Wednesday Apr 10, 2013

Planning at the Speed of Business with Hyperion Planning on Oracle Exalytics

Oracle’s corporate strategy is based on simplifying IT and powering innovation for our customers. As part of that, we recently announced a series of new Oracle In-Memory Applications and released several white papers focusing on how Oracle Engineered Systems can help customers run their business processes without constraints.
In the world of enterprise planning, this includes implementing best practices like driver-based rolling forecasts, “tapping into the wisdom of crowds” in the forecasting process, and aligning financial and operational planning. While customers strive to actually implement these best practices, system constraints often get in the way. In fact, in a study done by Dynamic Markets for Oracle in 2011, a staggering 95% of respondents said they encountered problems with their current planning systems, especially around data, timeliness and analyzing different scenarios.

Deploying Oracle Hyperion Planning on the Oracle Exalytics In-Memory Machine changes the game by delivering some remarkable performance capabilities at lower cost than ever before possible. In-memory technology can dramatically accelerate analytic performance and enable more innovative decision-making. Exalytics drives a new class of smarter and more powerful analytic applications that simply weren’t possible using conventional planning software and generic hardware configurations.

Consider the following results from early customer benchmarks:

+ 5X to 100X faster interactivity, leading to better decisions and accuracy

+ 6X to 10X faster planning cycles

+ 5X reduction in server footprint, resulting in lower TCO

So what does this mean for you? It means you can more feasibly address the new realities of today’s planning environment. You can speed up your planning and forecasting processes, while planning in more detail and for more users across the organization. Moreover, you can extend planning beyond Finance, run more complex planning models, and ultimately increase your forecast accuracy. Improvements in forecast accuracy translate into substantial business value – industry analysts estimate that even a nominal 3% improvement in accuracy could drive as much a 2% gain in profit margins. And isn’t increasing business value what Finance is all about?

For more information about Oracle Hyperion Planning and EPM applications running on Oracle Exalytics, you can find the new whitepapers on oracle.com here:

+ Oracle Exalytics In-Memory Machine: Enterprise Planning without Constraints (PDF)
+ Oracle Hyperion EPM Applications on Oracle Exalytics In-Memory Machine: Performance Management without Constraints (PDF)
+ Management Reporting on Oracle Exalytics In-Memory Machine (PDF)
+ Achieving a Virtual Financial Close with Oracle Exalytics In-Memory Machine (PDF)
You can also listen to the replay of a recent webcast about how Biogen Idec, working with Peloton Group, is leveraging Oracle Exalytics to transform planning processes. Click here to listen to the replay.

Tuesday Apr 02, 2013

Shared Service Costs: Are They Adding or Destroying Company Value?

Recently, Oracle published a very interesting podcast on shared service costs and whether shared services were adding or destroying company value. The information provided was extremely enlightening.

I had the pleasure of interviewing Bart Stoehr, Senior Product Management Director for Oracle Hyperion Profitability and Cost Management (HPCM), and Tom Gargas, a Principal Solutions Manager from Edgewater-Ranzal, an Oracle Partner. Here, I will summarize a few of the key points from the interview. 

According to Bart, shared services are really a concentration of company resources performing like activities, but they are spread out across the organization to service multiple, internal partners at a lower cost and providing higher levels of service. Most organizations have shared services, but often do not understand the value that they add to a company or the value that they can destroy. What are the goals for shared service centers? Bart explained that the goals are “To delight external customers and enhance corporate value”. These centers provide economies of scale and act much like centers of excellence. Examples of shared service centers mentioned by Bart include IT, Human Resources, Finance, Legal Services, Facilities and Communications.

We also discussed why it was so difficult to understand shared service costing. Bart revealed that it was really an aggregation issue. Organizations can see the total cost of a service that is shared, but not necessarily what the business units are consuming and therefore how they relate to products and customers. Understanding how each service is consumed by each part of the business will enable organizations to account for the services and charge back accordingly. But it is not only the financial aspects we are worried about. Understanding the costs of each shared service can help the company see how the costs of the service compare with the value of the service. If a service does not add value, then the company needs to take a hard look at why they are still performing it.

Tom gave us excellent information about a practical implementation approach for shared service costing which includes the FAST characteristics:


Flexibility  (in analysis and cost methods as shared services change)

Audit and Control (ensuring compliance and approved regulatory controls)

Shared Methodology (everyone uses consistent allocation methods which ensures accurate comparisons)

Transparency (details of allocations are provided to all)


Other details in the conversation covered how better understanding shared service costs can lead to organizational and management changes; becoming aligned on allocation methods and improving internal customer service levels. It can lead to excellence in business practices -- finding and exploiting core competencies, partnering with the strategic business units to help them increase their ability to create revenue, and adding value to the organization instead of destroying it through duplication of efforts and misalignment.

