Profitabilty, Analytics, and Exalytics

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Edgewater Ranzal hosted a series of luncheons in various cities to share real examples of how clients are leveraging Oracle Hyperion short and long-term EPM/BI solutions delivered on Oracle Exalytics …

Edgewater Ranzal hosted a series of luncheons in various cities to share real examples of how clients are leveraging Oracle Hyperion short and long-term EPM/BI solutions delivered on Oracle Exalytics to improve decision-making processes that lead to profitable growth.

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  • 1. Edgewater Ranzal Enabling Profitability Management with Oracle Business Analytics & Exalytics Mike Killeen Vice President of Technology mkilleen@ranzal.com October 23, 2013
  • 2. Agenda ► Introductions The Need for Profitability Management ► Profitability Management Enablement: Software ► Profitability Management Case Study ► Profitability Management Enablement: Exalytics ► Closing and Q&A ► 2
  • 3. About the Presenter - Mike Killeen • 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.
  • 4. Edgewater Ranzal Overview & Differentiators ► 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 • • • ► Workforce Planning Balance Sheet Planning Capital Planning & PFP • • • HFM Financial Close Mgmt Disclosure Management • • • HPCM HSF FDMEE/ERPi & EPMA Customer Advisory Boards, Beta Testing, Certification Exam Development
  • 5. Edgewater Ranzal Service Offerings 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 Consolidation Installation, Upgrades, Migration, System Monitoring, Backup and Recovery, Disaster Recovery, Load Testing, Hardware Sizing, Exalytics Benchmarking Strategic Finance, Planning, Budgeting, Forecasting, Workforce Planning, Capital Planning, Project Financial Planning Business Intelligence Enterprise Planning Costing & Profitability Mgmt Infrastructure Data Integration, Financial Data Management, Data Warehousing, Master Data Management &DRM, ETL Services, Automation Data Services Project Management Training & Support Services Key Teach Course Delivery: Planning, Essbase, Financial Reporting, Smart View, HPCM, HFM, FDM, DRM, OBIEE Custom Training Delivery: Process & Reporting HPCM Standard & Detailed Models, Waterfall Allocations, Activity Based Costing, Customer, Product & LOB Profitability Project/Program Mgmt, EPM Road Maps, Application Reviews, Business Requirements, Process Change, Documentation Support Services – Infrastructure & Application Support Contracts
  • 6. The Need for Profitability Management
  • 7. Why Enterprise Performance Mgmt (EPM)? Doing Fine Call Me  Under-performing Products  Under-served Customers  Under-utilized Staff, Assets  Excess Cash  Inefficient Business Processes recognize react
  • 8. 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
  • 9. Using the Wrong Tools to Effectively Analyze Profitability “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...” Accurate Costing Is Key to Profitability Ventana Research, 2008
  • 10. Polling Question #1 10 ... et s/ M ge r Sp re ad sh e Ge ne ra l Le d ... ut io So l Cu st om Pa c ka g ed Pr of i.. . 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? 1. Packaged Profitability or Costing 25% 25% 25% 25% 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
  • 11. 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
  • 12. 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 ► ► ► Selling Costs (e.g. Sales & Marketing) ► Investment Costs (e.g. R&D, Initiatives) ► ► Operating Costs (e.g. Call Center, Plant Overhead) G&A Costs (e.g. IT, HR, Finance, Admin) Finance Charges for Cost of Capital Employed
  • 13. Profitability Challenge #1 Indirect Expenses Assignment to Products & Customers Standard, accepted process No Standard Process  Indirect Costs are difficult to track and measure
  • 14. Profitability Challenge #2 Statutory Reports are not Timely or Detailed Enough Financial transactions • 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? Consolidation (GL or HFM) Organizational P&L Financial Data Accumulator Bottom-line Results
  • 15. Profitability Challenge #3 – Ensuring Consistent Performance as Users, Data Volumes, & Frequency of Use Increases User Counts Products & Customers Data Volumes Frequency Of Use Sales/Product Managers 1000’s 1 MM’s 10K’s 1000’s Weekly 1000’s Cost Center Managers Daily Monthly 100’s Qtrs Departments LOB Execs. 100’s LOB/Functions 10’s Finance Segments/Entities
