New methodology on using Enterprise Performance Management · Oracle’s Enterprise Performance...
Transcript of New methodology on using Enterprise Performance Management · Oracle’s Enterprise Performance...
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New methodology on using Enterprise
Performance Management
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Oracle’s Enterprise Performance Management SystemComplete, Integrated, Open
OLTP & ODSSystems
Data WarehouseData Mart
PackagedApplications(Oracle, SAP, Others)
ExcelXML/Office
BusinessProcess
OLAPSources
Exadata Unstructured & Semi-Structured
BI Server
Common Enterprise Information Model
EssbaseDimension
Management
Predictive
Analytics
ERP
Analytics
Strategy
Management
Financial Close
and Reporting
Planning &
Forecasting
Profitability
Management
CRM
Analytics
Industry
Analytics
Interactive Dashboards
Reporting &Publishing
Ad-hoc Analysis
Detect& Alert
Office Integration
Search EmbeddedDataIntegration
Mobile Scorecards Collaborate
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Oracle Hyperion EPM 11.1.2
Release Summary
• Hyperion EPM R9.3 (2007)
• Hyperion EPM R11.1.1 (2008)
• Hyperion EPM R11.1.2 (2010)
Extend
Planning
Across the
Enterprise
• Major Release of Hyperion Planning • New Public Sector Planning & Budgeting module• Enhanced Hyperion Profitability & Cost Management
application
Streamline
Financial
Close and
Reporting
• New Hyperion Financial Close Management Application• New Hyperion Disclosure Management Application• New Oracle Essbase Analytics for Hyperion Financial
Management• OBIEE and Hyperion Financial Management integration• Integration between Hyperion Financial Management and
Oracle GRC
Deliver EPM
Value Faster,
Reduce TCO
• Enhanced Hyperion Data Relationship Management module
• Enhanced Oracle Hyperion EPM integration with Oracle Fusion Middleware
• Enhanced Integration with Oracle E-Business Suite and PeopleSoft Financials and HCM
• UPK pre-built content
• 3rd major release since acquisition
• 4 New Products
• 250 New Features
• 502 Customer-Driven Enhancements
Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
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End to End Close
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Sub Ledger CloseGeneral
Ledger CloseData
AssuranceConsolidation
Internal Mgmt Reporting
External Financial Reporting
Filing
Close Sub Ledgers into GL (i.e. AR, AP, FA, etc.)
Perform Reconciliations
• Bank Reconciliations
• Standard Account Recon
• Sub Ledger Recon
Post Accruals
Deliver self service reporting to the organization for performance discussions and plan realignment
Automate external reporting gathering disclosures and financial information
Automate and deliver Edgar & XBRL filings, Statutory filings, Tax, etc.
Gather and validate complete data sets to support all financial reporting needs (i.e. Legal Entity, Segment, Management, Tax, Sustainability Metrics, etc.)
Automate consolidated financial reporting leveraging multiple hierarchies and calculations (i.e. CTA, FASB, KPI‟s, FX, Retained Earnings, Topside Entries etc.)
Close Process and Key Activities
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Sub Ledger CloseGeneral
Ledger CloseData
AssuranceConsolidation
Internal Mgmt Reporting
External Financial Reporting
Filing
Close Process Issues
• Lack of visibility to tasks across financial systems, departments, regions, etc.
