Edgewater Ranzal

Enabling Profitability Management with Oracle Business Analytics & Exalytics

October 23, 2013

Mike Killeen

Vice President of Technology

mkilleen@ranzal.com

► Introductions

► The Need for Profitability Management

► Profitability Management Enablement: Software

► Profitability Management Case Study

► Profitability Management Enablement: Exalytics

► Closing and Q&A

Agenda

2

• 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.

About the Presenter - Mike Killeen

► 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

► Customer Advisory Boards, Beta Testing, Certification Exam Development

Edgewater Ranzal Overview & Differentiators

• Workforce Planning

• Balance Sheet Planning

• Capital Planning & PFP

• HFM

• Financial Close Mgmt

• Disclosure Management

• HPCM

• HSF

• FDMEE/ERPi & EPMA

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

Strategic Finance, Planning, Budgeting, Forecasting, Workforce Planning, Capital Planning, Project Financial Planning

Data Integration, Financial Data Management, Data Warehousing, Master Data Management &DRM,

ETL Services, Automation

Project/Program Mgmt, EPM Road Maps, Application Reviews, Business Requirements, Process Change, Documentation

Installation, Upgrades, Migration, System

Monitoring, Backup and Recovery, Disaster Recovery,

Load Testing, Hardware Sizing, Exalytics Benchmarking

Consolidation

Business Intelligence

Enterprise Planning

Infrastructure

Training & Support Services

Project Management

Data Services

Costing & Profitability

Mgmt

Support Services – Infrastructure & Application Support Contracts

Key Teach Course Delivery: Planning, Essbase, Financial Reporting, Smart View, HPCM, HFM, FDM, DRM, OBIEE

Custom Training Delivery: Process & Reporting

Edgewater Ranzal Service Offerings

HPCM Standard & Detailed Models, Waterfall Allocations, Activity Based Costing, Customer, Product & LOB Profitability

The Need for Profitability Management

Call Me Doing Fine

Why Enterprise Performance Mgmt (EPM)?

react recognize

Under-performing Products

Under-served Customers

Under-utilized Staff, Assets

Excess Cash

Inefficient Business Processes

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

Using the Wrong Tools to Effectively Analyze Profitability

Accurate Costing Is Key to Profitability

Ventana Research, 2008

“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...”

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?

10

Packaged Profi..

.

Custom Solutio

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General L

edger

Spreadsh

eets/M

...

25% 25%25%25%1. Packaged Profitability or Costing

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

Polling Question #1

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

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

► Operating Costs (e.g. Call Center, Plant Overhead)

► Selling Costs (e.g. Sales & Marketing)

► Investment Costs (e.g. R&D, Initiatives)

► G&A Costs (e.g. IT, HR, Finance, Admin)

► Finance Charges for Cost of Capital Employed

Profitability Challenge #1 - Indirect Expenses Assignment to Products & Customers

No Standard Process

Standard, accepted process

Indirect Costs are difficult to track and measure

Profitability Challenge #2 - Statutory Reports are not Timely or Detailed Enough

• 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?

Financial transactions

Financial Data

Consolidation (GL or HFM)

Accumulator Bottom-line

Results

Organizational P&L

Profitability Challenge #3 – Ensuring Consistent Performance as Users, Data Volumes, & Frequency of Use Increases

Sales/Product Managers

Cost Center Managers

LOB Execs.

Finance 10’s

100’s

1000’s

1000’s

LOB/Functions

Segments/Entities

Departments

Products & Customers

User

Counts

Data

Volumes

Frequency

Of Use

100’s

1000’s

10K’s

1 MM’s

Qtrs

Monthly

Weekly

Daily

Profitability Management Solution Elements

Planning, Reporting & Analysis

Product P&L by Activity

Financial P&L

Operational

Data

Source Data

Meaningful Attributions &

Allocations

EPM/BI Platform

Source Data – Financial P&L

Legend

C Customer Specific Costs

P Product Specific Costs

F Financial/Overheads

Type P&L Line $ % of Rev

C/P Units Sold 100

C/P Gross Sales 1,000$ 102%

C/P Less Disc, Rtrns & Allow. (20)$ -2%

Net Sales 980$ 100%

C/P COGS @ Std 400$ 41%

F COGS @ Var 23$ 2%

Less: Total COGS 423$ 43%

Gross Profit 557$ 57%

P/F/O Selling & Marketing Exp 150$ 15%

F G&A Exp 100$ 10%

Less: Total Operating Exp 250$ 26%

Operating Income 307$ 31%

F Depreciation & Amortization (75)$ -8%

F Other Inc/(Exp) (50)$ -5%

Net Income Before Taxes 182$ 19%

Less: Income Taxes @ 40% 73$ 7%

Net Income After Taxes 109$ 11%

Dept Costs:

