Lead with IntelligenceBy David Baum
Oracle data warehouse, business intelligence, and enterprise performance management solutions deliver information, analysis, and efficiencies that put you ahead of the competition.
Agile companies need to make decisions—from what markets to enter and which products to sell to what software works best—and they need to make them quickly. But they can’t make critical business decisions if they don’t have the information they need. From the sea of data that’s available, managers must be able to get what they need, when they need it, to assess and analyze both performance and results.
“In times of economic stress, managers are looking for clear and immediate visibility into what’s happening in their business,” says Paul Rodwick, vice president of product management, Oracle Business Intelligence. “Ideally, they want this information by customer, by product line, by sales channel—by whatever slice of the business is needed—and they want to understand the reasons for performance variances.”
That’s tough to come by, continues Rodwick, when business leaders lack insight into the performance of customers, products, and key processes. They are unable to pinpoint leading and lagging parts of the business quickly, and they lack a single, consistent view of information across functions. This leads to time wasted gathering information.
“What they really want is a cross-functional view that combines metrics from different parts of the business, such as sales and manufacturing or HR and customer service,” Rodwick says. “Yet, while they need to access data efficiently from many source systems, extracting data can be next to impossible.”
To make sure that they can take advantage of all the data at their disposal, companies have turned to Oracle data warehouse, business intelligence (BI), and enterprise performance management (EPM) software that helps them structure strategic, financial, and operational management processes.
Oracle provides a complete, integrated, and open stack of data warehouse, BI, and EPM solutions—from storage to scorecard—that helps organizations manage their information more effectively. Together, these Oracle technologies enable organizations to be smart, agile, and aligned.
Extreme-Performance Data Warehouse
Oracle offers a broad set of solutions for building data warehouses, data marts, and operational data stores, anchored by Oracle Database. Organizations demanding extreme data warehouse performance have chosen the HP Oracle Database Machine, a complete system of software, servers, networking, and storage designed to run multiterabyte data warehouses.
Allegro Group, one of the world’s largest internet auction sites and the largest e-commerce company in eastern Europe, selected the HP Oracle Database Machine and its revolutionary data warehouse architecture for one primary reason: to obtain precise information to make precise business decisions.
Allegro Group has more than two dozen Web sites in more than 14 countries in eastern Europe, including Russia, the Czech Republic, and Hungary, that amass more than 500 million page views a day by about 13 million users. The company’s business is growing by more than 40 percent a year—but the amount of data it generates has been growing by 65 percent a year. And until recently, the company lacked a unified perspective into all of this information, causing analysts to obtain different answers to the same questions.
“As a consequence of our rapid growth, our knowledge gap became too big,” says Christian Maar, CIO of Poznań, Poland-based Allegro Group. “In addition, managing all this information had become more and more difficult.”
When Allegro started looking for a new data warehouse and data storage environment in the middle of 2008, the company “did many tests with many vendors,” Maar says. “When we heard Oracle was about to release an entirely new solution, we decided to hold off on finalizing our decision.”
Maar believes it was worth the wait. The HP Oracle Database Machine, announced at Oracle OpenWorld in September 2008, is a grid of eight database servers with 64 Intel processor cores running Oracle Database 11g and Oracle Real Application Clusters on Oracle Enterprise Linux. This data warehouse solution also includes a storage grid of 14 HP Oracle Exadata Storage Servers with 112 processor cores that’s connected to database servers over InfiniBand. The HP Oracle Exadata Storage Server smart storage software offloads data-intensive query processing from the database servers and locates it closer to the data.
“The HP Oracle Database Machine beat competing solutions on bandwidth, load rate, disk capacity, and transparency,” says Maar.
On the software side, Allegro Group tested BI tools from Cognos, Business Objects, Microstrategy, and Oracle. Again the company picked Oracle. This time, the deciding factor was a desire for easy integration. “We picked Oracle because we wanted to have our entire data warehouse and BI solution from one vendor,” Maar says.
In December 2008, Allegro Group deployed the HP Oracle Database Machine and began generating operational and statistical reports using Oracle Business Intelligence Suite, Enterprise Edition Plus. Allegro Group also created an interface to its existing systems using Oracle Warehouse Builder, a core component of Oracle Database 11g. Each day, Oracle Warehouse Builder automatically loads production data into Allegro Group’s Oracle data warehouse, which already holds more than 7TB of data on the HP Oracle Database Machine.
Allegro Group saw a significant performance boost from the new data warehouse. “A query that used to take 24 hours to complete now runs in less than 30 minutes on the HP Oracle Database Machine,” says Maar, “and that’s without any manual query tuning.”
