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Enterprise Performance Management (EPM)PartnerLabJulie HarrisNicholas CoxHoward JonesKevin McCarthyKen Jones
© 2008 Oracle Corporation
Objectives for today
• Enable you to deliver the Oracle EPM “elevator pitch” and
articulate the story behind it
• Equip you to build pipeline, lead and WIN successful Oracle
EPM sales cycles
• Understand the business drivers and benefits
• Deliver a high level solution overview
• Learn customer success examples and sound bites
• Target the right audience
• Qualify opportunities and assess Oracle EPM solution fit
• Know the competitive market and Oracle's differentiation against competitors
• Understand a typical sales cycle
• Understand product pricing
• Know where to go for further training, help and assistance
Top
Priority
© 2008 Oracle Corporation
The following is intended to outline our general product direction. It is intended for information
purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any
material, code, or functionality, and should not be relied upon in making purchasing decisions.The development, release, and timing of any
features or functionality described for Oracle’s products remains at the sole discretion of Oracle.
© 2008 Oracle Corporation
Agenda
• 10.00 – Welcome, Introduction and Objectives
• 10.15 – EPM History and Overview
• 10.55 BREAK
• 11.15 – Oracle Hyperion Planning
• 12.00 – Strategic Finance & Crystal Ball
• 12:30 – Cost & Profitability Management
• 12.45 LUNCH
• 13.30 – Financial Consolidation & Reporting
• 14.15 – Essbase
• 14.30 – Oracle Competitive Differentiators
• 14.50 – Competitive Landscape
• 15.10 BREAK
• 15.30 – Partnering with Oracle - All you need to know!
• 15.45 – Q&A discussion
• 16.00 – Conclusion and wrap-up
© 2008 Oracle Corporation
Who are Hyperion?
• Leaders in Financial Consolidations, Planning Applications and OLAP technology
• Acquired by Oracle in 2007
• Products now form Oracle’s strategic direction in Enterprise Performance Management (EPM)
• Ongoing investment has resulted in new products and enhanced integration with ERP
© 2008 Oracle Corporation
Oracle’s EPM Vision
• Link strategic goals to operational decisions
• Transform financial management processes
• Monitor execution in real-time
• Deliver consistent, reliable insights to drive action
• Lower costs and reduce system complexity
• Single version of the truth
InsightPerformance
Action
SetGoals
Plan
Monitor
Analyze
Report
Align
© 2008 Oracle Corporation
Enterprise Performance Management SystemDrives Business Performance Improvement
InsightInsightPerformancePerformance
ActionAction
SetSetGoalsGoals
PlanPlan
MonitorMonitor
AnalyzeAnalyze
ReportReport
AlignAlign
• Strategic Modelling• Monte Carlo Simulations
• Communication of Strategy
• Planning• Budgeting• Forecasting• Operational & Financial
• Alerts & Notifications• Analytic Workflow • Business Activity Monitoring
• Financial Consolidations• Statutory & Legislative
Reporting• Sarbox Compliance
• Executive Workspace• Balanced Scorecards• Operational Workflow
• Collaboration
• Management Reporting• Operational Analysis
• Dashboards• Slice and Dice
• Graphical
© 2008 Oracle Corporation
Oracle’s Enterprise Performance Management Vision:
“Moving from operational excellence to management excellence.”