• Manual spreadsheets are used to manage the financial close calendar
• „Hope‟ and email are core to the process
• Account reconciliations are managed manually
• Task management is fragmented and manual
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Critical Components to Implement
Financial Close Best Practices
FinancialConsolidation
DataAssurance Oracle Disclosure
Management
XBRL/SEC
Regulatory Reporting
Financial andMgmt. Reporting
ERP: Oracle, SAP, Legacy, Other
TaxFiling
Oracle Financial Close Management
CFO Dashboard
TaxCalculations
Transactions Reporting
Governance, Risk & Compliance
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Streamline the Extended Close Process
with Financial Close Management
• Close Process Analysis,
Trending and Improvement
• Process Monitoring
• Active Calendar
• Single Task List
• Automated workflow
• Ensure Compliance
• Email Notifications
• Account Reconciliations *
* Delivered in V2
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TASK MANAGEMENT
PROCESS MONITORING
ACCOUNT RECONCILIATIONS *
ACTIVE CALENDAR
Active integration with EPM and ERP systems
Executive Dashboard Views
Centralized web based task management and collaboration
Automation through matching capabilities and integration with all sources
Oracle Financial Close Management
Streamline the Extended Close Process
* Delivered in V2
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Key Benefits
• Financial Close Management
– Collapse activity timelines by removing process „windows‟
– Balance and evaluate workload across resources
– Integrated Close solution from Sub Ledger to Regulatory
Filings *
– FCM delivers process visibility and task management across
close
– Delivers process risk assessment in near real-time *
* V1 Full EPM integration, ERP integrations are limited to url and web service, V2 ERP complete
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HFM 11.1.2.2
Configurable Dimensionality
• Unlimited Custom
Dimensions
– Additional custom
dimension to existing
application
– Ability to configure size of
custom dimension
– Flexible dimension name
and alias for custom
dimension
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* Available with 11g
Hyperion Financial Management 11.1.2.1 OBIEE
connection to HFM
Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
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• Create and populate relational tables with the HFM
data
• Complete star schema with metadata tables
• Fastest HFM extraction with flexible selection logic
• No impact on the consolidation servers during extract
Essbase Analytics Link for HFM (EAL)
Near Real Time
Synchronization
HFM Database
Server
D
W
Fast
Extract
ETL
Relational
Star Schema
Other
Sources
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Sub Ledger CloseGeneral
Ledger CloseData
AssuranceConsolidation
Internal Mgmt Reporting
External Financial Reporting
Filing
Document Management and Creation Issues
• Manual management and creation of critical documents (Debt Covenants, 10Q/K, Board Package and Presentation, etc.)
• Gathering and managing commentary is manual
• Adjustment of financial data is manual
• MS Word documents sent to 3rd party who reformats and files with EDGAR (error prone)
• MS Word files are converted to XBRL by 3rd parties or manually (error prone)
• Adhoc process and limited control
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Ensure High Quality Report Submission
with Disclosure Management
• Collaborative document
creation *
• Document Versioning *
• Workflow and approvals *
• MS Office centered
• Multiple report formats
(Edgar, XBRL, etc.) *
• Embedded XBRL
• Seamless Data Integration
* Delivered in V2
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Oracle Financial Close Analytics Dashboard*
• Pre-Built Analytics to reduce complexity and TCO for
our customers
• Extend Applications with Best in Class BI Technology
• Integrate BI with HFM
and FCM
* To be released
1
2
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Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
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Financial Close Analytics Dashboard Contents
• Executive– Gross profit by Region, Income by Region, Net Cash Flow, P & L by products
• Process Management– PM Metrics, PM Trend Analysis, PM Overall\Entity Status
• Financial Close Schedule Summary– Schedule Summary, Schedule Graph, Schedule Milestones\Roadblocks
• Performance Indicators– BS Ratios YoY comparison table, BS Ratios components, BS Ratios Trend Analysis
• Profit and Loss– Summary Income Statement, Variance Analysis, Trend Profit and Loss
• Gross Profit – Variance Analysis, Gross Profit by Product, Trend Gross Profit
• Balance Sheet– Consolidating BS, BS metrics, Variance Analysis, Trend BS
• Cash Flow– Cash Flow Summary, Consolidating Cash Flow, Variance Analysis
• Currency Analysis– P & L Variance Analysis, BS Variance Analysis, CF Variance Analysis
Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
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First to Report on the Dow Jones
Before
• 20 days to close
• Lengthy year-end reporting
• Costly financial reporting
process
• 78 charts of accounts
• Widely varying reporting
definitions and procedures
After
• 5 days to close
• Global consolidation across 58
lines of business
• Global forecasting and reporting
solution for 1,000+ users
• Minutes to access information
The world‟s leading producer of primary aluminum with $23.5 billion in revenues with operations in 43 countries and 350 locations. Alcoa has over 131,000 employees.
Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
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End to End Planning
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Critical Components to Implement
Planning Best Practices
Copyright © 2010, Oracle and/or its affiliates. All rights reserved.
