planning Framework
EPM Workspace
CORE FINANCIAL PLANS SPECIALIZED MODULES OPERATIONAL PLANS
Sales Marketing
Planning Planning
Income Balance Workforce CapEx
Statement Sheet Cashflow Planning Planning
Projects
Planning IT Planning
Hyperion Planning Application
Essbase OLAP Server
Data Warehouses Transactional Systems Performance Management
Applications
Hyperion Planning
Shortens Planning Cycles and Improves Business
Predictability
Efficient Data
Integration
Powerful workflow
and process
management
Flexible modeling
Intuitive interface
Slide Courtesy of Oracle
Why Essbase*
* Slide courtesy of Oracle
Streamline Planning, Budgeting and Forecasting
• Centralized and Consistent
• Shortens budget cycles
• Collaboration &
Accountability across
organization
• Process drives forecast
accuracy
• Align top-down with bottom-
up
• Driver-based planning
• Rolling forecasting
Slide Courtesy of Oracle
Components of Hyperion Planning
Session: Driving Shareholder Value with Customer Profitability
Components of Core Hyperion Planning
Planning Functionality Delivered through Web interface of EPM
Workspace or Office Interface provided by Smart View
Built on top of Essbase, all features and capabilities of Essbase are
available
Scalable Architecture with an advanced calculation Engine
Multi-Dimensional Slicing and Dicing
Out of Box Financial and Time Series Intelligence
Application Related Features
Process Management
Web Forms
Graphical Business Rule Development
Supporting Details
Task Lists
Cell Notes
Textual and Date Measures
Session: Driving Shareholder Value with Customer Profitability
Intuitive Web Interface for Wide Deployment
Slide Courtesy of Oracle
Guide Users Through Budget Process
Fast Adoption and Increased Accuracy
• Budget wizard to
guide planners
• Include instructions
• Set due dates
• Alerts and progress
monitoring
• Send email
reminders
• Report on budget
status
Slide Courtesy of Oracle
Capital Expense Planning – What Is It?
What can you do with it ?
• Plan for new asset purchases
• Plan for Depreciation/Amortization calculations
• Plan for actions on existing assets
• Plan for driver based/user defined asset related expenses
• Capital purchases process management (future release)
• Report on Assets
What it is not meant to be?
• Capital Asset Inventory and Tracking system
• Fixed Asset System
Manager
Center
Capital Expense Planning Process
Plan for Plan
Cost
Plan Asset Submit for
New Asset actions on
related Approval
Requests Existing
expenses
Assets
Authorities
Approving
Review New Approve and
Review Capital Expenditure Capital Asset Promote
and Financial Impacts Requests and Asset
Priorities Requests
Management
Review Approve
Review Long
Top
Corporate Capital
Term Financial
Capital Expense
Impacts
Expenditure Budget
Establish
Finance
Corporate Review Balance Sheet, P&L and Cash Flow
Global Impact
Assumptions
Capital Planning - Feature and Functionality
• Plan for new capital expense and intangible expense
• Planning of multiple asset requests or multiple units
• Depreciation/Amortization calculations – Straight Line, Declining
Balance, Sum of Years Digit, Conventions
• Cash flow impacts and funding options
• Predefined global assumptions e.g. Useful Life, Depreciation
conventions
• Planning for asset related expenses e.g. Maintenance,
Insurance,Repairs
• Planning for Improvements on Existing assets
• Planning for Sale and Writeoff
• Planning for Transfer
• Planning for impairments on intangible and corresponding amortization
impacts
Capital Planning - Feature and Functionality
• Reporting at entity level or at aggregated corporate level across asset
class
Capital Expenditure Summary and details
Balance Sheet Impacts
Profit & Loss Impacts
Cash flow Impacts
• Provision to specify to Justification, Priority, CAR # (Capital Acquisition
Request)
• Additional hidden fields – Freight, Installation, Tax,Retirement
Obligations and Additional Charges
Global Assumptions
New Asset Requests – Add New
New Asset Requests – Input
Workforce Planning – What Is It?
• A collection of pre-built forms, business rules, and processes that
allow a company to forecast and budget salary related expenses
• Work force planning while ‘pre-built’ is fully customizable
• Out of the box business logic to calculate:
Salaries – including base, merit, overtime, and bonus
Benefits
Taxes – Social Security, Medicare, SUI, and FUTA
Additional Employee Related Expense – Training, Travel, etc.
FTE & Headcount Metrics
Slide Courtesy of Oracle
Workforce Planning – What Is It?
