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Advice and Information for Finance Professionals

Reimagining Oracle’s Planning, Budgeting and Forecasting Processes for an Unpredictable World

Ivgen Guner
Executive Vice President of Global Business Finance, Oracle

Powerful socioeconomic factors are accelerating the transformation of finance processes globally, especially in financial planning and analysis (FP&A), an area that has become mission critical since COVID-19 surfaced and changed our world.  Fortunately, innovative cloud solutions make it technically possible and economically feasible to automate more and more of the finance function. 

I run Global Business Finance (GBF) at Oracle, a team of 900 finance professionals who provide planning, budgeting, forecasting and business partnering services to management and our lines of business.  When it comes to finance automation, I consider myself somewhat of an expert, if only because we challenge ourselves daily to constantly uptake the latest versions of our enterprise software that we sell to our 430,000 customers worldwide. Today, we run our US$40 billion business using a full suite of Oracle Cloud solutions, operating on a single, global chart of accounts to support 122 business units in 175 countries. In Oracle GBF, we’ve eliminated over 1,000 manual spreadsheets and 2,000 hours of data gathering per month, using the automation capabilities in Oracle Fusion Cloud Enterprise Performance Management to adopt standardized approaches and EPM models to improve forecast accuracy and deliver better outcomes for the business. 

Automating processes is top-of-mind for the finance executives I talk with because they want to free up their talented teams to engage in more high-value activities. The challenges I see now are determining what to automate and when, how to fine-tune the makeup of finance teams to capitalize on those automation opportunities, and how to equip teams with the right mix of business and IT skill sets to predict and respond to an increasingly volatile and unpredictable world. 

In this post, I will share my vision for reimagining finance for the new normal, based on my experiences leading our own cloud-based transformation in Oracle GBF, and upskilling our teams to move from financial advisors to co-creators of enterprise value.

Embracing automation to reimagine performance management 

I recently participated in Agile Finance: Reimagining Finance for the New Normal, the third webcast in a five-part series sponsored by the Association of International CPAs to help CFOs manage through COVID-19, with insights from McKinsey & Company. In this webcast, we examined the trends already underway that were leading CFOs to embrace large-scale automation, and how the pandemic has accelerated that shift.  We also looked at which new ways of working CFOs should consider institutionalizing post-COVID, such as shorter, more frequent planning and forecasting cycles and investing more in developing FP&A talent. Many of those strategies are ones my organization had already implemented even before COVID-19 hit, which helped us quickly provide information, plans and forecasts to management for real-time crisis planning. 

For example, we’ve reimagined planning, moving from a linear approach to continuous forecasting and planning scenarios using the standard models available in Oracle Cloud EPM. Standardized approaches to forecasting and automated variance analyses have enabled us to improve forecast accuracy by 25 percent, a capability that proved invaluable as we navigated through unchartered waters these past few months. For me, this process starts with using our front office solutions and weaving data points from our back office solutions when I’m working on planning and scenario analysis. The standard driver-based models in our planning solution are not just financial KPIs.  We also incorporate many operational KPIs so that business planning is now an integrated part of our entire forecasting process. 

The ability to forecast and plan continuous enhances our ability to adjust to current conditions and better anticipate the future. What were once disconnected business plans are now operationally connected plans. We have standard forecast models, consistent and automated baseline data, standard workflows, and automated reporting. By removing bias through data-driven process and becoming more agile, we’ve increased our forecast accuracy. We’re managing risk and opportunities much better, while increasing transparency and mitigating risks with greater controls.  

The Finance Continuum 

During the webcast, we explored a new model for adopting automation that Oracle calls the Finance Continuum, designed by our applications development team to provide a continuous way to look at future of finance combined with business operations. The Finance Continuum gives us a roadmap on how to integrate and automate end-to-end processes across accounting and corporate finance to deliver real-time accounting and continuous forecasting capabilities, both essential as we shift from strategic advisors to management to being true co-creators of enterprise value 

Figure 1: Oracle’s Finance Continuum

One example of how we are moving along the finance continuum is what we’ve accomplished with our close process. With a unified platform of Oracle Cloud ERP, EPM, and Analytics, we now close our books, analyze data, prepare for the earnings call, and report to the street 11 to 12 days after our quarter close.  We then file our 10-K’s and 10-Q’s the very next day. During the pandemic—when all our finance teams are working from home—we’ve even been able to reduce the close cycle by one day, freeing up our team members to focus on more critical activities during this turbulent time.  