Accounting

Mgmt

IT

Raw Materils,

Labor, Freight In,

Mfg Ovhd

Mfg Plant

Departmental Exp

Variances

► 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

Typical Financial Analysis

SHIPPED TO SOLD TO TERMS: FROM INVOICE DATE

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

2% 15 days Net 16, USD

DIRECT INQUIRIES TO: 1 (800) 999-9999

INVOICE SHIP DATE 11/01/2004 INVOICE DATE 11/01/2004

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

PURCHASE ORDER NO. SHIP NO. CUST. NO. SALES DIST. PLEASE SHOW THIS INVOICE NUMBER WHEN REMITTING TEST ORDER #1 S901999 B901999 2377

DATE INV’D 11/01/04 2002009999

ORDER DATE MM/DD

DELIVERY DATE MM/DD ACCT. AT CUST. CARRIER SALES ORDER

199299888 11/01 11/11 1202 Customer pick-up

QUANTITY UNITS PRODUCT CODE DESCRIPTION UNIT PRICE AMOUNT

700 CA 4100000295 TBAH 24/500 75.35 52,745.00

700 CA 4100000295 Efficiency Allowance 333333 0.05- 35.00- 700 CA 4100000295 SpecAllow-OI RateCs 654737 0.50- 350.00- 700 CA 4100000295 Freight-Backhaul 1.08- 155.74- 700 CA 4100000295 Fuel Allow Percent 6% 9.34- 700 CA 4100000295 Unload Allowance 0.04- 28.00-

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)

Source Data – Sample Operational Data

Meaningful Allocation – Top Down via Rules

› Allocation Rules can use drivers such as headcount, percentages, hours, etc

Customer Profitability

CRM HR GL EDW EPM

Available Driver & Allocation Source Data

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

Allocation Rules

Meaningful Allocation – Bottoms Up Via ABC

► 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?

Example

Reporting & Analysis: Published Customer & Product P&L Reports

22

Reporting & Analysis: Interactive Analysis via Mobile Dashboards

Outcomes: Expectations of a Profitability Management Solution

► Reliability – Visibly defensible profitability

and cost results through transparency & audit/control

► Agility – Timely reflection of results to be

actionable

► Relevance – An ability to Allocate resources

to the most important opportunities

Financial Results

Revenue & Cost Models

Operational Results

FP&A

Senior Management

Which of the below use cases would your organization prioritize as the top application for a Profitability & Cost Management Solution?

24

Cost Allo

catio

n Proce

ss f.

.

Act

ivity

Base

d Costing F

o...

High

Level P

rofit

ability .

..

Deta

iled Custo

mer/

Prod...

25% 25%25%25%

1. Cost Allocation Process for External Purposes

2. Activity Based Costing For External Purposes

3. High Level Profitability for Management Purposes

4. Detailed Customer/Product/Operational Profitability for Management Purposes

Polling Question #2

Overview of Oracle Business Analytics Profitability Management Solution

EPM/BI Platform

& Analysis

(profitability)

Consolidation & Reporting

Financial Planning

react recognize

today

• 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. Analysis

(profitability)

Building an EPM/BI Platform

Which of the following EPM/BI programs would you rank as MOST important to your organization?

27 O

ptimizi

ng the...

Impro

ving t

he ...

Enablin

g Act

io...

Deliv

ering a

nd...

25% 25%25%25%

1. Optimizing the Financial Close & Reporting Process

2. Improving the Budgeting, Forecasting & Planning Process

3. Enabling Actionable Operational and Financial Analytics throughout the organization

4. Delivering and Optimizing a Profitability and/or Cost Management Solution

Polling Question #3

Reporting & Analysis Financial Reports, Smart View for Office,

BI Foundation (OBIEE)

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

Exalytics X2-4

Reporting Tools Capabilities

BIF BI Publisher 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

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 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.

EPM

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.