Tom indicated that Oracle Hyperion Profitability and Cost Management is an excellent tool for calculating shared service costs, and that these calculations can help in the financial planning process as well.  Shared service centers must plan both for the consumption of services (which services SHOULD they provide, volume of services, cost of services, etc.) and the supply side (workflow, accountability and what actually transpires). Being able to properly calculate service center costs and report against chargebacks by business unit just makes good sense. Being able to calculate and include service charges during budgeting and forecasting cycles makes forecasting more accurate.

“Using Hyperion Profitability and Cost Management with Oracle Hyperion Planning (and possibly Oracle Hyperion Workforce Planning) to manage the supply and consumption of shared services helps ensure that organizations are right-sized”, said Tom.

Bart and Tom convinced me that having well run shared service centers, understanding true shared service costs, and using those costs to plan for the future adds tremendous value to a company. Understanding these costs and using them to make sound business decisions can certainly make the difference between company financial profitability and loss.

To listen to the entire podcast, click here.

For more information about Hyperion Profitability and Cost Management, click here.

Tuesday Mar 26, 2013

Best Practices in Profitability and Cost Management

I recently had the opportunity to run some roundtable discussions on best practices in profitability and cost management with financial executives attending the CFO CPM Conference in Philadelphia and CFO Rising East Conference in Orlando. The attendees represented companies in different industries ranging from manufacturing, to transportation, real estate, insurance, telecommunications and healthcare.

The premise for the roundtable discussion was this; For most organizations, aggressive cost-cutting and management were critical to remaining profitable while top line revenue was flat or shrinking during the recession. However, now many organizations taking a more “surgical” approach to profitability and cost management, by understanding which products, services, customers and channels are truly profitable and which ones are draining value from the business. In these roundtable sessions we discussed best practices in profitability and cost management, including how to accurately allocate revenue and costs to individual product lines, services, customer segments, locations, channels and other lines of business in order to improve decision-making. Here’s a summary of the feedback I received from attendees at these sessions:

At what level does your organization analyze and manage profitability? The answers to this question varied by industry and company: Insurance - region, state and products.  For example:


+ Real Estate Brokerage - offices, products
+ Healthcare Providers – hospitals, business units, departments, services, patients
+ Healthcare Insurance – products, markets, customers
+ Transportation/Freight – ship level, market (car rentals), customers
+ Manufacturing – location/site, products, major customers, projects
+ Retail – store level, regions
+ Telecommunications – business units, products


Are there any regulatory requirements driving detailed allocations of revenue and costs in your industry or organization? Based on the roundtables, the primary industries where there is a regulatory driver behind cost allocations and profitability analysis are Telecommunications, and Healthcare. (The latter as a result of the Healthcare Reform legislation and need to report on Medical Loss Ratios)

How are allocations performed to distribute revenue and costs down to the appropriate level in the business? What allocation techniques is your organization using? Here the participants indicated they are using a variety of techniques ranging from standard costing based on headcount, square footage, and revenue contribution to activity-based cost drivers and allocations for certain areas, such as customer service.

How frequently are detailed cost allocations performed? The frequency of allocations varied across individual companies. Some are performing this task on a quarterly basis, some semi-annually, one bi-weekly, and most of the participants are doing detailed allocations monthly. One company, in Transportation, mentioned they were doing this on a daily basis, running detailed P&Ls for each of their ships (pretty impressive).

What tools are used to perform the allocations and report on profitability at the line of business level? The tools used to perform detailed allocations, cost and profitability analysis included spreadsheets, ABC tools, multidimensional OLAP tools (i.e. Oracle Essbase), and in some cases, the general ledger system.

Who consumes the profitability reporting in your organization? The consumers of this information varied by industry and company, for example:


+ Insurance – product line managers, actuaries, regulators
+ Real Estate Brokerage – branch managers (with compensation linked)
+ Healthcare Providers – doctors, marketing campaign managers
+ Manufacturing – senior management, controllers, sales managers, business unit leaders, operations managers
+ Telecommunications – finance, business unit leaders


Is profitability reporting and management linked to the annual budgeting process? The answers to this question were more varied across the participants. Some leverage this information in their long-term strategic planning process, some link to their annual financial budget, and some are just starting to create a link to their planning processes.

Overall I was impressed with the feedback I received from participants in these sessions. Every company who participated was performing cost allocations and analyzing profitability at some level other than the corporate summary. Some were doing this at a very detailed level (i.e. daily ship P&L), and others at a more summarized level but looking to get more granular over time. I was also impressed with the frequency of profitability reporting, with most of the participants doing this on a monthly basis, some less frequently. And it was clear that the information being generated was actively shared and utilized beyond the finance organization to business unit leads, product managers, sales managers and other line of business decision-makers.

