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Essatto Introduction and White Paper


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This document introduces Essatto - a Business Intelligence and Performance Management software application. It also includes a White Paper on "Three Key Ingredients To Making Informed Decisions"

This document introduces Essatto - a Business Intelligence and Performance Management software application. It also includes a White Paper on "Three Key Ingredients To Making Informed Decisions"

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  • 1. Analyse the Past & Visualise the future withEssattoThe Essatto solution is built on the industrial strength Oracle database which has beenused extensively in the development of data warehouse applications globally. Essattoleverages this capability by providing a pre-built data warehousing, Business Intelligenceand Business Performance Measurement framework that allows users to rapidly and costeffectively store, integrate, interrogate, manipulate and derive data sourced from disparatesources.Figure 1 - Essattos Integrated SolutionThis takes the functional capabilities of Essatto way beyond a “financial only” solutionby facilitating the effective storage of financial and non-financial data into a singleunified environment. Combining this with Essatto’s rich Business Intelligencecapabilities delivers a powerful application that provides accurate and timelyinformation to drive strategic direction.For an organisation to make informed decisions it needs to bring together the rightcombination of quality ingredients and expertise. We see the key ingredients as: Timely access to accurate data(data warehouse); Flexible & intelligent reporting(business intelligence); and Evaluation of future possibilities (business performance measurement)Essatto brings these key ingredients together in one easy to manage software solution,empowering management to make informed decisions based on real data.This information pack incorporates; • A Whitepaper that develops the business case around the “Three key ingredients to making informed decisions” and • An Essatto key information sheet.Page 1 Phone +61 8 6382 1700, Fax +61 8 9225 5469
  • 2. Essatto at a GlanceKey featuresEssatto’s key features include: Historical reporting Pre-built dashboards Pre-built web reports Ad-hoc report building Live Excel spreadsheet interface Multiple hierarchies – drill-down and roll-up ‘What If’ scenario testing Multi-Currency Integrated Profit & Loss, Balance Sheet & Cash Flow Forecasting including the following pre-built modules; o Revenue o COGS forecasting o Labour forecasting o CAPEX forecasting o Indirect expense forecasting o Costs allocation moduleMinimum Hardware & Software RequirementsHardware Essatto SME/Enterprise Essatto LiteCPU At Least 3GHz Dual core CPU At Least 3GHz Dual core CPURAM 16GB 6GBHDD 100GB 100GBSoftwareItem DetailsMicrosoft Excel 2007 or aboveMicrosoft Internet Explorer 7 or aboveMicrosoft Windows O/S* Windows Server 2003/2008 Server 32 bit or 64 bit* Windows 7 Professional 32-bit version can be used with Essatto Lite only. All other Essattoversions require a Windows Server version of the operating system.Page 2 Phone +61 8 6382 1700, Fax +61 8 9225 5469
  • 3. Versions and PricingEssatto is offered in three versions – Lite, SME and Enterprise. The features and functionalityoffered with each version are detailed in the table below.Version Comparison Essatto Small Business Enterprise Lite Edition EditionNo of Users RestrictionMinimum Users 1 1 5Maximum Users 3 10 UnlimitedProcessor PricingEssatto is attractively priced relative to alternatives in the market place. Pricing information willbe provided upon request.Historical ReportingView and Customize pre-built dashboardsInfrastructure pre-built web reportsVies and Customize considerationsIt is assumed that the client operates a suitable server with necessary processing andCreate interactive reports in either the webor Excel environmentsstorage space to enable Essatto to operate.Structure MaintenanceThe following tables set out the minimum hardware and software requirements necessaryBudgeting and Forecastingfor the implementation of the Essatto Solution.Revenue ForecastingCOGS ForecastingCapital Expenditure ForecastingManpower ForecastingIndirect Expense ForecastingRebate ModuleSAP/Oracle ConnectorOptionsEssatto PublisherEssatto AnalyticsEssatto ETLEssatto is attractively priced relative to alternatives in the market place. Pricing information will beprovided upon request.Essatto AnalyticsEssatto Analytics delivers the full range of Business Intelligence (BI) capabilities includinginteractive dashboards, full ad hoc, proactive intelligence and alerts, enterprise and financialreporting, real-time predictive intelligence and more.Essatto PublisherEssatto Publisher allows users to manage, and deliver all types of highly formatted documents. Endusers can easily design report layouts directly in a Web browser or using familiar desktop tools,dramatically reducing the time and cost needed to develop and maintain reports.Essatto ETLEssatto ETL allows users to extract, transform and load data from outside sources into the Essattoapplication.Page 3 Phone +61 8 6382 1700, Fax +61 8 9225 5469