Transactional Systems

& BI Data Marts

EPM/ Essbase

EP

M W

ork

space

Users

Solution Component: BI Foundation Reporting Tools

Solution Component – Essbase OLAP Server

Why? Profitability Applications are Multi-Dimensional in Nature

32

• 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

Solution Component: Hyperion Profitability & Cost Management (HPCM)

Organizations need information management solutions to address the challenges.

Why HPCM? To Meet Key Allocation Requirements

Flexibility

• 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.

Audit & Control

• 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.

Organizations need information management solutions to address the challenges. These needs can be abbreviated as F-A-S-T!

What’s New in 11.1.2.2 HPCM – Detailed Profitability Models

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

Reporting & Analysis Financial Reports

Smart View for Office BI Foundation (OBIEEE/Essbase)

EPMA

Hyperion Planning Multi User Data Entry Task Lists & Workflow

Bottoms Up Calculations Reporting & Commentary

HPCM Multi-Step Allocation Modeling

Validation Reporting Traceability Maps & Analysis

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

Shared Dimensions & Hierarchies (EPMA)

HPCM & Planning – Better Together

What role do you see a budgeting/forecasting/planning product playing in a profitability & cost management solution?

37

Crit

ical -

the d

efiniti

on of..

Importa

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tio...

Nice

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ave – ca

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Not I

mport

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25% 25%25%25%1. 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

2. Important – the solution needs to support processing of both actuals and budget/forecast data sets

3. Nice to Have – can extend the profitability process through driver collection & an occasional what-if scenario

4. Not Important – we would run our processes only for actuals

Polling Question #4

Profitability Case Study HR Consulting Firm

Business Process

► Process

• Creation of a “Fully Burdened” dataset.

• Attribute the “Fully Burdened” dataset.

• Allocate the Costs to the lowest level of the business (Entity & C2 Dimensions)

► As-Is • 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.

Staging

Application

HPCM Source

Application

Driver Data

Hyperion Planning

Hyperion Profitability & Cost Management

Microsoft Excel

HPCM Stage

Management Utility

Application Architecture

STG 1

BONUS

STG 2

PROP & ADMIN

STG 3

MGTI

STG 4

PRE ATTR

STG 5

POST ATTR

STG 6

PRE HPCM

STG 7

POST HPCM

STG 8

TOTAL ALLOC

Source

Application

SOURCE DATA

Source

Application

Business Logic

Attributions & Allocations – Attribution Data Entry Form

HPCM – Allocation Matrix

Entity Business Account

Entity Business

Entity Business

Entity Business

Department

Stage 1 - Global

Stage 2 - Regional

Stage 4 - Business

Stage 3 - Local

Stage 5 - Department

HPCM Model Architecture

► 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.

HPCM Allocation Model Definition Components

Source Stage

Project Detail Target Stage

Customer

Project

Dept

Resource

Customer

Project Driver

Driver Selections – Defines what Driver Definitions to use against the Source stage, typically the dimension identified as the driver definition.

Assignment Rules Definitions– Defines the member combination in the target dimension for the assignment.

Assignments– Defines the source dimension combination and the target Assignment Rule

Driver Definitions – Create an allocation formula/methodology that references a loaded metric within the model.

1

2

3

4

2 3

1 4

4

HPCM – Driver Definitions and Selections

HPCM – Stage Balancing Report

HPCM – Trace Allocations

Trace Allocation

for Local Data

Allocation

Source

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

Oracle Engineered Systems Exalytics In Memory Machine

What is Exalytics?

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

Benefits

Superfast, Interactive Visual Analysis

Faster Planning & Budgeting with Richer Models

Quick to Deploy, Supports More Users

Faster, Cheaper, Better Analytics

1 TB DRAM, 40 Intel Cores, InfiniBand

Planning, ERP, CRM, Profitability, Vertical-specific

80+ Pre-packaged

In-memory Analytic Applications

OBIEE + Endeca + Mobile

In-Memory Analytic Platform

Endeca TimesTen Essbase

Unstructured ROLAP MOLAP

I n - M e m o r y A n a l y t i c E n g i n e s

► 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

What Comes with Exalytics?

