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Oracle BI Applications Project Summary

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Page 1: Oracle: Information’s Business Impact -  Business Intelligence

Oracle BI Applications Project Summary

Page 2: Oracle: Information’s Business Impact -  Business Intelligence

222

Key Performance Indicator (KPI)

infoGROUP IncOpportunity

AnalysisImpact of Improvement

Baseline Value

($m)

KPI Value

Industry Average

(TTM)

Oppty.

($ m)Change

in KPIPotential

($ m)

SG&A Expenses Reduction

SG&A Expenses / Revenues (%) 255,228 51.05 -1% 2.55

Receivables Reduction

Day Sales Outstanding (DSO)

60 56.68 -2 day .90

Industry: AdvertisingSource: OneSource Data as of 01/20/2009

Opportunity Analysis

*Currency: USD, in millions

1. Integrate Financial to identify and create opportunities for synergizes to drive out cost.

2. Enable Payables and Receivables analysis to enable optimization and monitoring

Page 3: Oracle: Information’s Business Impact -  Business Intelligence

333

System Complexity Creates Chaos

MULTIPLE ROLES

DIFFERENTMETRICS

DISPARATE BI TOOLS & REPORTING SYSTEMS

FRAGMENTEDDATA SOURCES

Executive

Marketing

Finance

HumanResources

CustomerService

COMPANY HEALTH

BRAND

EBITDA

HIRING QUALITY

SERVICE LEVELS

FINANCE

OPERATIONS

PLANNING

Multiple Point Applications

Multiple ERP

MultipleSupply Chain

Multiple Legacy Applications

Multiple Data Warehouses

Page 4: Oracle: Information’s Business Impact -  Business Intelligence

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Sample Legacy Reporting EnvironmentComplex and Expensive

Disparate Data Sources Disparate Reporting Tools

SQR

Reports,

Discoverer,

BI Publisher

MSRS

SAS,

Greenbar,

DataStation, …

SAR

output

MSAS,

ProClarity

Cognos

Business

Objects

N Vision

Crystal

Reports

Decision

Cast

PS Query

MBI

DTS

HR

GL

EBS

Mainframe

Headcount

Forecast

Data

Warehouses

HR, GL, EBS

Data Marts

Roles Use Multiple Tools

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Record to Report ChallengesDeliver High Value and Reduced Cycle Times

Collect data Close AdjustmentsCurrency

I/CSubsidiaries

ReportManagement

LegalExternal

Analyze

6 Days 12 DaysAverage

Collect Close Adjustment Report Analyze and Forecast

<2 Days 6 DaysWorld Class

More time!

Page 6: Oracle: Information’s Business Impact -  Business Intelligence

666

Oracle’s End to End SolutionRecord to Report

CloseClose ReportReportEliminateEliminateRecordRecord

Transactions Sub Ledgers

Accounting Accruals ResultsI/C

Activity Sub

Ledgers Foreign Currency

AnalyzeAnalyze ConvertConvert AdjustAdjust

Oracle

E-Business

Suite

Financial Analytic

Applications

HyperionIFRS/GAAP

Page 7: Oracle: Information’s Business Impact -  Business Intelligence

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Sample Oracle Reporting EnvironmentSimplified and Effective

Single Source of Truth One BI Enterprise Solution Roles Use Single Platform

HR

GL

EBS

Mainframe

Headcount

Forecast

Data

Warehouses

HR, GL, EBS

Data Marts

BI AppsBI AppsData WarehouseData Warehouse

(Oracle DB)(Oracle DB)

Page 8: Oracle: Information’s Business Impact -  Business Intelligence

88

Improve Financial Timeliness and Analysis for

Improved Accuracy

• Single Source Best Practice method of financial data integration. Minimizes Control Testing Points.

• Ability to source data throughout the period and provide corporate visibility into financial status

• View across Organizations, Customers, and Products to address profitability and expense issues.