Areas for improvement that most participants identified included moving this process from spreadsheets to analytic tools and applications designed to automate and support detailed allocations and costing on a more frequent and repeatable basis. The good news here is that there are a number of packaged applications available in the market designed to support detailed allocations of revenue and costs. These applications include powerful reporting and analysis tools to provide insights and support improved decision-making regarding resource allocations, product/service mix, pricing, customer service and campaign strategies. Some of these are available as standalone solutions, while others are delivered within Enterprise Performance Management (EPM) application suites and provide seamless integration with EPM planning and reporting applications.

For more information about the profitability and cost management applications offered as part of Oracle’s EPM solutions please go to www.oracle.com/epm.


 

Monday Mar 25, 2013

Optimizing the Business as a Whole: The Case for Enterprise-Wide Planning

I recently interviewed David Jones, Director in PWC’s Consulting Services EPM Practice, and Simon Kenney a Senior EPM Consultant also from PWC, in a podcast about their successes in enterprise planning implementation and their research on finance effectiveness.


Initially, we discussed the research they have been conducting around planning and forecasting effectiveness; they call it the Finance Effectiveness Benchmark. For 2012, some issues were consistent with previous years. Planning, budgeting and forecasting is taking too long to pull together, it’s still too manual and requires too many resources or effort to get it done. But the interesting headline this year is that 80% of the respondents declared that the accuracy of their forecasts is critical to the running of their business, but only 45% said that their forecasts were actually reliable. This result is very concerning as this deficiency will prevent companies from making the right critical business decisions.


So what are the causes of this large deficiency?


According to Simon, a lack of integration across the entire planning process – front office to back office is a key issue. The business functions are just not engaged enough as the forecasting is mostly finance led. Sales and marketing are essential to any forecast, but they are often not engaged properly. Ultimately, those that generate the opportunities and the revenue need to be involved with the forecast.


No wonder the forecasts are not accurate!


How do companies to fix this deficiency and move to an integrated more inclusive world of forecasting? Simon suggested the following three steps are a good start.


Step 1: Identify why the forecasting process is failing (Is each function independently running their own processes? Is there a lack of clearly defined accountabilities?)


Step 2: Determine if/when the company is ready to integrate their processes. (Does it have the required level of sponsorship in place to move to an integrated planning process? Are the functions prepared for change?)


Step 3: Define a blue print or target “n” state (Design the integrated process. Determine which technology can help support the new integrated process)


These steps sound fairly simple, so I asked David what some of the more difficult or challenging things are that he sees when undertaking these steps with his customers. David indicated that there are challenges specific to each industry, but some common ones to watch for are:



  • Lack of executive sponsorship across functions (Very Key!) The drive to implement change must come from the top and be a collaborative process.

  • Miss-aligned performance measures that drive the wrong behaviour.

  • Too much granularity or unnecessary detail in the financial plan. Requests for more detail and more clarifications lengthens the process (without sufficient benefit) taking too much time and effort.


Simon shared his experience working with a large UK based motor car manufacturer – the challenges and success they had experienced.


Car manufacturers are a more traditional type of company with lots of legacy systems. Being so entrenched in these systems meant that they were not sure if they were really ready for a big bang approach to integrated planning and forecasting. They, therefore, decided to work on one area of the company at a time – in waves – so they could prove it was the right thing to do by demonstrating success and showing value to drive further change.


I asked David how real the benefits were that could be obtained through integrated planning and forecasting. David said that he sees real results in more accurate forecasts and a much better understanding of what goes on in the business, how it behaves, and the impact each business function has on delivering the optimal level of profit. These are real and tangible benefits. Individual functional areas need to understand their role in the overall plan and not behave independently.


What can organizations do today to evaluate their planning and forecasting processes? Simon suggested the following:



  • Look at your existing processes – are they collaborative and integrated?

  • How accurate are your forecasts? If you are not sure, take a retrospective look and find out.

  • How effective are the different business functions in forecasting accurately?

  • Take a look at benchmarks and case studies outside your organization and see how you measure up and what else you can achieve.

  • If you are in the spreadsheet world, re-evaluate the process and take an honest look at how it is working for you. How accurate are your forecasts?


It became quite apparent from speaking to David and Simon that it’s all about optimizing the business as a whole and not the individual parts; without enterprise planning integration, this is simply not possible.


To listen to the webcast, click here.