► Memory Optimized Essbase

► BSO – Concurrency Performance Optimizations

► ASO – Outline Based Memory

► BI Server

► Summary Advisor

► Aggregate Persistence for TimesTen In-Memory DB

Exalytics X2-4

OS: Linux x86-64

► OBEE

► Essbase

► OSSM

► EAL

► Mobile

► HFR

EPM 11.1.2.3/BI 11.1.1.7 Exalytics Certifications (Linux x64)

► EPM Applications

– Hyperion Planning

– New! - Hyperion Profitability & Cost Management

► EPM Foundation

– Calculation Manager

– Shared Services

– EPM Workspace

► FDMEE

► BI Foundation Suite

– OBIEE

• BI Server

• Answers

• Interactive Dashboards

• Delivers

– BI Mobile

– Oracle Scorecard &Strategy Management

– Essbase Application Link for HFM

– Essbase Studio

– BI Components Available to EPM

• Essbase

• Financial Reports

• Provider Services

• Essbase Admin Services

► Times Ten In Memory Database

► Endeca

► Oracle HTTP Server

Exalytics Use Cases

1. Enterprise Planning

• Server/App Consolidation

• Bundled HW/SW Licensing

2. Profitability Applications

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

3. BI Reporting & Analytics

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

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 • Reduce Deploy Complexity

• Reduce Lead Times

Exalytics Customer Story

55

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.

Challenges / Opportunities

● 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.

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.

Results

● 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.

Client Since 2012

Solution Delivered 2013

Vertical Healthcare-Medical Equip

Products Infrastructure - Upgrade

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

Summary: Exalytics Value Proposition

► Increase End User Satisfaction & Productivity

– Increase timeliness of Data

– Speed of Thought Response Time for Planning & Reporting

– Increase User Counts and adoption rates

► Reduce/Repurpose Resources

– 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

Ranzal has the Exalytics In-Memory Machine!

58

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 • Operating System • Virtualization

• Full EPM/BI Install • Dynamic Scripting • Complete Automation

Closing and Q&A

► 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?

Self-Evaluation Questions

Closing and Q&A

61

Mike Killeen, Vice President Edgewater Ranzal

108 Corporate Park Drive, Suite 105 White Plains, NY 10604

E-mail: mkilleen@ranzal.com

Appendix I HPCM Demo

Project Profitability

Published Reports &

Interactive Analytics Model Development

• Create & Manage

Dimensions &

Hierarchies

• Deploy the

Application

• Define Data

Integrations from

Source Systems

• Manage User

Security

Master Data & Data

Integration Management

Enterprise

Performance

Management

Architect

(EPMA)

Dimensions Hierarchies Attributes

Hyperion Profitability & Cost

Management

(HPCM)

Stages Drivers

Assignments

Essbase

Calculation

Cube

(BSO)

Essbase

Reporting

Cube

(ASO)

Financial Reports,

Smart View,

Business Intelligence

Foundation

Produce Management and

Performance Reports:

• Financial Results Books

• Margin Analysis

• Cost & Revenue

Contribution Analysis

• What-If Scenario

Comparisons

• Genealogy Reports

Execute a Model POV:

1. Load Cost/Revenue Data

2. Load Driver Metric Data

3. Validate Model Inputs

4. Execute Calculations

5. Trace Allocations &

Validate Model Results

6. Publish the Model POV

Create & Manage the

Business Model:

1. Define the Stages

2. Create a Model Point-Of-

View (POV)

3. Define the Drivers

4. Define Assignment Rules

5. Assign Drivers

6. Create Assignments

Model Execution

HPCM Workflow in Profitability & Cost Solution

Demo - Define POV, Business & Driver Metrics in EPMA

POV Dimensions Business Dims Driver Metrics

Demo - Business User Defines Stages in HPCM for Allocation Flow

Stage definition is wizard

driven, and provides the

appropriate selections for

stage creation.

HPCM Allocation Model Definition Components

Source Stage

Project Detail Target Stage

Customer

Project

Dept

Resource

Customer

Project Driver

Driver Selections – Defines what Driver Definitions to use against the Source stage, typically the dimension identified as the driver definition.

Assignment Rules Definitions– Defines the member combination in the target dimension for the assignment.

Assignments– Defines the source dimension combination and the target Assignment Rule

Driver Definitions – Create an allocation formula/methodology that references a loaded metric within the model.

1

2

3

4

2 3

1 4

4

Demo - End Users Define Drivers in HPCM 1

Select from list of user defined driver metrics and allocation methodologies.

Demo - End Users Assign Drivers to Source Cost Pools in HPCM 2

Select Default Drivers for Cost Pools, with an ability to provide exceptions for unique projects.

