Enterprise

Planning with
Oracle Hyperion
 Agenda

 About Ranzal
 Challenges in Typical Current State Planning Processes
 Enterprise Performance Management
 Enterprise Planning Module Components
 Core Planning Functionality
 Capital Planning Functionality
 Workforce Planning Functionality
 Workforce Planning Demo Screenshots
 Case Study: Catalina Marketing
 Q&A

Session: Enterprise Planning

Typical Planning Process Challenges

Session: Driving Shareholder Value with Customer Profitability

 Budgeting Process is Highly Inefficient

• Time – takes too long, results

obsolete
• Quality – political/negotiation,
Senior Management not reflective of business
• Cost – many wasted
resources, dubious benefits
• Flexibility – lack of
responsiveness to changes
FP&A Group

Dept B Dept C
Dept A

Slide Courtesy of Oracle

 Typical Challenges in Integrated Planning

• Black Boxes
 Multiple areas of the organization each have their own solutions
creating silos of information and multiple versions of the truth
• Disconnect Between Finance and Operations
 Numbers drive Finance, Events drive operations. Budgeting
models linking numbers to those events is key.
• Predictability
 Its not just planning, and its not just reporting. Its about using the
past to help accurately predict the future, and use operational
drivers to make sound financial decisions.
• Transparency
 Making sure stakeholders throughout the organization have
visibility and an understanding of the numbers and their source.
This allows people to own the financial results by understanding
the drivers they are managing to on a daily basis.
 Other Challenges….

• Business & Environmental change

• No linkage between operational & financial plans
• Aggressive Forecasting/planning
• No strategic/exec. Direction
• Inaccurate/no data used in plan
• People don’t understand the budget
• Process too long
 Typical Current State Planning Solutions

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rights reserved.
 Other Current State Planning Practices

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rights reserved.
Enterprise Planning Architecture

Session: Driving Shareholder Value with Customer Profitability

 Oracle Enterprise Performance Management
System

EPM
EPMWorkspace
Workspace

Performance Management
BI Applications
Applications
BUSINESS INTELLIGENCE FOUNDATION
Common Enterprise Information Model
Essbase BI Server Real Time Decisions

Fusion Middleware

OLTP & ODS Data Warehouse OLAP SAP, Oracle, Siebel, Excel Business
Systems Data Mart PeopleSoft, Custom XML Process

* Slide courtesy of Oracle

 Hyperion System 9 – Financial Performance
1 Enterprise Data
Sources
Mgmt Apps
System 9 P
ER
includes:
2 Foundation Services
• EPMA 1 M
CR
Shared Services 5
3
• Security
• Life Cycle Management DW
4 Workspace
• Web Access Y
AC
• Smartview for Office LE
G
6
Oracle EPM Offerings:
5 Applications
• Hyperion Financial
Management
• Hyperion Planning 3
- Addl: Capex, Workforce 7
• Strategic Finance
• Performance Scorecard 8
6 BI Tools & Technology
• Essbase
• Financial reporting
• Web Analysis
• Production Reporting
• Interactive Reporting 2
7 Data Integration 4
• FDM (Upstream)
• HAL (Vignette)
• ODI (Sunopsis)
• DIM (Informatica)
8 Master Data Management
• MDM (DRM)
 Integrated Business Planning Framework

EPM Workspace

CORE FINANCIAL PLANS SPECIALIZED MODULES OPERATIONAL PLANS

Sales Marketing
Planning Planning
Income Balance Workforce CapEx
Statement Sheet Cashflow Planning Planning

Projects
Planning IT Planning

Hyperion Planning Application

Essbase OLAP Server

Data Warehouses Transactional Systems Performance Management

Applications
 Hyperion Planning

Shortens Planning Cycles and Improves Business

Predictability

 Efficient Data
Integration
 Powerful workflow
and process
management
 Flexible modeling
 Intuitive interface

Slide Courtesy of Oracle

Why Essbase*

* Slide courtesy of Oracle

Streamline Planning, Budgeting and Forecasting

• Centralized and
Consistent
• Shortens budget cycles
• Collaboration &
Accountability across
organization
• Process drives forecast
accuracy
• Align top-down with
bottom-up
• Driver-based planning
• Rolling forecasting

Slide Courtesy of Oracle

Components of Hyperion Planning

Session: Driving Shareholder Value with Customer Profitability

 Components of Core Hyperion Planning

 Planning Functionality Delivered through Web interface of EPM

Workspace or Office Interface provided by Smart View
 Built on top of Essbase, all features and capabilities of Essbase are
available
 Scalable Architecture with an advanced calculation Engine
 Multi-Dimensional Slicing and Dicing
 Out of Box Financial and Time Series Intelligence
 Application Related Features
 Process Management
 Web Forms
 Graphical Business Rule Development
 Supporting Details
 Task Lists
 Cell Notes
 Textual and Date Measures

Session: Driving Shareholder Value with Customer Profitability

Intuitive Web Interface for Wide Deployment

Slide Courtesy of Oracle

 Guide Users Through Budget Process
Fast Adoption and Increased Accuracy

• Budget wizard to
guide planners
• Include instructions
• Set due dates
• Alerts and progress
monitoring
• Send email
reminders
• Report on budget
status

Slide Courtesy of Oracle

 Capital Expense Planning – What Is It?