Monday Mar 04, 2013

Bridging the Gap Between Project Management and the CFO’s Office

Organizations undertake numerous projects and initiatives to generate revenue,  improve productivity and increase profits in the hope that they will have the desired effect. But in large and multi-national companies, how can they sensibly and efficiently decide which projects to undertake, how to assign resources, and how to fund them?

Aligning organizational plans (long term and short term) with financial plans and forecasts while enabling the various Lines of Business (LOBs) to lead the projects might sound like it would be next to impossible, but with proper project financial planning tools, it can work really well!

Whether you have indirect (or administrative projects) that generate cost but not revenue, capital projects or contract projects (that generate cost and revenue), or a combination of them, having a well defined, easy to navigate process for documenting, evaluating , funding and approving multiple projects from many LOBs is crucial for forecasting cost and revenues, and booking resources and staff.


Consider these steps:


Step 1: Plan for expenses and revenues (where appropriate), by individual project – and by groups of projects

Step 2: Generate and analyze project financials for individual projects and groups of projects

Step 3: Analyze the funding requirements and revenue generation potential for individual projects and groups of projects

Step 4: Analyze and approve workforce requirements and asset requirements for individual projects and groups of projects

Step 5: Enable the analysis, and approval process by Business Unit Leaders and Finance managers for individual projects and groups of projects within the overall financial plan

Step 6: Enable intercompany project planning and reconciliation to get a complete corporate view of projects within the overall financial plan

Step 7: Enable continued monitoring of project financials within the overall financial plan


Oracle Hyperion Project Financial Planning embraces these steps and provides the needed structure and automation to simplify an otherwise complex set of processes.

When proposing and planning new initiatives, understanding the financial implications on corporate financial plans and objectives and gaining consensus among all concerned parties are a major challenge for many organizations. Without good financial and operational information for both proposed and current projects, it is difficult to analyze and make decisions on new projects to undertake. Oracle Hyperion Project Financial Planning provides the ability for all involved parties to help with this decision making.

It bridges the gap between the detailed task oriented project plans that a project manager within each LOB maintains, and the overall impact of projects on corporate finances and resources. Management can get a holistic view of how their assets and resources are allocated, and then monitor performance and receive information about return on investment (ROI).

Oracle Hyperion Project Financial Planning bridges the gap between LOB project management and the financial plans and forecasts within the CFO’s office.

For more information, click here to read Oracle’s new whitepaper on Oracle Hyperion Project Financial Planning: Aligning Financial and Project Plans.

Monday Feb 25, 2013

Gartner Positions Oracle as a Leader in CPM Suites

On February 14th Gartner released their 2013 Magic Quadrant for Corporate Performance Management Suites report. In the report, Oracle was recognized as a Market Leader for the sixth consecutive year.


Gartner’s Magic Quadrant reports position vendors within a particular quadrant based on their completeness of vision and ability to execute. In this year’s report, among the market leaders, Oracle is positioned with the highest ability to execute and the strongest in completeness of vision.


Here’s an excerpt from the report with some comments about Oracle from Gartner:


“Oracle is a Leader in CPM suites, and the Hyperion brand is respected by finance executives worldwide. Oracle has a very broad and deep CPM product suite, which employs a multiproduct approach with different applications for each of the major CPM processes; however, these products employ a common foundation and administrative components. The vendor has a well-established partner channel and Hyperion skills are plentiful among the consultant community, given the well-established products.”


Oracle Hyperion Performance Management Applications are part of Oracle Business Analytics, which combine market-leading enterprise performance management applications with business intelligence tools and technology and analytic applications to help organizations strategize, plan and optimize business operations and achieve better business outcomes.


Click here to learn more:  reportpress release


For more information about Oracle’s Hyperion Performance Management Applications please go to www.oracle.com/epm.

Wednesday Feb 13, 2013

Tax Provisioning: Simplify, Standardize then Automate

Tax provisioning is a process that has become increasingly more complex to perform, but increasingly more important to do well. I recently interviewed Andy Oliver, a PWC Director in their Tax Practice and an expert in Tax Provisioning, in a Podcast which I feel sheds some light on this increasingly complex matter. To listen to the Podcast, click here.


Tax provisioning is the process of reporting current and deferred income taxes in a company’s financial statements – tax on current profits and estimated future tax on future profits. There are a myriad of rules and requirements for calculations and disclosure that apply to different companies and countries and they are changing all the time. It is extremely important to have accurate, transparent calculations as when and what to pay and defer can make a huge difference to a company’s bottom line.


How do most tax accountants and departments manage this process? Andy indicated that a majority of companies pull this information together through numerous and large spreadsheets with complex and convoluted calculations. And although these spreadsheets offer flexibility – to keep up with the ever changing rules – they do not provide consistency in calculations, standardization of the process, or data security. This means that the calculations and resulting reports are error prone and can cause countless hours of work to find and correct the errors.