• Business logic is based on various employee attributes
• Out of the box employee attributes include
Status – Active, Departed, Sabbatical
Position – Customized by the client
Pay Type – Exempt, Non-Exempt
Employee Type – Regular, Contract, Temporary
Tax Region – US, State, Intl
Health Plan – Family, Individual, Individual + 1
Performance – Below expectations, meets, exceed
Merit Month – Jan, Feb, Mar…
Slide Courtesy of Oracle
Workforce Planning Benefits
• Best of both worlds approach
Extensive pre-built functionality
Fully customizable to client’s needs
• Simple & Intuitive User Interface
• Creates greater visibility into the salary planning process
• Provides a single source of salary information
• Seamless integration with overall operational planning
• Fewer spreadsheet errors
• Less re-work on the effect of changes in assumptions
• More time for true analysis
Slide Courtesy of Oracle
Slide Courtesy of Oracle
Workforce Planning Benefits
Slide Courtesy of Oracle
Workforce Planning Benefits
Slide Courtesy of Oracle
Workforce Planning Benefits
Slide Courtesy of Oracle
Ranzal Case Study
Hyperion Planning – Enterprise Planning
Catalina Marketing
Tampa, FL
Session: Driving Shareholder Value with Customer Profitability
Catalina Marketing Overview
• Targeting change with behavior-based marketing
• Catalina Marketing is the global leader in providing behavior-based
communications on a mass scale, targeted to individuals as
individuals
• Catalina Marketing was founded on the premise that the
combination of access to consumers and insight into their actual
purchase behavior would enable more effective, cost-efficient
promotions than traditional marketing approaches
• The company’s vision created an alternative to usual methods such
as freestanding inserts (newspaper coupons), which are subject to
waste, misredemption, and clutter
Offices Around the World
Business Challenges - Forecasting and Budgeting
• Budgeting and forecasting was prepared using
Hyperion Pillar
• Difficult to consolidate and disseminate budget
and forecast information quickly
• Limited modeling capability – really starting to
push the limits of Hyperion Pillar
• “What-if” analysis was largely unavailable when
preparing budgets and forecast
• Version comparison was cumbersome
• Not linked to the financial consolidation system –
Hyperion Enterprise. Thus, to get comparative
reports, data had to be manually uploaded to
Hyperion Enterprise
Business Challenges - Financial Reporting
• Reporting carried out by merging consolidation
data from Hyperion Enterprise with forecast
and budget data from Hyperion Pillar
• Manual update of spreadsheets for
management reporting
• No central repository of information led to
inconsistencies in formulas and calculations
• Difficult to prepare detailed “what if” analysis
across multiple versions
• Overall reporting was a manual effort that
required a great deal of hands-on involvement,
and often produced questionable results
Business Challenges - Operational Change
• Contract to Cash (C2C)
• A sweeping initiative involving new custom systems to handle the
following business processes:
Contract Management
Billing
Accounts Receivable
Invoicing
Revenue Recognition
• Legacy system maintained using Oracle back-end and Access
• Little visibility to data
• Data starting to overload legacy application
• Legacy application over 10 years old
A Changing Climate
• Catalina recognized the need for a platform that would help them
manage the great organizational change that was upon them
• Some of the most critical needs
Better visibility to data in all facets of the business – not just
finance and accounting
An iterative process that allowed the planning, forecasting,
and reporting process to be seamless
The ability to link data from operational systems into the
planning process
Dashboard-type reporting for executives
Detail analytics for analysts
A central repository to manage these reporting needs
Planning and Analysis Needs
• The ability to provide timely and accurate forecasts on a monthly
and annual basis
• An integrated planning and reporting engine that provided insight
into ever-changing business conditions
• A tool that allowed for complex modeling of capital, revenue, and
salary processes
• The standardization of the forecast and planning process across the
organization
• The alignment of general financial statements with monthly forecasts
and annual plans
• A robust engine that allowed for a myriad of versions, “what if”
scenarios, and on-the-fly analytics
• A toolset that could evolve as the organization changed
The Solution
• Hyperion System 9
• Utilize Hyperion Planning for the monthly forecast and annual
planning process
• Leverage the Hyperion Essbase database behind Planning to load
in monthly actual data from Lawson
• Exploit the powerful calculation engine in Hyperion Essbase to
create variances across versions and scenarios, and standardize
metrics across the organization
• Utilize Hyperion Workspace to provide dashboard reports to
management and highly formatted reports to distribute to the
business – from the same interface
The Planning Solution
• Domestic
Phase I
Go live – October Year 1
Consisted of the following
models:
Revenue Planning
Salary Planning
Capital Planning
Core Financial Planning
The Planning Model – Core
• Core Financials brought information from each model by
general ledger account, cost center, activity, and month
• Core serves as a central repository for actual, forecast, and
budget information
• Domestic and International data are both consolidated in
Core
• The majority of financial reporting is done out of this
database
• Local Currency and USD supported
• Multiple hierarchies for reporting in both the organization and
accounts dimensions
The Planning Model – Core
The Planning Model – Salary
• Salary information loaded from Ceredian monthly
• Monthly Forecast and Annual Plan both utilize the detail
salary model
• Prepared by employee by cost center
• Ability to add new employees and transfer employees
• Salary, Bonus, Taxes, and FTE all calculated in this model
• Summarized by cost center and general ledger account and
sent to the Core Financial database
The Planning Model – Salary
The Planning Model – Revenue
• Revenue planning by Product Class (the product Catalina is
selling to the customer) and Targeting Method (the method
that the consumer is being targeted)
• Revenue is input at a high level by general ledger account,
product class, targeting method and month
• Revenue is then allocated to the Chain (retail location in
which the print printed)
• COGS accounts calculated – paper and ink
• Monthly Forecast and Annual Plan both utilize the detail
revenue model
• Summarized by chain and general ledger account and sent
to the Core Financial database
The Planning Model – Revenue
The Planning Model – Capital
• Capital Planning by cost center, activity, account category,
and expenditure type
• Activity typically corresponds to a project
• Account Category corresponds to balance sheet asset
accounts – Software, Hardware, Office Equipment, Store
Equipment, etc.
• Expenditure Type can be Growth, Productivity, or
Maintenance
• Asset dollars are input, depreciation is calculated
• Monthly Forecast and Annual Plan both utilize the detail
capital model
• Summarized by activity, general ledger account, and cost
center and sent to the Core Financial database
The Planning Model – Capital
Ranzal & Associates
Enterprise Planning with Oracle Hyperion
Mike Killeen, Practice Director – gvillamil@ranzal.com
Jill Horn, Business Development Manager – jhorn@ranzal.com
Session: Driving Shareholder Value with Customer Profitability
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