Short term, our goal is to move to a one-day close, but we don’t think that’s good enough. With integrated cloud systems that are continuously updated, we’re able to constantly leverage new capabilities powered by AI, machine learning, chatbots, digital assistants and other innovations embedded in the Oracle Cloud to drive toward touchless transactions and a completely automated close, eliminating human intervention and error in the process. 

Changing finance roles

Predictably, these dramatic increases in finance agility and efficiency are forcing us to examine how we approach hiring, developing, and retaining talent. Even as automation increases, we still see a need for humans to be involved. As my colleague Christina Kite, Oracle’s Vice President of ERP Business Strategy and Analytics says, there is always the need to be able to trust and verify results—interpreting and translating information that’s coming from assets, IoT, global socioeconomic indicators, or discussions with our line of business owners.

By being on the forefront of embracing finance automation, we’ve created talent-related challenges for ourselves.  We foresaw the need to create a program to develop our talent and worked proactively with our HR counterparts to develop the Global Business Finance Training Academy.  Through hundreds of courses, we evolve our FP&A team from being just a reporting arm to traveling along a path of becoming trusted advisers to our line of business owners. By doing this, finance teams must move into the realm of operations and become not just advisers but also decision-makers. Consequently, roles change. You are not a financial reporter—you’re a financial translator. You’re not just a user of the solution—you’re also a developer and an innovator of new capabilities. 

In addition to our Finance Academy, we have a robust hiring process.  We start by hiring individuals that have, of course, technical expertise in finance, but also with broad expertise in multiple functions. And we have a very clear recruiting strategy. For example, when a position opens up, we don’t just backfill it. We consider where that role or position is headed in the future. Do we really need to fill it? How is that role evolving? How does hiring for this position mesh with our diversity and college recruiting strategies?  We infuse this targeted recruiting program with “class of” college recruiting and internship programs. 

Our new hires go through a six-month training plan, followed by role-based training. Equally important is keeping everyone on our finance teams involved in ongoing career development. Everyone needs to become a digital technologist to understand all tools that are available to them. They each need to become active participants in shaping our new strategic agenda, not just creating new financial reporting capabilities but also having the vision for how they impact operational metrics. 

Like our CEO Safra Catz, who moved out of the CFO role into the executive office, finance leaders are becoming true chief operating officers, always ready to step into the CEO role thanks to their enterprise-wide view of the business and unique understanding of the business model and levers available to create business value.  

The sociology of finance

Yes, technology is an enabler, but my organization’s true business assets are our employees. If they’re not onboard with our strategies and programs, no technology is going to make us achieve what we need to achieve. 

I sum it up with these four steps: 

  1. Streamline—The more you remove the complexity and simplify the steps, the better the experience is going to be. 
  2. Empower your employees—For example, I start by assigning each person a small thing to achieve. The minute they see what they can possibly do, half the battle is won.
  3. Delight your internal and external customers by designing a positive experience, one they will want to come back to again and again.
  4. Automate everything you can—this frees people up do things that are more important to the business and gives people the ability to grow professionally by working on more challenging assignments.

The impact of COVID-19 has been far-reaching, serving as a wake-up call to those of us in finance on what strategies we must adopt to ensure the continuity of our operations in the face of a crisis.  Every industry has been impacted differently but the cycles can be different. Some companies worry about their cash position. Some companies worry about their supply chain management. And almost every company is worried about talent. 

What I’ve seen is that our customers who have moved to cloud solutions—in finance, supply chain, and human resources—are dealing better with these impacts than those who haven’t, in many ways. Like Oracle, organizations with finance in the cloud can look to the future with greater confidence, especially if they take the opportunity to use that move to the cloud to rethink every aspect of their finance operating model and the talent that underpins it– especially in FP&A.  

Resources to turbocharge your FP&A organization 

To learn more about how you can turbocharge your FP&A function, you can watch the replay of the webcast Reimagining Finance for the New Normal and download the accompanying white paper. I also invite you to join me on September 15, 2020 for Planning for Uncertainty: Bold Moves to Recapture Growth, a virtual summit for FP&A professionals sponsored by Oracle and featuring executives from McDonalds and McKinsey. 

Oracle Cloud EPM Virtual Summit

 

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