  • 16. Profitability Management Solution Elements Financial P&L Operational Product P&L by Activity Data Source Data Meaningful Attributions & Allocations Planning, Reporting & Analysis EPM/BI Platform
  • 17. Source Data – Financial P&L Legend C Customer Specific Costs P Product Specific Costs F Financial/Overheads Typical Financial Analysis ► ► Type C/P P&L Line Units Sold $ % of Rev 100 ► ► C/P C/P Gross Sales Less Disc, Rtrns & Allow. Net Sales $ 1,000 $ (20) $ 980 C/P F COGS @ Std COGS @ Var Less: Total COGS $ $ $ 400 23 423 41% 2% 43% $ 557 57% Selling & Marketing Exp $ G&A Exp $ Less: Total Operating Exp $ 150 100 250 15% 10% 26% Operating Income $ Depreciation & Amortization$ Other Inc/(Exp) $ Net Income Before Taxes $ 307 (75) (50) 182 31% -8% -5% 19% Less: Income Taxes @ 40% $ Net Income After Taxes $ 73 109 7% 11% Gross Profit P/F/O F F F 102% -2% 100% Raw Materils, Labor, Freight In, Mfg Ovhd Mfg Plant Departmental Exp Variances ► ► ► Dept Costs: Accounting Mgmt IT ► ► 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
  • 18. Source Data – Sample Operational Data INVOICE SHIPPED TO SOLD TO ORDER DATE MM/DD 11/01 DELIVERY DATE MM/DD 11/11 QUANTITY UNITS SHIP NO. S901999 TERMS: FROM INVOICE DATE XXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXX PURCHASE ORDER NO. TEST ORDER #1 SHIP DATE 11/01/2004 INVOICE DATE 11/01/2004 CUST. NO. B901999 ACCT. AT CUST. 1202 PRODUCT CODE SALES DIST. 2377 CARRIER Customer pick-up 2% 15 days Net 16, USD DATE INV’D 11/01/04 DIRECT INQUIRIES TO: 1 (800) 999-9999 PLEASE SHOW THIS INVOICE NUMBER WHEN REMITTING 2002009999 SALES ORDER 199299888 DESCRIPTION UNIT PRICE AMOUNT 700 CA 4100000295 TBAH 24/500 75.35 52,745.00 700 700 700 700 700 CA CA CA CA CA 4100000295 4100000295 4100000295 4100000295 4100000295 Efficiency Allowance 333333 SpecAllow-OI RateCs 654737 Freight-Backhaul Fuel Allow Percent Unload Allowance 0.050.501.086% 0.04- 35.00350.00155.749.3428.00- 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)
  • 19. Meaningful Allocation – Top Down via Rules › Allocation Rules can use drivers such as headcount, percentages, hours, etc Allocation Rules Customer Profitability 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 Available Driver & Allocation Source Data CRM HR GL EDW EPM
  • 20. Meaningful Allocation – Bottoms Up Via ABC Example ► 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?
  • 21. Reporting & Analysis: Published Customer & Product P&L Reports
  • 22. Reporting & Analysis: Interactive Analysis via Mobile Dashboards 22
  • 23. Outcomes: Expectations of a Profitability Management Solution ► Reliability – Visibly defensible profitability and cost results through transparency & audit/control ► Senior Management Agility – Timely reflection of results to be actionable ► FP&A Relevance – An ability to Allocate resources to the most important opportunities Operational Results Financial Results Revenue & Cost Models
  • 24. Polling Question #2 Which of the below use cases would your organization prioritize as the top application for a Profitability & Cost Management Solution? 25% 25% 25% 25% /P ro d. .. ... ty bi li er Cu st om lP se d d le De ta i Ba iv it y Ac t ro fit a Co st in Pr t io n llo ca Co st A 24 Fo ... g oc e ss f.. 4. ve 3. Le 2. Cost Allocation Process for External Purposes Activity Based Costing For External Purposes High Level Profitability for Management Purposes Detailed Customer/Product/Operational Profitability for Management Purposes Hi gh 1.
  • 25. Overview of Oracle Business Analytics Profitability Management Solution
  • 26. Building an EPM/BI Platform today EPM/BI Platform Consolidation & Reporting Financial Planning &Analysis Analysis (profitability) recognize react • 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.
  • 27. Polling Question #3 Which of the following EPM/BI programs would you rank as MOST important to your organization? 25% 25% 25% 25% 27 an d. .. ... ct io ... he gt r in g ive De l vin Im pr o Op t im izi ng th e. .. 4. gA 3. bl in 2. Optimizing the Financial Close & Reporting Process Improving the Budgeting, Forecasting & Planning Process Enabling Actionable Operational and Financial Analytics throughout the organization Delivering and Optimizing a Profitability and/or Cost Management Solution En a 1.
