Meets and ExceedsBy David A. Kelly
Merrill Lynch uses a combination of Oracle products to go beyond collecting information and bring benefit to the business.
The world of financial services changes quickly, and with every compliance and reporting regulation and customer demand comes the need for financial services firms to alter their internal applications, reports, and key performance indicators. Merrill Lynch, a wealth management, capital markets, and advisory firm with US$1.6 trillion in assets, has found that one secret to success during shifting economic times has been its ability to deploy sophisticated but adaptable business intelligence capabilities that work seamlessly with its financial IT infrastructure and applications.
Like many organizations, speed to market is critical for Merrill Lynch. “We wanted to create an environment that would be very flexible, so that it could easily change as user needs are changing, because we need to meet demanding business climate requirements,” says Manoj Bohra, director of the business intelligence and development departments of the finance technology group at Merrill Lynch.
Merrill Lynch’s goals are part of a trend that many companies—not just financial services firms—share.
“We’re seeing several trends happening in IT that are affecting enterprise organizations, such as financial services companies,” says Ted Farrell, chief architect and senior vice president of tools and middleware, Oracle. “One of the first is extending business processes and having an infrastructure that allows you to make changes to the business very easily. Now, organizations need to be able to adjust and make decisions faster, and service-oriented architectures and solutions like Oracle Fusion Middleware and Oracle Business Intelligence are allowing them to do that.”
As businesses and regulations evolve, flexible technology is key.
“It’s become extremely critical for firms to implement technologies that can change with the changing needs of the business and regulatory environment,” says Rob Hegarty, managing director at Tower Group, a research and consulting firm focused on the financial services industry. “All of those things make it imperative that financial services firms have a highly flexible, very open technology platform.”
From Difficult to Flexible
Like most financial services companies, Merrill Lynch has many lines of business, including global markets and investment banking, global wealth management, fixed income, ML Bank, and more. However, the company’s finance technology group works horizontally across those units, supporting the finance function for them in a consistent manner—expense management, monthly close, legal and management reporting, as well as transparency of balances.
Merrill Lynch once had many legacy applications that were used for a combination of reporting and warehousing. The mix-and-match environments were troublesome, both from a support perspective and in terms of the availability of profit-and-loss and other reporting figures. The time it took to close accounting periods was vital, and the company’s financial solution, based on a mixture of systems, wasn’t meeting business needs.
These factors led to a decision to eliminate most legacy financial applications and migrate to an Oracle-based environment. In addition, Merrill Lynch selected Oracle for its data warehouse initiative and Oracle’s Hyperion business intelligence applications to enable it to manage and quickly change its business. Starting in 2004 with its finance global initiative, Merrill Lynch also merged nearly a dozen general ledgers (GLs) into a single chart of accounts within two instances of Oracle Applications—one for the Americas and one for all the regions. Its GL system is fed by more than 300 sources.
“Our data warehouse is updated from both instances of our Oracle Applications, with a latency of only a few minutes,” says Bohra. “It’s a very aggressive data warehouse environment powered by highly aggregated Oracle Essbase reporting cubes.”
All the data can then be reported using Oracle’s Hyperion Essbase - System 9 and Oracle tools, leveraging back-end Oracle Databases. The system offers users information fast.
“When users want to find out how our numbers are turning for a specific account or business for the last 13 months, or two years, or four years, they can do that with a click using Hyperion Essbase,” Bohra says. “You don’t have to come back to technology and change the requirements of how the report should be changed. You can just click, click, click, and in five minutes you can have a brand-new report depicting exactly what you wanted.”
The company’s combination of Oracle products—including Oracle Business Intelligence, Hyperion Essbase - System 9, Oracle’s Hyperion Data Relationship Management, Oracle Applications, Oracle Data Warehouse using Oracle Database 10g, and more—helps Merrill Lynch stay ahead of its competition.
Organizations in all industries depend on different technology products and tools for different functions in the enterprise. The use and integration of key Oracle products, however, can do much more than add those product features to the enterprise.
“The combination of Oracle Business Intelligence with the Hyperion Essbase products allows organizations to take data from different, disparate sources and logically tie them together, and not just into an information portal,” says Oracle’s Farrell. “They enable you to create an abstract data model on top of your physical data models that gives you views you would never have been able to see before.”
This has certainly been the case at Merrill Lynch, where a key portion of the company’s Hyperion Essbase environment is Hyperion Data Relationship Management, where all the reporting hierarchies are maintained.
“Information is fed continuously throughout the day into an Oracle-based reference data repository, which is a single point of distribution for all the general ledger-based financial reference data within Merrill Lynch,” says Merrill Lynch’s Bohra. “The reference data repository then feeds into the finance data warehouse—based on Oracle technology—that’s then used by the business intelligence platform for all Merrill Lynch reporting and consolidation.”
Dynamic business requirements demand dynamic information management and business intelligence, and that’s why Hyperion Essbase and Hyperion Data Relationship Management are such an important component of Merrill Lynch’s finance technology solution.
“Organizations have all this great data, and a good business intelligence system allows you to bring that together and build a logical model. Hyperion Essbase adds the value of understanding that data and being able to predict your business based on that data and then tracking the business to see exactly how well you did or didn’t do,” says Oracle’s Farrell. “The concept is being able to build dynamic applications that can change as your business changes, and bringing information together in context is key.”
In the end, for Merrill Lynch, the real benefit of having an integrated Oracle architecture for its finance technology needs is allowing its employees to spend time on what really matters—business decisions.
“Our infrastructure allows our users to invest time analyzing data for business benefit rather than spend time just trying to collect the data,” says Merrill Lynch’s Bohra.
David A. Kelly (email@example.com) is a business, technology, and travel writer who lives in West Newton, Massachusetts.