Ideally, the tax provisioning process should be performed early in the financial close process to get a really good picture of the end result. However, inevitably being early in the process means the financial results will change and the provision or estimation will have to be recalculated. Having the tax provisioning process integrated with the financial close process and systems makes a lot of sense, from an efficiency standpoint, to reduce the amount of work required each time there is a change to the financial results. We also discussed how important it is to SIMPLIFY the tax provisioning process and then standardize and automate the process before integrating with the financial close process to be truly effective and world-class.


Oracle’s Hyperion Tax Provision solution was designed to provide this integration with the financial close process and drive efficiency into the tax provisioning and disclosure process.


Finally, Andy had this advice for the listeners, “If you can align the tax reporting process with the financial close process – eliminating much of the manual, spreadsheet-based calculations, you will get the job done quicker, experience fewer mistakes, and be able to spend more time doing the important part of your job as a tax accountant; analyzing the numbers, and providing insight on the results such as WHY the numbers are different from forecast or from last year.


For more information on the Oracle Hyperion Tax Provision solution, click here.


To listen to the podcast, click here.


 

Tuesday Feb 05, 2013

How Corporate Culture Affects Performance Management

Good news – now there is research to support the idea that corporate culture really does impact corporate performance management!

A new article by the Business Research and Analysis Group (BRAG) was published in the January 2013 issue of Strategic Finance called "How Corporate Culture Affects Performance Management". Click here to read the article. It is an interesting piece that focuses on two main things:

1) An original bit of research on the attributes of effective CPM systems (EPM in Oracle vernacular) and

2) How/if those criteria support Howard Dresner’s Performance Culture Maturity Model. This model tracks 6 critical measurement criteria through four levels of maturity therefore highlighting the status of any company in fostering a performance directed culture. 

The article starts off listing strategic and operational benefits that can result from having an effective EPM system, and then goes on to investigate how significant Dresner’s six criteria of a performance directed culture are to the organizations in the survey that had achieved significant strategic and operational benefits – with a view of the level of maturity organizations reached with respect to these criteria. In the end, we can see which factors impact the achievement of benefits from an EPM system.

Dresner’s six criteria from his Maturity Model are:

1) Alignment with Mission

2) Transparency and Accountability

3) Action on Insights

4) Conflict Resolution

5) Common Trust in Data

6) Availability and Currency of Information


Through a series of graphs and tables presented and an analysis performed, it was determined that three of the six criteria are very significant to achieving benefits from an EPM system, while the  other three (although still important) are less significant to the sample of organizations involved in the study. The three very significant criteria are:

a) Alignment of an organization with its mission and vision

b) The presence of transparency and accountability

c) The ability of an organization to resolve conflict effectively

An interesting detail noted in this article was that in general, organizations are doing a poor job of achieving organizational maturity in the three areas that were found to have the most significant impact on achieving benefits!  The four levels of maturity modeled were Level 1: Chaos Reigns, Level 2: Departmental Optimization, Level 3: Performance Directed Culture Emerging, Level 4 Performance-Directed Culture Realized.

Another interesting detail was that the ONE criteria that organizations have really improved upon over the years and have reached a higher degree of maturity on – was one that was considered to have less impact on achieving significant benefits (Availability and Currency of Information).

The big message here is although it is important to have good EPM information in a timely fashion upon which to base sound business decisions, corporate culture has an even bigger impact on being able to achieve significant EPM benefits.

Click here to access the article.

Friday Feb 01, 2013

Not Your Father’s Scorecard

If you are new to the world of Business Scorecards – Welcome! If you have been at it for a while, it might be time to have another look at what your scorecard is doing for you.

Jacques Vigeant, Product Strategy Director for Oracle Business Intelligence and Enterprise Performance Management, was interviewed in a podcast by Nigel Youell, Director of Product Marketing for Oracle Performance Management Applications, and had a very interesting discussion about the business value that scorecards add to dashboards. To listen to the podcast click here.

To summarize, Jacques explained that dashboards are really about monitoring organizational metrics, usually including data that has been rolled up by dimensions relative to the business. Typically they are single page dials and graphs that give you information about trends and data in a point in time. Very useful for keeping track of what has happened. Whereas scorecards can provide a huge amount of business value by supplying additional information about how those metrics are related to the business strategy, which metrics are particularly important, what impact a particular metric has on the strategy, and who is accountable for the metric. This additional information enables employees to better evaluate their own impact on strategy and effect real change based on the metrics and initiatives they can influence.

