order to cash process flow

“This presentation is for informational purposes only and may not be incorporated into a contract or agreement.”

The following is intended to outline our general product direction. It is intended for information purposes only, and may not be

incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in

making purchasing decision. The development, release, and timing of any features or functionality described for Oracle’s products

remains at the sole discretion of Oracle.

Victoria Whitlock VP ComplianceEnpria, Inc.

Jeffrey HutchinsSenior Principal Product ManagerOracle Corporation


Enabling Inter-Enterprise Connectivity

Addressing compliance, security, visibility, scalability, and standards from the Business and IT aspects

Agenda

• Introduction• Defining the problem?• Solving the problem?• Process example: “Order-to-Cash”

Who we are…

Victoria WhitlockBusiness Focused• 22 years of IT experience• Author• Recognized SME

• Compliance• Business Integration• Data Warehousing• Business Intelligence• Data Base Administrator• Corporate Educator

Jeffrey HutchinsImplementation Focused• 24 years of IT experience • Author• Recognized SME

• Standards• Integration Architecture• Data Warehousing• Business Intelligence• Application Developer• Corporate Educator

Common IssuesCompliance & Information Technology

• Information Security Management• Electronic Document Management• Poor and Inconsistent Documentation• Data / Customer / Process Integration• Collaboration and Messaging• Authentication Technologies• Storage Technology• Lack of Communication• System Development Life Cycle• Change Management• Segregation of Duties

The Revelation

Our issues are the same !!!

Compliance and Integration• Business Processes that need to be enabled• Physical architectures to enable the Business Process• Compliance and Integration have the same goals

“End-to-end Connectivity is the Lifecycle of a transaction from both a Business and a Information Technology View”

Victoria Whitlock & Jeffrey Hutchins

Current Culture: Compliance

• Government Compliance • Industry Standards Organizations• Corporate Standards • International Standards• Accounting Standards• Industry Specific Compliance

Current Culture: IT

• Managements attitude about IT spend• Y2K over spend• Cavalier approach and “.com” over spend• IT does not generate revenue

• Attitudes about Compliance• Not Y2K• Expenses and no value perceived

• Everyone wants the mantra: “To gain a competitive edge, fastest response to industry changes, to reduce operational cost and to reduce Total Cost of Ownership.”

This is not new:History of Accounting / Computer

3500 BC Accounting begins3000 BC Dust abacus is invented, probably in Babylonia500 BC Bead and wire abacus originates in Egypt50 BC Roman Corporations Established

1789 US Federal Government1833 Charles Babbage designs the Analytical Machine1886 William Burroughs develops the mechanical adding machine 1936 Security Exchange Commission established – GAAP begun1938 Hewlett-Packard is founded1944 Grace Murray Hopper is the first programmer for the Mark I1946 ENIAC (Electronic Numerical Integrator and Computer)

This is not new:History of Accounting / Computer

1959 COBOL is defined based on Grace Hoppers Flow-Matic1967 First issue of ComputerWorld is published1971 Intel Corporation announces the first microprocessor1977 Oracle Corporation founded1978 The first COMDEX trade show is held1982 Sun Microsystems is founded1984 Apple introduces the Macintosh computer1990 Microsoft introduces Windows 3.01991 World Wide Web established2002 Sarbarnes-Oxley passed

What is the problem? Vocabulary

BusinessBusinessITITTermTermSarbarnes-Oxley ActService Oriented

ArchitectureSOA

Business SolutionDigital SignatureNon-Repudiation

To declare or make legally valid. To mark with an indication of official sanction. To establish the soundness of. To corroborate.

Data structure validation

Validation

To give permission. A manager authorizes a transaction by signing a voucher authorizing the disbursement.

Privilege to perform a function

Authorization

Transactions are authorized, and receipts and expenditures are being made only in accordance with authorizations of management.

System Authentication

Authentication

The words are the same but the meaning is not…

Common Business Vocabulary

• GovernanceMethodology for the implementation of good engineering practices

• ComplianceThe enforcement of governance by law

• Internal Controls An integrated process of checks and balances established by management

How to solve this problem?• Information Technology

Establish a “Baseline” of your IT architecture• Corporate

Establish a “Baseline” of your business processes• How to uses the baselines

- Are you using it? - Are they complete?- Are they in sync?

