Oracle Procurement and Spend Analytics for Oracle E-Business Suite
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Transcript of Oracle Procurement and Spend Analytics for Oracle E-Business Suite
1 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
LOGO
Presenting with
Oracle Procurement and Spend Analytics for Oracle E-Business Suite Rao Adivikolanu Director, Product Management/Strategy Oracle Business Intelligence
ORACLE PRODUCT
LOGO
Dan Allen Director, Information Technology Qualcomm
Eric Lloyd Sr. Staff Programmer Analyst Qualcomm
2 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
3 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
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 decisions.
The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.
Safe Harbor Statements
4 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Program Agenda
• Oracle BI Applications Overview
• Oracle Procurement and Spend Analytics
• BI Applications in Fusion
• Qualcomm Deployment
• Q&A
5 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Oracle BI Applications Overview
6 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Oracle’s Enterprise Performance Management System Complete. Open. Integrated.
OLTP & ODS Systems
Data Warehouses Data Marts
Packaged Applications
(Oracle, SAP, Others)
Excel XML/Office
Business Processes
OLAP Sources
Exadata Unstructured & Semi-
Structured
ERP Analy*cs
Planning & Forecas*ng
Financial Close & Repor*ng
Strategy Management Profitability Management
CRM Analy*cs
Industry Analy*cs
BI Server
Common Enterprise Informa*on Model
Essbase Dimension Management Predic*ve Analy*cs
Interactive Dashboards Reports & Publishing Query & Analysis Detect & Alert Office Search Embedded Mobile Scorecards
Data
Sources
BI/EPM
PlaD
orm
BI / EPM
Ap
ps
7 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Oracle BI Applications Prebuilt Solutions for EBS, PeopleSoft, Siebel, JD Edwards, SAP and more
• Add insight to CRM and ERP applications
• Easy to adapt and extend • Tight integration with OLTP
systems • Works with existing IT environment • Fast time to value;
Low TCO • Over 3,000 customers
8 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Oracle BI Applications Analysis Spanning Heterogeneous Sources in a Conformed Model
CRM ANALYTICS
ERP ANALYTICS
ORACLE BI FOUNDATION
Sales Marke7ng
Service and Contact Center
Price
Loyalty
Financials Procurement and Spend
Supply Chain & Order Management
Projects Human Resources
Customer Data Management*
Product Informa7on
Management*
* New for Fusion Applications
AND OTHER OPERATIONAL AND ANALYTIC SOURCES
9 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
How’s the spend compared to budgets?
Are we procuring the goods/services without following P2P process? Are we procuring the goods
without leveraging the existing contracts?
Where we are spending money?
Who are the top suppliers that we deal with?
Example of Business Questions Supported by OBIA Procurement and Spend Analytics
Do we have contracts in place for all the goods
that we procure?
10 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Pre-mapped metadata, including embedded best practice calculations and metrics for Supply Chain, Supplier, and other Business Users.
Ø Presentation Layer Ø Logical Business Model Ø Physical Sources
3
Pre-built ETL to extract data from over 3,000 operational tables and load it into the DW, sourced from Oracle EBS and other sources.
2
A “best practice” library of over 250 pre-built metrics, Dashboards, Reports and alerts for Buyers, Cost center Managers, Inventory Managers, Procurement Managers and Supply Chain Executives.
4
Pre-built warehouse with 10 star-schemas designed for analysis and reporting on Procurement & Spend Analytics.