According to Jacques, not all metrics are created equal. Some have a much bigger impact on strategic outcomes than others. For example, the number of units sold is a good metric to watch, but the profit on those units sold is MORE important. Importance can be seen through weightings placed on metrics relative to the strategy, and through maps showing how each of the metrics are related – cause and effect style.

The BIG news however is how scorecard functionality is changing, and Oracle is investing here.   Oracle Scorecard and Strategy Management, or OSSM, has taken better decision making very seriously. Oracle has introduced the concept of ‘actions’ and invoking those actions based on who is viewing the scorecard (position in the organization) and which metric they are viewing. If a value has gone wrong (or very right) a list of suggestions – based on the individual viewing the metric – can be presented to the user. In some cases, it is appropriate to automatically invoke a business process, trigger a workflow or initiate a job requisition based on a metric result value. In other words, intelligence can be built in to assist employees to make better business decisions every day. In addition, employees can support each other even more in making better business decisions through written collaboration and annotations on metrics and initiatives and what is happening to improve them.

Finally, reporting has changed to improve understanding of how each metric contributes to the organizational strategy.  Strategy maps show relationships between objectives, but can also show relationships to specific metrics. The ‘contribution wheel’, a patented graphic that Jacques himself designed, beautifully depicts how each metric and initiative contributes to the overall strategy in one graphic.   





So as you can see, Oracle Scorecard and Strategy Management is not your father’s scorecard. It has moved on to enabling managers and business leaders to see the impact of initiatives and metrics on the organizational strategy and, more importantly, helping to modify the behavior of employees to make better business decisions every day. At the end of the day, Oracle Scorecard and Strategy management can help provide enough business context so that everyone can make better business decisions every day. When this happens, achieving organizational goals and strategy is possible!


To listen to the Podcast, click here.

Thursday Jan 31, 2013

Profitability – the Proof is Deep Inside the Pudding

Recently, Oracle published a very interesting podcast on how the ability to view and analyze detailed costing is enabling us to better see the impact of costing on organizational success. To listen to the podcast, click here.

Bart Stoehr, Senior Product Management Director for Oracle Hyperion Profitability and Cost Management (HPCM), was interviewed by Nigel Youell, Director of Product Marketing for Oracle Performance Management Applications. Here I will summarize some of the key points. 

Bart started off by explaining why detailed costing is more important now than it has been in the past. More and more organizations have the need to understand costing and/or profitability on a granular level due to extreme competition, or due to inflexible regulation by governing bodies. For example:

- Financial institutions such as banks have to compete on a daily basis to keep a customer. For this reason they need to understand cost and profitability by customer for each of the products and services they consume: checking accounts, savings accounts, mortgages, loans, etc.

- Healthcare providers need to better understand the cost for each patient by the treatments they receive (DRGs) and types of services they consume.

- Transportation organizations (e.g., airlines, trains, etc.) have to understand costs by route, segment, seating class, etc. Without this crucial information, companies in these types of industries might not survive. Competition and regulation prevent them from jacking up price, so they instead must understand costs, how they are consumed, and therefore which products, services and customers are profitable and which are not. The ultimate business goal of detailed costing is to be able to manage the profit creating and profit destroying customers and parts of your business.

Applications like Oracle Hyperion Profitability and Cost Management enable our customers to analyze their customers, patients and subscribers (often counted in the millions) and to differentiate themselves through their sales, service and marketing functions.   These tools help managers find the “proof in the pudding” , and figure out what and who work(s) well and what and who does not.

When asked how most organizations currently perform this type of detailed analysis, Bart explained that most companies don’t attempt to do it because it is SUCH a daunting task despite the unprecedented insight into profit creation and profit destruction. Bart went on to explain that Oracle Hyperion Profitability and Cost Management has introduced detailed costing (available to the business user) to enable analysis and reporting at granular level, and to potentially enable 100’s of millions of allocations in a reasonable timeframe.

The podcast closed with the following thought – given the economic climate of today, is it enough to understand the average unit costs for an average customer, patient or subscriber? To stay competitive, or to convince a governing body that a service rate is unfair or unrealistic – you need to understand highly financially accurate and detailed records reflective of specific consumption. In other words, what each customer, patient or subscriber is REALLY costing you.

To replay this podcast, click here.

Monday Dec 17, 2012

Integrated Reporting is Getting Closer

Oracle recently sponsored a webcast on CFO.com titled:  The CFO Playbook on Integrated Reporting: Integrating Sustainability into Financial Disclosures.  The speakers for this webcast were James Margolis, partner with Environmental Resources Management (ERM), a global provider of environmental, health, safety, risk and sustainability consulting services (EHSS) and Mike Wallace, Director of the Global Reporting Initiative's Focal Point USA.