• Reduction in audit expenses due to consistent process and ability to track issues to source.

FDW Project Enablers• Multiple consolidation steps and manual

intervention can impact accuracy of financial data

• Late or Unexpected impact to earnings (Goodwill, etc.)

• Lack of understanding of profitability can lead to not changing behavior on supporting/selling/marketing poor yielding products.

What Risks Analytics Helps Mitigate

Opportunity• Lack of intra period reporting of Financials

• Accuracy of profitability analysis

• Complex and extensive audit process

Page 9: Oracle: Information’s Business Impact -  Business Intelligence

99

Improve Receivables Analysis and Focus to Reduce DSO and Improve Terms

• Identify trends around Reversals to provide feedback on which customers/products are biggest offenders

• Ability to monitor status and delays via a common score card

• Ability to pro actively identify source of late payment and escalate as appropriate

• Ability to trend impact of late payments relationship to uncollectable debt

• Ability to analyze customer trends to optimize payment and credit terms

FDW Project Enablers• Reversal behavior remain persistent, and no

trending is available to identify areas of concern

• Aged Debt becomes uncollectable and impacts balance sheet and shareholder value

• Miss-management of customers credit can result in customer churn

• Miss appropriated credit terms and decrease margin and increase expenses

What Risks Analytics Helps Mitigate

Opportunity• Lack of visibility into collections can cause focus to shift from late invoices

• Multiple sources of invoices complicates the collection process

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Improve AP Analysis and Focus to Manage Expense & Maximize Discounts

• Ability to monitor invoice delays via a common score card

• Ability to identify opportunities for vendor consolidation and negotiation

• Ability to report discount metrics by commodity, vendor, and organization

• Ability to analyze internal processes to optimize negotiated discount terms and associated discounts

FDW Project Enablers What Risks Analytics Helps Mitigate• Erosion of operating margin through increased

expenses

• Stricter payment terms can impact cash flow

• Misappropriated credit terms and decrease margin and increase expenses

Opportunity• Little visibility in to expense detail leads to lack of accountability

• Visibility can provide opportunity for consolidation and better costs and payment terms with core vendors

Page 11: Oracle: Information’s Business Impact -  Business Intelligence

1111

Improve Financial Timeliness and Analysis for Improved Accuracy

• Single Source Best Practice method of financial data integration. Minimizes Control Testing Points.

• Ability to source data throughout the period and provide corporate visibility into financial status

• View across Organizations, Customers, and Products to address profitability and expense issues.

• Reduction in audit expenses due to consistent process and ability to track issues to source.

How Analytics Helps Achieve• Multiple consolidation steps and manual

intervention can impact accuracy of financial data

• Late or miss statement of earnings

• Lack of understanding of profitability can lead to pushing poor yielding products.

What Risks Analytics Helps Mitigate

Opportunity

• Lack of intra period reporting of financials

• Accuracy of profitability analysis

• Complex and extensive audit process

Page 12: Oracle: Information’s Business Impact -  Business Intelligence

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Improve Receivables Analysis and Focus to Reduce DSO and Improve Terms

• Ability to monitor status and delays via a common score card

• Ability to pro actively identify source of late payment and escalate as appropriate

• Ability to trend impact of late payments relationship to uncollectable debt

• Ability to analyze customer trends to optimize payment and credit terms

How Analytics Helps Achieve• Aged Debt becomes uncollectable and impacts

balance sheet and shareholder value

• Miss-management of customers credit can result in customer churn

• Miss appropriated credit terms and decrease margin and increase expenses

What Risks Analytics Helps Mitigate

Opportunity

• Lack of visibility into collections can cause focus to shift from late invoices

• Multiple sources of invoices complicates the collection process

Page 13: Oracle: Information’s Business Impact -  Business Intelligence

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Improve AP Analysis and Focus to Manage Expense & Maximize Discounts