  • 28. 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 Reporting & Analysis Financial Reports, Smart View for Office, BI Foundation (OBIEE) Exalytics X2-4
  • 29. Solution Component: BI Foundation Reporting Tools Reporting Tools 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 Transactional Systems & BI Data Marts BI Publisher 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 EPM/ Essbase EPM 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. 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. EPM Workspace BIF Capabilities Users
  • 30. Solution Component – Essbase OLAP Server
  • 31. Why? Profitability Applications are Multi-Dimensional in Nature
  • 32. Solution Component: Hyperion Profitability & Cost Management (HPCM) • 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 32
  • 33. Why HPCM? To Meet Key Allocation Requirements Organizations need information management solutions to address the challenges. These needs can be abbreviated as F-A-S-T! Flexibility Audit & Control • 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. • 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.
  • 34. What’s New in 11.1.2.2 HPCM – Detailed Profitability Models
  • 35. 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
  • 36. HPCM & Planning – Better Together Hyperion Planning Multi User Data Entry Task Lists & Workflow Bottoms Up Calculations Reporting & Commentary Shared Dimensions & Hierarchies (EPMA) EPMA 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 Reporting & Analysis Financial Reports Smart View for Office BI Foundation (OBIEEE/Essbase) HPCM Multi-Step Allocation Modeling Validation Reporting Traceability Maps & Analysis
  • 37. Polling Question #4 What role do you see a budgeting/forecasting/planning product playing in a profitability & cost management solution? .. w e ex te n an t– ca Im po rt – No t e Ha v to Ni ce w ou n. .. ... tio so lu t– Im po r ta n th e lCr iti ca 37 th e de fin 4. of .. 3. on 2. 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 Important – the solution needs to support processing of both actuals and budget/forecast data sets Nice to Have – can extend the profitability process through driver collection & an occasional what-if scenario Not Important – we would run our processes only for actuals iti 1. 25% 25% 25% 25%
  • 38. Profitability Case Study HR Consulting Firm
  • 39. Business Process ► Process • • • ► As-Is • • • ► Creation of a “Fully Burdened” dataset. Attribute the “Fully Burdened” dataset. Allocate the Costs to the lowest level of the business (Entity & C2 Dimensions) 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.
  • 40. Application Architecture Hyperion Planning Hyperion Profitability & Cost Management Driver Data Microsoft Excel Source Application Staging Application HPCM Stage Management Utility HPCM
  • 41. Business Logic STG 6 PRE HPCM Source Application STG 7 POST HPCM STG 1 SOURCE DATA STG 2 STG 3 STG 4 STG 5 STG 8 BONUS PROP & ADMIN MGTI PRE ATTR POST ATTR TOTAL ALLOC Source Application
  • 42. Attributions & Allocations – Attribution Data Entry Form
  • 43. HPCM – Allocation Matrix
  • 44. HPCM Model Architecture Stage 1 - Global ► ► ► 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. Business Entity Stage 2 - Regional Business Entity Stage 3 - Local Business Entity Stage 4 - Business Business Stage 5 - Department Department Entity Account
  • 45. HPCM Allocation Model Definition Components Source Stage Project Detail Target Stage Customer formula/methodology that references a loaded metric within the model. Project Customer Dept Resource 4 1 Driver Definitions – Create an allocation 2 2 Driver Selections – Defines what Driver Definitions to use against the Source stage, typically the dimension identified as the driver definition. 3 Driver 1 Project 4 3 Assignment Rules Definitions– Defines 4 the member combination in the target dimension for the assignment. Assignments– Defines the source dimension combination and the target Assignment Rule
  • 46. HPCM – Driver Definitions and Selections
  • 47. HPCM – Stage Balancing Report
  • 48. HPCM – Trace Allocations Allocation Source Trace Allocation for Local Data
  • 49. 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
  • 50. Oracle Engineered Systems Exalytics In Memory Machine
  • 51. What is Exalytics? Planning, ERP, CRM, Profitability, Vertical-specific 80+ Pre-packaged In-memory Analytic Applications OBIEE + Endeca + Mobile In-Memory Analytic Platform 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 Endeca Unstructured In-Memory TimesTen Essbase ROLAP MOLAP Analytic Engines 1 TB DRAM, 40 Intel Cores, InfiniBand Benefits  Superfast, Interactive Visual Analysis  Faster Planning & Budgeting with Richer Models  Quick to Deploy, Supports More Users  Faster, Cheaper, Better Analytics ► ► ► 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