This webcast focused on why top companies in the U.S. and overseas are incorporating sustainability content into their annual reports and other financial disclosures. The speakers discussed the benefits of integrating sustainability reporting with traditional financial reporting. They noted how investors, corporate directors, lenders and most recently, the Securities and Exchange Commission, use this information to better understand, benchmark and value companies. They also discussed the November 2012 release of an Integrated Reporting Framework by the International Integrated Reporting Council (IIRC).  See the press release and link to the framework here. 


The shift towards integrated financial and sustainability reporting is gaining momentum with a number of global stock exchanges endorsing this approach in 2012.  See the links here if you want to listen to the webcast or download the slides. Also, here is a demonstration of Oracle’s solution for integrated financial and sustainability reporting. If you’re interested in learning more about this and Oracle’s other Sustainability Reporting solutions, click here.


If you have any questions or need additional information, please feel free to contact me at john.orourke@oracle.com.

Friday Oct 19, 2012

Why CFOs Should Care About Big Data

The topic of “big data” clearly has reached a tipping point in 2012.  With plenty of coverage over the past few years in the IT press, we are now starting to see the topic of “big data” covered in mainstream business press, including a cover story in the October 2012 issue of the Harvard Business Review. 


To help customers understand the challenges of managing “big data” as well as the opportunities that can be created by leveraging “big data”, Oracle has recently run and published the results of a customer survey, as well as white papers and articles on this topic.  Most recently, we commissioned a white paper titled “Mastering Big Data: CFO Strategies to Transform Insight into Opportunity”.


The premise here is that “big data” is not just a topic that CIOs should pay attention to, but one that CFOs should understand and take advantage of as well.  Clearly, whoever masters the art and science of big data will be positioned for competitive advantage in their industries or markets.  That’s why smart CFOs are taking control of big data and business analytics projects, not just to uncover new ways to drive growth in a slowing global economy, but also to be a catalyst for change in the enterprise.  With an increasing number of CFOs now responsible for overseeing IT investments and providing strategic insight to the board, CFOs will be increasingly called upon to take a leadership role in assessing the value of “big data” initiatives, building on their traditional skills in reporting and helping managers analyze data to support decision making.


Here’s a link to the white paper referenced above, which is posted on the Oracle C-Central/CFO web site, as well as some other resources that can help CFOs master the topic of “big data”:


White Paper “Mastering Big Data:  CFO Strategies to Transform Insight into Opportunity


CFO Market Watch article:  “Does Big Data Affect the CFO?”


Oracle Survey Report:  “From Overload to Impact – An Industry Scorecard on Big Data Industry Challenges”


Upcoming Big Data Webcast with Andrew McAfee


Here’s a general link to Oracle C-Central/CFO in case you want to start there:


www.oracle.com/c-central/cfo


Feel free to contact me if you have any questions or need additional information:  john.orourke@oracle.com


Wednesday Oct 03, 2012

Planning in the Cloud - For Real

One of the hottest topics at Oracle OpenWorld 2012 this week is “the cloud”.  Over the past few years, Oracle has made major investments in cloud-based applications, including some acquisitions, and now has over 100 applications available through Oracle Cloud services. 


At OpenWorld this week, Oracle announced seven new offerings delivered via the Oracle Cloud services platform, one of which is the Oracle Planning and Budgeting Cloud Service.  Based on Oracle Hyperion Planning, this service is the first of Oracle’s EPM applications to be to be offered in the Cloud.    This solution is targeted to organizations that are struggling with spreadsheets or legacy planning and budgeting applications, want to deploy a world class solution for financial planning and budgeting, but are constrained by IT resources and capital budgets. With the Oracle Planning and Budgeting Cloud Service, organizations can fast track their way to world-class financial planning, budgeting and forecasting – at cloud speed, with no IT infrastructure investments and with minimal IT resources.


Oracle Hyperion Planning is a market-leading budgeting, planning and forecasting application that is used by over 3,300 organizations worldwide.  Prior to this announcement, Oracle Hyperion Planning was only offered on a license and maintenance basis.  It could be deployed on-premise, or hosted through Oracle On-Demand or third party hosting partners.  With this announcement, Oracle’s market-leading Hyperion Planning application will be available as a Cloud Service and through subscription-based pricing. This lowers the cost of entry and deployment for new customers and provides a scalable environment to support future growth.


