Multiple Pillar Oracle Cloud Implementation Best Practices

Transcription

1 Multiple Pillar Oracle Clud Implementatin Best Practices Clud Financials and Clud HCM O R A C L E W H I T E P A P E R S E P T E M B E R

2 Table f Cntents Intrductin 3 Revisiting Key Dependencies between Oracle HCM and Financials Clud 3 Cmmn Implementatin Cnsideratins 5 Which One t Start First? 6 GSI versus Nn-GSI Envirnments 6 Defining Enterprise Cnfiguratins An Overview 7 Enterprise Structures Cnfiguratr (ESC) 7 Rapid Implementatin Templates fr Financials 9 Legal Entities 10 Divisins 12 Ledgers 12 Business Units 13 Reference Data Sets 14 Jbs and Psitins 15 Departments and Cst Centers 16 Security and Rles 16 Data Cnversin 17 Integratin 18 Key Interfaces Glbal Payrll 18 Key Interfaces Planning and Budgeting 19 Wrkflw Apprval 19 Deplyment Cnsideratins HCM and Financials Cncurrent (Big Bang) 21 1 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

3 Deplyment Cnsideratins HCM First then Financials (Phased) 21 Deplyment Cnsideratins Financials First then HCM (Phased) 23 Cnclusin 24 Appendix Summary f Financials/HCM Cnfiguratin Best Practices 25 2 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

4 Intrductin We have all heard the adage A chain is nly as strng as its weakest link. Applying this cncept t business sftware like Enterprise Resurce Planning (ERP), we wuld cnclude that a business slutin is nly as strng as its weakest integratin. Usually verlked and underestimated, integratin is ne f the mst imprtant factrs t cnsider as part f yur enterprise implementatin. Oracle Clud Services is an integrated service acrss Financials (ERP), Human Capital Management (HCM), Supply Chain Planning (SCM) and Custmer Experience (CX) slutins. This white paper prvides implementatin leading practices t system integratrs wh are abut t assist custmers with new Oracle Enterprise Clud Service implementatins. The purpse f this whitepaper is t identify these dependencies and prvide yu with the infrmatin t make infrmed decisins. The initial scpe f this dcument will fcus n the fllwing ERP and HCM Clud implementatin scenaris:» Big Bang Financials and HCM are implemented at the same time.» Financials then HCM (Phased) Financials is implemented first then HCM is implemented in a future phase.» HCM then Financials (Phased) HCM is implemented first then Financials is implemented in a future phase. Nte: Additinal pillars (CX, PPM, and SCM) will be added in a future dcument release. This is a living dcument that will evlve as service plicies and features evlve. This whitepaper will hlistically address key cnfiguratin decisins and clud deplyment best practices. The purpse f this whitepaper is nt t replace but rather cmpliment individual whitepapers and user dcumentatin n individual Oracle Clud applicatins. Revisiting Key Dependencies between Oracle HCM and Financials Clud Regardless f the Oracle Clud slutin deplyed initially, it is imprtant t plan and cnsider key infrmatin that is shared acrss the Oracle Clud slutin. Fllwing is a summary f the infrmatin sharing between the Oracle Clud Financials and HCM slutins: 3 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

5 Prjects Inventry Accunts Receivable General Ledger Emplyees Organizatins Jbs/Psitins Hierarchies Lcatins Emplyees Assignments Emplyees Organizatins Ledgers Legal Entity Cst Centers Payrll Expense Cmpetencies Time and Labr Sales & Marketing Human Capital Management Emplyees Field Service Cmpetencies Emplyees Cmpensatin Emplyees Assignments Emplyees Emplyees Assignments Expense Acct Emplyees Organizatins Assignments Jbs/Psitins Fixed Assets Expenses Purchasing Accunts Payable Figure 1. Key Infrmatin Sharing between Oracle Clud Financials and Oracle Clud HCM SHARED FOUNDATION DATA BETWEEN ERP AND HCM» Addresses» Lcatins» Assignments» Organizatins» Banks and Bank Accunts» Peple» Business Units» Perids f Service» Cmpetencies» Persn Types» Expense Accunt» Phnes» Jbs» Psitins» Legal Entities» Qualificatins» Ledger» Departments KEY INTEGRATIONS BETWEEN FINANCIALS AND HCM Surce Target Transactin Integratin HCM Financials» Payrll Expenses (Distribute Payrll Accunting)» Time & Labr t Prject Csting ( Prcess Prject Cst Transactins)» Persn Infrmatin (if nt using Oracle Clud)» Emplyment Infrmatin (if nt using Oracle Clud)» Apprval Management (Understanding Apprval Management) Histrically, Financials and HCM slutins were implemented acrss multiple database instances, which required additinal pint integratins t facilitate cnfiguratin and transactin sharing. With Oracle Financials and HCM 4 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