John KopckeSenior Vice President
EPM Global Business Unit
Oracle Corporation
© 2008 Oracle Corporation
InsightInsightPerformancePerformance
ActionAction
SetSetGoalsGoals
PlanPlan
MonitorMonitor
AnalyzeAnalyze
ReportReport
AlignAlign
Going Beyond the Story We Created
© 2008 Oracle Corporation
ERP Has Leveled the Playing FieldCreating Operational Efficiencies
Based on Michael E. Porter’s Value Chain
Inbound Logistics
OperationsMarketing &
SalesService
Outbound Logistics
Firm Infrastructure
Human Resource Management
Technology Development
Procurement
Invest to Retire
Source to Procure
Procure to Pay
Order to Cash
Develop to Release
© 2008 Oracle Corporation
Oracle’s EPM Vision: Extend Operational Excellence to Management Excellence
Time
CompetitiveAdvantage
OPERATIONAL EXCELLENCE
MANAGEMENT EXCELLENCE
© 2008 Oracle Corporation
Pillars to Achieving Management Excellence
SMART
AGILE
ALIGNED
Rationalize Your Management Systems
Leverage Advanced Integration
Share Insights Across the Extended Enterprise
© 2008 Oracle Corporation
Strategy to Success: Oracle’s Framework for Achieving Management Excellence
© 2008 Oracle Corporation
Integrating Key Management ProcessesOracle EPM System
EXTERNAL REPORTING
PREDICTIVE MODELING
INTEGRATED BUSINESS PLANNING
PROFITABILITY & COST MANAGEMENT
SCORECARDING
MONITORING, ANALYSIS & REPORTING
FINANCIAL REPORTING
BI REPORTING TOOLS & APPLICATIONS
OLAP
DATA QUALITY, DATA INTEGRATION & MASTER DATA
APPLICATION & METADATA MANAGEMENT
STRATEGIC & FINANCIAL MODELING
© 2008 Oracle Corporation
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EPM SYSTEM Architecture
• Common information delivery within a workspace
• Common information model
• Common platform and integrations
© 2008 Oracle Corporation
Oracle EPM System
Ledger
Financial Management
Reporting & Analytics
Other Sources
Exc
el ,
Acq
uis
itio
ns
& O
the
r S
ou
rces
Da
ta R
ela
tion
ship
Ma
na
ge
men
t
Fin
an
cia
l D
ata
Qu
alit
y M
an
age
men
t –
Bu
sin
ess
Use
r P
rocessin
g
Oracle Data Integrator –Automated Batch Processing
EPMA & Shared
Services
Strategic Finance
Planning
Montecarlo Capex
Workforce
Tax Stream Essbase
‘My EPM’ Workspace
Scorecard
© 2008 Oracle Corporation
Oracle’s Enterprise Performance Management System
BI Applications
EPM Workspace
OLTP & ODSSystems
Data WarehouseData Mart
SAP, Oracle, Siebel,PeopleSoft, Custom
ExcelXML
BusinessProcess
OLAP
Fusion Middleware
Business Intelligence Foundation
BI ApplicationsPerformance Management
Applications
© 2008 Oracle Corporation
Market Leading Performance Management Applications
BI Applications
EPM Workspace
OLTP & ODSSystems
Data WarehouseData Mart
SAP, Oracle, Siebel,PeopleSoft, Custom
ExcelXML
BusinessProcess
OLAP
Fusion Middleware
Business Intelligence Foundation
BI Applications
PERFORMANCE MANAGEMENT APPLICATIONS
StrategyManagement
BusinessPlanning
ProfitabilityManagement
FinancialReporting &Compliance
© 2008 Oracle Corporation
Market Leading Performance Management Applications - CXO & FINANCE
PERFORMANCE MANAGEMENT APPLICATIONS
StrategyManagement
BusinessPlanning
ProfitabilityManagement
FinancialReporting &Compliance
Set Goals and Align
Plan
Analyze
Consolidate and Report
© 2008 Oracle Corporation
Market Leading Performance Management Applications - CXO & FINANCE
PERFORMANCE MANAGEMENT APPLICATIONS
StrategyManagement
BusinessPlanning
ProfitabilityManagement
FinancialReporting &Compliance
Hyperion Performance Scorecard, Hyperion Strategic Finance,
Crystal Ball
Hyperion Planning, Workforce Planning, Capital Asset Planning
Integrated Operational Planning
Hyperion Profitability and Cost Management
Hyperion Financial Management, Hyperion Financial Data
Quality Management
© 2008 Oracle Corporation
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EPM: Enterprise Performance Management
High Yield QuestionsEPM
Overview
High Yield Questions
Business Pains
Customer Story
Benefits by Role
The Solution
© 2008 Oracle Corporation
High Yield Questions
• How long is your consolidation, planning or budgeting process? Are there any discussions in your management meetings comparing actual and budget and who has the right information?
• What software tools do you use for your consolidation, planning or budgeting process? What about the next generation worker who is hungry for information, are your systems ready for it?
• How much time do you spend thinking about your competitors?
• How do you ensure that your strategy is executed on time and on budget?
CFO
CIO
Sales Manager
CXO
© 2008 Oracle Corporation
How Do You Build the Budget?
1. Finance creates the forms
2. Managers input their data by accounting period
3. Finance aggregates the budget
4. Management reviews the budget and…
“Repeat this cycle until either the management team is happy with the budget or budget managers lose
their will to live”
Gartner
© 2008 Oracle Corporation
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What Are the Challenges?