What can you do with it ?

• Plan for new asset purchases
• Plan for Depreciation/Amortization calculations
• Plan for actions on existing assets
• Plan for driver based/user defined asset related expenses
• Capital purchases process management (future release)
• Report on Assets
What it is not meant to be?
• Capital Asset Inventory and Tracking system
• Fixed Asset System
Manager Capital Expense Planning Process

Plan Plan
Center

Plan for
Cost

actions on Asset Submit for

New Asset
Existing related Approval
Requests
Assets expenses
Authorities
Approving

Review New Approve and

Review Capital Expenditure Capital Asset Promote
and Financial Impacts Requests and Asset
Priorities Requests
Management

Review Approve
Review Long
Corporate
Top

Capital
Term Financial
Capital Expense
Impacts
Expenditure Budget

Establish
Finance

Corporate Review Balance Sheet, P&L and Cash Flow

Global Impact
Assumptions
 Capital Planning - Feature and Functionality
• Plan for new capital expense and intangible expense
• Planning of multiple asset requests or multiple units
• Depreciation/Amortization calculations – Straight Line, Declining
Balance, Sum of Years Digit, Conventions
• Cash flow impacts and funding options
• Predefined global assumptions e.g. Useful Life, Depreciation
conventions
• Planning for asset related expenses e.g. Maintenance,
Insurance,Repairs
• Planning for Improvements on Existing assets
• Planning for Sale and Writeoff
• Planning for Transfer
• Planning for impairments on intangible and corresponding
amortization impacts
 Capital Planning - Feature and Functionality

• Reporting at entity level or at aggregated corporate level

across asset class
 Capital Expenditure Summary and details
 Balance Sheet Impacts
 Profit & Loss Impacts
 Cash flow Impacts

• Provision to specify to Justification, Priority, CAR # (Capital

Acquisition Request)
• Additional hidden fields – Freight, Installation, Tax,Retirement
Obligations and Additional Charges
Global Assumptions
New Asset Requests – Add New
New Asset Requests – Input
 Workforce Planning – What Is It?

• A collection of pre-built forms, business rules, and

processes that allow a company to forecast and budget
salary related expenses
• Work force planning while ‘pre-built’ is fully customizable
• Out of the box business logic to calculate:
 Salaries – including base, merit, overtime, and bonus
 Benefits
 Taxes – Social Security, Medicare, SUI, and FUTA
 Additional Employee Related Expense – Training, Travel,
etc.
 FTE & Headcount Metrics

Slide Courtesy of Oracle

 Workforce Planning – What Is It?

• Business logic is based on various employee attributes

• Out of the box employee attributes include
 Status – Active, Departed, Sabbatical
 Position – Customized by the client
 Pay Type – Exempt, Non-Exempt
 Employee Type – Regular, Contract, Temporary
 Tax Region – US, State, Intl
 Health Plan – Family, Individual, Individual + 1
 Performance – Below expectations, meets, exceed
 Merit Month – Jan, Feb, Mar…

Slide Courtesy of Oracle

 Workforce Planning Benefits

• Best of both worlds approach

 Extensive pre-built functionality
 Fully customizable to client’s needs
• Simple & Intuitive User Interface
• Creates greater visibility into the salary planning process
• Provides a single source of salary information
• Seamless integration with overall operational planning
• Fewer spreadsheet errors
• Less re-work on the effect of changes in assumptions
• More time for true analysis

Slide Courtesy of Oracle

Slide Courtesy of Oracle
Workforce Planning Benefits

Slide Courtesy of Oracle

Workforce Planning Benefits

Slide Courtesy of Oracle

Workforce Planning Benefits

Slide Courtesy of Oracle

 Ranzal Case Study

Hyperion Planning – Enterprise Planning

Catalina Marketing
Tampa, FL

Session: Driving Shareholder Value with Customer Profitability

 Catalina Marketing Overview

• Targeting change with behavior-based marketing

• Catalina Marketing is the global leader in providing
behavior-based communications on a mass scale, targeted
to individuals as individuals
• Catalina Marketing was founded on the premise that the
combination of access to consumers and insight into their
actual purchase behavior would enable more effective,
cost-efficient promotions than traditional marketing
approaches
• The company’s vision created an alternative to usual
methods such as freestanding inserts (newspaper coupons),
which are subject to waste, misredemption, and clutter
Offices Around the World
 Business Challenges - Forecasting and Budgeting

