Date post: | 13-Sep-2014 |
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Edgewater Ranzal
Enabling Profitability Management with Oracle Business Analytics & Exalytics
October 23, 2013
Mike Killeen
Vice President of Technology
► Introductions
► The Need for Profitability Management
► Profitability Management Enablement: Software
► Profitability Management Case Study
► Profitability Management Enablement: Exalytics
► Closing and Q&A
Agenda
2
• Vice President of Technology for Edgewater Ranzal Responsible for establishing new service offerings to drive growth Established and Co-Managed Ranzal’s UK Division for 2 Years Managed Ranzal North American Planning & Analytics Practice for 3 Years
• Certified Professional in: Essbase, Planning & HFM Oracle ACE – Planning/BI
• 17+ years of functional and technical experience in: Budgeting, Forecasting & Planning Cost Allocation & Profitability Management Solutions Business Intelligence Master Data Management & Data Integration Solution Architecture & Design Process Rationalization & Transformation
• Client Engagements portfolio includes varied industries: Financial Services & Insurance Consumer Products Health Care & Education Professional Services Telecommunications
• Works closely with Oracle product management on enhancements and direction.
About the Presenter - Mike Killeen
► Oracle Platinum Consulting Partner - 100% Focus on Oracle/Hyperion EPM & BI
– 175+ Full time EPM/BI Billable Consultants throughout the US, Canada and the United Kingdom
► EPM & BI Experience & Success
– 1,500+ Oracle EPM & BI projects successfully delivered since our founding in 1996
► Depth & Breadth of EPM & BI Service Offerings
– Product Experts across the full EPM/BI Suite - Planning, HFM, HSF, HPCM, Essbase, OBIEE, DRM, FDMEE
– Visioning & Roadmaps, Full Life Cycle Implementations, Tech Review & Assessments, Staff Augmentation
► Additional Value Added Service Offerings
– Exalytics – Installation, Configuration & Benchmarking Services
– Infrastructure Services – Design, Configuration, Performance Tuning & Upgrades
– Support Services – Remote Help Desk, Lev 1 Support, Patch release Support
– Training Services - Customized and Pre-Packaged EPM/BI Training Delivery
► 3 Ranzal Oracle ACEs Across EPM/BI Platform (Planning/BI, HFM & FDMEE)
► Co-Development Efforts with Oracle Product Management
► Customer Advisory Boards, Beta Testing, Certification Exam Development
Edgewater Ranzal Overview & Differentiators
• Workforce Planning
• Balance Sheet Planning
• Capital Planning & PFP
• HFM
• Financial Close Mgmt
• Disclosure Management
• HPCM
• HSF
• FDMEE/ERPi & EPMA
Dashboards & Scorecards, Financial Analytics & Reporting, Operational Analytics, What-if
Analysis, Query & Reporting, Visual Exploration
Financial performance, Legal, Segment & Mgmt Reporting, Financial Close
HFM Optimization, Performance Lab SOX Compliance Support
Strategic Finance, Planning, Budgeting, Forecasting, Workforce Planning, Capital Planning, Project Financial Planning
Data Integration, Financial Data Management, Data Warehousing, Master Data Management &DRM,
ETL Services, Automation
Project/Program Mgmt, EPM Road Maps, Application Reviews, Business Requirements, Process Change, Documentation
Installation, Upgrades, Migration, System
Monitoring, Backup and Recovery, Disaster Recovery,
Load Testing, Hardware Sizing, Exalytics Benchmarking
Consolidation
Business Intelligence
Enterprise Planning
Infrastructure
Training & Support Services
Project Management
Data Services
Costing & Profitability
Mgmt
Support Services – Infrastructure & Application Support Contracts
Key Teach Course Delivery: Planning, Essbase, Financial Reporting, Smart View, HPCM, HFM, FDM, DRM, OBIEE
Custom Training Delivery: Process & Reporting
Edgewater Ranzal Service Offerings
HPCM Standard & Detailed Models, Waterfall Allocations, Activity Based Costing, Customer, Product & LOB Profitability
The Need for Profitability Management
Call Me Doing Fine
Why Enterprise Performance Mgmt (EPM)?
react recognize
Under-performing Products
Under-served Customers
Under-utilized Staff, Assets
Excess Cash
Inefficient Business Processes
Understanding Profitability Exposes Hidden Cost Behaviors
“…Technology vendors are spending, on average, 19% of their selling, general, and administrative (SG&A) costs or $135,262 per quota-carrying salesperson in support-related activities.
Few are aware of this enormous amount because the costs are hidden .”