Demo - End Users Create Target Range Assignment Rules in HPCM 3

Demo - End Users Map Source Stage to Targets Via Assignments 4

Or Allocation Assignments can be bulk loaded via a staging table.

Demo - Load and Validate Project Cost & P&L Data

Add Capitalization Rules to Calculate P&L Impact of Capital Project

Demo - Load and Validate Driver Metric Upload

Traffic Lighting to verify statistical driver metrics tie to 100%

Demo - Model Validation – Stage Balancing Report

All Costs are

Allocated to

Final Stage

Demo - Model Validation – Detailed Validation Results

Demo – Traceability Analysis – What makes up a client charge?

35% of China Costs come

from Asia Region Office

Project 212375

2% of China Charge came

from resource wswain

from Dept X working on

Project Y

Demo - Transparency into Details of Chargeback

Resource , Dept, Project

& Expense Type Details

of What Makes up China

Charge

Appendix II Backup Slides

About Edgewater-Ranzal

78

► 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.

Edgewater

Founded in

1996

Essbase Acquired by

Edgewater

2004

Data

Integration &

Warehousing/

CRM/

Web 2.0

Development

Acquired

Vertical Pitch

2007

HFM/

FDM

► Publicly Traded as: EDGW

► One of The Boston Globe’s Top 100 businesses

► Ranked as one of the 500 fastest-growing stocks on Wall Street

Acquired

Meridian

2010

HSF

Planning

2001

Planning

Building

OBI Team

2011

OBIEE

Ranzal

Build DRM &

HPCM Teams

2009

DRM &

HPCM

Ranzal Profitability & Cost Mgmt Solutions

12/5/2013 79

Profitability

Sample Clients

Typical Customer Profitability Distribution

-$2,000

-$1,500

-$1,000

-$500

$0

$500

$1,000

$1,500

$2,000

$2,500

1 2 3 4 5 6 7 8 9 10

TAIL CHART

10 CUSTOMERS OR MILLION CUSTOMERS IN DECILES

CUSTOMER SEGMENTS

EC

ON

OM

IC P

RO

FIT

AVERAGE ECONOMIC PROFIT PER CUSTOMER = $250

E CUSTOMERS = $2,500

“Portfolio of Customers”

Geoffrey Colvin

Oracle Business Analytics – EPM/BI Software Architecture

BI Foundation: Info Delivery

EPM Apps: Information Generation

Master Data, Data Quality & Data Integration Tools: Information Management

Interactive Dashboards

Smart View Office Integration

Secure Search

Production Reporting

Mobile

Ad-hoc Analysis

Scorecards

Strategy Maps

Geographic Visualization

Financial Reporting

Solution Component: BI Foundation Reporting Tools

83

EPM/BI Platform: Software & Hardware That Supports Key Capabilities

SECURE MOBILE ANALYTICS

DATA GOVERNANCE

SCALABILITY AND PERFORMANCE

FLEXIBLE DEPLOYMENT

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

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

HPCM Performance Results with Exalytics

► 11.1.2.3.351 HPCM is Exalytics Certified

► New Parallel Calc

► Non EPMA Mode

Summary: When Should You Consider Exalytics?

► Enterprise Planning Domain

– Enterprise Planning with Hyperion Planning

• Heavy Driver Based Models (Public Sector, Workforce Planning)

• Frequent Use (e.g. Rolling Forecast) and Large Concurrency

– Custom Financial and LOB Planning with Essbase

• Typically Larger Dimensions Sizes

► Profitability and Cost Management using HPCM

– Multi-Step, Multi Stage Allocations

► Analytics and Reporting using OFMA, OBI or OSSM

– Optimize Multi-User Federated ROLAP Queries with the BI Server

► Hardware Consolidation

– Hardware Refreshes/Upgrades – Reduce Data Center Foot Print

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

Exalytics Hardware Updates So Far

Exalytics X3-4

2TB RAM, 40 cores

2.4TB Flash (6x F40)

5.4TB HDD

Exalytics X2-4

1TB RAM, 40 cores

3.6TB HDD

2.4 TB Flash Upgrade Kit

2TB Memory and

2.4TB Flash

Upgrade Kit

Time

Exalytics T5-8

4TB RAM, 128 cores

3.2TB Flash (6x F40)

7.2TB HDD