1
Procurement and Spend Analytics Components
11 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Build from Scratch with Traditional BI Tools
Oracle BI Applications
Prebuilt Business Adapters for Oracle EBS, PeopleSoft, JD Edwards. 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 and Mapping
DW Design
Define Metrics & Dashboards
Back-end ETL and Mapping
DW Design
Define Metrics & Dashboards
Training / Roll-out
Training / Rollout
Quarters or Years
Source: Patricia Seybold Research, Merrill Lynch, Oracle Analysis
Speeds Time To Value and Lowers TCO Oracle BI Applications
ü Faster deployment ü Lower TCO ü Assured business value
12 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Oracle BI Applications
7.9.6.3 Release Overview
13 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Oracle BI Applications 7.9.6.3 New Release Concurrent with 11.1.1.5
• Full suite of pre-built CRM and ERP Analytics offerings – Siebel, PeopleSoft, JD Edwards, E-Business Suite
• Built for and certified with OBIEE 11.1.1.5 – Adopts 11g presentation features
• Presentation hierarchies, master-detail linking, cascading prompts – Adopts 11g security model
• Role-based, not group-based – Unlock new capabilities for BI Apps customers
• Geospatial, scorecard, mobile support, systems management
• Additional important certifications, including: – Informatica 9.01 HF2 – Teradata 13.10
• Additional bug fixes and ETL optimizations
14 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
All 7.9.6.3 Analytic Apps Work on BI Mobile Example: Procurement and Spend Analytics
15 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Oracle Procurement and Spend Analytics Overview
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Procurement Organizations Struggle to Use Data and Intelligence to Increase Performance
Lack of Visibility into Spend
Time Wasted Gathering Data to Report and Manage
Insufficient insight into Supplier Performance
Ø Quantities sourced from different suppliers Ø Prices by supplier and pricing trends Ø Inability to get the best prices Ø Missed opportunities to consolidate buying
Ø Continued reliance on management-by-spreadsheet Ø Disparate sales reporting and poor internal distribution Ø Relevant data in multiple systems – financial, proc, etc. Ø No single source of the truth
Ø On-time delivery of goods to support operations Ø Billing accuracy of suppliers and error types Ø Quality of delivered goods including rejections and returns Ø Price performance of strategic partner suppliers
Ø Lack of compliance with contract prices and use of existing contracts to reduce spend
Ø Timely processing and fulfillment of requisitions and purchase orders
EXAMPLES KEY CHALLENGES
Inability to Detect Purchasing Inefficiencies in time to correct them
17 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Oracle Procurement and Spend Analytics Complete Solution for the Purchasing and Procurement Organization
Procurement Performance • Understand Procurement effectiveness and monitor procurement performance on regular basis
in order to identify bottlenecks and proactively take corrective action before they become major issues
Supplier Performance • Understand and track cycle times, supplier price performance, supplier scorecard, delivery
performance, and product receipt quality. Decrease costs and procurement cycle times and minimize working capital.
Employee Expenses • Understand how the money related to travel and expenses is being spent by gaining a
complete picture of Employee Expenses, including approval cycle times, expenses by expense type, expense report status, and more
Spend Analyzer • Understand spending patterns and savings opportunities with increased visibility into direct and
indirect spend, enabling users to determine spend by commodities, products, services, suppliers and contract usage.
18 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Role-Based Best Practices Provide Relevant and Actionable Insight for Everyone
Procurement & Spend Analytics - Key Objectives and Questions by Role Meet operational objectives at minimum cost • What is the pattern of Spend trend from
year to year? • Are our strategic suppliers ensuring a
healthy supply line?
• Are we identifying and exploiting cost savings opportunities?
• How efficient is the procurement organization?
Ensure timely delivery of quality goods at low cost
• Which suppliers are not delivering quality goods on time?
• Are there large numbers of unprocessed requisitions?
• Are our suppliers invoicing us correctly?
• Are we sufficiently taking advantage of volume discounts?
• Are prices creeping up? What could be done to control them?
• Are there outstanding supplier payment issues?
Ensure orders are placed with the most reliable supplier • Are we placing orders with reliable
suppliers? • Is our company fully utilizing strategic
contracts in order to get the best value?
• Can we better consolidate orders to get the best volume discounts?
• Are we processing requisitions that are overdue?
