Monthly Archives: December 2016

Why EPM Theory is Backwards: Start with the Budget!

December 20, 2016

Author: Kirby Lunger, Performance Architects

Many of us are familiar with the “Holy Grail” of enterprise performance management (EPM) solutions: state your organization’s mission and vision; develop a strategy based on these items; develop strategic objectives with measures, targets, initiatives, milestones and owners related to this strategy; and then allocate resources according to the prioritization of these objectives. The linkage between strategy and operations is, therefore, the planning process because this is how most organizations end up allocating resources:

Based on this logic, starting an EPM project means starting with…mission, vision and strategy.  Most organizations already have done some work in this area and when we start talking with their team, they feel like it’s “good enough.”  The next logical place to go is setting objectives, measures, targets, initiatives and owners.  This is often where the “rubber hits the road” and organizations don’t have a well-defined process for tying day-to-day work to the mission and vision.  So what happens?  The primary focus for an organization’s first EPM initiative becomes the planning process.

When I think about the planning process, there are three discrete types of planning every organization performs (albeit using many different formal and informal methodologies): budgeting, forecasting, and long-range planning. As the diagram below depicts, there are two axes that clearly delineate the differences in types of planning: planning perspective and planning duration (timeframe).

Planning perspective relates to the organizational focus of the planner. A more strategic focus includes “big picture thinking” around mission, vision, strategy, objectives, etc., while operational planning focuses on the tactics used to achieve those strategic goals and objectives. Planning duration really means the time horizon of the planning activity.  The budget generally is <12-18 months; the forecast is usually ~3-5 years; and the long-range plan (LRP) is often 5+ years:

This chart depicts how this ties back to the “textbook” EPM process:

When revamping the planning process and solution, most teams start with the need that is closest to their near-term, operational pain points: the budgeting process.  Budgeting generally impacts a large audience, since many organizations are stuck in a situation where they are disseminating and collecting spreadsheets for departments, groups, etc. to budget.  This graphic depicts the first stage we see in most planning initiatives…to fix the broken budgeting process, and to provide basic financial and managerial reporting:

Once the budgeting process is stabilized and automated, the next step is to focus on enhancing planning and reporting capabilities:

Most organizations then focus on explicitly linking long-range strategy and day-to-day operations, generally looking at non-financial drivers that could influence plan outcomes…and along the way, question the assumptions in the “good enough” mission, vision, and strategy statements/plans they ignored during the first few stages of their planning (EPM) initiatives:

What does this mean?  It means that organizations usually start at the opposite end of where they’re supposed to start from a “textbook” EPM approach. In theory, this is not a good idea, because if you’re budgeting spend against a mission, vision or strategy that hasn’t been correctly vetted, this means that you may be spending precious resources on the wrong focus areas!  That said, in practice, unless you have an automated and integrated solution for the planning process, it is not efficient or effective…so starting at the wrong end of theoretical “best practice” is generally necessary. This is one case where “starting small and thinking big” definitely applies.


© Performance Architects, Inc. and Performance Architects Blog, 2006 - present. Unauthorized use and/or duplication of this material without express and written permission from this blog's author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Performance Architects, Inc. and Performance Architects Blog with appropriate and specific direction to the original content.

Replicating On-Premise Essbase Load Rules in Oracle Planning and Budgeting Cloud Service (PBCS) Using Data Management

December 14, 2016

Authors: Mohan Chanila and Tyler Feddersen, Performance Architects

One of the perceived issues with the release of Oracle Planning and Budgeting Cloud Service (PBCS) in 2014 was the lack of full-use Essbase in the cloud.  With this, the ability to use load rules to modify, edit, and prepare a data file to upload into the cloud was taken away, and the PBCS interface did not provide the ability to tweak and modify a data file. However, “Data Management,” sometimes referred to as “Financial Data Quality Management (FDMEE) for the cloud” is included in your PBCS subscription, and can be used to replicate load rule functionality.

This blog entry highlights three examples where you can easily replicate on-premise Essbase load rule functionality in PBCS using the power of Data Management in PBCS: merging data fields; prefixing fields in a data file to match a PBCS dimension; and mapping fields in the data file to certain dimension members:

  1. Merging Data Fields

A common task performed in Essbase load rules is to use a non-formatted data file to merge or concatenate two or more columns in the file to provide a PBCS field.

In Data Management, this task can be performed in the setup window using the “Import Format” option. The sample window looks like this:

mohan-1

Choose “File” as your source and the EPM application and plan type to load the data into as your target. In order to concatenate or merge multiple columns together, simply click on the “Add” button and then enter an expression that specifies which columns in the data file you want to merge.

  1. Prefixing Fields in a Data File to Match a PBCS Dimension

A good example of prefixing fields in a data file to match a PBCS dimension includes a case where you need to load accounts, and the source system provides data files with a numeric account code (for example, “40001”) which you need to convert to a PBCS account member that contains a prefix (for example, “AC_40001”).