Maar finds the business benefits even more compelling. Previously Allegro Group could offer Web reports and statistics only biweekly in spreadsheets. “Now the production data is loaded into the HP Oracle Database Machine every 24 hours and it’s available online, so users can drill down to slice and dice the data whenever they like,” he says.
For example, line-of-business managers can do week-to-week comparisons and analyze clickstream data to identify buying trends of customers. Analysts can monitor the value of cross-selling activities, maintain a precise record of merchandise flow, and track all auction activities by user type, date, and region—drilling down into categories and subcategories. This knowledge enables the company to conduct more-precise marketing campaigns.
“We now have accurate figures on a daily basis,” Maar sums up. “This wasn’t possible before.” Further, Maar expects that eventually information will be available even faster than that. “By the end of 2009, we plan to offer real-time information—information with a maximum of 30 minutes’ delay,” he says.
Another company that’s using BI to get better information and accelerate business decisions is Audatex, a Solera company, which offers software applications for automotive claims processing, estimating, shop and yard management, and related business functions. Its solutions help insurance carriers, collision repair shops, and automotive recyclers automate core business processes, streamline workflow with industry partners, and manage performance.
Audatex supports these customers and more than 1,000 internal users in six countries with Oracle E-Business Suite. Now Audatex has enhanced that support, providing better information more quickly with Oracle Business Intelligence Applications, which enable companies to deploy packaged analytics easily with Oracle Applications.
Built on Oracle Business Intelligence Suite, Enterprise Edition Plus, Oracle Business Intelligence Applications deliver role-based intelligence companywide—for everyone from front-line employees to senior management—from a range of datasources and applications including Oracle E-Business Suite, Oracle’s PeopleSoft, Oracle’s Siebel, and third-party systems. Integrated capabilities span many disciplines, such as budget planning, workforce planning, sales territory planning—essentially any domain that requires what-if analysis and modeling. Audatex uses Oracle Business Intelligence Applications for its general ledger, accounts receivable, accounts payable, and purchasing functions.
Before Audatex deployed Oracle Business Intelligence Applications, managers had to generate standard financial statements, enter the data into a spreadsheet to create management reports, and then download the transaction data into another software application for additional analysis. According to Terence Ng, director of global information systems at Audatex, these methods were time-consuming, labor-intensive, and prone to errors. Furthermore, they didn’t yield key performance indicators (KPIs) for analysis. “We wanted our analysts to do analytical work rather than shuffling data from place to place,” Ng says.
Audatex contracted with Business Intelligence Consulting Group, an Oracle partner, to implement Oracle Business Intelligence Applications. The implementation team developed custom dashboards, reports, and KPIs using Oracle Business Intelligence Enterprise Edition, and implemented data-row-level security by cost center, line of business, company, and country to ensure that only authorized users could view sensitive financial information.
“Oracle Business Intelligence Applications include a prebuilt data warehouse, so all we need to do is pick the data elements and report attributes and then use them to generate a report,” says Ng.
Obtaining a single-vendor solution for storing, managing, and analyzing data—in conjunction with prebuilt analytic applications—dramatically accelerates the implementation cycle, says Ng, who is responsible for the Audatex global enterprise resource planning and BI implementations.
“According to our estimates, if we had to do all of the data mapping, modeling, and transformations ourselves, it would probably take three or four times longer than it took to implement Oracle’s prebuilt BI solution,” Ng says. “Oracle Business Intelligence Applications identify and load all the required data elements into the data warehouse. All we need to do is activate a data transfer process to include the pertinent information.”
The implementation team deployed Oracle Financial Analytics to create a self-service financial reporting environment for users throughout the United States and Canada, including profit and loss revenue reports, expense analysis by cost center reports, and many other reports from the general ledger, accounts receivable, and accounts payable data.
Additionally, the implementation team created a series of dashboards to keep employees in touch with financial and operational metrics. An executive dashboard provides at-a-glance information on revenue trends; actual returns versus forecast projections; net operating income; head count; revenue per head; and earnings before interest, tax, and amortization expenses (EBITA).
“We have highly targeted analytics, yet we did not need to create a data mart or generate custom reports,” says Ng. “Our management gets accurate, up-to-date information to make informed decisions. In our industry, having this insight at your fingertips is essential.”
A receivables dashboard provides information about monies due, credit risks, collector efficiency, days sales outstanding, and other KPIs. “This information enables our finance team to manage cash inflows and collect debt,” says Ng. “It also provides an overview of payables so the accounting managers and controller can manage cash outflows and ensure timely payments to suppliers.”
So far, says Ng, senior executives and finance and accounting personnel are the primary beneficiaries of these BI efforts. “Thanks to Oracle BI tools and applications, they no longer need to generate reports manually or ask IT professionals for assistance,” he says.
