Since its introduction in version 11.1.1.x Oracle Hyperion Profitability Cost Management (HPCM) has allowed companies to gain a deeper level insight into their business performance than ever before. Join us to hear how clients currently tackle profitability questions and how HPCM will help clients provide actionable insights into cost and profitability. We will discuss standard HPCM model functionality, discuss how HPCM drives organizational performance by discovering drivers of cost and profitability, and discuss how you can empower your users with visibility and flexibility to improve resource alignment. During this webinar we will review the following: What Profitability means How clients today answer profitability questions HPCM models (three models) Use Cases - How Companies are using HPCM How HPCM fits into the EPM product suite Look into HPCM standard model build details Quick Demo of HPCM model Features that are available inside the HPCM model

1. HPCM
Hyperion Profitability and Cost Management
Introduction to HPCM
April 29, 2016
Srinivas Salguti

2. • Proven and Trusted Track Record:
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Finit Overview

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6. Finit Customer Success
Page 6
Our values, culture, and approach to
becoming a trusted advisor to our
customers has led to
100% customer success
for every Finit client (250+) and for
every Oracle Hyperion project (500+)

7. Some Finit Customers

8. Questions

9. About the Presenter
Slide 9
Srinivas Salguti
ssalguti@finit.com
• Member of Finit’s Planning and Essbase
Practice
• Worked in Enterprise performance
management workspace for the last 12 +
years
• 10 years at Hyperion/Oracle consulting services
• Primary focus on Hyperion Planning and
Essbase
• 3 HPCM full cycle implementations
• OBIEE integration with Essbase
• PBCS
• Certified implementation consultant
• Hyperion Planning
• Essbase

10. Agenda
• What is Profitability
• Oracle’s HPCM Architecture
• Model Components
• Demo
• Key Features of HPCM
• Q & A
Slide 10

11. Profitability Questions
• What defines a profitable
customer?
• What is the profit contribution
margin of a product or a service?
• How do business processes impact
profitability?
• Cost drivers are not clearly
understood and as a result, cost-
cutting initiatives are not targeted
at the right places
• Focus only on cost and not
revenue
Slide 11

12. How companies try to tackle profitability questions
Slide 12
• Excel/Manual Based Processes and BI Tools Provide
Incomplete Solutions
• Lack of process
• Lack of integration
• Lack of confidence
• Rigid, costly to maintain
• Inability to act

13. What is Oracle Hyperion Profitability and Cost Management
(HPCM)?
• A user-driven Performance Management application that:
• Measures, allocates and assigns Cost and Revenues
• Computes Profitability for business segments, customers and products
• Provides scenario modeling for decision making
• Actual Vs Budget
• What-If
• Is tightly integrated with EPM Technology Stack
• Shared Services
• EPMA
• Essbase
• Reporting Tools
Slide 13

14. Profitability Model Types
• Standard Profitability
• Enables you to monitor and control direct contribution data for your entire model.
• Data for the Standard Profitability model is housed in both Essbase multidimensional
databases and relational databases.
• Provides ability to use hierarchical structures.
• Detailed Profitability
• Provides a single-step allocation of data from a single source to a destination for the
purpose of analyzing profitability.
• Data for the Detailed Profitability model is housed in relational databases only.
• Can handle extremely large volumes.
• Management Ledger Profitability
• No concept of stages or layers.
• All structure is controlled through the organization of rule sets and rules under POVs.
• Designed for use by analysts who may not have much experience with Essbase or
programming languages but have good understanding of management reporting.
Slide 14

15. Profitability Model use cases
• Standard Model
• Where focus is on contribution analysis which enables flow of cost and revenue through all
stages to determine where there is a chance to improve process
• Ex: Financial services - Customer & Branch profitability analysis – used HPCM model to
allocated shared services to markets/branches and then to customer / product level to analysis
profitability at lowest level
• Healthcare Services – Allocation Model for reimbursement of expenses.
• Detailed Profitability
• Single step allocation process with pools or rates from single source to destination for
profitability analysis.
• Ex: Airline route analysis : Track route detailed cost analysis
• Management Ledger
• Used by analysts who have deep domain expertise in computation and reporting methods of
management reporting
• Ex: Management reporting analysis : Management reporting analysts who would like to create
cost/revenue allocations using defined rules to provide different views for management
reporting.
Slide 15