Integration

Business Unit

Compliance

Information Technology

“IT must become a partner in the Business Solution in order to enabling security, visibility and scalability”

Case Study: “Order-to-Cash”A simplified view of a common business / IT process

Ship NoticeShip NoticeShip Notice

InvoiceInvoiceInvoice

PaymentPaymentPayment

Purchase OrderPurchase OrderPurchase Order

Jeff’s Distributors

Victoria’s Vineyards

Business Flow: Order-to-CashA simplified view

PO Processed

PO PO ProcessedProcessed

Valid PO

Valid Valid POPO

NoNo Manager notified for Resolution

Manager Manager notified for notified for ResolutionResolution

YesYes

PIC Slip createdPIC Slip createdPIC Slip created

Inventory ReducedInventory ReducedInventory Reduced

Product to shippingProduct to shippingProduct to shipping

Shipping Notice Generated

Shipping Notice Shipping Notice GeneratedGenerated

Invoice Generated

Invoice Invoice GeneratedGenerated

Payment ProcessedPayment Payment

ProcessedProcessedPayment Applied

Payment Payment AppliedApplied

PO Received

PO PO ReceivedReceived

ASN Initiated

ASN ASN InitiatedInitiated

Invoice InitiatedInvoice Invoice InitiatedInitiated

Payment ReceivedPayment Payment ReceivedReceived

Controls: Internal & Key InternalBusiness Objective

Invoice generated

Payment Waiting

Product to Shipping

Ship Notice generated

Notification of Shipping

Notification of Payment

Inventory reduced

PIC Slip created

Reconciliation of a processing failure

Notification of Purchase Order received

Internal Control

Notification of Payment received

Ship Notice Initiated

Inventory reduced

Review of manager’s reconciliation process

Purchase Order received

Key Internal Control

Notification of Payment received

Purchase Order received

Common IT Vocabulary

• ApplicationAny endpoint application: Trading Partner, Legacy, Packaged, Composite or Portal..

• MiddlewareA centralized platform that enables an architecture to integrate all applications.

• B2B GatewayA component of the middleware that manages all inter-enterprise connectivity

• Canonical XML SchemaA superset data structure representing a business object “Create PO”. Messages from each application are then mapped to this construct.

B2B Gateway

AS2: MDN

AS2: MDN

HTT

P Se

rver

850: PO850: PO

AS2: MDN

AS2: MDN

856: ASN856: ASN

AS2: MDN

AS2: MDN

810: Invoice810: Invoice

AS2: MDN

AS2: MDN

820:Payment820:Payment

DMZ997: FA

997: FA

997: FA

997: FA

EDI850

EDI856

EDI810

EDI820

Detailed IT Flow: Order-to-Cash

Application

Ship ConfirmEvent TriggeredShip Confirm

Event Triggered

Invoice TriggeredInvoice Triggered

Order ProcessOrder Import

Open Interface Tables

Order ProcessOrder Import


AutoLockBox Process


AutoLockBox Process


Invoice ProcessInvoice Process

Middleware

DequeuePO

DequeuePO XSLT TransformXSLT Transform

DB InsertDB Insert

DB QueryDB Query

DB QueryDB Query

DB InsertDB Insert

EnqueueASN

EnqueueASN XSLT TransformXSLT Transform

DequeueInvoice

DequeueInvoice XSLT TransformXSLT Transform

DequeuePayment

DequeuePayment XSLT TransformXSLT Transform

XML850

XML856

XML810

XML820

IT Flow: Order-to-Cash

Enterprise Service BusBusiness Activity Monitoring

OracleeBusiness Suite

POPO

Ship NoticeShip Notice

InvoiceInvoice

Payment Payment

• Document Processing• Process Orchestration• Human Workflow

Oracle Integration B2B

POPO


InvoiceInvoice

PaymentPayment

PO Received

PO Received

ASNSent

ASNSent

InvoiceSent

InvoiceSent

PaymentReceived

PaymentReceived

• Inter-Enterprise Connectivity• Trading Partners Mgmt• Document Mgmt

• Batching• Encryption• Validation• Translation

POPO


InvoiceInvoice

PaymentPayment

• Intra-Enterprise Connectivity• Document Mgmt

• Validation• Transformation

• Process Orchestration• Human Workflow• Error Handling

OracleBPEL Process Manager

Oracle Fusion Middleware

Integration Methodology: Points to Identity and document

• Integration Patterns: What are you integrating?

• Process: “Order-to-Cash”

• Business Objectives: Management’s requirements

• Internal Controls: The Checks and Balances

• Key Internal Controls: The Auditing points

• Compliance requirements• Architecture (middleware) requirements

How is the data accessed, structured, and processed?

