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TRANSCRIPT
Integrated Business Planning & Analytics at HPHC –
Leveraging the Power of the Cloud
Philip Peck
Vice President – Finance Transformation Practice
Peloton Group
Kate Stansky
Director Budget and Cost Management
Harvard Pilgrim Health Care
Agenda
• Introductions
• Current State Environment
• Software Vendor Selection Process
• Implementation Overview
• Post Implementation – Next Steps on the Journey
• Lessons Learned
CredentialsKate Stansky – Harvard Pilgrim Health Care (HPHC)
• Leader with over 25+ years as a strategic business partner to Executive Management
• Responsible for executing the budgeting process, financial forecasts, & management reporting
• Actively involved in the development of long-term financial plans & capital resource allocation
Philip Peck – Peloton
• 30+ years of industry and consulting experience in Planning, Performance Management, and
Analytics
• Responsible for developing multi-phase digitally enabled transformation roadmaps and guiding
organizations through the journey
• Recognized FP&A thought leader, external speaker, and member of the AFP FP&A Advisory
Council
Peloton – Executive Summary
Industry
Consulting Industry
Retail | Life Sciences | Manufacturing |
Financial Services | Insurance |
Aerospace & Defense
Full Life Cycle
Advisory | Consulting | Managed Services
BreakawayTM
Innovative and Collaborative Implementation
Approach that Drives Adoption
Certified
175+ Certified Resources
Finance, Accounting, & Cloud Integration
Experts
750+ Projects
Cloud Accelerators | Cloud Development Hub
Referenceable Clients
125+ Cloud Implementations
EPM – Planning, Reporting, Close
ERP | Big Data and Analytics
Cloud Integration | Program Mgmt
Digital Finance
World-Class Finance Transformation Services
Technology and Business Process Expertise
White Papers & Leading Practices
HPHC Overview
• A leading not-for-profit health services
company, Harvard Pilgrim was founded 50
years ago by doctors
• Harvard Pilgrim and its family of companies
provide health benefit plans, programs and
services to more than 3 million customers in
New England and beyond
• Nationally recognized for outstanding
performance in clinical quality and member
satisfaction
Mission
Improve the quality and value of
health care for the people and
communities they serve
Current State Environment
Background, Issues, & Challenges• HPHC implemented systems and processes to support planning, cost
allocations, and reporting using Clarity software in 2007
• The legacy solution was in need of a major upgrade where limited investments
had occurred for 10+ years.
• The solution was increasingly out of synch with the evolving business structure
requiring manual workarounds and several “single point of failure” risks.
• The existing solution was people dependent with a heavy reliance on
institutional knowledge and a small group of SME’s (Jedi Knights)
• Overall process inefficiencies including long planning, reporting, and allocation
cycle times with unnecessary work activities and duplicative effort
Catalyst for
Change
Start
Sustained
Success &
Continuous
Improvement
Exploration &
Business
Needs
HPHC Finance Transformation Journey
Vendor
Evaluation &
Selection Solution
Implementati
on
Enhancements
& Expanded
Capabilities
Evolving Business Needs & Change Mandate
• Competitive landscape required more visibility into drivers of business results
• Business strategy necessitated involving more people in planning across the
organization (e.g. distributed planning with ownership & accountability aligned
to the business owners)
• Imperative for more transparency and flexibility in cost allocations
• Mandate to improve efficiency by reducing offline processes, automating data
integrations, minimizing reconciliations and freeing up Finance associates
time to focus on business partnering activities
• Demanded a high performing platform that supported the analytic needs of
the business
Software Vendor Selection Process
Vendor Selection ProcessCodify Critical
Business NeedsProof of Concept
Strategic Direction
& Decision Criteria
Industry Research
& Networking
• Leverage independent,
unbiased resources like
the Gartner Magic
Quadrant, the Forrester
Wave, and BPM Pulse
Survey Results
• Network with similar
organizations in your
industry regarding their
EPM solutions and
experiences
• Establish enterprise
strategic direction
regarding platforms and
tools
• Create clear decision
making criteria
• HPHC
• Cloud solution
• Out-of-box capabilities /
minimal customization
• Low overall cost of
ownership
• Canvas organization to
understand business
needs (today, tomorrow,
future
• Ensure that all users
have a voice in the
process
• Incorporate the future
state vision for Finance
as part of the needs
assessment
• Conduct proof-of-
concept to demonstrate
capabilities of the
chosen vendor with real
data and information
• Pressure test the vendor
solution with relevant,
impactful business uses
cases
• Understand potential
trade-offs
Implementation Overview
Solution Goals and Objectives
Enhanced Analytics
Process Efficiency &
Effectiveness
Leverage Enabling
Technology
• Provide visibility into the key drivers of business performance
• Improve decision-making (“insights at the speed of thought”)
• Deliver management standard reports & common analytic views
• Eliminate of manual data integration and process workarounds
• Significantly reduce cycle time (e.g. allocations process)
• Enhance “what-if” modeling and scenario analysis capability
• Decommission legacy Clarity solution. Move to the cloud.