With this announcement, Oracle is the first major vendor to offer one of its core EPM applications as a cloud-based service.  Other major vendors have recently announced cloud-based EPM solutions, but these are only BI dashboards delivered via a cloud platform.   With this announcement Oracle is providing a market-leading, world-class financial budgeting, planning and forecasting as a cloud service, with the following advantages:


·                     Subscription-based pricing


·                     Available standalone or as an extension to Oracle Fusion Financials Cloud Service


·                     Implementation services available from Oracle and the Oracle Partner Network


·                     High scalability and performance


·                     Integrated financial reporting and MS Office interface


·                     Seamless integration with Oracle and non-Oracle transactional applications


·                     Provides customers with more options for their planning and budgeting deployment vs. strictly on-premise or cloud-only solution providers.


The OpenWorld announcement of Oracle Planning and Budgeting Cloud Service is a preview announcement, with controlled availability expected in calendar year 2012.  For more information, check out the links below:


Press Release


Web site


If you have any questions or need additional information, please feel free to contact me at john.orourke@oracle.com.

Thursday Sep 13, 2012

What's Happening in Business Analytics at OpenWorld 2012?

Oracle OpenWorld 2012 is rapidly approaching on September 30th when we take over the city of San Francisco for five days.  The Business Analytics this year is our strongest ever with over 150 EPM, BI, Analytics and Data Warehousing sessions delivered by Oracle, our customers and partners.  We’ll also have Hands-On Labs, 20 demo pods dedicated to Business Analytics products, and over 30 partners exhibiting their solutions. 


So what’s hot in the Business Analytics program at OpenWorld?  Here are some of the “can’t miss” sessions at this year’s conference:



  • The EPM and BI general sessions, led by SVP of Product Development Balaji Yelamanchili will highlight what’s new provide a view into Oracle’s EPM, BI and Analytics strategies.  Both sessions are scheduled on Monday, October 1st.

  • Thursday Keynote:  See More, Act Faster:  Oracle Business Analytics, led by Oracle President Mark Hurd, will provide a view into Oracle’s strategy for Business Analytics, especially engineered systems designed to provide extreme performance for the most rigorous analytic tasks.

  • Superfast Business Intelligence with Oracle Exalytics.  Hear about various business intelligence scenarios in which Oracle Exalytics provides exemplary value—from operational reporting and prepackaged applications to analytics on unstructured data.

  • Turn Insights into Real-Time Actions with Oracle Business Intelligence Mobile.  Learn how Oracle Business Intelligence Mobile enables organizations to deliver relevant information and turn insight into real-time action, no matter where employees are located.

  • Empowering the Business User: Introduction to Oracle Endeca Information Discovery.  Find out how you can find fast answers to the new questions that confront your business every day, while avoiding the confusion and inconsistencies brought about by spreadsheets and desktop tools.

  • Big Data:  The Big Story.  Learn how to harness big data, your existing data, and predictive analytics to make better decisions in an environment of rapid shifts in behavior and instant feedback.  Learn about the technologies that constitute a big data architecture, how to leverage and implement advanced analytics for real-time decisions, and the tools needed to know the unknown.

  • Planning at the Speed of Business with Oracle Exalytics.  Learn how Oracle Hyperion Planning leverages the power of Oracle Exalytics to do planning faster, with more detail and more users than ever.


For more details on these and other Business Analytics sessions at OpenWorld, download the Focus On Business Analytics program guide at:  http://www.oracle.com/openworld/focus-on/index.html


We look forward to seeing you in San Francisco!

Friday Aug 03, 2012

What CFOs Need to Know About the Cloud

“The Cloud” has become one of the hottest buzz topics in the industry this year, and what started out as a topic mostly of interest to IT executives is quickly moving to the radar screen of CFOs and Finance Executives.  To help companies understand “the cloud”, as well as the advantages and considerations of cloud computing, Oracle has recently published a number of articles, white papers and videos on this topic. 


Some of the advantages of cloud-based applications include improved time to value, reduced up-front costs, leveraging 3rd party skill sets and having a scalable environment to support future growth.  Some of the considerations and risks include security, performance, integration of cloud-based applications with on-premise systems and long-term costs of ownership.


Here are some links to articles, case studies and videos covering what CFOs should know about the cloud on Oracle C-Central:


Partner Perspectives video: What CFOs Should Know About the Cloud


CFO Market Watch article: What CFOs Should Know About the Cloud


Essex County Council Adopts Cloud Computing for Payroll to Save US$ Millions & Offer Shared Services


Here’s a general link to Oracle C-Central/CFO in case you want to start there:


www.oracle.com/c-central/cfo


Here’s an article from Profit Magazine that might be of interest:


Five Ideas: Finance - What CFOs need to know about cloud and other technology solutions


Feel free to contact me if you have any questions or need additional information:  john.orourke@oracle.com


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This blog will highlight key EPM market trends, recent events and other news of interest to our field, customers and partners.

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