“Uncovering The Hidden Costs Of Sales Support”
Scott Santucci - April 13, 2009
Using the Wrong Tools to Effectively Analyze Profitability
Accurate Costing Is Key to Profitability
Ventana Research, 2008
“Most companies are not using the right tools…spreadsheet based models are hard to change, error prone and difficult and time-consuming to use. Relying on desktop spreadsheets can keep your company from doing the kind of analyses it needs to do when it needs to do them...”
Does Your Company use a tool today to perform allocations as part of a profitability management or cost management solution? If so, what tool do they use?
10
Packaged Profi..
.
Custom Solutio
...
General L
edger
Spreadsh
eets/M
...
25% 25%25%25%1. Packaged Profitability or Costing
Application (e.g. HPCM, OFSAA)
2. Custom Solution Using EPM, BI, or OLAP Tool (e.g. Planning, EDW, Essbase)
3. General Ledger
4. Spreadsheets/Microsoft Access Solution or not sure
Polling Question #1
Operational Profitability Defined –> Customer Focus
Wikipedia Defines Customer Profitability as:
“Customer profitability is the difference between the revenues earned from and the costs associated with the customer relationship in a specified period”
Basic Formula:
Profitability = Revenue - Direct Costs - Indirect Costs
Cost Definitions
► Direct Costs
► Costs Directly associated to the making of a product or delivery of a
service
► Parts for the product
► Labor for Service Delivery
► Costs Directly attributed to the selling to a customer or client
► Shipping and Handling Expense
► Customer Processing Expense
► Indirect Costs
► Costs that are not directly attributable to the making of a product or the
selling to a customer
► Operating Costs (e.g. Call Center, Plant Overhead)
► Selling Costs (e.g. Sales & Marketing)
► Investment Costs (e.g. R&D, Initiatives)
► G&A Costs (e.g. IT, HR, Finance, Admin)
► Finance Charges for Cost of Capital Employed
Profitability Challenge #1 - Indirect Expenses Assignment to Products & Customers
No Standard Process
Standard, accepted process
Indirect Costs are difficult to track and measure
Profitability Challenge #2 - Statutory Reports are not Timely or Detailed Enough
• What defines a profitable customer?
• What is the profit contribution margin of a product or a service?
• What does it cost to sell to or to service customers?
• What proportion of resources does a specific customer consume?
• Why hasn’t increased revenue resulted in increased profitability?
Financial transactions
Financial Data
Consolidation (GL or HFM)
Accumulator Bottom-line
Results
Organizational P&L
Profitability Challenge #3 – Ensuring Consistent Performance as Users, Data Volumes, & Frequency of Use Increases
Sales/Product Managers
Cost Center Managers
LOB Execs.
Finance 10’s
100’s
1000’s
1000’s
LOB/Functions
Segments/Entities
Departments
Products & Customers
User
Counts
Data
Volumes
Frequency
Of Use
100’s
1000’s
10K’s
1 MM’s
Qtrs
Monthly
Weekly
Daily
Profitability Management Solution Elements
Planning, Reporting & Analysis
Product P&L by Activity
Financial P&L
Operational
Data
Source Data
Meaningful Attributions &
Allocations
EPM/BI Platform
Source Data – Financial P&L
Legend
C Customer Specific Costs
P Product Specific Costs
F Financial/Overheads
Type P&L Line $ % of Rev
C/P Units Sold 100
C/P Gross Sales 1,000$ 102%
C/P Less Disc, Rtrns & Allow. (20)$ -2%
Net Sales 980$ 100%
C/P COGS @ Std 400$ 41%
F COGS @ Var 23$ 2%
Less: Total COGS 423$ 43%
Gross Profit 557$ 57%
P/F/O Selling & Marketing Exp 150$ 15%
F G&A Exp 100$ 10%
Less: Total Operating Exp 250$ 26%
Operating Income 307$ 31%
F Depreciation & Amortization (75)$ -8%
F Other Inc/(Exp) (50)$ -5%
Net Income Before Taxes 182$ 19%
Less: Income Taxes @ 40% 73$ 7%
Net Income After Taxes 109$ 11%
Dept Costs:
Accounting
Mgmt
IT
Raw Materils,
Labor, Freight In,
Mfg Ovhd
Mfg Plant
Departmental Exp
Variances
► Accounts
► Legal Entity/Company
► Cost Center/Department
► Product Line/Profit Center
► Other Chart Fields:
► Sub Accounts/Functional Area
► Projects
► Line of Business/Channel
► While some elements of product profitability and customer profitability may be present, they are typically at a much higher level (e.g. many SKUs rolling up to a Product Line, or many Customers rolling up to a Channel)
► Significant manual effort may be involved in achieving this (e.g. Thick G/L, XL, Manual Journals)
► Complete Financial Results also occur at the close, where its often too late to react