“High processing time due to lack of strategic guidance and missing link
between financial and operational plans”
“Low plan accuracy (variance accuracy) due to inaccurate data”
“Limited level of detail for the budget”
“High number of Excel spreadsheets that need maintenance”
“Need to expand to: rolling forecasts, operational planning, investment
planning, bulk updates, pre-built depreciation calculations, version control”
© 2008 Oracle Corporation
Budgeting Process is Highly Inefficient
• Time – takes too long, results obsolete
• Quality – political/negotiation, not reflective of business
• Cost – many wasted resources, dubious benefits
• Flexibility – lack of responsiveness to changes
FP&A Group
Senior Management
Dept A Dept B Dept C
© 2008 Oracle Corporation
Best Practices in PlanningStreamlining Planning, Budgeting and Forecasting Processes
• Centralized, not distributed
• Short budget cycles
• Collaboration across organization
• Consistent assumptions and calculations
• Accurate data and plans
• Accountability
• Align top-down with bottom-up
• Driver-based planning
• Rolling forecasting
© 2008 Oracle Corporation
Innovative Solution growing with the Customer Needs
• 1989 Philip Morris USA
• 1992 Logitech, Toshiba, Morgan Stanley
• 1996 Nationwide
• 1997 Pfizer
• 1999 Heineken
• 2000 Olympus
• 2001 All Seasons, Autonation
• 2002 Pepsi, Wellpoint
• 2003 Telenor
• 2004 Toyota, UMB Bank
Long time referenceable clients in all industries and all geographies
© 2008 Oracle Corporation
Hyperion Planning Market Penetration
1395
278
504
740
1008
1272
1624
2050
0
500
1000
1500
2000
2500
2000 2001 2002 2003 2004 2005 2006 2007 2008
Year
Customer Count
© 2008 Oracle Corporation
20,000
Num
ber
of U
se
rs
Scalable Planning Solution
ToyotaHyatt
3,000
Norway Post
Petrobras
Newmont
Credit Suisse
Telenor
Turkiye IS Bank
Lockheed Martin
BritishTelecom Dell
Alcoa
© 2008 Oracle Corporation
After• First budget iteration takes only 4½weeks
• Reorganizations down to 24 hours
• A very detailed expense budget that utilized over 700 accounts
• Each individual employee was budgeted (60,000 in phase 2)
• For the first time ever, ING had three-dimensional reporting
• Several new reports enable managers to analyze the business (e.g. year-over-year quarterly comparison)
Before
• First budget iteration took 8 weeks, while transferring employees or departments took 10 days
• Creation & distribution of the Excel templates took 4 weeks
• The data was not dependable for management to make business decisions
• Corporate Budget Group employed 9 people to maintain the process and offline system
� One of the 20 largest financial institutions worldwide
� Revenues of ~9 billion USD (2005)� Over 113 thousand full time employees
© 2008 Oracle Corporation
Planning Challenges Solved
Planning Cycle Time
Accuracy / Variance
Excel Errors
Level of Plan Detail
Finance Productivity
ROI
50-82% time reduction
65-80% improvement
Replaced 6,000+ Spreadsheets
700 accounts; 60,000 employees
8 FTE’s transferred to analysis
$1.5M Return on Investment
Customer Challenges Results with Oracle
© 2008 Oracle Corporation
Strategic Planning
Enterprise Planning
Operational Planning
Revenue / P&L Planning
Organization-wide Planning
Capacity Planning
Rolling Forecasting
Budgeting
Capital Planning
Closed-loop Budgeting
Project Planning
Integrated Business Planning
ONEONEPlanning PlatformPlanning Platform
© 2008 Oracle Corporation
…with Analysis by Many Dimensions
Legal EntityCost Centre
Account
• Business Unit
• Analysis Code
• Project
• Time
• Scenario
• etc.
© 2008 Oracle Corporation
Excel
Offline
Process
Security Automated Data Input
Data Manipulation
Reporting
Web Forms
Oracle Hyperion Planning
Essbase
© 2008 Oracle Corporation
Automated data input
Data Manipulation
ReportingInput Forms
User Task lists
Process Control
Approval Workflow
Usability features
Menus
Annotations
Supporting detail
Standard functions
Oracle Hyperion Planning Functionality
© 2008 Oracle Corporation
Automated data input
Data Manipulation
ReportingInput Forms
User Task lists
Process Control
Approval Workflow
Usability features
Smart View Add-in
Offline mode
Workforce Planning
Capital Planning
Oracle Hyperion Planning Functionality
© 2008 Oracle Corporation
Planning Dimensions
Dimensions
• Entity
• Account
• Year
• Period
• Scenario
• Version
• Currency
• + 13 custom
Uses
• Organizational unit
• Natural Account Code
• FY, CY
• Days, weeks, months
• Budget, Forecast, Stretch, etc.
