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Oracle Enterprise Performance Management

John R. Hite
Sr. Director, BI and PM Global Business Unit

Oracles Integrated Analytic Solution

S
C
I
YT
AL

REPORT

DU
IND
UST ST
RY A
RY
NAAL
NAYTICS
LY
TI
C
S

P
ER

N
A
ANALYTIC FOUNDATION

S
IC
YT
AL
AN

Financials
HR
Procure & Spend
Projects
Supply Chain
Order Mgt
Logistics

M
CR

PRE-BUILT CUSTOM EMBEDDED

S
SINGLE
PP
A
ENTERPRISE
M

P
EFORECAST

Sales
Marketing
Service
Contact Center
Price
Loyalty

ANALYZE

IN

INFORMATION
MODEL

Financial Close
Strategic Planning
Planning & Forecasting
Profitability Management

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

MODEL

Financial Services
Communications
Healthcare
Retail

Key Enabler for the Oracle EPM System

Ad-hoc
Analysis

Interactive
Dashboards

Reporting &
Publishing

Detect &
Alert

Disconnected
Analytics

Office
Integration

PERVASIVE INFORMATION ACCESS

STRATEGIC
PLANNING

PLANNING &
BUDGETING

FINANCIAL
CCLOSE

PROFITABILITY
MANAGEMENT

ERP
ANALYTICS

CRM
ANALYTICS

INDUSTRY
ANALYTICS

COMMON ANALYTIC FOUNDATION

Forward-Looking Analytic Engine

Multi-user Write-back
Financial Intelligence
Enterprise Dimension Management

OLTP & ODS

Systems

Data Warehouse
Data Mart

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

OLAP

Single Enterprise Information Model

Conformed Dimensions
Federated Query
Intelligent Caching

Oracle, Siebel, PeopleSoft

JD Edwards, SAP, Custom

Excel
XML

Business
Process

Improve Shareholder Value

WORLD CLASS EPM ORGANIZATIONS DELIVER

2.4 TIMES MORE EQUITY MARKET RETURN THAN
THEIR INDUSTRY PEERS

Sources: IBM CFO study 2008, Hackett 2007; Accentures Finance And Performance Management Mastery, 2004

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

Enterprise Performance
Management is a Discipline
that Enables Management to:

Link strategies to plans and execution,

Monitor financial and operational results
against goals, and applying analytics to

Drive enterprise-wide performance

improvement.

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

Market Pressures Demand Effective

Performance Management
Todays Reality: Management
Processes Are Fragmented
OPERATIONAL

SIX SIGMA

PLANNING
VARIANCE
ANALYSIS

Lack of business alignment

ANALYZE

GOAL

PERFORMANCE

SETTING

Low predictability in performance

FINANCIAL
MODELING

Inconsistency in business
decisions

SCORECARDS

FINANCIAL
REPORTING

ROLLING
FORECAST

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

MONITOR
RESULTS

Oracle EPM Connects Management

Processes

Common Reporting & Interaction

Strategic Planning

Planning & Forecasting

Financial Close

Profitability Management

Common Integration & Analysis

Data Quality and Consistent Dimensions

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

EPM Enables World Class Finance

Align Processes
Deliver consistency
Greater Visibility

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

Critical Components to Implement

Financial Close Best Practices
CFO Dashboard
Governance, Risk & Compliance
Financial Close Workflow

ERP:
Oracle, SAP,
Legacy, Other

Data
Assurance

Transactions

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

Financial
Consolidation

Tax
Calculations

Tax
Filing

Financial and
Mgmt. Reporting

Document
Management
& Filing

Reporting

Key Capabilities
Accelerate Reporting Cycles and Reduces Costs of
Compliance
Patented financial consolidation
and reporting features
Complete audit trails, workflow
and validations
Smart Dimensionality
Flexible what if scenario
management features
Powerful, reporting and analysis
tools
Full integration with ERP and
other transaction systems
Easy to customize and extend
Web-architected

Copyright 2009, Oracle and / or its affiliates. All rights reserved.

10

First to Report on the Dow Jones

The worlds leading producer of primary aluminum with $23.5
billion in revenues with operations in 43 countries and 350
locations. Alcoa has over 131,000 employees.

Before

After

20 days to close
Lengthy year-end reporting
Costly financial reporting
process
78 charts of accounts
Widely varying reporting
definitions and procedures

5 days to close

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

Global consolidation across 58

lines of business
Global forecasting and reporting

solution for 1,000+ users

Minutes to access information

11

Critical Components to Implement

Planning Best Practices

Predictive Modeling & Simulation

Functional Plans

Long-Term
Financial
Planning

Workforce
Planning

Capital Assets
Planning

Project
Planning
Marketing
Planning

Operational
Revenue & Cost
Modeling

Planning, Budgeting & Forecasting

Financial
Detail

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

Operational
Detail

12

Key Capabilities
Accelerate the Planning & Forecasting Process

Centralized system
Align top-down and bottom-up
Consistent assumptions
Common allocations &
calculations
Integrated Operational Planning
to address in-depth revenue and
margin planning
Purpose-built Capital Assets and
Workforce planning modules for
fast deployment
Powerful workflow and process
management for budgeting and
forecasting
Leverages Essbase powerful
reporting and analysis