  • 52. ► OBEE ► OSSM ► Mobile ► What Comes with Exalytics? Essbase ► EAL ► HFR Exalytics X2-4 OS: Linux x86-64 ► Memory Optimized Essbase ► ► BSO – Concurrency Performance Optimizations ASO – Outline Based Memory ► BI Server ► ► Summary Advisor Aggregate Persistence for TimesTen In-Memory DB
  • 53. EPM 11.1.2.3/BI 11.1.1.7 Exalytics Certifications (Linux x64) ► BI Foundation Suite – OBIEE • • • • BI Server Answers Interactive Dashboards Delivers – BI Mobile – Oracle Scorecard &Strategy Management ► – Essbase Application Link for HFM EPM Applications – Hyperion Planning – New! - Hyperion Profitability & Cost Management ► – Essbase Studio – BI Components Available to EPM • • • • EPM Foundation – Calculation Manager – Shared Services – EPM Workspace ► FDMEE ► ► ► Essbase Financial Reports Provider Services Essbase Admin Services Times Ten In Memory Database Endeca Oracle HTTP Server
  • 54. Exalytics Use Cases 1. Enterprise Planning 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 2. Profitability Applications 3. BI Reporting & Analytics 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 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 • Server/App Consolidation • Bundled HW/SW Licensing • Reduce Deploy Complexity • Reduce Lead Times
  • 55. Exalytics Customer Story 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. 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. Challenges / Opportunities Results ● 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. ● 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. 2012 Solution Delivered 2013 Vertical Healthcare-Medical Equip Products 55 Client Since Infrastructure - Upgrade
  • 56. 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
  • 57. Summary: Exalytics Value Proposition ► Increase End User Satisfaction & Productivity – – – ► Reduce/Repurpose Resources – – ► Increase timeliness of Data Speed of Thought Response Time for Planning & Reporting Increase User Counts and adoption rates 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
  • 58. Ranzal has the Exalytics In-Memory Machine! 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 • Full EPM/BI Install • Operating System • Dynamic Scripting • Virtualization • Complete Automation 58
  • 59. Closing and Q&A
  • 60. Self-Evaluation Questions ► ► ► ► ► ► ► ► 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?
  • 61. Closing and Q&A Mike Killeen, Vice President Edgewater Ranzal 108 Corporate Park Drive, Suite 105 White Plains, NY 10604 E-mail: mkilleen@ranzal.com 61
  • 62. Appendix I HPCM Demo Project Profitability
  • 63. HPCM Workflow in Profitability & Cost Solution Master Data & Data Integration Management • Create & Manage Dimensions & Hierarchies • Deploy the Application • Define Data Integrations from Source Systems • Manage User Security Dimensions Hierarchies Attributes Enterprise Performance Management Architect (EPMA) Model Execution Model Development Create & Manage the Business Model: Execute a Model POV: 1. Load Cost/Revenue Data 1. Define the Stages 2. Load Driver Metric Data 2. Create a Model Point-OfView (POV) 3. Validate Model Inputs Produce Management and Performance Reports: • Financial Results Books • Margin Analysis 4. Execute Calculations 4. Define Assignment Rules 5. Assign Drivers • Cost & Revenue Contribution Analysis 5. Trace Allocations & Validate Model Results • What-If Scenario Comparisons 6. Publish the Model POV 3. Define the Drivers • Genealogy Reports 6. Create Assignments Stages Drivers Assignments Published Reports & Interactive Analytics Essbase Calculation Cube (BSO) Essbase Reporting Cube (ASO) Hyperion Profitability & Cost Management (HPCM) Financial Reports, Smart View, Business Intelligence Foundation
  • 64. Demo - Define POV, Business & Driver Metrics in EPMA POV Dimensions Business Dims Driver Metrics
  • 65. Demo - Business User Defines Stages in HPCM for Allocation Flow Stage definition is wizard driven, and provides the appropriate selections for stage creation.
  • 66. HPCM Allocation Model Definition Components Source Stage Project Detail Target Stage Customer formula/methodology that references a loaded metric within the model. Project Customer Dept Resource 4 1 Driver Definitions – Create an allocation 2 2 Driver Selections – Defines what Driver Definitions to use against the Source stage, typically the dimension identified as the driver definition. 3 Driver 1 Project 4 3 Assignment Rules Definitions– Defines 4 the member combination in the target dimension for the assignment. Assignments– Defines the source dimension combination and the target Assignment Rule
  • 67. Demo - 1 End Users Define Drivers in HPCM Select from list of user defined driver metrics and allocation methodologies.