► Need to be more detailed, timely, transparent & automated to be actionable
Typical Financial Analysis
SHIPPED TO SOLD TO TERMS: FROM INVOICE DATE
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
2% 15 days Net 16, USD
DIRECT INQUIRIES TO: 1 (800) 999-9999
INVOICE SHIP DATE 11/01/2004 INVOICE DATE 11/01/2004
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
PURCHASE ORDER NO. SHIP NO. CUST. NO. SALES DIST. PLEASE SHOW THIS INVOICE NUMBER WHEN REMITTING TEST ORDER #1 S901999 B901999 2377
DATE INV’D 11/01/04 2002009999
ORDER DATE MM/DD
DELIVERY DATE MM/DD ACCT. AT CUST. CARRIER SALES ORDER
199299888 11/01 11/11 1202 Customer pick-up
QUANTITY UNITS PRODUCT CODE DESCRIPTION UNIT PRICE AMOUNT
700 CA 4100000295 TBAH 24/500 75.35 52,745.00
700 CA 4100000295 Efficiency Allowance 333333 0.05- 35.00- 700 CA 4100000295 SpecAllow-OI RateCs 654737 0.50- 350.00- 700 CA 4100000295 Freight-Backhaul 1.08- 155.74- 700 CA 4100000295 Fuel Allow Percent 6% 9.34- 700 CA 4100000295 Unload Allowance 0.04- 28.00-
Data Sources: Order Mgmt, A/R, Billing, Trade Spending apps
Customer - By Customer - Bill To/Sold To - Shipped To - By Market - Mkt (Channel) - Sales ID - Shipped To
Product - Category - Sub-Category - Brand - Sku
Time - Year - Quarter - Month(5-4-4) - Week - Day
Accounts - Net Sales Dollars - Gross Sales Dollars - Less: Cash Disc - 2% 15 days - Efficiency Allow - Spec Allow, etc
Attributes Quantity - SKU A (Case = 12) - SKU B (Case = 1000)
Source Data – Sample Operational Data
Meaningful Allocation – Top Down via Rules
› Allocation Rules can use drivers such as headcount, percentages, hours, etc
Customer Profitability
CRM HR GL EDW EPM
Available Driver & Allocation Source Data
Profit Before Overheads Gross Profit Total MDC Total Overheads Total Mktg Overhead Total Sales Overhead Total General Overhead Total Associated Costs Broker Commissions JV Income
Allocation Rules
Meaningful Allocation – Bottoms Up Via ABC
► Activity based costing:
► Rather than looking at departmental expenses as a collection of costs by functional areas, look at them as a collection of activities.
► Functional view:
► Total Distribution Costs
► Order Desk Dept
► Warehousing Dept
► Shipping Dept
► Activity view:
► Total distribution costs:
► Take orders
► Pick items from shelves
► Drive trucks
► Specify a department & get cost - e.g., Order Desk - $100
► Identify activities – e.g., take phone order, take fax order
► Identify % time spent on each activity – e.g., 70%, 30%
► Identify Driver for Each Activity – e.g. # of Orders - 50, 110
► Calculate activity cost rates
► Divide departmental cost by driver
► Phone order rate = $100*70%/50 = $1.40/phone order
► Fax order rate = $100*30%/110 = $0.27/fax order
► Load in drivers by customer
► Customer A – 10 phone orders = $14.00 total cost
► Customer B – 10 fax orders = $2.70 total cost
► Assuming Customer A & B order the same product, which is more profitable?
Example
Reporting & Analysis: Published Customer & Product P&L Reports
22
Reporting & Analysis: Interactive Analysis via Mobile Dashboards
Outcomes: Expectations of a Profitability Management Solution
► Reliability – Visibly defensible profitability
and cost results through transparency & audit/control
► Agility – Timely reflection of results to be
actionable
► Relevance – An ability to Allocate resources
to the most important opportunities
Financial Results
Revenue & Cost Models
Operational Results
FP&A
Senior Management
Which of the below use cases would your organization prioritize as the top application for a Profitability & Cost Management Solution?
24
Cost Allo
catio
n Proce
ss f.
.
Act
ivity
Base
d Costing F
o...
High
Level P
rofit
ability .
..
Deta
iled Custo
mer/
Prod...
25% 25%25%25%
1. Cost Allocation Process for External Purposes
2. Activity Based Costing For External Purposes
3. High Level Profitability for Management Purposes
4. Detailed Customer/Product/Operational Profitability for Management Purposes
Polling Question #2
Overview of Oracle Business Analytics Profitability Management Solution
EPM/BI Platform
& Analysis
(profitability)
Consolidation & Reporting
Financial Planning
react recognize
today
• The more mature the EPM platform, the more lead time to RECOGNIZE issues (i.e. the transfer from Finance to Operational insight)
• The better enterprise reporting & analysis tools, the easier it is to RECOGNIZE issues.