• Eliminate offline models, shadow systems, and spreadsheets
• Enable integrated business planning
Integrated Business Planning at HPHCPremium & Product
Modeling
Medical &
Operations CostsCost Allocations
Capital &
Project Planning
Management &
Regulatory Reporting
Non-driver based modeling and
planning, annualized models
Driver Based, Support Key
Metrics for Iterative Pricing &
Product Analysis
Ability to classify costs, model
variations, and analyze trends
Transitioning to …
Product viability, changing
markets & distribution channels
Volatility around medical cost
increases, commission programs,
and cost optimization
Cost detail tied to product
dimensionality, operating model
cost modeling
Transitioning to …
Medical Loss Ratio (MLR)
scrutiny, accurate allocations
and transparent audit trails
Allocations over-engineered,
limited visibility into drivers
Transitioning to …
Accurate & transparent
profitability by segment, plan &
distribution channel
Regulatory emphasis & speed
of information expectations
Disparate data, lack of data
management, speed of delivery
Transitioning to …
Timely, accurate, actionable
operational & financial
performance information
Efficient and effective use of
capital, risk-return composition
Optimally aligning large
initiatives to broader strategy
Transitioning to …
Integrated impacts to all
Financial Statements, real time
impacts to initiatives
Bu
sin
ess
Nee
ds
Ch
alle
ng
eF
utu
re S
tate
Enterprise Planning - EPBCS
Financials Financials / Workforce Capital / Project
EPBCS
FinancialsPCMCS
Integrated Business Planning at HPHCPremium & Product
Modeling
Medical &
Operations CostsCost Allocations
Capital &
Project Planning
Management &
Regulatory Reporting
Non-driver based modeling and
planning, annualized models
Driver Based, Support Key
Metrics for Iterative Pricing &
Product Analysis
Ability to classify costs, model
variations, and analyze trends
Transitioning to …
Product viability, changing
markets & distribution channels
Volatility around medical cost
increases, commission programs,
and cost optimization
Cost detail tied to product
dimensionality, operating model
cost modeling
Transitioning to …
Medical Loss Ratio (MLR)
scrutiny, accurate allocations
and transparent audit trails
Allocations over-engineered,
limited visibility into drivers
Transitioning to …
Accurate & transparent
profitability by segment, plan &
distribution channel
Regulatory emphasis & speed
of information expectations
Disparate data, lack of data
management, speed of delivery
Transitioning to …
Timely, accurate, actionable
operational & financial
performance information
Efficient and effective use of
capital, risk-return composition
Optimally aligning large
initiatives to broader strategy
Transitioning to …
Integrated impacts to all
Financial Statements, real time
impacts to initiatives
Bu
sin
ess
Nee
ds
Ch
alle
ng
eF
utu
re S
tate
Enterprise Planning - EPBCS
Financials Financials / Workforce Capital / Project
EPBCS
FinancialsPCMCS
Solution Architecture Blueprint
Oracle EPM Cloud
Financials
Workforce
Capital
Projects
EPM
AutomateEPBCS
Cloud Inbox
FDMEE
Data
Management
Smart View
Browser
Financial Reporting
EPBCS Dashboards
Expense Management
Planning & Reporting - EPBCS
Allocations - PCMCS
Oracle EBS
Driver
Templates
Other Sources
Strategic
Financials
Workforce
Capital
Projects
Strategic
HPHC InstituteHPHC Corporate
Reporting
Allocations Modeling
Next Steps on the Transformation Journey
The Journey Continues
HPHC to leverages the integrated business planning solution to significantly improve reporting and analytic
capabilities and provide key insights and “top of mind” KPI’s through standard reports & dashboards
Commercial – Member Months by Funding / SegmentCommercial – Financials & Admin PMPM
Next on the Horizon
Training,
Education,
Adoption
Expanding the
EPM Solution
Platform
• Implement training programs to improve finance literacy,
self-sufficiency, and user adoption
• Conduct regular communication forums highlighting
ongoing improvements and key finance activities
• Multi-year forecasting models w/ “what-if” analysis
• IT specific application for capital planning & investments
• Flexible staffing models (e.g. membership change impacts)
Value Proposition & Business Impact
• Increased frequency of reports, insights, & faster decision-making
Risk Mitigation
Information
Delivery
Business
Partnering
Analytics
Solution TCO
• Greater demand for expertise & involvement with the leadership team
• Enhanced business understanding via reports, analytic views, & dashboards
• Substantial reduction in maintenance, administration, and overall cost
• Elimination of people dependent processes
Lessons Learned
Lessons Learned• Change management and solution adoption is hard. Challenges getting
business users off the legacy system especially with specific report sets.
• Need to elevate Budget owners knowledge of finance. Greater ownership and accountability is empowering but requires finance aptitude.
• Initial rollout of standard reports, common analytics views / drill paths, and dashboards received well but struggled to maintain momentum
• Be careful what you ask for. Delivering better information and insights at a greater frequency generates MORE demand from the senior leadership team.
• Finance and business transformation occurs in waves. Proactively provide communication, updates, and positive messaging (e.g. “wins).
Back in the Office
1. Understand your key business requirements, execute against an intentional
roadmap, and acknowledge the “journey”
2. Do not underestimate the potentially uphill battle in getting users to adopt
the new solution (business processes, planning applications, reports)
3. Proactively find ways to keep the initial positive momentum moving forward
and growing over time
Q&A