Capital AssetsPlanning
Workforce Planning
Long-Term Financial Planning
FinancialDetail
OperationalDetail
Predictive Modeling & Simulation
OperationalRevenue & Cost
Modeling
Planning, Budgeting & Forecasting
Functional Plans
ProjectPlanning
MarketingPlanning
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Financial Modeling is Highly Fragmented
• Complex spreadsheet models
• No consolidated view
• Spreadsheets are error prone
• Limited accounting integrity
• Lack of integrated models make
scenario analysis cumbersome
• Long simulation times
Treasury
Board of DirectorsSenior Management
Banks Investors AcquisitionsDivestitures
Long-Term Planning
Corporate Development
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Critical Components to Implement
Strategic Planning Best Practices
Predictive Modeling & Simulation
CorporateDevelopment
Value Management
Long-Term Financial Planning
Treasury Strategies
Planning, Budgeting & Forecasting
What-if Analysis
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Pre-built Financial Logic & Forecast Tools
• Pre-built, fully integrated financial statement foundation
• Pre-built forecast methods and formula functions
• What-if Analysis toolkit
• Consolidation intelligence
• User-defined reports for benchmarking analysis
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Investment Analysis Tools
• Pre-built valuation logic
(NPV, IRR, etc.)
• Purchase accounting for
acquisitions
• Goal-Seek
• Movable Deal Period
• Include/Exclude option
• Fiscal year-end conversion
• Divestiture logic
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Treasury Toolkit
• Calculates net cash
surplus or deficit from
multiple models and
scenarios
• Funding Options tool to
re-allocate surpluses and
fund deficits
• Debt scheduler
• User-defined reports to
monitor covenants, credit
ratings, and earnings per
share
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Apply Monte Carlo Simulation To Measure the
Effects of Uncertainty
• Assign probability distributions to uncertain assumptions
• Run thousands of simulations
• Analyze range of outcomes and probabilities
• Assess model sensitivities
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Align Planning Processes
Corporate
Development
Long-Term
Planning
Value
Management
Treasury
Strategies
Seed Budgets with
Strategic Targets
Update
Strategic Plans
with Latest
Forecasts
Periodic
Forecasts
Annual
Budget
Capital
Planning
Workforce
Planning
Strategic Planning
Planning, Budgeting and Forecasting
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Measure the Financial Impact of Key Business
Strategies
1 Project anticipated financial results
3 Optimize capital structure
5 Revise forecasts from detailed business plans
2 Invest/divest for future growth
4 Manage risk and uncertainty in your plans
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Overcome A Financial Crisis
$22 Billion global provider of power and automation technologies
Before
Lost investment-grade credit rating
Needed to recapitalize balance sheet
No cash flow modeling capability
No simulations at the divisional or
business unit level
After
Credit rating back to investment grade
$4 Billion debt restructuring
Simulate capital structure and cash
flow
97% accuracy in net income projection
Copyright © 2009, Oracle and/or its affiliates. All rights reserved.
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Robust End User Experience
Hyperion Planning 11.1.2
• Powerful Process
Management
• Validation of plans including
color coding, notifications and
approvals
• Sophisticated Web and MS
Excel capabilities
• Comprehensive support for
MS Office; Excel, Word,
PowerPoint and Outlook
• Task Lists and user actions
within MS Outlook and Excel
• Enhanced reporting and
budget books
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Hyperion Planning 11.1.2.2
Web Forms with Graphs
Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
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Hyperion Planning 11.1.2.2
New Predictive Planning Capability
• Statistical-based forecasting
is a feature, not a stand-alone
product
• Usable by all business
planners
• Leverage proven methods
and techniques
• Improve accuracy through
rigor and standardization
Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
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Profitability and Cost
Management
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Others require analysis to appropriately assign
MaterialDirect Labor
What are the Contributors of Cost?
Some are obvious and relatively easier to assign
Production Overhead
Product Management
Customer Service
Administrative Support
Quality Service
Sales/ Marketing
Support
Organizations are seeking flexibility to assign and transform these costs!
Utilities
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…Supports all Levels of Costing and Profitability
Objectives
Cost, Revenue and Profitability Analytics
Cost and Profitability Reporting
Cost and Revenue Allocation
Calculations
AllocatePerformance Improvement
Cost and Profitability Simulation
Analyze
Who are the most and least profitable customers?