  • 68. Demo - 2 End Users Assign Drivers to Source Cost Pools in HPCM Select Default Drivers for Cost Pools, with an ability to provide exceptions for unique projects.
  • 69. Demo - 3 End Users Create Target Range Assignment Rules in HPCM
  • 70. Demo - 4 End Users Map Source Stage to Targets Via Assignments Or Allocation Assignments can be bulk loaded via a staging table.
  • 71. Demo - Load and Validate Project Cost & P&L Data Add Capitalization Rules to Calculate P&L Impact of Capital Project
  • 72. Demo - Load and Validate Driver Metric Upload Traffic Lighting to verify statistical driver metrics tie to 100%
  • 73. Demo - Model Validation – Stage Balancing Report All Costs are Allocated to Final Stage
  • 74. Demo - Model Validation – Detailed Validation Results
  • 75. Demo – Traceability Analysis – What makes up a client charge? 2% of China Charge came from resource wswain from Dept X working on Project Y 35% of China Costs come from Asia Region Office Project 212375
  • 76. Demo - Transparency into Details of Chargeback Resource , Dept, Project & Expense Type Details of What Makes up China Charge
  • 77. Appendix II Backup Slides
  • 78. About Edgewater-Ranzal ► ► One of The Boston Globe’s Top 100 businesses ► Edgewater Publicly Traded as: EDGW Ranked as one of the 500 fastest-growing stocks on Wall Street Ranzal Planning 2001 Planning Founded in 1996 Essbase Acquired Vertical Pitch 2007 HFM/ FDM Acquired by Edgewater 2004 Data Integration & Warehousing/ CRM/ Web 2.0 Development 78 Building OBI Team 2011 OBIEE Acquired Meridian 2010 HSF Build DRM & HPCM Teams 2009 DRM & HPCM ► ► ► 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.
  • 79. Ranzal Profitability & Cost Mgmt Solutions Sample Clients Profitability 12/5/201379
  • 80. Typical Customer Profitability Distribution $2,500 E CUSTOMERS = $2,500 $2,000 $1,500 ECONOMIC PROFIT AVERAGE ECONOMIC PROFIT PER CUSTOMER = $250 $1,000 $500 $0 1 2 3 4 5 6 7 8 9 10 -$500 -$1,000 -$1,500 TAIL CHART 10 CUSTOMERS OR MILLION CUSTOMERS IN DECILES -$2,000 CUSTOMER SEGMENTS “Portfolio of Customers” Geoffrey Colvin
  • 81. Oracle Business Analytics – EPM/BI Software Architecture EPM Apps: Information Generation BI Foundation: Info Delivery Master Data, Data Quality & Data Integration Tools: Information Management
  • 82. Solution Component: BI Foundation Reporting Tools Scorecards Interactive Dashboards Mobile Strategy Maps Ad-hoc Analysis Geographic Visualization Secure Search Smart View Office Integration Production Reporting Financial Reporting
  • 83. EPM/BI Platform: Software & Hardware That Supports Key Capabilities SECURE MOBILE ANALYTICS DATA GOVERNANCE SCALABILITY AND PERFORMANCE FLEXIBLE DEPLOYMENT 83
  • 84. 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
  • 85. 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
  • 86. HPCM Performance Results with Exalytics ► 11.1.2.3.351 HPCM is Exalytics Certified ► New Parallel Calc ► Non EPMA Mode
  • 87. Summary: When Should You Consider Exalytics? ► Enterprise Planning Domain – Enterprise Planning with Hyperion Planning • • – Custom Financial and LOB Planning with Essbase • ► Multi-Step, Multi Stage Allocations Analytics and Reporting using OFMA, OBI or OSSM – ► Typically Larger Dimensions Sizes Profitability and Cost Management using HPCM – ► Heavy Driver Based Models (Public Sector, Workforce Planning) Frequent Use (e.g. Rolling Forecast) and Large Concurrency Optimize Multi-User Federated ROLAP Queries with the BI Server Hardware Consolidation – Hardware Refreshes/Upgrades – Reduce Data Center Foot Print
  • 88. 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
  • 89. Exalytics Hardware Updates So Far 2.4 TB Flash Upgrade Kit Exalytics X2-4 1TB RAM, 40 cores 3.6TB HDD 2TB Memory and 2.4TB Flash Upgrade Kit Exalytics X3-4 2TB RAM, 40 cores 2.4TB Flash (6x F40) 5.4TB HDD Exalytics T5-8 4TB RAM, 128 cores 3.2TB Flash (6x F40) 7.2TB HDD Time