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

13

Shortens Budget Cycle by Implementing

18 Month Rolling Forecast
World's 5th largest Airline, celebrating its 75th anniversary in 2009
Operates 2,750 daily departures;133 domestic, 132 international
destinations
Named Fortune magazine No1 World's Most Admired Airline
Before

After

30% of FP&A time spent on data

management
Thousands of spreadsheets exist with
embedded calculations, macros &
links
Excessive review time and multiple
iterations due to extended budget
cycle
Security issues with having data
residing in offline Excel spreadsheets

Move to a 18 month rolling forecast to

allow for shorter budgeting process
Replaced 1000s of excel
spreadsheets
Web-based data entry for Workforce
Planning (Mgmt, Reservations agents)
Enabled for local currency input and
automated currency translation
Driver-based calculations using
Operational Statistics

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

14

Critical Components to Implement

Profitability and Cost Management Best Practices

Common Reporting & Interaction

Cost and
Revenue Allocation
Calculations

Cost and
Profitability
Reporting

Cost, Revenue and

Profitability
Analytics

Cost and
Profitability
Simulation

Profitability and Cost Management

Allocate

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

Analyze

Organizational
Improvement

15

Key Capabilities
Improve Profit Decisions Through Better Visibility
A packaged application that enables:
Accurate measurement, allocation and
management of costs and revenues
Computation of Profitability for business,
product, and customer segments
Profitability measurement by using cost
decomposition, consumption-based
costing, and scenario playing

Designed for the business user

Leverages existing IT investments

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

16

Optimize Product Mix to Maximize

Profitability
Regional bank serving 19 Western and Midwestern
states and 4 million households. Over $60B in assets
with more than 10,000 employees.

Before

After

IT resources demand exceeded

capacity for profitability reporting
Needed business users to drive
profitability modeling
Lack of insight how shared costs
impacted economics of the business
Challenge to optimize product mix that
maximizes bank profitability

Minimal IT involvement
Easy integration into EPM system
infrastructure
Ability to offer a basket of products by
mixing and matching products
according to customer demographics
Benchmarking costs for developing
and marketing new products

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

17

Critical Components to Implement

Strategic Planning Best Practices

Predictive Modeling & Simulation

Long-Term Financial
Planning

What If
Analysis

Corporate
Development

Treasury
Strategies

Planning, Budgeting & Forecasting

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

18

Key Capabilities
Accounting Integrity and Modeling Speed
Integrated financial
statements
Project shareholder value
Run unlimited scenarios
Consolidate multiple
business combinations
Evaluate strategic projects
Simulate effects of M&A
Debt Scheduling
Optimize capital structure

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

19

Reduce Modeling Time From Days to Hours

Fortune 500 energy company and nations leading supplier of
competitive electricity to large commercial and industrial
customers.

Before

After

In Excel took days to run new

scenarios 5 year long-range plan
Lack of fully integrated financial
scenarios between debt pay downs,
share buy-backs and investments in
long-term capital projects
No integration between FP&A and
Treasury models

Cash-flow models in hours, not days

Sensitivity analysis on cash-flow and
treasury scenarios

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

Strategic use of funds across debt,

equity and capital projects

20

Oracle EPM Connects Management

Processes

Common Reporting & Interaction

Strategic Planning

Planning & Forecasting

Financial Close

Profitability Management

Common Integration & Analysis

Data Quality and Consistent Dimensions

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

21

EPM Process/Product Mapping

Strategic Planning
Hyperion Strategic Finance
Hyperion Scorecard
Crystal Ball

Financial Close
Hyperion Financial
Management
Financial Close Management
Disclosure Management
GRC Manager
GRC Intelligence

Planning and Forecasting

Shared Components
Financial Data
Quality
Management
Essbase

Hyperion Planning
Workforce Planning
Capital Asset Planning
Integrated Operational
Planning
Public Sector Planning

Data Relationship
Management

Profitability Management
Hyperion Profitability and
Cost Management

Copyright 2009, Oracle and/or its affiliates. All rights reserved.

22

Oracle EPM System Functional Architecture

EPM WORKSPACE
Web

Desktop

Search

PERF. MANAGEMENT

Performance
Management
Financial
Planning
Profitability
and
GRC Applications
Applications

Alerts

Office

Mobile

BI APPLICATIONS

BI Applications

BI Applications
CRM Analytics
ERP Analytics

Management

BUSINESS INTELLIGENCE FOUNDATION

Common
Enterprise Information
Model
Business
Intelligence
Foundation
BI Server

Essbase

Predictive Analytics

FUSION MIDDLEWARE
SOA

OLTP & ODS

Systems

Data
Quality

Identity
Fusion
MDM Middleware

Data
Integration

Data Warehouse
Data Mart

2009 Oracle Corporation Proprietary and Confidential

Management

OLAP

Content
Management

Oracle, PeopleSoft, JDE,

Siebel, SAP, Custom

Excel
XML

Business Process
Management

Business
Process