Why are customers profitable or unprofitable?
What can we do to improve the situation?
What is a customer‟sprofitability?
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Critical Components to Implement
Profitability and Cost Management Best Practices
Cost, Revenue and Profitability Analytics
Cost and Profitability Reporting
Cost and Revenue Allocation
Calculations
AllocatePerformanceImprovement
Cost and Profitability Simulation
Analyze
Profitability and Cost Management
Common Reporting & Interaction
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Key CapabilitiesImprove Profit Decisions Through Better Visibility
• A business user application to
build models that:
• Accurately assign, measure, and
manage costs and revenues
• Use any methodology to transform
financial data through multiple stages
• Compute costs and profitability for
multiple business objectives:
• Customers, products, services,
activities, etc.
• Use scenarios to evaluate alternate
approaches
• Leverage Essbase‟s powerful
reporting and analysis
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Multi Stage• Up to 9 Stages
• 3 dimensions per stage
• Intrastage supported
• Direct Contribution data always
generated
• Genealogy optional
• Layers for Cost and Revenue
Detailed Profitability• 2 Stages
• 5 Dims Source, 20 on destination
• Intra-stage not supported in this
release
• Direct contribution data optional
• No Genealogy
• No Layers – any financial
element type allowed
Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
HPCM 11.1.2.2
Multi Stage vs. Detailed Profitability
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Financial Healthcare Comm &
Media
Hi-Tech
Mfg &
Distribution
RetailDefense /
Govt / Non
Profit
Services
HPCM usage in MY vertical is already a realityHPCM has over 70 customers now
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Data Relationship
Management
4141
Data Governance
Operational
Systems
PeopleSoft
Siebel
SAP
Custom Apps
External AppsBudgeting
Analytical
Systems
DW
BI, Datamarts
Planning
Consolidation
Oracle Fusion Middleware
Application Integration Architecture
Analytical
MDMOperational MDM Apps
Cli
en
ts
Su
pp
lie
rs
Fin
an
ce
, K
PIs
OracleDRM
Oracle
Customer Hub
Dim
en
sio
ns
Em
plo
ye
es
Oracle
Product Hub
Pro
du
cts
Eq
uip
em
en
t
Sit
esOracle
Site Hub
Data Relationship Management (DRM)
The most complete MDM offering in the market today
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Typical Dimension Maintenance
The business problem
EssbaseEssbaseBusiness
Intelligence
Planning
Corp
Oracle
APAC
Custom
LATAM
Peoplesoft
EMEA
SAP
Review
Spreadsheet
ETL
EAI
• Accounts
• Entity
• Cost Center
• Product
• Location
• Channel
DW
Spreadsheet
BusinessUser
IT Admin
OracleAdmin
PlanningAdmin
EssbaseAdmin
Analytic Applications• Different people involved
• Inevitable manual processes
• Error-prone, inconsistent
• No way to audit
• No way to rollback changes
• Time and resource consuming
• Updates “interpreted” by systems experts
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So … What is the Business Impact?
• Business measures that should be the same are not
• Uncertainty on accuracy of reporting
• Uncertainty if discrepancies are caused by bad data, different definitions, human error…
• Month after month, expensive time and effort spent researching and reconciling
• Audit / compliance difficulty, compliance implications for legal reporting
EssbaseEssbaseBusiness
Intelligence
Planning
Corp
Oracle
APAC
Custom
LATAM
Peoplesoft
EMEA
SAP
ETL
EAI
• Accounts
• Entity
• Cost Center
• Product
• Location
• Channel
DW
BusinessUser
Analytic Applications
YTD
Revenue
$13,500,322
YTD
Revenue
$12,994,332
YTD
Revenue
$13,509,999
YTD
Revenue
$13,599,322
YTD
Revenue
€ 9,322,219?
?
?