  • 4. Whitepaper:Three key ingredients to makinginformed decisions Timely access to accurate data There is no point in having an intelligent reporting solution if the data presented within such a solution is inaccurate and out-dated. Typical scenarioTimeliness and accuracy of information can be a real problem for many organisations,generally an outcome of either lack of a central data store; or a central data store exists butit isn’t regularly updated for new data.As a result, individual users extract base level data from various source systems, which isthen used to create more detailed analysis, usually within an Excel spreadsheetenvironment.The issuesThese spreadsheets tend to grow exponentially and become islands of unrelated data.There is considerable risk of inaccuracies creeping into this information because thecreators of these spreadsheets find it difficult to keep track of all the interlinked cells.Adding to the inaccuracy issues is the end user nature of spreadsheets which often lack therigor and control of an audit trail ordinarily present in a formally developed Essattoenvironment. Our environments typically go through a full cycle: scoping, specification,development, unit testing and user acceptance testing PRIOR to being rolled out as a “live”system.Dependency on the spreadsheet creators is also a major issue. Organisations becomesomewhat beholden to the creators of key spreadsheets, which over time develops into keyman risk. It is unusual for such environments to be documented to the extent necessarythat would allow new management to assume similar responsibilities.There is also the issue of data consistency. If multiple end users are sourcing data fromthe same system at different times then there is a strong possibility that the same datapresented in different spreadsheets may not generate the same outcomes; leading toembarrassing situations at meetings and inefficient use of management time reconcilingthe differences.The solutionMost of these issues can be resolved by establishing a Central Data Store (datawarehouse) of key decision making information that is refreshed on a regular basis.By making the Central Data Store the focal point for all reporting activity an organisationwill eliminate many of the data inconsistencies associated with spreadsheets.Page 4 Phone +61 8 6382 1700, Fax +61 8 9225 5469
  • 5. An additional benefit of storing data from multiple sources into one central environment isthat it would be possible to start linking and relating data from these disparate systemswithin this environment, dramatically enhancing interrogation and analysis capabilities.For example, a Central Data Store environment uses one algorithm for all users to define acalculated outcome, whereas in spreadsheets multiple variations of the same algorithmmay be used resulting in an “apples” to “oranges” comparison of the same results. Flexible & intelligent reporting Spreadsheet reporting Many organisations have teams of people compiling spreadsheets which are used as the basis for hard copy output on a daily, weekly or monthly basis.Adding to the inherent issues associated with spreadsheets discussed above, is theadditional problem that the spreadsheet output delivered to decisions makers is static. Itlacks “intelligence” and requires the end user to seek out the author should further detailbe required.Third party Enterprise Resource Planning (ERP) reporting toolsMany organisations have endeavoured to improve decision making through betterreporting by overlaying onto their Enterprise Resource Package (“ERP’) a third partyreporting solution that can produce better reports than what is available from the ERP.Whilst these solutions may be an improvement on the combined ERP/spreadsheetapproach, they are not optimal.Output produced by these solutions is generally more attractive and will facilitate deeperanalysis than is possible with the native ERP report writer, however the reports are stilllimited to the outputs produced by the ERP.In addition, the benefits of this solution can be negated if end users are required to reviewand relate data coming from multiple source systems in the process of making decisions.For example, a consulting firm may track “The monthly Average Billable Rate” as a KeyPerformance Indicator. To calculate this at a group, regional or departmental level theorganisation will need to combine the billable hours from its timesheet system with therevenue generated which is sourced from the accounting system. Quite often thesesolutions are not user friendly and may require the engagement of external consultantsskilled in the framework of the third party reporting solution every time a new report isrequested by an end user – adding an additional layer of delay and cost.It is worth noting the primary function of an organisation’s ERP is to record individualtransactions as they occur. The underlying database of a transaction processing system isoptimised for this purpose and in technical parlance is referred to as a “denormaliseddatabase”. The configuration of a database optimised for reporting is the exactopposite (normalised) to a database optimised for transaction processing.Consequently, overlying an ERP with a reporting tool and having end users run queries toproduce reports whilst your ERP is simultaneously being used to process transactions mayPage 5 Phone +61 8 6382 1700, Fax +61 8 9225 5469