16. Oracle’s Hyperion Profitability & Cost Management
Slide 16

17. HPCM Architecture (Standard Profitability)
Slide 17
Calculation
Cube
EPM Architect
Model definition:
• Stages
• Drivers
• Assignments
Reporting
Cube
Deploy
dimensions
Profitability & Cost Management Model
Aggregate storage
outline
Reporting and Analysis
tools:
• Financial Reporting
• Web Analysis
• Smart View
Transfer data
Maintain Metadata &
Model design
Workspace
Hyperion Profitability & Cost Management Solution
Block storage
outline
Calc script

18. Oracle EPM Stack - Components of HPCM
• Performance Management Architect (EPMA) – Maintenance of
application metadata
• HPCM – Model design and maintenance
• Workspace – Common product interface layer
• Shared Services – Security and product administration
• Essbase – Multi-dimension databases for calculation of models and
reporting
• Relation DB – Used in-case of detailed model
• Reporting Tools (not all required) – Smartview Office Addin, Financial
Reporting, Web Analysis, OBIEE
Slide 18

19. HPCM Model Build Sequence
Slide 19
Transfer
EPMA
Interface
Stages
Driver
Definitions
Driver
Selection
POV
POV
Dimensions
Assignments
Assignment
Rules
Deploy Calculation
and Reporting Cubes
Resource
Costs
Driver/Assignment
Data
Essbase database
Reporting
Calculate
Generate Calc Scripts
Create / Deploy Application
HPCM
Interface
Members
Hierarchy
Alias
Property
Alias
Dimension
Business
Dimensions
Measures
Dimension
Calculate Genealogy
Changed Changed
Essbase database
Calculation
1
3
45
6
Sequence
Reporting
EPMA
Application
HPCM
Application
Essbase
Application
2

20. Creating Applications - Steps
• Create Dimensions in EPMA
• Create Profitability Application in EPMA
• Required System Dimensions:
• Measures
• Allocation Type
• Required User Dimensions:
• At least 1 POV Dim
• At least 1 Business Dim
• Optional Dimensions:
• Alias
• Attributes
• Validate and Deploy to HPCM
Slide 20

21. HPCM Task Flow Overview
Slide 21
Define
stages
Create
drivers
Select
drivers
Make
assignments
Validate
model
structure
Generate
Essbase
Applications
Load data
into
Essbase
Run
calculation
scripts
Create
reports
Validate
calculations
Generate
Calculation
scripts
Validate
the data

22. HPCM Model Build - Stages
Slide 22
Define Stages – Stages define available segments for data allocations.
Stage One: GL Accounts
Stage Two: Processes
Stage Three: Products
Stage Four: Customers
General ledger
(P&L)
Departments,
Activities
Products
Customers,
Products

23. HPCM Model Build – Stages
Slide 23
Business Operations stage with two dimensions Departments and Activities.

24. HPCM Model Build - Drivers – How Much ???
Page 24
Stage One
Stage Two
Drivers provide the formulas to allocate values at source
intersections to their assigned destination intersections.
Data
Driver 1
Driver 2Data Data

25. Driver Definitions
Page 25
How Salary is allocated -> Quantity * Rate

26. HPCM model Build - Assignments
Page 26Page 26
Assignments define where and how to move data from one stage to another.

27. HPCM model Build – Assignments Setup
Page 27Page 27

28. HPCM Standard Model
Page 28Page 28
DEMO

29. Key Features
Page 29Page 29
• Model / Driver Driven Approach
• Multi-Stage, Multi-Step Allocations
• Empowers users to execute/update allocation
methodologies without depending on IT
• Traceability Maps
• Model Validation Reporting

30. Traceability
Page 30Page 30
• Provide transparency into revenue and cost allocations.
• You may trace backwards and forwards from any point in the allocation model

31. Model Validation
Page 31Page 31
• Model validation reporting helps ensure completeness of model.
• Stage Balancing follows the inputs and allocated outputs and include idle capacity and
unassigned amounts

32. Thank You for Attending!
Page 32
Today’s Presenter:
Srinivas Salguti
ssalguti@finit.com
General Questions:
Greg Barrett
gbarrett@finit.com
Joe Mizerk
jmizerk@finit.com
Copy of the slides or
Recording:
Email us for a copy of the slides or a
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