Supply Chain and
Procurement Executives
Procurement and
Commodity Managers
Buyer
19 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Spend Analyzer • # of Suppliers • # of Supplier Sites • # of Buyers • Spend • Year Ago Spend • Addressable Spend • Non-Addressable Spend • Chg Year Ago Spend • % Chg Year Ago Spend • Payables Leakage Amount • Payables Leakage Rate • Invoiced Amount • Invoiced Quantity • Invoice Price Variance
Amount (IPV) • Average Invoice Unit Price • Min Invoice Unit Price • Max Invoice Unit Price • Benchmark Price
Procurement Performance • Contract PO Amount • Off-Contract PO Amount • Contract Leakage • Others Off-Contract PO
Amount • Year Ago Contract PO
Amount • Year Ago Off-Contract PO
Amount • Year Ago Contract Leakage • Year Ago Others Off-
Agreement PO Amount • Contract Purchase Rate • Off-Contract Purchase Rate • Contract Leakage Rate • Others Non-Agreement
Purchase Rate • PO Matched Spend • Year Ago PO Matched Spend • Avg Purchase Unit Price
Employee Expenses • Total Expense Amount • Expense Approval Cycle
Time • Approved Expense Amount • Requested Expense Amount • Outstanding Expense
Amount • Airfare Expense Amount • Accommodation Expense
Amount • Meal Expense Amount • Other Expense Amount • Total Expense Year Ago • Total Expense YTD • # of Approved Expense
Reports • Expense Reimbursement
Cycle Time • Expense Filing Cycle Time • Mileage Expense Amount
Example Oracle Procurement and Spend Analytics Metrics Supplier Performance
• Supplier Score • % Received Late • % Received On Time • % Received Early • Received Late Quantity • Received Early Quantity • Received On Time Quantity • % Accepted • % Rejected • Average Purchase Cycle Time • Average Receipt Cycle Time • Average Approval Cycle Time • Cancelled Amount • Cancelled Quantity • Received Quantity • Approved PO Amount • Approved PO Quantity
Oracle Procurement and Spend Analytics
20 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Copyright © 2009, Oracle and/or its affiliates. All rights reserved. 20
Business Objectives /
Issues
Gain Insights
Take Action
Target Efforts to consolidate and save
What are top 5 products by spend amount ?
Which commodities have the largest spend ?
Reduce Indirect Material Spend
Drill to D
etail
Is there out-of-contract buying for these items? How many suppliers and what are their unit costs?
Quantity bought from each supplier?
Example Decision Workflow Business Func*on: Purchasing Role: Commodity Manger Objec*ves:
1) Reduce Indirect Spend 2) Develop strategic suppliers
21 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Copyright © 2009, Oracle and/or its affiliates. All rights reserved. 21
Packaged Spend Analysis Flow with Spend Classification Solution
Spend Classifica7on
Oracle EBS, PeopleSoft, JDE E1, and Legacy Applications
Procurement & Spend Analy7cs
3
1 24Oracle BI Apps
• Maps raw data into reference taxonomies
• Built for business users • Designed to work with OBI Apps
7.9.6.1 and above
22 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Oracle BI Applications
Stepping Stone to Fusion for Current Oracle Applications Customers
23 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
1. Add insight layer over existing IT assets – Use prebuilt BI Apps to implement
quickly and follow best practices – Start with a single area or tackle
several in parallel – Also build custom analytic apps as
necessary
Oracle BI Applications Implementation Strategy Insight for Today’s Applications and for Fusion
Oracle BI Applications
Oracle EBS Financials
Siebel CRM
PeopleSoft HR
Other Apps
2. Benefit from enterprise-wide analysis as you broaden your implementation
Oracle Fusion Applications
3. Incorporate Fusion Apps using same architecture and technology
24 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Example: Oracle EBS to Fusion Evolution Before Fusion
Apps Unlimited
• Faster time to value w/prebuilt adapters for CRM and ERP applications
• Improve spend visibility and identify savings opportunities
• Improve Contract utilization and operational efficiency
Common Enterprise Information Model Finance HCM SCM Procure Project CRM
OBIA
OBIA Data Warehouse
BI Foundation
Oracle EBS Procurement
Legacy & 3rd Party
ETL Periodic Updates
Pre Packaged Reports &
Dashboards
Self-Service Query &
Reporting
25 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Co-Existence
Common Enterprise Information Model Finance HCM SCM Procure Project CRM
OBIA OTBI
OBIA Data Warehouse
BI Foundation