• The better transparency to details to revenues and costs, the more time for insight to REACT and resolve.
• The more integrated these components, the faster time to REACT. Analysis
(profitability)
Building an EPM/BI Platform
Which of the following EPM/BI programs would you rank as MOST important to your organization?
27 O
ptimizi
ng the...
Impro
ving t
he ...
Enablin
g Act
io...
Deliv
ering a
nd...
25% 25%25%25%
1. Optimizing the Financial Close & Reporting Process
2. Improving the Budgeting, Forecasting & Planning Process
3. Enabling Actionable Operational and Financial Analytics throughout the organization
4. Delivering and Optimizing a Profitability and/or Cost Management Solution
Polling Question #3
Reporting & Analysis Financial Reports, Smart View for Office,
BI Foundation (OBIEE)
EPM/BI Profitability Solution Elements Each Solution requires a Mix of these products – Ranzal does requirements analysis
Hyperion Planning
HPCM
Essbase
Potential Ancillary Products – DRM, FDM, etc
Exalytics X2-4
Reporting Tools Capabilities
BIF BI Publisher Quickly modify pre-defined, high volume operational reports without IT assistance. End users can author, manage and deliver a range of highly formatted documents in familiar desktop tools like WORD and PDF.
BI Answers The interface used to query an organization's data ie used to build and modify reports. Answers requests can be formatted, saved and shared with other users via BI Dashboards and Publisher or remain within Answers.
BI Interactive Reports & Dashboards
Dashboards provide a visual display of the most critical and meaningful information that an individual or role requires to perform their function effectively. Dashboards are interactive, allowing the user to select prompts, change views and drill down to details.
Smart View for Office An MS Office Add-in which provides users the ability to quickly perform LIVE, ad hoc queries with multi-dimensional analysis, pivoting and drill down to analyze data within a familiar spreadsheet environment.
EPM
Hyperion Financial Reporting
Produce professional quality financial statements and view results with live drilldowns to source transactions. Distribution to authorized users efficient.
Embedded Product Reports
Pre Built Reports within EPM apps, such as Traceability Maps and Stage Balancing Reports.
Transactional Systems
& BI Data Marts
EPM/ Essbase
EP
M W
ork
space
Users
Solution Component: BI Foundation Reporting Tools
Solution Component – Essbase OLAP Server
Why? Profitability Applications are Multi-Dimensional in Nature
32
• Packaged Profitability functionality
• Computes Profitability for Units, Segments and Services
• Pre-Built Framework for profitability modeling:
• Pre-built Measures dimension
• Support for Multiple Cost Allocation methodologies
• Pre-Built Validation reporting
• Graphical Interactive Traceability Maps
• Genealogy Reporting shows flow from any stage to any stage
• A User-Driven application
• Measures, Allocates and Assigns Cost and Revenues via User Defined Rules
• Finance User-facing Administration
• Provides Scenario Modeling for Decision Making
• Tightly integrated with the full Hyperion EPM Suite
• Shared Data and Master Data via EPMA
• Shared Reporting Tools like Financial Reports & Smart View for Office
• Proven Technology Stack
Solution Component: Hyperion Profitability & Cost Management (HPCM)
Organizations need information management solutions to address the challenges.
Why HPCM? To Meet Key Allocation Requirements
Flexibility
• Analyze different chargeback approaches to yield optimal mix of services versus costs incurred by the shared service center.
• Rapidly evolve methodologies as the maturity model of the shared service center evolves.
Audit & Control
• Provide key stakeholders confidence in the numbers produced and methodologies employed to ensure compliance.
Shared Methodology
• Define consistent allocation and charge back methodology across all management cycles.
• Ensures consistent comparisons when reviewing and updating methodology result and planning for future management cycles.
Transparency
• Give Units the detail costs they incur for the service consumed.
• Compare effectiveness of internal unit services with those of external providers to ensure efficiency.
Organizations need information management solutions to address the challenges. These needs can be abbreviated as F-A-S-T!
What’s New in 11.1.2.2 HPCM – Detailed Profitability Models
Solution Component - Hyperion Planning EPM Application Shorten Planning Cycles and Improve Business Predictability
► Powerful workflow and process management
► Intuitive interface for end user data entry
► Robust data integration
► Leverages Essbase for powerful reporting and analysis
► Scalable Web infrastructure
► Shared EPM Administration Tools
Reporting & Analysis Financial Reports
Smart View for Office BI Foundation (OBIEEE/Essbase)
EPMA
Hyperion Planning Multi User Data Entry Task Lists & Workflow
Bottoms Up Calculations Reporting & Commentary
HPCM Multi-Step Allocation Modeling
Validation Reporting Traceability Maps & Analysis
Data synch: Costs by Account & Dept
Data synch: Direct Attribution to LOB
Data synch: Drivers by Account & Dept & LOB
Data synch: Results by Account & Dept & LOB
Shared Dimensions & Hierarchies (EPMA)
HPCM & Planning – Better Together
What role do you see a budgeting/forecasting/planning product playing in a profitability & cost management solution?