• Budgeting and forecasting was prepared using Hyperion

Pillar
• Difficult to consolidate and disseminate budget and
forecast information quickly
• Limited modeling capability – really starting to push the
limits of Hyperion Pillar
• “What-if” analysis was largely unavailable when
preparing budgets and forecast
• Version comparison was cumbersome
• Not linked to the financial consolidation system –
Hyperion Enterprise. Thus, to get comparative reports,
data had to be manually uploaded to Hyperion
Enterprise
 Business Challenges - Financial Reporting

• Reporting carried out by merging consolidation

data from Hyperion Enterprise with forecast and
budget data from Hyperion Pillar
• Manual update of spreadsheets for management
reporting
• No central repository of information led to
inconsistencies in formulas and calculations
• Difficult to prepare detailed “what if” analysis
across multiple versions
• Overall reporting was a manual effort that
required a great deal of hands-on involvement,
and often produced questionable results
 Business Challenges - Operational Change

• Contract to Cash (C2C)

• A sweeping initiative involving new custom systems to handle the
following business processes:
 Contract Management
 Billing
 Accounts Receivable
 Invoicing
 Revenue Recognition
• Legacy system maintained using Oracle back-end and Access
• Little visibility to data
• Data starting to overload legacy application
• Legacy application over 10 years old
 A Changing Climate

• Catalina recognized the need for a platform that would help them manage the
great organizational change that was upon them
• Some of the most critical needs
 Better visibility to data in all facets of the business – not just finance and
accounting
 An iterative process that allowed the planning, forecasting, and reporting
process to be seamless
 The ability to link data from operational systems into the planning process
 Dashboard-type reporting for executives
 Detail analytics for analysts
 A central repository to manage these reporting needs
 Planning and Analysis Needs

• The ability to provide timely and accurate forecasts on a

monthly and annual basis
• An integrated planning and reporting engine that provided
insight into ever-changing business conditions
• A tool that allowed for complex modeling of capital, revenue,
and salary processes
• The standardization of the forecast and planning process across
the organization
• The alignment of general financial statements with monthly
forecasts and annual plans
• A robust engine that allowed for a myriad of versions, “what if”
scenarios, and on-the-fly analytics
• A toolset that could evolve as the organization changed
 The Solution

• Hyperion System 9
• Utilize Hyperion Planning for the monthly forecast and
annual planning process
• Leverage the Hyperion Essbase database behind Planning
to load in monthly actual data from Lawson
• Exploit the powerful calculation engine in Hyperion Essbase
to create variances across versions and scenarios, and
standardize metrics across the organization
• Utilize Hyperion Workspace to provide dashboard reports to
management and highly formatted reports to distribute to
the business – from the same interface
 The Planning Solution
• Domestic
 Phase I
 Go live – October Year 1
 Consisted of the following
models:
 Revenue Planning
 Salary Planning
 Capital Planning
 Core Financial Planning
 The Planning Model – Core

• Core Financials brought information from each model by general

ledger account, cost center, activity, and month
• Core serves as a central repository for actual, forecast, and budget
information
• Domestic and International data are both consolidated in Core
• The majority of financial reporting is done out of this database
• Local Currency and USD supported
• Multiple hierarchies for reporting in both the organization and
accounts dimensions
The Planning Model – Core
 The Planning Model – Salary

• Salary information loaded from Ceredian monthly

• Monthly Forecast and Annual Plan both utilize the detail salary model
• Prepared by employee by cost center
• Ability to add new employees and transfer employees
• Salary, Bonus, Taxes, and FTE all calculated in this model
• Summarized by cost center and general ledger account and sent to
the Core Financial database
The Planning Model – Salary
 The Planning Model – Revenue

• Revenue planning by Product Class (the product Catalina is selling to the customer)
and Targeting Method (the method that the consumer is being targeted)
• Revenue is input at a high level by general ledger account, product class, targeting
method and month
• Revenue is then allocated to the Chain (retail location in which the print printed)
• COGS accounts calculated – paper and ink
• Monthly Forecast and Annual Plan both utilize the detail revenue model
• Summarized by chain and general ledger account and sent to the Core Financial
database
The Planning Model – Revenue
 The Planning Model – Capital

• Capital Planning by cost center, activity, account category, and expenditure type
• Activity typically corresponds to a project
• Account Category corresponds to balance sheet asset accounts – Software, Hardware,
Office Equipment, Store Equipment, etc.
• Expenditure Type can be Growth, Productivity, or Maintenance
• Asset dollars are input, depreciation is calculated
• Monthly Forecast and Annual Plan both utilize the detail capital model
• Summarized by activity, general ledger account, and cost center and sent to the Core
Financial database
The Planning Model – Capital
Ranzal & Associates
Enterprise Planning with Oracle
Hyperion

Mike Killeen, Practice Director –

gvillamil@ranzal.com
Jill Horn, Business Development Manager –
jhorn@ranzal.com

Session: Driving Shareholder Value with Customer Profitability