Financial Systems IntegrationExecuting the Strategy

Pam McGregorToni CobbJeff MayoCarol Praplaski

June 14, 2002

Agenda

•About NDCHealth

•Financial Systems Strategy

•Phased Delivery Approach

•Implementation Accomplishments and Challenges:•Accounts Receivable

•Order Management

•Project Accounting

•iTime & iExpense

About NDCHealth

NDCHealth has been providing integrated information

support to all segments of the health industry for over two

decades. This experience, leveraged with our powerful

network and information management capabilities, has

built our reputation as a premier provider of value-added

information services serving more segments of the

healthcare industry than any other similar company.

About NDCHealthTechnology and Resources Intelligent network processes over 2 billion real-time health

care transactions annually, peak rate of 650

transactions/second Connected to over 4,000 payer plans 39% of nation’s hospitals > 400 beds, about 1,200 hospitals 90% of nation’s pharmacies, about 50,000 pharmacies > 150,000 physicians 25 terabyte Oracle database for the pharmaceutical industry,

over 100 pharmaceutical manufacturers Over 3.5 billion prescriptions on file

NDCHealth’s Financial Systems Strategy

“Create integrated financial information system effectively supporting company goals and objectives” - 1999

Gradual Execution of Strategy

1999 & Earlier 2000 2001 2002 Y2K Remediation Lawson HR/Payroll Financials Benchmark Financial Package

Evaluation and Selection Implement Oracle

Financials (PO, AP, CE, FA, GL)

Procurement Card Procure to Pay Shared

Service Center

Upgrade Lawson Lawson’s Employee

Self Service Upgrade Oracle 11i Billing Assessment

Across multiple Business Units

Begin Phased Billing

Implementation

April: Go Live Revenue & Accounting

Shared Service Center Oracle AR (Reporting

and Cash Application) Project Costing and

Billing Order Management iTime iExpense In Process: Phased Advanced Pricing / Contracts / OM Solution

Billing Implementation Quick Wins

Improved cash flow through a centralized automated billing and AR system

Global reporting

Centralized processing

Fewer lockboxes

Timely and accurate recording of AR transactions

One global customer master file utilized company wide

Natural Integration between Oracle subsystems (AR, OM, PA and GL)

Improved customer AR account status information provided by on-line inquiry to record all customer issues

Online collection activity comments with automatic follow-up notification

Automated, real-time credit card payment method utilizing Authorize.Net

Implementation Accomplishments & Challenges

• Accounts Receivable

• Order Management

• Project Billing / Project Costing

• iTime & iExpense

Accounts Receivable

Business Drivers Antiquated and non-integrated financial systems Standalone billing/AR systems Lack of Customer Master Lack of management information – Consolidated DSO Analysis Desire for centralized shared services Desire for improved cash flow through automated, centralized

processes High cost of manual and duplicate processes

Billing Customer Maintenance

Accounts Receivable

Converted data – from multiple systems: Customers

Open Balances for Customers

Customer Bank Information

Items

Installed Customizations/Interfaces Credit Card process using 3rd party tool - Auth.net

AR Open Balances to HP3000 to keep opening balance on invoices generated in HP3000

AR Customer Update to HP3000 to keep new/modified customers in sync in both systems

HP Items to Oracle Interface - as new service codes are added in HP3000 automated way to bring data into Oracle

Accounts Receivable

Challenges: Reporting by individual Business Unit in a single organization

environment

Customer data review and cleansing needs to happen in a controlled timely manner by end users most familiar with data

Same customers with multiple bill-to and ship-to’s in several legacy systems

Determining naming convention and data entry standards

Creating a shared services environment at same time we were implementing new applications

Order Management

Business Drivers

Lack of integrated order management system into Oracle

Financials

Lack of easily obtained OM information

Need for improved management information

Order Management

Converted Data Price Lists

Customers in conjunction with AR

Inventory items

Customizations Freight calculation for orders based on ship-from and ship-to zip codes, using UPS

rate table information.

Shipping UPS interface that will request, generate and print UPS shipping labels, using UPS web interface and custom NDC code.

Order fulfillment sets assignment. Automatically set all order lines to an order fulfillment set to insure discounts and service items invoice together with shippable items, especially since most sales are paid with credit cards.

Credit card authorization customization using Auth.net web interface.

Order Management

Challenges

Existing Oracle Inventory lacked item categories

Data cleansing

Functional involvement

Project Accounting

Business Drivers

A need for a centralized, automated, integrated capital

expense tracking system

A need for a centralized, integrated customer billing system

Project Accounting

Data Converted Projects – contract & capital

Project costs and revenue

AR contact

Customizations

– Event Spawning – Ability to automatically create events on a weekly, monthly, or quarterly basis

– Additional Invoice Information – Customized the PRC: INTERFACE INVOICE TO RECEIVABLES program to include descriptive flex field, and product information.

– Created Custom Invoice Printing using Optio.

– Custom Tax Program to accommodate multiple taxing jurisdictions by project

– Created interface to load external expenditures.

Project Accounting

• Challenges

Project “Name” data was not unique in legacy system and exceeded field length, had to clean data

Agreement on Auto Accounting setup

Determining standardized burdening rates

iTime & iExpense

• Business Drivers

Eliminate paper driven system

Lack of standardized labor collection process

Enforce business policy

Eliminate manual processes

iTime & iExpense

• Implementation

Interfaces/Customizations

Created interface between non-Oracle HR/Payroll system for employee add/update/terminations

Automated “User” maintenance for new employees

Created custom workflows for Approvals

Use of Email Alerts

Notifications

Missing Timecards

System Administration

iTime & iExpense

• Challenges

Routing driven off HR supervisor – ensure data accuracy prior to deployment

Develop process to update HR supervisor to avoid document routing problems

Develop a realistic expense report approval hierarchy

Adequately staff a “Help Desk” to answer user questions

Be prepared for quirky PC desktop problems due various browser versions and other desktop PC configurations

Centralization During Implementation

Challenges

Centralization of processes & procedures

New players have much to learn

Old players lose interest in project

Mitigate Risk to Project Success

Excessive training

Facilitate knowledge transfer sessions between old and new players

Hold a post go-live “pass the torch” meeting between project team and users

Hold regular “lessons learned” meetings after each month-end close

Don’t accept excuses from new players

Implementation Recommendations

Data Conversion:

Determine naming conventions early on in the project

Provide enough time for data cleansing

Perform Static Conversions 1 month prior to go-live and ensure totals in legacy systems match totals converted in Oracle

Resources:

Secure upper management support

Identify the most knowledgeable, internal functional staff for the project and dedicate them for the project’s duration

Testing:

Identify all business scenarios and fully test.

Perform at least two full integration tests.

Implementation Recommendations

Training:

Complete Policies and Procedures for new business processes prior to go-live

Implement Help Desk Support/Procedures for Oracle Applications

Complete end-user training 1-2 weeks prior to go-live

Leverage the Train-the-Trainer approach.

Keep legacy system query capabilities available for 3-6 months after production

Freeze application setups 1 month prior to go-live

Prior to go-live, put process in place to address requests for new requirements and related enhancements

Determine Key Success Factors prior to project start-up and evaluate 3 to 6 months after implementation

Questions?