37
Crit
ical -
the d
efiniti
on of..
Importa
nt – th
e solu
tio...
Nice
to H
ave – ca
n ext
en...
Not I
mport
ant – w
e wou..
25% 25%25%25%1. Critical - the definition of a set of routines that
can be shared with the profitability management solution for actuals, plans, forecast, and what-if scenarios
2. Important – the solution needs to support processing of both actuals and budget/forecast data sets
3. Nice to Have – can extend the profitability process through driver collection & an occasional what-if scenario
4. Not Important – we would run our processes only for actuals
Polling Question #4
Profitability Case Study HR Consulting Firm
Business Process
► Process
• Creation of a “Fully Burdened” dataset.
• Attribute the “Fully Burdened” dataset.
• Allocate the Costs to the lowest level of the business (Entity & C2 Dimensions)
► As-Is • A large tactical MS Excel solution – 50+ worksheets
• Difficult to interrogate the process.
• Difficult to control changes.
► To-Be
• To deliver an allocation system that uses a combined Hyperion Planning and HPCM approach.
• Solution on an Enterprise Platform - a platform for further growth.
• Ability to easily run multiple versions.
Staging
Application
HPCM Source
Application
Driver Data
Hyperion Planning
Hyperion Profitability & Cost Management
Microsoft Excel
HPCM Stage
Management Utility
Application Architecture
STG 1
BONUS
STG 2
PROP & ADMIN
STG 3
MGTI
STG 4
PRE ATTR
STG 5
POST ATTR
STG 6
PRE HPCM
STG 7
POST HPCM
STG 8
TOTAL ALLOC
Source
Application
SOURCE DATA
Source
Application
Business Logic
Attributions & Allocations – Attribution Data Entry Form
HPCM – Allocation Matrix
Entity Business Account
Entity Business
Entity Business
Entity Business
Department
Stage 1 - Global
Stage 2 - Regional
Stage 4 - Business
Stage 3 - Local
Stage 5 - Department
HPCM Model Architecture
► HPCM allocates Costs & Revenue Pools through one or more stages in a top down capacity
► Stage – Step in the allocation process that has similar pool characteristics
► Separate stages enable traceability.
HPCM Allocation Model Definition Components
Source Stage
Project Detail Target Stage
Customer
Project
Dept
Resource
Customer
Project Driver
Driver Selections – Defines what Driver Definitions to use against the Source stage, typically the dimension identified as the driver definition.
Assignment Rules Definitions– Defines the member combination in the target dimension for the assignment.
Assignments– Defines the source dimension combination and the target Assignment Rule
Driver Definitions – Create an allocation formula/methodology that references a loaded metric within the model.
1
2
3
4
2 3
1 4
4
HPCM – Driver Definitions and Selections
HPCM – Stage Balancing Report
HPCM – Trace Allocations
Trace Allocation
for Local Data
Allocation
Source
Outcome…
• Excellent visibility throughout the allocation process.
• A platform for great reporting.
• Ability to run multiple versions.
• Low IT involvement (Run the Model).
• Can answer business questions quickly.
• A robust and repeatable process.
• Business areas can understand their costs – challenge the data
not the process.
• Risk mitigation – Enterprise platform
Oracle Engineered Systems Exalytics In Memory Machine
What is Exalytics?
Unique Features
In-Memory Analytics: Structured and Unstructured Data
Best TCO for running Pre-Packaged Oracle Analytic
Applications
Advanced, Real-time analytic modules for Apps
Works seamlessly with Exadata and Exalogic
Benefits
Superfast, Interactive Visual Analysis
Faster Planning & Budgeting with Richer Models
Quick to Deploy, Supports More Users
Faster, Cheaper, Better Analytics
1 TB DRAM, 40 Intel Cores, InfiniBand
Planning, ERP, CRM, Profitability, Vertical-specific
80+ Pre-packaged
In-memory Analytic Applications
OBIEE + Endeca + Mobile
In-Memory Analytic Platform
Endeca TimesTen Essbase
Unstructured ROLAP MOLAP
I n - M e m o r y A n a l y t i c E n g i n e s
► Memory: Exalytics is designed to massively boost performance of Business Intelligence queries by processing vast amounts of data in memory
► Disk: Exadata is designed to optimize the performance of large databases where most of the query overhead is experienced whilst reading or writing from disk
► CPU: Exalogic is designed for large application servers (e.g. server farms, data centers, virtualization) with massively parallel and scalable CPU performance
What Comes with Exalytics?