• Ability to monitor invoice delays via a common score card

• Ability to identify opportunities for vendor consolidation and negotiation

• Ability to report discount metrics by commodity, vendor, and organization

• Ability to analyze internal processes to optimize negotiated discount terms and associated discounts

How Analytics Helps Achieve What Risks Analytics Helps Mitigate• Erosion of operating margin through increased

expenses

• Stricter payment terms can impact cash flow

• Miss appropriated credit terms and decrease margin and increase expenses

Opportunity

• Little visibility in to expense detail leads to lack of accountability

• Visibility can provide opportunity for consolidation and better costs and payment terms with core vendors

Page 14: Oracle: Information’s Business Impact -  Business Intelligence

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Time to Benefit SummaryFocus on Reducing DSO & Expenses Can Yield $2.6M in Savings

• Benefits Based on a 1% Improvement in Expense 2 Day Reduction in DSO

• Achieved over 5 year at a 0.20% achievement per year

• 5 year cumulative benefit of $3.3M

-800-600-400-200

020040060080010001200

1080

554 554 554 554

-700

-90 -90 -90 -90

Cost

Benefits

$380

Year 1

$464 Net Benefit

Year 2 Year 3 Year 4 Year 5

$464 $464 $464

Page 15: Oracle: Information’s Business Impact -  Business Intelligence

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Benefit CalculationsINPUTS Current Target

SG&A Expenses $255,228,000 -1.00%

Annual revenue (A) $499,913,000 

Days Sales Outstanding (B,C) 60 58

Receivables balance (D=(A/365)*B,E=(A/365)*C) $82,177,479 $79,438,230

One-time reduction in accounts receivable due to lower days sales outstanding (F)=(D)-(E) $2,739,249 

Cost of working capital (%) (G) 8 

   

Annual Benefits (factoring growth and adoption rates) 20% 

Annual Benefits (USD) Year 1 Year 2 Year 3 Year 4 Year 5

Reduction in working capital due to reduction in accounts receivable factoring adoption rate $548,000 $0 $0 $0 $0

Reduction in annual interest cost due to lower working capital due to reduction in accounts receivable $22,000 $44,000 $44,000 $44,000 $44,000

Reduce days sales outstanding factoring benefit adoption rate $570,000 $44,000 $44,000 $44,000 $44,000

Summary: Year 1 Year 2 Year 3 Year 4 Year 5Cumulative

Expenses $510,456 $510,456 $510,456 $510,456 $510,456 $1,531,368

DSO $570,000 $44,000 $44,000 $44,000 $44,000 $658,000

Total: $1,080,456 $554,456 $554,456 $554,456 $554,456 $3,298,280

Page 16: Oracle: Information’s Business Impact -  Business Intelligence

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Solution Overview

Page 17: Oracle: Information’s Business Impact -  Business Intelligence

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PackagedPackagedETL MapsETL Maps

UniversalUniversalAdaptersAdapters

IVR, ACD, CTIIVR, ACD, CTIHyperionHyperionMS ExcelMS Excel

Other Data SourcesOther Data Sources

Ad-hoc Analysis

ProactiveDetectionand Alerts

MS OfficePlug-in

Reporting & Publishing

Interactive Dashboards

DisconnectedAnalytics

WebServices

Oracle BI ApplicationsMulti-source Analytic Apps Built on BI Suite EE Plus

Oracle BI Apps built on

Oracle BI EE Plus• Prebuilt Hierarchies, Drill Paths, Security, dashboards, reports

• Common Enterprise Information Model

• Based on industry and analytic best practices

Oracle BI Applications

SalesService &Contact Center

Marketing

Supply Chain & Order

Management

Procurement & Spend

FinancialsHuman

Resources

Page 18: Oracle: Information’s Business Impact -  Business Intelligence

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AutoAuto Comms& MediaComms& Media