This can be done using Data Management in the “Workflow” tab under “Data Load Mapping.” In the sample screenshot below, you would simply use the “LIKE” expression to say, “All accounts should be prefixed with an “AC_” (the actual expression would be, “LIKE * to target AC_*”).

mohan-2

  1. Mapping Fields in the Data File to Certain Dimension Members

One of the more difficult load rule tasks is mapping fields from a data file into specific dimension members in Essbase. This is rarely done using load rules since it is far easier to format a data file to provide the requisite fields. However, in many situations (such as a smaller organization with limited IT resources), this is something that the EPM specialist may have set up for on-premise applications.

When you move onto PBCS, since load rules are no longer available, this task can now be performed using Data Management.  First, in the setup window, you will need to specify the source as a data file and the target as your EPM application. This is explained in Section 1 above.

After this, navigate to the “Workflow” section and the “Data Load Mapping” window. This time, you can set up a complex mapping table using the source and target mappings you’ve created and replicate them in FDMEE using the various functions available in Data Management. You can choose to do explicit mappings using one-to-one mappings; choose a range using the “BETWEEN” function; or use the “LIKE” operator to map all. Another nice feature in Data Management is that these mappings can be saved and imported in bulk.

Sample screen shot shown below:

mohan-3

We can list many more examples of load rule functionality that can be recreated seamlessly in Data Management in PBCS; however, that would take a lot more real estate than is possible in this blog entry.


© Performance Architects, Inc. and Performance Architects Blog, 2006 - present. Unauthorized use and/or duplication of this material without express and written permission from this blog's author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Performance Architects, Inc. and Performance Architects Blog with appropriate and specific direction to the original content.

Oracle Planning and Budgeting Cloud Service (PBCS): Twelve Month Farewell Tour for the “Standard Interface”

December 7, 2016

Author: Chuck Persky, Performance Architects

Chuck - PBCS

Not quite the fanfare of the final episode of Seinfeld… and not the emotional impact of the Derek Jeter farewell tour (which as a Sox fan, seemed to last for eons)…but we knew it was coming, and now we know when.

Oracle Corporation documented in their Planning and Budgeting Cloud Service (PBCS) December 2016 release notes that the PBCS standard interface will no longer be available, beginning in December of 2017, and all PBCS subscriptions will utilize the more modern and mobile friendly, simplified interface (SI).

From Oracle:

The simplified interface, an option available in the service since November 2014, will be established as the standard across the service. As a result, the current Standard Interface, which is also known as the Enterprise Planning and Budgeting Cloud Workspace, will be discontinued starting the December 2017 update. To prepare for this change, have your users familiarize themselves with the Simplified Interface using the following information sources:  

What does this mean to you?

For PBCS subscribers who chose to utilize the SI, or for customers that activated their PBCS subscription after July 31, 2016, this is not relevant. However, for the many early adopters of PBCS, who implemented during a time when the simplified interface (SI) was not entirely proven, solutions were implemented with the “standard” interface. For these customers, change is here. However, this change should not be viewed as a bad thing!

The Simplified Interface is now a well-proven and well-functioning user interface that contains all of the existing “standard” interface functionality, and more. Do not wait until December 2017 to try SI out! Whether you enlist the help of experts (like my organization, Performance Architects), or do it on your own, I recommend that you dive in and learn how to navigate with the new SI. By moving now, you will afford your organization the appropriate time to learn and embrace this interface. In the end, you will like working with the new interface, and be happy that you did so.


© Performance Architects, Inc. and Performance Architects Blog, 2006 - present. Unauthorized use and/or duplication of this material without express and written permission from this blog's author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Performance Architects, Inc. and Performance Architects Blog with appropriate and specific direction to the original content.

Oracle Profitability & Cost Management Cloud is now Available!

December 1, 2016

Author: Melanie Mathews, Performance Architects

You may have missed the notice Oracle released this week…  Oracle Profitability & Cost Management Cloud (PCMCS) is now generally available! This is Oracle’s latest addition to their EPM Cloud suite of products and it delivers a comprehensive allocation solution designed to be owned by business users.

PCMCS addresses critical business process challenges such as product, customer, and market profitability, shared service allocations, IT service costing and chargeback, management allocations, cost transparency, and transfer pricing. PCMCS improves financial decision making, empowers business users with flexibility, and creates a culture of profitability & accountability.

PCMCS is a perfect complement to the Oracle ERP and EPM Clouds. The solution includes certified integration to both EPM Cloud and ERP Cloud, and shares capabilities such as Smart View and Financial Reporting.

PCMCS at a Glance:

  • Discover drivers of cost and profit
  • Empower users with flexibility
  • Create a culture of profitability and accountability
  • Improve financial decision Making
  • Discover and act on hidden profit and loss

If you would like to learn more about the highlights and benefits of PCMCS, email us here and we will set up a time to chat.


© Performance Architects, Inc. and Performance Architects Blog, 2006 - present. Unauthorized use and/or duplication of this material without express and written permission from this blog's author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Performance Architects, Inc. and Performance Architects Blog with appropriate and specific direction to the original content.