► Memory Optimized Essbase
► BSO – Concurrency Performance Optimizations
► ASO – Outline Based Memory
► BI Server
► Summary Advisor
► Aggregate Persistence for TimesTen In-Memory DB
Exalytics X2-4
OS: Linux x86-64
► OBEE
► Essbase
► OSSM
► EAL
► Mobile
► HFR
EPM 11.1.2.3/BI 11.1.1.7 Exalytics Certifications (Linux x64)
► EPM Applications
– Hyperion Planning
– New! - Hyperion Profitability & Cost Management
► EPM Foundation
– Calculation Manager
– Shared Services
– EPM Workspace
► FDMEE
► BI Foundation Suite
– OBIEE
• BI Server
• Answers
• Interactive Dashboards
• Delivers
– BI Mobile
– Oracle Scorecard &Strategy Management
– Essbase Application Link for HFM
– Essbase Studio
– BI Components Available to EPM
• Essbase
• Financial Reports
• Provider Services
• Essbase Admin Services
► Times Ten In Memory Database
► Endeca
► Oracle HTTP Server
Exalytics Use Cases
1. Enterprise Planning
• Server/App Consolidation
• Bundled HW/SW Licensing
2. Profitability Applications
1. Mature Standard Models
• Increase Freq. of Use
• Model Complexity
• What If-Scenarios
• Process Parallel POV
2. Introduce Detailed Models
• Larger Operational Dimensions (10K+)
• Customers
• Prod/SKUs
• Optimize RDBMS Mart Rptg & Analysis
3. BI Reporting & Analytics
1. Increase ROLAP reporting user counts due to memory optimizations by a factor of 3x
2. Increase ROLAP Report Speed by up to 18x with In Memory Analytics
• Summary Advisor
• Times Ten DB
3. BIF Suite Improves Insight
• Increase Adoption via Mobile Delivery
• Incorporate Scenario Modeling w/ Essbase
• Increase Oversight via OSSM
1. Process Maturity
• Increase Freq. of Use
• Rolling Forecasts
2. Drivers Maturity
• Increase Users
• Model Complexity
• Interactive Scenarios
Throughput goes up!
4. Lower IT TCO • Reduce Deploy Complexity
• Reduce Lead Times
Exalytics Customer Story
55
Client Overview
● Siemens was founded in 1847 and is based in Munich, Germany. It has over $100B in revenue and operates in the energy, healthcare, industry, and infrastructure and cities sectors worldwide. In the healthcare sector, the company develops manufactures, and markets diagnostic and therapeutic systems, devices, and consumables, as well as information technology systems for clinical and administrative purposes.
Challenges / Opportunities
● Current environment did not support IT’s future state operating system, internet browser, server database and desktop business applications ● Performance of complex Planning application for Health Services was slow. Needed to improve to run multiple what-ifs for decision processes. ● Five Business Units with different HFM and Planning applications needed to be upgraded. ● Budget process was to start in early February creating a tight timeline to complete the upgrade.
Implemented Solution
● Implemented the latest 11.1.2.2 version of Oracle/Hyperion. ● This migration included all relevant patches and the implementation of Oracle’s new Exalytics box. ● Supported all facets of the installation and configuration which included: Networking, Operating System and Virtualization of Linux environment. ● Migrated applications and developed automated scripts for back up and updates. ● The new 11.1.2.2 environment improves the user experience, provides the new high speed Exalytics engine and reduced the number of servers required for each environment.
Results
● Project completed on time and under budget. ● Business Units have migrated to the new environment and started their budget processes. ● Reduced Planning calculation time from 4+hours to 40min.
Client Since 2012
Solution Delivered 2013
Vertical Healthcare-Medical Equip
Products Infrastructure - Upgrade
Exalytics - Tips, Tricks and Lessons Learned ► Services – The software doesn’t come pre-installed. Take advantage of the
installation and configuration services available from Oracle and Ranzal.
► Remember you will still need to procure machines for multiple environments –our clients typically have 2-4. OVVM is available for shared Dev/Test.
► Remember to set key Essbase.cfg file settings
OracleHardwareAcceleration TRUE
RESTRUCTURETHREADS 20
► Update your EPM Application Configuration to take advantage of massive parallel processing wherever possible
► Parallel Calculations – Split up into “chunks” batch processes/scale to larger number of concurrent single thread calculations
► Parallel Exports & Restructures
► Parallel Data Loads
► Store Essbase Index/Page Files on SAN or the Exalytics RAM disk, as you will achieve greater performance than the local RAID-5 disk configuration
► While BI Apps with large number of users benefit natively with Exalytics , EPM apps will likely require certain changes to maximize performance
Summary: Exalytics Value Proposition
► Increase End User Satisfaction & Productivity
– Increase timeliness of Data
– Speed of Thought Response Time for Planning & Reporting
– Increase User Counts and adoption rates
► Reduce/Repurpose Resources
– Reduce internal/external time allowances for tuning/optimization – for some applications.