Complex

Mfg

Complex

Mfg

ConsumerSector

ConsumerSector EnergyEnergy

FinancialServicesFinancialServices

HighTechHighTech

Insurance

& Health

Insurance

& Health

LifeSciences

LifeSciences

Public SectorPublic Sector

Sales Marketing Procurement & Spend

Supply Chain & Order

Management

HumanResources

PipelineAnalysis

ForecastAccuracy

Sales Team Effectiveness

Up-sell/ Cross-sell

Cycle Times

Lead Conversion

Employee Productivity

Compensation

Compliance Reporting

WorkforceProfile

RetentionAnalysis

Return on Human Capital

Revenue andBacklog

Inventory

FulfillmentStatus

CustomerStatus

Order Cycle Time

BOM Analysis

Direct / Indirect Spend

Buyer Productivity

Off Contract Purchases

Supplier Performance

Purchase Cycle Time

Employee Expenses

Campaign Effectiveness

CustomerInsight

Product Propensity

Loyalty &Attrition

Market Basket Analysis

Campaign ROI

Service &Contact Center

ServiceEffectiveness

Customer Satisfaction

ResolutionRates

Service RepEfficiency

Service Cost

Churn & Service Trends

Travel& TransTravel

& TransTravel

& TransTravel

& Trans

Financials

General Ledger

AccountsReceivable

AccountsPayable

Cash Flow

Profitability

ExpenseManagement

Oracle BI ApplicationsComplete, Pre-built, Best Practice Analytics

Oracle BI Suite Enterprise Edition Plus

and Other Operational & Analytic Sources

Source adapters:

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Financial Analytics Components

Pre-mapped metadata, including embedded best practice calculations and metrics for financial, executives and other business users

A “best practice” library of over 360 pre-built metrics, 30 intelligent dashboards, 200+ reports and several alerts for CFO, Finance Controller, Financial Analyst, AR/AP Managers and Executives

Pre-built ETL to extract data from over 3,000 operational tables and load it into the DW, sourced from PSFT, Oracle EBS and other sources

Pre-built warehouse with 16 star-schemas designed for analysis and reporting on financial analytics

• Presentation layer• Logical business

model• Physical sources

1 3

2 4

Page 20: Oracle: Information’s Business Impact -  Business Intelligence

202020 >> © 2008 Optimum Solutions Group, LLC

Architectural BI Foundation

ETL

Load Process

Staging Area

Extraction Process

DA

C

Oracle DataOracle DataWarehouseWarehouse

EBS

Excel

Other

BI Foundation

Oracle BI EE Plus

BI Applications

Finance

Web

Disconnected

Office

Alerts

Mobile

Desktop

Page 21: Oracle: Information’s Business Impact -  Business Intelligence

Financial Analytics Includes:

Page 22: Oracle: Information’s Business Impact -  Business Intelligence

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Oracle Financial AnalyticsComprehensive View of Financial Performance

General Ledger & Profitability Analytics• Incorporates detail-level general ledger transactions and cash flow analysis

across locations, customers, products, sales territories, distribution channels, and business units

• Identifies the customers and transactions that are providing maximum profits by product, location, department, and geographic detail. When combined with Marketing Analytics, it enables analysis of Campaign ROI and assists in customer segmentation

Payables Analytics• Provides visibility into payments due to suppliers and expense line detail so

managers can manage cash outflows and control expenses. When combined with Procurement & Spend Analytics, it allows full procurement analysis from Requisition to Check

Receivables Analytics• Monitors collections processes to show what customers buy and how they

pay, enabling managers to identify overdue balances and other receivables bottlenecks. When combined with Sales Analytics and Supply Chain & Order Management Analytics, it enables more efficient management of the entire Lead to Cash process.