Oracle EBS Procurement
Legacy & 3rd Party
ETL Periodic Updates
Real-Time Queries
Fusion Procurement
BI View Objects
Pre Packaged Reports &
Dashboards
Self-Service Query &
Reporting
Fusion Embedded Analytics
Fusion Apps • Embed analytics
directly into key business processes
• Deliver real-time and analytical reporting in a single user interface
• Integrated with Oracle’s next-generation Fusion Procurement
Example: Oracle EBS to Fusion Evolution
Apps Unlimited
• Faster time to value w/prebuilt adapters for CRM and ERP applications
• Gain visibility to employee performance to engage & develop key talents
• Lower costs through reduced turnover & more targeted recruiting
26 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
With Fusion
Common Enterprise Information Model Finance HCM SCM Procure Project CRM
OBIA OTBI
OBIA Data Warehouse
BI Foundation
Legacy & 3rd Party
ETL Periodic Updates
Real-Time Queries
Fusion Procurement
BI View Objects
Pre Packaged Reports &
Dashboards
Self-Service Query &
Reporting
Fusion Embedded Analytics
Fusion Apps • Embed analytics
directly into key business processes
• Deliver real-time and analytical reporting in a single user interface
• Integrated with Oracle’s next-generation Fusion Procurement
Example: Oracle EBS to Fusion Evolution
27 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Oracle BI Apps 11g Unified Release (Fusion + AU) • Informatica version
Oracle BI Apps Roadmap
Oracle BI Apps 11.1.1.5.1 (Fusion Apps theme) • Full suite of analytics for Fusion Applications • OTBI – Oracle Transactional BI for Fusion Apps; real-time
analytics vs. warehouse based
Oracle BI Apps 11g Unified Release (Fusion + AU) • ODI version • Increased depth of existing Apps (predictive analytics, scorecards) • Combined support for Fusion Apps + Apps Unlimited + SAP + GBUs • Full uptake of OBIEE 11g, including new capabilities • Sourcing Analytics • Enhancements to Change Orders and Agreements • Procurement Scorecard • New JDE Adapter
Oracle BI Apps 7.9.7 (SAP Source) • SAP Financials • ETL through ODI
Available
Oracle BI Apps 7.9.6.3 (OBIEE 11g compatibility) • Upgraded and certified for OBIEE 11g
Available Oracle BI Applications
Oracle BI Applications for SAP Oracle BI Apps 7.9.7.1 (SAP Source)
• SAP Procurement & Spend • SAP Supply Chain & Order Management • Localization, translation • ETL through ODI
"This information is not a commitment to deliver any material, code, or functionality. The development, release, and timing of any features or functionality described remains at the sole discretion of Oracle"
Oracle BI Apps 11.1.1.6 (Fusion Apps theme) • Incremental Fusion TCO improvements • CxO Dashboards • Leverage new BI Foundation “speed of thought” visualizations
Controlled Availability
Corporate IT
Procurement and Spend Analytics deployment at
Qualcomm
IT Global Operations
29
Agenda § Qualcomm Overview § Purchasing at Qualcomm § Oracle Procurement and Spends Analytics
Solution § Why OBIA/OBIEE § Team Structure § Spends OBIA/OBIEE Implementation § Other Modules
IT Global Operations
Qualcomm Overview § Headquarters – San Diego, CA § Offices - Worldwide § Key Business Areas:
– CDMA Chipsets – Technology Licensing (Patents)
§ FY 2011 Q3 Revenue $3.6B – Up 34% YoY § FY 2011 Revenue – $14.5B (projected)
30
IT Global Operations
Qualcomm Overview
31
IT Global Operations
Procurement Landscape § Distributed procurement model
– Autonomous BUs within “loose” federation – Corporate services and oversight
§ Large R&D, Engineering and Product Development spend
§ Global footprint
32
IT Global Operations
Procurement Landscape § Multiple Oracle EBS instances § Production and MRO procurement models
– Material – Services – SW
33
IT Global Operations
Qualcomm Challenges § Individual BU purchasing groups
– Lack of communication / synergy between teams § Lack of supplier consolidation across BUs § Limited “volume discounts” across spend § Poor visibility to rates negotiated by other BUs § Need for Approved Vendor Lists
34
IT Global Operations
Oracle Procurement and Spends Analytics Solution § Solution driven by Procurement and Spend
engagement with McKinsey & Company – Year long analysis of procurement process
activity and opportunities – Analytics was identified as a key area of opportunity
in the overall procurement solution – Improve process via better data management
and usage
35
IT Global Operations
Oracle Procurement and Spends Analytics Solution § Improved cost management through:
– Supplier performance – Supplier consolidation and AVLs – Volume discounts and improved leverage in
negotiations – Composite spend – Strategic sourcing
36
IT Global Operations
Oracle Procurement and Spends Analytics Solution § Provide consolidated view of all Qualcomm
spend – By supplier, part/product, division,
department, VP, fiscal period, etc. – Better data visibility / utilization
37
IT Global Operations
Oracle Procurement and Spends Analytics Solution
38
IT Global Operations
Pre Procurement & Spend Analytics Architecture
39
IT Global Operations
Current Procurement & Spend Analytics Architecture
40
IT Global Operations
Oracle Procurement and Spends – Overview Dashboard
41
IT Global Operations
Procurement and Spends - KPIs and Drill Into AP Holds
42
IT Global Operations
Oracle Procurement and Spends – Payment Analysis
43
IT Global Operations
Why Oracle BI Applications / Oracle BI § Out-of-box capability
– Prebuilt ETLs, based on EBS – Prebuilt metadata model (RPD) – Significant time savings vs. build from scratch – Multi-source ready – Extendable
§ One, validated source of truth § Robust reporting tool(s)
44
IT Global Operations
Why Oracle BI Applications / Oracle BI § Aligns with Qualcomm technology roadmap
– EBS, WebLogic, Oracle DB, Informatica
§ Dovetails with long term Oracle technical direction – Replace Discoverer – Align with Fusion architecture
§ Transferable skills / resources § Leverages existing Oracle relationship
45
IT Global Operations
Qualcomm’s OBIA/OBIEE Team § OBIEE/OBIA requires many different skills:
– Analysts who understand the business and OLAP – Report developers – RPD developers – ETL developers – DAC developers – Data modelers – DBAs / App Admins
46
IT Global Operations
Qualcomm’s OBIA/OBIEE Team § Utilized existing BI COE, particularly on
Informatica and DAC § Used implementation partner for OBIA expertise § Partnered with Oracle on training and skill
development § Hired an OBIEE/OBIA expert
47
IT Global Operations
Qualcomm’s OBIA/OBIEE Team § Re-purposed existing analyst talent for reporting
– Answers and Dashboard training is key
§ Re-purposed existing integration development skill
§ Augmented with off-shore consulting
48
IT Global Operations
Oracle Procurement and Spend Analytics Implementation § Audience
– Director/VP/C level – Buyer teams
§ Scope – 5 out of box OBIA stars – Custom department hierarchy dimension – Extension to the buyer_d for buyer teams – 7 dashboards / 250 reports
§ Timeline – 9 months 49
IT Global Operations
Oracle Procurement and Spend Analytics Implementation § Team Makeup - Qualcomm
– PM – Analyst – Data Modeler – 1/4 head – ETL x2 – Report Developer x2 – QA x4
§ Team Makeup – Partner – PM, Architect, ETL Developer, RPD Developer
50
IT Global Operations
Development Methodology § Scrum (5 week sprints) § One IT team (data modelers through to analysts) § We focus on getting out-of-box data in front of
customers ASAP § Follow-on sprints are used to enhance the data
model, RPD, and reporting Ø Customers see value from the start, while having the chance
to learn the tool and determine their REAL requirements
51
IT Global Operations
Other Deployed Modules Functionality OBIA Subject Area Implementation Time License Management Service Analytics 1 month Order Management Enterprise Sales 3 months Inventory Supply Chain 3 months Supply Chain Planning Custom 6 months Customer Scorecard Custom 2 months Problem Receipts / NC Custom 2 months
52
IT Global Operations
Future Plans § Expansion to additional Business Units § Additional reporting of existing data § Ramp VP/dept. grain self-service § OBIEE 11g upgrade
– Mobile Analytics – Scorecards – Enhanced Charting Features
§ R12 source upgrade support
53
54 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
Q&A
55 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
BI Applications Demo Pods – Moscone South
Moscone South Pods:
§ Human Resources Analytics (S278)
§ Supply Chain and Order Management Analytics (S276)
§ CRM Analytics (S281)
§ Financial Analytics (S279)
§ Procurement and Spend Analytics (S280)
§ Project Analytics (S277)
56 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
57 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
The preceding 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 decisions.
The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.
Safe Harbor Statements
58 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.
59 Copyright © 2011, Oracle and/or its affiliates. All rights reserved.