• Working, Draft, Final, etc.
• Automatic
• Product, Channel, Project, Customer, etc.
Hierarchies built on all dimensions
© 2008 Oracle Corporation
Workforce PlanningImproves Headcount, Salary and Compensation Planning
• Packaged solution based on the Planning platform
• Plan salary, compensation, turnover rates at any level
• Add, edit, transfer and delete employees and new hires
• Leverage pre-defined or custom calculations for taxes
• Integrate actuals from HR systems
• Test scenarios in real-time for impact analysis
© 2008 Oracle Corporation
Capital Expense PlanningImproves Planning the Acquisition, Lifecycle Management and Retirement of Capital Assets
• Packaged solution based on the Planning platform
• Plan for asset purchases and capital asset related expenses
• Transfer, retire, and improve assets
• Leverage pre-defined or custom calculations for depreciation and amortization, etc.
• Interfaces with external systems
• Analyze impact on P/L, Balance Sheet and Cash Flow
© 2008 Oracle Corporation
Key Success FactorsWhat it means to our customers
• Accuracy - One Planning platform for all the modules like Workforce Planning, Capital Expense Planning, improving processing time and accuracy, as well as reducing the maintenance overhead
• Performance - Essbase, award winning OLAP engine, boosting the scalability and performance of any planning application
• Simplicity - One reporting workspace enabling real-time, side-by-side planning, forecasting and analysis
© 2008 Oracle Corporation
What is Enterprise Planning ?
OPERATIONAL PLANNING
Annual PlanDepartmental
PlanningForecasting
Specialised Planning
INTEGRATED
ENTERPRISE PLANNING
SIMULATION & MODELING
STRATEGIC PLANNING
Long-Range Plan
Major Investments
Treasury Strategies
M&A and Divestitures
© 2008 Oracle Corporation
53
Forecast With Confidence
Key Metrics
• Earnings
• Debt/Equity
• Interest Coverage
Valuation
• Free Cash Flows
• Cost of Capital
• Net Present Value
Income Statement
• Revenues
• COGS
• OPEX
• Net Income
Balance Sheet
• CAPEX
• Working Capital
• Equity
• Debt
Cash Flow
• Operating
• Investing
• Financing
Fully Integrated Financials
Financing
• Term Debt
• Revolving Debt
• Common Stock
• Preferred Stock
Business Specific Drivers
• Market Growth %
• Days Sales
• Inventory Turns
Historicals
• Income Statement
• Balance Sheet
Ratings
• Credit Ratings
• Bank Covenants
Operational Plan
• Revenue targets
• Investment limits
• Working cap’l level
• Assumptions
© 2008 Oracle Corporation
Extending the Planning Platform to Manage Corporate Value
Treasury
CFO
CorporateFinance
CorporateDevelopment
Top-Down Target Setting
Contingency Planning
Strategy Screening
Covenant/Ratio Analysis
Funding Alternatives
Rating Agencies
Mergers & Acquisitions
Valuation Analysis
Divestitures
© 2008 Oracle Corporation
Overcome a Major Liquidity Crisis
• Lost investment-grade credit rating
• Needed recapitalize balance sheet
• No cash flow modeling capability
• No simulations at the divisional or business unit level
BEFORE
• Credit rating back to investment grade
• $4 Billion debt restructuring
• Simulate capital structure and cash flow
• 3% accuracy in net income projection
AFTER
$22 Billion global provider of power and automation technologies
© 2008 Oracle Corporation
Hyperion Strategic Finance extends the planning platform
• Trail Analysis - visualizing the model logic
• Consolidation Intelligence -including dealing with complex entity structures
• “Deal Period” functionality especially for M&A simulations
• Debt Scheduler to understand cash flow implications of debt
• Funding Options - optimizing capital structure
• “What-If” Analysis Toolkit with unlimited scenarios
Accounting Integrity and Modeling Speed
© 2008 Oracle Corporation
Benefits of Simulation in Risk Analysis
• What do you think would happen if we did not use simulation?
Would you fund this project?
• Range of Outcomes
• Probability of Failure28%
• Single-Point Estimate
NPV£2 B- £2 B- £4 B £4 B £6 B £8 B£0 B
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