  • 6. materially impact the performance of your ERP. It is therefore prudent to separate thekey functions of transaction processing and reporting whenever possible.Finally, as we will see in the next section, this type of solution tends to have little or nocapability when it comes to quantifying and analysing the future.Reporting from a central data storeAn alternative to simply overlying your ERP with a reporting tool is to introduce a CentralData Store. Having said this, there is no point having a Central Data Store if theinformation contained therein is not readily accessible to end users in a form thatfacilitates fluid decision making.The solutionIn the modern era, a reporting solution has to do more than simply provide a formatted,static view of data. It has to have an element of “intelligence”. It needs to be intuitive and itmust provide the end user with the ability to interrogate the data in a way that reflectslogical pathways to effective decision making.Essatto’s reporting features deliver comprehensive Business Intelligence capabilitiesincluding; Hierarchies: Ability to drill up and down data levels, for example unit sales for an individual customer, including across product combinations, all the way up to total unit sales for the company, or anywhere in between. Points of view: Create multiple hierarchies against different points of view (e.g., customer, product, account) allowing users to create multiple drill paths and summary levels for each of these points of view depending on the requirement. Querying tools: Ability to use querying tools for enquiries such as: o Top 20/bottom 20 customers or products; o Search for data based on matching a text string such as, “extract all values associated with account descriptions which include the word ‘sales’”. o Hierarchical querying such as, “extract all accounts and their values that are children of the ‘Other Income’ summary account” o Relational querying such as, “extract all customers that reside within postcode 6014” o Conditional querying such as, “Give me all customers that purchased more than 500 hundred units of Product A in March 2011”Page 6 Phone +61 8 6382 1700, Fax +61 8 9225 5469
  • 7. Presentation: Essatto provides end users with options on how they would like to see the data presented. These options will include all or a combination of: o Dashboards o Pivot tables o Formatted reports o Live linked Excel reports Conditional formatting: In our experience, many of the major issues facing an organisation lie below the surface. Essatto’s sophisticated conditional formatting allows end users to identify underlying issues which can be quickly navigated to for further analysis. Quite often a Key Performance Indicator may indicate all is well at the top level of an organisation. It is not until a user drills down to lower levels that issues within that KPI are exposed. Conditional formatting alerts the user that “problems lie within” in spite of the top level of the KPI indicating “all is well”. Quantifying and evaluating the future The focus of the points made thus far has been data derived from transactional information i.e. historical information, that is, the past.A key element to making informed decisions is the ability to test and evaluate futureoutcomes. Future outcomes are typically represented by long term & medium termplans, Budgets and Rolling Forecasts.OverviewUnfortunately, whilst many organisations undertake some or all of the above activities, inour experience, they usually do so as a mandatory element of the annual cycle, oftenmissing the opportunity to seriously evaluate their business strategy.Many organisations use spreadsheets extensively for this process. Consequently theinherent issues with spreadsheets as discussed in prior sections of this document are all atplay within this process.Typical Budget scenarioAn organisation may have a number of contributors to a budgeting process. For example,sales managers may be responsible for sales to specific sales channels, product managersmay be responsible for consolidated sales across all channels and regional managers maybe responsible for the performance of all channels and their products across theirrespective regions.Assuming that we are dealing with a sales channel manager’s example, what typicallyhappens is that each sales channel manager will prepare the sales, cost of sales andexpense Budget’s for each of their respective channels in a spreadsheet. The “finaloutcomes” of this Budget would be submitted to head office finance function forconsolidation into a enterprise wide Budget.Page 7 Phone +61 8 6382 1700, Fax +61 8 9225 5469