– Improved Productivity allows more time for
► Reduce Deployment Time
– Hardware Procurement time
– Software Installation/Configuration Time
– Infrastructure Testing Time
Ranzal has the Exalytics In-Memory Machine!
58
Specializing in Installation, Configuration and Testing of Hyperion EPM/BI apps.
• Not Sure? Test Drive Exalytics BEFORE you make the investment
• Speed of Thought Performance • Better User Experience • Reduction in Servers
• Networking • Operating System • Virtualization
• Full EPM/BI Install • Dynamic Scripting • Complete Automation
Closing and Q&A
► Does your company understand the true costs of its products or services?
► Are costing models transparent enough? Can you easily trace back the assigned costs to the activities and line item expenses that drive them?
► Do your costing methods operate at the right level of detail?
► Are you satisfied that you are allocating shared services (such as IT or a centralized HR function) accurately?
► Are people spending too much time maintaining our costing models and other elements of our costing system?
► Can people in your company quickly test how changes to commodity, input costs, lower or higher volumes will affect our profitability?
► Are you getting answers from our costing systems fast enough to be actionable? Would reducing this process time improve our competitiveness or profitability?
► Is all of the data that you need to understand true costs available in a single ERP system? If not, what are the initial and ongoing costs of integrating that data into your ERP system?
Self-Evaluation Questions
Closing and Q&A
61
Mike Killeen, Vice President Edgewater Ranzal
108 Corporate Park Drive, Suite 105 White Plains, NY 10604
E-mail: [email protected]
Appendix I HPCM Demo
Project Profitability
Published Reports &
Interactive Analytics Model Development
• Create & Manage
Dimensions &
Hierarchies
• Deploy the
Application
• Define Data
Integrations from
Source Systems
• Manage User
Security
Master Data & Data
Integration Management
Enterprise
Performance
Management
Architect
(EPMA)
Dimensions Hierarchies Attributes
Hyperion Profitability & Cost
Management
(HPCM)
Stages Drivers
Assignments
Essbase
Calculation
Cube
(BSO)
Essbase
Reporting
Cube
(ASO)
Financial Reports,
Smart View,
Business Intelligence
Foundation
Produce Management and
Performance Reports:
• Financial Results Books
• Margin Analysis
• Cost & Revenue
Contribution Analysis
• What-If Scenario
Comparisons
• Genealogy Reports
Execute a Model POV:
1. Load Cost/Revenue Data
2. Load Driver Metric Data
3. Validate Model Inputs
4. Execute Calculations
5. Trace Allocations &
Validate Model Results
6. Publish the Model POV
Create & Manage the
Business Model:
1. Define the Stages
2. Create a Model Point-Of-
View (POV)
3. Define the Drivers
4. Define Assignment Rules
5. Assign Drivers
6. Create Assignments
Model Execution
HPCM Workflow in Profitability & Cost Solution
Demo - Define POV, Business & Driver Metrics in EPMA
POV Dimensions Business Dims Driver Metrics
Demo - Business User Defines Stages in HPCM for Allocation Flow
Stage definition is wizard
driven, and provides the
appropriate selections for
stage creation.
HPCM Allocation Model Definition Components
Source Stage
Project Detail Target Stage
Customer
Project
Dept
Resource
Customer
Project Driver
Driver Selections – Defines what Driver Definitions to use against the Source stage, typically the dimension identified as the driver definition.
Assignment Rules Definitions– Defines the member combination in the target dimension for the assignment.
Assignments– Defines the source dimension combination and the target Assignment Rule
Driver Definitions – Create an allocation formula/methodology that references a loaded metric within the model.
1
2
3
4
2 3
1 4
4
Demo - End Users Define Drivers in HPCM 1
Select from list of user defined driver metrics and allocation methodologies.
Demo - End Users Assign Drivers to Source Cost Pools in HPCM 2
Select Default Drivers for Cost Pools, with an ability to provide exceptions for unique projects.
Demo - End Users Create Target Range Assignment Rules in HPCM 3
Demo - End Users Map Source Stage to Targets Via Assignments 4
Or Allocation Assignments can be bulk loaded via a staging table.
Demo - Load and Validate Project Cost & P&L Data
Add Capitalization Rules to Calculate P&L Impact of Capital Project
Demo - Load and Validate Driver Metric Upload
Traffic Lighting to verify statistical driver metrics tie to 100%
Demo - Model Validation – Stage Balancing Report
All Costs are
Allocated to
Final Stage
Demo - Model Validation – Detailed Validation Results
Demo – Traceability Analysis – What makes up a client charge?