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EssbaseEssbaseBusiness
Intelligence
Planning
Corp
Oracle
APAC
Custom
LATAM
Peoplesoft
EMEA
SAP
ETL
EAI
• Accounts
• Entity
• Cost Center
• Product
• Location
• Channel
DW
Analytic Applications
Enterprise Dimension Management
The Hyperion DRM solution
Hyperion DRM
BusinessUser
• Publish changes for each specific consuming system as needed, when needed
• Each system receives required content and structure
• “Alignment” of accounts trees assured
• Same process can be leveraged for other dimension
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“Governed” Dimension Maintenance
High maturity
Enterprise Applications
CC
GL
Org
En
tity
Tim
e
Pro
d
G/L Planning Consol Reporting Analytics DW
Hyperion DRM
Standard user interface for all dimension maintenance
Enterprise dimensions aligned – consistent processes – delegated governance
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G/L System
Oracle
Hyperion DRM
G/L System
Co
nso
lid
ati
on
Rep
ort
ing
Data
Ware
ho
use
Systems of entry:
• For G/L accounts: G/L System
• For all other dimensions: Oracle Hyperion DRM
Oracle Hyperion DRM is System of Record for all
Dimensions
High-level architecture
System of record, system of entry?
Oracle
Hyperion DRM
G/L
Syste
m
Co
nso
lid
ati
on
Rep
ort
ing
Data
Ware
ho
use
Oracle Hyperion DRM is:
• System of Entry
• System of Record
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FINANCIAL SERVICES
Mature Product, widely deployed
PUBLIC SECTOR LIFE SCIENCES AND HEALTHCARE
RETAIL
HIGH TECHNOLOGY
MANUFACTURING & DISTRIBUTION
COMMUNICATIONSMEDIA & UTILITIES
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“Oracle's [Hyperion] Data Relationship Management solution
provides one single application interface that enables
centralized business maintenance of Dell's master data and
global hierarchies. Data is now governed and distributed
from one source which promotes consistent and reliable
reporting across the organization”
Kristin Pollock, Product Manager, Global Finance, Dell Inc
What Dell Is Saying
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Enabling Consistent Reporting
Oracle Hyperion Data Relationship Management
$60+ billion technology company
Over 82,000 employees
EBS Financials & Teradata warehouse
Before
• Reporting hierarchies created
redundant, inconsistent data
structures across applications,
regions, and segments, resulting in
various versions of the “truth”
• Decentralized technology structure
requires independent maintenance
processes and onerous
synchronization routines
• Dell data warehouse and financial
management system overloaded as
reference data sources
After
• Implemented Hyperion DRM to master
chart of accounts, entities, accounts,
projects, & products
• Provides a single, scalable
maintenance interface to support
10,000+ changes each month to
Dell’s global hierarchies
• Enables consistent distribution of
reporting master data
• Enables global visibility, reduction in
manual processes, improved data
integrity, reduced reconciliation effort
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Summary
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Oracle EPM Connects Management Processes
Common Integration & AnalysisData Quality and Consistent Dimensions
Common Reporting & Interaction
Strategy Management
Financial Close
Planning & Forecasting
Profitability Management
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Oracle Hyperion EPM Applications RoadmapPlanned content highlights
Hyperion EPM 11.1.2.2
• Hyperion Planning
• PSB Commitment control
• Predictive Planning
• Project Planning module
• HSF – Smart View
• Hyperion Financial Management
• Configurable Dimensionality
• Financial Close Analytics
Dashboards*
• Financial Close
• Account Reconciliations
• EBS/Fusion Integration
• Disclosure Management
• Edgar-ready format*, SEC validation*
• Collaborative document authoring
• Profitability & Cost Mgmt.
• Micro-costing
Hyperion EPM 11.1.2.1 Available
• Upgrade from prior releases
• iXBRL HMRC Income Tax Returns
• PSFT & Financial Close Mgt. integration
Hyperion EPM 11.1.2
• New Financial Close Mgt. Product
• New Disclosure Mgt. product
• New Public Sector Budgeting module
• Hyperion Planning
• Configurable & data driven workflows
• Conditional formatting
• Smart View extensions
• Oracle tech stack optimization
Available
FY13FY12FY11
* Available earlier
Target end CY11
"This information is not a commitment to deliver any material, code, or functionality. The development, release,
and timing of any features or functionality described remains at the sole discretion of Oracle"
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Become A World Class EPM Organization
• Define and communicate your
strategy
• Shorten the close process
• Improve your planning and
forecast processes
• Extend your profitability and
analytic capabilities
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