  • 8. Firstly, let’s consider what is submitted with these budgets. The underlying detailedassumptions and basis for the calculations are usually retained by each of the channelmanagers. The group may not have visibility as to how these numbers have been derived,other than high level assumptions.The Budget usually is submitted in a static state, with no ability to flex the outcomes orundertake “What if?” scenario analysis, which is only possible by changing the baseassumptions.Re-calculating at a group level is only possible if the underlying assumptions andalgorithms reside in each of the channel managers spreadsheets. The more typical scenariois the group communicate to each of the channel managers the revised scenario and havethem create a new version of their individual Budget for resubmission incorporating thesechanges.Once they all resubmit, the outcomes would again need to be consolidated to arrive at thegroup perspective. Such an approach is very cumbersome, time consuming, costly andsomewhat impractical – yet common practice. Essatto software is a better option.Typical Rolling Forecast scenarioMany organisation give scant regard to a regular forecasting process choosing instead tofocus and report against an original Budget. Circumstances change during the course of ayear, currencies fluctuate, interest rates move, competitors and products enter & exit themarket and unforseen opportunities and threats arise. A rigorous forecasting process isintegral to making informed strategic decisions. A spreadsheet based forecasting process isunlikely to meet this need.The reason organisations typically undertake a limited forecasting process during thecourse of the year is because a spreadsheet based process is too cumbersome and timeconsuming. Consequently the frequency and the level at which these forecasts areundertaken is generally inadequate for real-time decision making purposes.Typical Strategic Planning scenarioIn our experience, quite often there is no linkage between say the first year of a three yearStrategic Plan and the first iteration of next year’s Budget. The first year of a three yearStrategic Plan should form the starting point of the Budget process and Budget’s should bevalidated against Strategic Plan outcomes, however, this does not always happen in manyorganisations. These processes are often run independently of each other, resulting in theBudget outcomes being wildly different from the Strategic Plan. This results in additionaliterations that consume valuable corporate time and resources which could have beenavoided.The solutionOrganisations are able to utilise Essatto at each stage of the planning process. For example,Essatto can be used as the basis for the strategic planning process whereby the currentyear’s projected year end forecast is available as the starting point for this process. Growthfactors can be loaded into Essatto which once calculated will produce detailed monthlyprojected outcomes by the various points of view such as product, channel, customer,account etc.Page 8 Phone +61 8 6382 1700, Fax +61 8 9225 5469
  • 9. The final iteration of the strategic planning process can be used as the basis for next year’sannual budget process. By creating a new scenario in Essatto and copying the assumptionsand the outcomes of the first year of the “Final” strategic plan iteration into this scenario,the organisation is effectively positioning the desired outcome of the budgeting process asit’s starting point. This approach has the benefits of reducing the number of iterationstypically associated with a budgeting process and ensuring the desired end result is notlost on participants involved in the bottom up build of a Budget.Once a Budget is put in place a new re-forecast can be created in a new scenario eachmonth which combines the latest year to date actual results, with remaining forecastoutcomes to produce an updated projected year end position across Profit & Loss, BalanceSheet and Cash Flow perspectives. This revised forecast can then be compared to theprevious forecast and/or the original Budget providing the organisation with acomprehensive framework for analysing outcomes and making decisions.Unlike a spreadsheet based system where contributors to budgeting, planning andforecasting processes retain the assumptions and calculations associated with theseprocesses in their individual spreadsheets, Essatto stores this information within itsCentral Data Store.Having access to both the underlying assumptions and the algorithms used to calculate theoutcomes means that organisations are able to quickly and effectively test future initiativesas they desire (i.e. “What if?” scenario analysis). Each of these iterations can be storedand compared to prior and future iterations as required. There is no limit to the number ofiterations that can be explored within Essatto. As the historical data also resides within thisenvironment, comparisons and analysis of the past against future outcomes can be readilyundertaken.SummaryBy bringing together market leading technologies of data warehousing, businessintelligence and business performance measurement into one comprehensive, integratedapplication, Essatto provides organisations with a powerful solution that facilitateseffective decisions making by providing: Timely access to accurate data; Flexible & intelligent reporting; and Evaluation of the future.Page 9 Phone +61 8 6382 1700, Fax +61 8 9225 5469