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Finance Struggles to Use Intelligence to Maximize Cash Flow and Profitability

KEY CHALLENGES EXAMPLES

Lack of visibility into financial performance data

• No single integrated view of multiple charts of accounts• Poor or inconsistent financial metric definitions• Inability to integrate dozens of financial source systems

Poor management of cash inflow and outflow

• Lack of insight into payments to suppliers and expenses• Unable to obtain timely financial data across the enterprise• Limited information to identify overdue balances and other

receivables bottlenecks

Unable to support financial accountability and best practices

• Unable to comply with financial and accounting disclosure legislation such as the Sarbanes-Oxley Act and IAS/IFRS

• Inability to associate aggregated financial results to the line item details in the transactional data sources

Time wasted gathering data to manage and report

• Continued reliance on management-by-spreadsheet• Disparate financial reporting and poor internal distribution• Relevant data in multiple systems – CRM, ERP, etc.• No single source of the truth

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ANALYSIS & METRICS BENEFITSReceivables

• More timely, informed decisions at all levels of the organization

• Control expenses before they impact earnings

• Maximize cash flow from payables while maintaining relationship with strategic suppliers

• Control the risk of overall receivables portfolio

• Drive financial accountability to managers

• Receive intra-period financial information before books are closed

• Identify weak business units and product lines

General Ledger

Payables

Profitability

• Closing Group amount• DSO• Credit limit used %• AR payment days• Time paid before Due

• Total AR Overdue amount• AR due 1-30 amount• AR overdue 1-30 amount• AR credit memo amount• AR Average Invoice amount

• Accounts receivable• Debt to equity ratio• AR turnover• Cash cycle• Inventory turnover

• Fixed assets turnover• Operating cash flow• Investing cash flow• Financing cash flow• Net cash flow

• AP due 1-30 Amount• AP payment days• AP weighted days• DPO• Times paid before Due

• AP overdue 1-30 amount• Closing group amount• Total AP overdue amount• Overdue Amount to total %• AP average Invoice amount

Oracle Financial Analytics Provides Insight to Maximize Cash Flow and Profitability

• Return on equity• Return on assets• Return on capital• Gross margin %• Product operating profit

• Net Income margin %• Operating margin %• EBT margin %• Product gross profit• Customer gross margin

Page 25: Oracle: Information’s Business Impact -  Business Intelligence

Why did we select the Packaged Solution for EBS?

Page 26: Oracle: Information’s Business Impact -  Business Intelligence

2626© 2008 Oracle Corporation – Proprietary and Confidential

Building BI Solutions is CostlySignificant Investment, Skills and Time Required

• Single subject data warehouse typically takes 1-1½ years and costs $1.5-3 million.

• Support typically runs 25% - 50% of build costs per year.• When you upgrade the OLTP, you rewrite half your OLTP specific

ETL.• Design and Implementation Costs

• ETL and metadata design and implementation are 70% of preproduction costs – Henry Morris, IDC

• No, they are 80% -- Ralph Kimball• Costs rise dramatically if there are many data sources.• Therefore, concentrating on vendors’ prebuilt reports focuses

on the tip of the iceberg, not the part that sinks the ships.

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Build from Scratchwith Traditional BI Tools Oracle BI Applications

Prebuilt Business Adapters for Oracle, PeopleSoft, Siebel, SAP, others

Prebuilt DW design, adapts to your EDW

Role-based dashboards and thousands of pre-defined metrics

Easy to use, easy to adapt

Weeks or Months

Back-end ETL andMapping

DW Design

Define Metrics& Dashboards

Back-end ETL andMapping

DW Design

Define Metrics& Dashboards

Training / Roll-out

Training / Rollout

Months or Years

Results• Faster time to value• Lower TCO• Assured business value

Source: Patricia Seybold Research, Gartner, Merrill Lynch, Oracle Analysis

Oracle BI Applications Speed Time To Value Lowers TCO

Copyright © 2008, Oracle and/or its affiliates. All rights reserved. 27

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BI Applications – Ex. Build vs. Buy ComparisonCategory Element of Solution Typical Build Effort Buy (Average

Configuration Effort)