35% of China Costs come
from Asia Region Office
Project 212375
2% of China Charge came
from resource wswain
from Dept X working on
Project Y
Demo - Transparency into Details of Chargeback
Resource , Dept, Project
& Expense Type Details
of What Makes up China
Charge
Appendix II Backup Slides
About Edgewater-Ranzal
78
► One of the largest Full-Service Oracle/Hyperion EPM and BI practices.
► Oracle Platinum Partner presented with numerous awards and recognitions by Oracle including multiple Partner of the Year awards.
► Premier Consulting Services in North America, and a regional European office located in the United Kingdom.
Edgewater
Founded in
1996
Essbase Acquired by
Edgewater
2004
Data
Integration &
Warehousing/
CRM/
Web 2.0
Development
Acquired
Vertical Pitch
2007
HFM/
FDM
► Publicly Traded as: EDGW
► One of The Boston Globe’s Top 100 businesses
► Ranked as one of the 500 fastest-growing stocks on Wall Street
Acquired
Meridian
2010
HSF
Planning
2001
Planning
Building
OBI Team
2011
OBIEE
Ranzal
Build DRM &
HPCM Teams
2009
DRM &
HPCM
Ranzal Profitability & Cost Mgmt Solutions
12/5/2013 79
Profitability
Sample Clients
Typical Customer Profitability Distribution
-$2,000
-$1,500
-$1,000
-$500
$0
$500
$1,000
$1,500
$2,000
$2,500
1 2 3 4 5 6 7 8 9 10
TAIL CHART
10 CUSTOMERS OR MILLION CUSTOMERS IN DECILES
CUSTOMER SEGMENTS
EC
ON
OM
IC P
RO
FIT
AVERAGE ECONOMIC PROFIT PER CUSTOMER = $250
E CUSTOMERS = $2,500
“Portfolio of Customers”
Geoffrey Colvin
Oracle Business Analytics – EPM/BI Software Architecture
BI Foundation: Info Delivery
EPM Apps: Information Generation
Master Data, Data Quality & Data Integration Tools: Information Management
Interactive Dashboards
Smart View Office Integration
Secure Search
Production Reporting
Mobile
Ad-hoc Analysis
Scorecards
Strategy Maps
Geographic Visualization
Financial Reporting
Solution Component: BI Foundation Reporting Tools
83
EPM/BI Platform: Software & Hardware That Supports Key Capabilities
SECURE MOBILE ANALYTICS
DATA GOVERNANCE
SCALABILITY AND PERFORMANCE
FLEXIBLE DEPLOYMENT
What Can We Do with In Memory?
► Speed of Thought Analytics and Superfast Calculations
Faster Analysis
Faster Calculations
Better Interactivity
Better Visualizations
More Users
More Queries
Business Agility
Better Forecast
Better Insights
Better Decisions
BI Adoption
Lower Cost
Essbase & Exalytics – Improvement in Parallel Processing
► 340-400% improvements for response time under load
► 4x improvement in throughput
► 4x reduction in CPU utilization
► 6x reduction in CPU saturation
► 10x improvements in Parallel Calcs
► However, single threaded processes cannot be improved by these enhancements…
► Depends on the actual workload
HPCM Performance Results with Exalytics
► 11.1.2.3.351 HPCM is Exalytics Certified
► New Parallel Calc
► Non EPMA Mode
Summary: When Should You Consider Exalytics?
► Enterprise Planning Domain
– Enterprise Planning with Hyperion Planning
• Heavy Driver Based Models (Public Sector, Workforce Planning)
• Frequent Use (e.g. Rolling Forecast) and Large Concurrency
– Custom Financial and LOB Planning with Essbase
• Typically Larger Dimensions Sizes
► Profitability and Cost Management using HPCM
– Multi-Step, Multi Stage Allocations
► Analytics and Reporting using OFMA, OBI or OSSM
– Optimize Multi-User Federated ROLAP Queries with the BI Server
► Hardware Consolidation
– Hardware Refreshes/Upgrades – Reduce Data Center Foot Print
Multi-Product EPM/BI Solution Architecture with Exalytics
► Separate Oracle RDBMS Server
► Windows Servers for HFM, FDM, and EPMA
► Exalytics for Planning, Essbase and BI
► Local Disk
► RAM Disk
Exalytics Hardware Updates So Far
Exalytics X3-4
2TB RAM, 40 cores
2.4TB Flash (6x F40)
5.4TB HDD
Exalytics X2-4
1TB RAM, 40 cores
3.6TB HDD
2.4 TB Flash Upgrade Kit
2TB Memory and
2.4TB Flash
Upgrade Kit
Time
Exalytics T5-8
4TB RAM, 128 cores
3.2TB Flash (6x F40)
7.2TB HDD