Similarly, line-of-business managers can keep an eye on the finances for their cost centers including budgeting, forecasting, planning, and cost analysis. One feature that helps them do this is the iBot, a feature of Oracle Business Intelligence Suite, Enterprise Edition Plus, that delivers reports to these managers and executives automatically.
iBots, which are Web robots, can filter and analyze data. Then, driven by schedule or events, or upon detection of a problem or opportunity, iBots determine the appropriate individuals to notify and deliver real-time, personalized intelligence by e-mail, pager, PDA, or mobile phone. That information delivery can even trigger other iBot information deliveries. “This helps us be more proactive and respond to issues more quickly,” says Ng.
In the near future, employees in the Audatex sales and customer support areas will enjoy additional reports, operational metrics, and dashboards from Oracle Business Intelligence Suite, Enterprise Edition Plus. “This is a very powerful tool that enables not just our finance team but people in many different departments to obtain timely, actionable information. Customer support is a prime example,” says Ng. “We want to keep track of the performance of the call center to ensure we are always responding to customer issues promptly.”
John Hagerty, vice president and research fellow at AMR Research, suggests the following BI best practices for companies to reach their goals.
“Structure strong data governance practices including sourcing, transforming, and storing information,” he advises. “Determine which metrics are most important, and make sure everybody agrees that they are the correct ones. And present information in a consistent way that is consumable. Some people may love having a 200-page report; others will want to drill interactively into the data.”
EPM: Management Analysis
Oracle’s family of BI applications and data warehouse solutions is only part of the overall data picture. For companies that need management analysis and enterprise performance management applications, Oracle’s Hyperion EPM products support strategic and financial performance management processes by delivering predictable results, improving transparency and compliance, and increasing business alignment. EPM applications can help provide a competitive advantage and leverage companies’ operational investments.
eSilicon, a fabless semiconductor company based in Sunnyvale, California, provides an extensive suite of application-specific integrated circuit services and solutions aimed at delivering a flexible, low-cost, lower-risk path to volume chip production. It uses Oracle Hyperion Planning and Oracle Essbase along with Oracle E-Business Suite and Oracle Data Integrator to obtain consolidated information for forecasting and financial planning.
As a contract-based, nonrecurring engineering services business, eSilicon depends on several payment milestones to forecast and recognize revenue. According to Larry Peyton, director of financial planning and analysis at eSilicon, these variables have a big impact on the balance sheet in terms of deferred cost, accrued cost, unbilled receivables, and deferred revenue, which reflects on financial results and cash flows. “We used Oracle Hyperion Planning to create some very unique calculations to help us forecast and manage those metrics,” Peyton says.
Before eSilicon deployed Oracle Hyperion Planning, the company lacked a corporate overview that pulled everything together—the plan, the variances, and the detailed statistical information.
“We wanted a database and BI environment that would give us a single source of truth for everything that’s going on within the company including budgets, statistical information, head count, and other variables,” says Naidu Annamaneni, senior director for e-business and processing integration at eSilicon. “Previously we had multiple forecasts, and it was hard to keep track of which one was current, let alone bring them together to do comparisons and variance analysis. With Oracle Hyperion Planning and Oracle Essbase, we have everything in one consistent database.”
As a result, reporting processes that used to take as long as two weeks can now be completed in only minutes or hours. Additionally, finance professionals have more flexibility to create new finance templates and reports.
Right now about a dozen people in finance and e-business depend on the new BI software. Ultimately, eSilicon plans to roll out Oracle Hyperion Planning and Oracle Essbase to all of its business users, including sales, marketing, operations, and executives. Annamaneni and his team are devising a self-service model that will permit these business users to access the information whenever they want. “Oracle Hyperion Planning and Oracle Essbase are very intuitive. A half-day training is all anyone needs to be proficient,” he says.
So far, the new BI solution has been easy to deploy. In all, eSilicon needed just three months to go live, just in time to begin its annual budgeting process. “The state of the economy is requiring management to be very proactive,” Peyton says. “Oracle Hyperion Planning and Oracle Essbase let our executives collaborate worldwide in real time. They can track changes as they occur and know that everybody is looking at the same information.”
Peyton says the EPM/BI software makes the team much more efficient as well.
“We can do things in minutes or hours that used to take days or weeks,” he says. “I can say with 100 percent certainty that without Oracle Hyperion Planning and Oracle Essbase, we wouldn’t be able to manage the business so efficiently. Now we are more nimble, more proactive, and we have fast access to important financial information.”
David Baum (email@example.com) is a freelance business writer based in Santa Barbara, California.