Define Metrics & Dashboards

Reports & Dashboards 2-4 Weeks 2-4 Weeks

Meta Data 7-10 Weeks 2-4 Weeks

DW DesignSchemas, Indexes, Aggregate

10-12 Weeks 1-3 Weeks

Back-End ETL and Mapping

Workflow & Scheduling 10-15 Weeks 2-4 Weeks

Transform & Load 12-20 Weeks 1-3 Weeks

Change Data Capture 8-9 Weeks 2-4 weeks

Staging 10-15 Weeks 1 Week

Extracts 12-15 Weeks 2-4 weeks

* Estimates Only (Assumes Typical Team Size 4-6 Full Time Resources)

71 – 100 Weeks 13 – 27 Weeks

73 % of Build Effort is Back End

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BI Applications - Classic Report Development

Application Dashboard Pages

Reports Average Build Effort Per Report

Weeks of Effort to Build

Content

Sales 33 620

24 Hrs (Using traditional reporting tools)

372Marketing 27 124 74Service 15 102 61Contact Center 17 72 43Finance 30 205 123HR 16 76 45Supply Chain & Order Mgmt.

18 157 94

Procurement & Spend

14 103 62

Total 317 2576 875

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3030Copyright © 2008, Oracle and/or its affiliates. All rights reserved. 30

BI Applications – Standardization Benefits

TYPICAL CUSTOMER CHALLENGES

Fragmented view

Unintuitive

Data latency

Expensive to maintain

Slow deployments

Limited scalability

ROI

ORACLE Real Customer VALUE

Single view, 14 TB across 3 systems

7,000 out of 7,400 employees use

Real-time global view – 500 top execs

400 dashboards, 1,250 users, 1 admin

3,000+ users live in 3.5 months

1,000,000+ users on 15 TB of data

500%; $30M savings

Page 31: Oracle: Information’s Business Impact -  Business Intelligence

3131Copyright © 2008, Oracle and/or its affiliates. All rights reserved.

31

BI Applications Reduces Risk and Lowers CostLeverages Investment, Skills and Time Required

License an ETL tool to move data from operational systemsto this DW

License interactive user access tools

License/create information delivery tools

Research/understand analytic needs of each user community

Set up user security & visibility rules

Perform QA & performance testing

Manage on-going changes/upgrades

Develop detailed understanding of operational data sources

Build ETL programs for every data source

Build analytics for each audience

Design a data warehouse by subject area

License an ETL tool to move data from operational systemsto this DW

License interactive user access tools

License/create information delivery tools

BI Applications Standardize Platforms

Develop detailed understanding of operational data sources

Build ETL programs for every data source

Build analytics for each audience

Design a data warehouse by subject area BI Applications Provide Time to Value

BI Applications Robust Architecture

Research/understand analytic needs of each user community

Set up user security & visibility rules

Perform QA & performance testing

Manage on-going changes/upgrades

Seeded Dashboards, Reports, and Metrics put focus on delivery vs. creation generating savings by faster deployment

Common Architecture Provides for Efficient and Cost Effective Extensibility & Scalability

Single Technology Stack and Vendor Support lower overall Support and Maintenance Costs

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Additional Un-quantified Benefits Tangible Yet Un-monetized Value

• Common enterprise-wide Business Intelligence and Operational / Financial Reporting platform.

• Reduced cost of ownership and improved time-to-value using a shared library of pre-built standard metrics and reports.

• Better, faster, accurate, more informed fact-based decisions.

• Enhanced visibility into detailed business data for trending, root cause analysis, period-to-period comparisons, what-if and forecasting.

• Flexible open technology enables integration of financial and operational data.

• Single source of truth for all information eliminates manual data gathering.

• Enable drilling from summary to detailed transaction level information via logical linkage to operational systems and data.

• Easy to use with minimal end user tool training thereby increasing adoption.

• Drive financial accountability down to the business.

• Receive intra-period financial information before books are closed.

• Empower everyone with relevant, complete and consistent information tailored to their function and role.