Trading Partner:Oracle Integration B2B

Process• Each transaction set is a

separate transaction• Translation EDI XML• AS2: Exchange process

Structure: EDI X12• 850 Purchase Order• 856 Shipping Notice• 810 Invoice• 820 Payments

Access• Trading Partner via AS2• BPEL PM via AQ

Middleware:Oracle BPEL Process Manager

Process• Transformation • Business process• Human Workflow process

Structure: XML Schema• EDI XML from Trading Partner• DB XML from Application • Canonical XML as transition

Access• Integration B2B via AQ• Application via DB

Application:Oracle eBusiness Suite

Process• Setup to use API• Each transaction set has a

separate Concurrent Program to process data.

Structure: Tabular• Inbound: Interface tables• Outbound: Database Views

Access• DB: Schema

How are errors managed?Trading Partner:Oracle Integration B2B

• Outbound errors:Middleware notified

• Inbound errors:Trading Partner notified

Error Levels• Transport

Connection failed• Exchange

Data not receivedData not sentSecurity violation

• BusinessData not valid

• Outbound errors:Initiates a Workflow

• Inbound errors:Initiates a Workflow


Human Workflow An Error Handling process was created to receive errors from both the Trading Partner and the Application. If an error occurs, a manager is notified for resolution.

• Outbound errors:Middleware notified

• Inbound errors:Middleware notified


Concurrent Program• Inbound:

Any error results in the rejection of the data and a notification via a Oracle Workflow

Outbound:Any error results in a notification via a Oracle Workflow

What are the security requirements?


• Authentication• Authorization• Secure Transport• Encryption• Non-Repudiation

• Origin & Content• Receipt


• Authentication• Authorization• Document Retention• Password Management• Role Management


• Authentication• Authorization• Database Access• Role Management

What are the visibility and monitoring requirements?

Oracle Business Activity MonitoringBusiness

• How long does it take to process a PO?• How long does it take to process a PO and respond with an ASN?• What is the average time for the completion of the “Order-to-Cash” cycle?

IT• What are the average number of errors by Trading Partner?• What are the average performance metrics for each component?


Reports / Monitoring• Business Message • Error Reports

Middleware: Oracle BPEL Process Manager

Reports / Monitoring• Operational• Administrative


Reports• Business• Financial

Compliance and Integration

Compliance and Integration enables you to focus on the core corporate competencies your business and allows you to create a flexible, scalable, integration business structure…

It does matter….

• Buying a tool does not make you Compliant

• The Cost of Not Doing itBy 2006, public companies that do not adopt a compliance management architecture will spend 50 percent more annually to achieve Sarbanes-Oxley compliance According to Gartner, Inc.

• Information Security Management• Electronic Document Management• Poor and Inconsistent Documentation• Data / Customer / Process Integration• Collaboration and Messaging• Authentication Technologies• Storage Technology• Lack of Communication• System Development Life Cycle• Change Management• Segregation of Duties

Common Issues SolvedBenefits of Compliance and Integration

The technology to address these issues: Oracle Fusion Middleware

• Collaborative Enterprise Portal• Development Tools• Composition and Process Orchestration• Information, Aggregation and Analysis• Enterprise Application Server• Management• Security• Grid Computing

The Business Objectives that drive the Technology Choices

• Buying a tools does not solve the answer• Use technology to support you business

needs• Design solutions that are flexible to grow

with your business.• Include business, finance and technology in

the decision process

If so then What…

Integration + Compliance = Good Corporate Governance

• The Business Objectives MUST drive the technology • Governance is the implementation of good engineering practices• Compliance is the enforcement of governance by law• The Fusion Middleware, when driven by the above:

Can enable Good Corporate Governance to a deliver flexible, scalable, integrated business structure than will support your tactical and strategic goals.

Q U E S T I O N SQ U E S T I O N SA N S W E R SA N S W E R S

Learn the TechnologyVisit OTN Microsites: otn.oracle.com

Try the SoftwareVisit the Hands-On Labs in Moscone West 1003, 1004

Ask Our ExpertsFusion Middleware Demogrounds; Sessions

Acronyms

EDI Transaction Set StandardX12eXtensible Markup LanguageXMLHyperText Markup LanguageHTTPExtraction Translation and LoadETLEnterprise Service BusESBElectronic Data InterchangeEDI

Business Process Execution Language BPELBusiness Activity MonitoringBAM

Business-to-Business (B2B)B2B

Applicability Statement 2AS2

Business Activity MonitoringBAMBusiness intelligencesBIBusiness Process ManagementBPM

Acronym Description

order to cash process flow

Documents