6 clud services, yu have a single data mdel that eliminates a majrity f pint integratins. Hwever, because f this tight integratin mdel, it is imprtant that yu cnsider key cnfiguratin decisins acrss the enterprise slutin, regardless f yur specific implementatin prject scpe. Cnsider the fllwing specific dependencies yu may face. Expenses Expenses utilize the emplyee s HCM assignment t default the fllwing infrmatin: Ledger and Chart f Accunts assciatin derived frm emplyee s assignment Business Unit. Legal Entity derived frm emplyee s assignment Legal Entity (which is derived frm the HCM Legal Emplyer). Expense template based n the emplyee s assignment Business Unit. Prjects Prjects utilize the emplyee s HCM assignment t default the fllwing infrmatin: Ledger and Chart f Accunts assciatin are derived frm an emplyee s assignment Business Unit. Legal Entity is derived frm primary Balance Segment Value (BSV) f Prject charge accunt. Self-Service Requisitin The Self-Service features f Prcurement Requisitins utilize the emplyee s HCM assignment recrd t default the fllwing infrmatin: Self services users are autmatically granted the ability t create requisitins in the emplyee s assignment Business Unit. Managers are autmatically granted the ability t reprt n the data in their emplyee s assignment Business Unit. The default security access can easily be mdified t "pint at" the crrect requisitining Business Unit. Apprvals Financials users needing apprval rles (initiatrs, apprvers) must have bth a relatinship and Assignment recrd via emplyee hire prcess fr apprval functinality t wrk prperly. Deep integratin enables effective data sharing; hwever, it requires a greater understanding f key cnfiguratins acrss the slutin. In the next steps, we will explre the key cnfiguratins t address as part f a multi-pillar implementatin. Cmmn Implementatin Cnsideratins Oracle Clud Services prvides yu the flexibility t implement the Financials and HCM Clud services in either a phased r cncurrent big bang deplyment apprach. In the fllwing sectins, we will discuss the key decisins and main deplyment scenaris fr a multi-pillar implementatin. Remember that requirement management (gathering, reviewing and validating business requirements) shuld cver all the Oracle Clud services deplyment(s). Otherwise, yu may increase the risk f implementing cnflicting requirements and/r cnfiguratins that will limit yur Oracle services business value generatin. 5 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

7 Which One t Start First? Technically speaking, there are n barriers t start with either Oracle s Financials r HCM clud services. Oracle s Functinal Setup Manager (FSM) has the ability t identify the dependencies regardless f starting with either HCM r Financials first. Hwever, what can easily be verlked is the impact that peple and rganizatins play with an implementatin. Organizatinal readiness/availability - which rganizatin is better prepared t supprt a clud implementatin, is a key factr fr cnsideratin. T assist yu with rganizatinal fit, we recmmend that yu perfrm an rganizatinal assessment leveraging the detailed business prcess maps in My Oracle Supprt (MOS). Figure 2 Organizatin Gap Analysis Essentially yu want t cmpare hw yur existing rganizatin s structure (rle and prcesses) aligns with the Oracle Financials and HCM clud services delivered rles and respnsibilities. This exercise will help quantify the rganizatin change required fr a successful implementatin. This analysis will als prvide insight int the ptential rle mappings that may need t be perfrmed in managing rle mappings. GSI versus Nn-GSI Envirnments Histrically, Oracle Clud services prvide tw types f envirnments t supprt yur clud services. A Glbal Single Instance (GSI) is an envirnment that can supprt the entire Oracle Clud Applicatin Prduct suite including CX, Financials, HCM, PPM, and SCM. A Nn-GSI envirnment is an envirnment that can nly supprt a single Oracle Clud Applicatin Prduct suite. Oracle HCM Clud and CX Clud are the nly individual service fferings that may have been deplyed in a Nn-GSI envirnment. 6 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

8 Nte: With the Release 13 upgrade, all existing Nn-GSI envirnments will autmatically be upgraded t GSI envirnments. This will create greater flexibility fr existing Oracle HCM-Only Clud custmers t utilize ther Oracle Clud service fferings. Fr new custmers mving frward, all envirnments will be prvisined as GSI pds. Defining Enterprise Cnfiguratins An Overview Oracle HCM and Financials Clud prvides a series f tls t guide and supprt yu during this mst imprtant step in yur implementatin. Fllwing is a summary f the tls available: Figure 3 Oracle Clud Cnfiguratin Tls During the implementatin, yu wuld utilize Enterprise Structures Cnfiguratr (ESC) t simulate and finalize cre enterprise structures acrss HCM and Financials. Next, rapid implementatin templates shuld be used t cmplete cnfiguratin setup t supprt the implementatin scpe defined in Functinal Setup Manager. If needed, bth Financials and HCM prvide data laders fr lading large number f values fr a cnfiguratin (i.e., talent data, currency rates). Enterprise Structures Cnfiguratr (ESC) Oracle Clud Applicatins have been designed t ensure yur enterprise can be mdeled t meet legal and management bjectives. This flexibility is an advantage but can seem a daunting task upn initial review. T guide and streamline the activity, Oracle HCM Clud Services prvides the ESC. This figure illustrates the prcess t cnfigure yur enterprise using the Enterprise Structures Cnfiguratr. 7 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

9 Figure 4 ESC Interview Prcess The ESC is an interview-based tl that guides yu thrugh the prcess f setting up a basic enterprise structure. By answering questins abut yur enterprise, the tl creates a structure f divisins, legal entities, business units, and reference data sets that reflect yur enterprise structure. Nte: The leading implementatin practice is t utilize ESC fr yur high level enterprise cnfiguratin mdeling activities. The Enterprise Structures Cnfiguratr (ESC) prvides the ability t rll back an enterprise cnfiguratin in certain situatins: Manual: Yu can manually rll back an enterprise cnfiguratin after lading it, fr example, because yu decide yu d nt want t use it. Autmatic: If an errr ccurs during the prcess f lading the cnfiguratin, then the applicatin autmatically rlls back any enterprise structures that were created befre the errr was encuntered. Fllwing are key cnsideratins fr utilizing ESC as part f yur implementatin: 1. ERP has mre dependencies n hw Business Units must be defined, s start with yur Financials requirements first befre addressing yur HCM requirements. 8 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

10 2. D nt utilize bth ESC and Enterprise Structure Rapid Implementatin Templates fr the same cnfiguratin values such as Legal Entities, Business Units, and reference data sets. If ESC is used t cnfigure Legal Entities, then tab Cmpanies and Legal Entities within Rapid Implantatin Sheets cannt be used and manual cnfiguratin tasks must be perfrmed. The verlap and usage f these tls shuld be analyzed early-n with design cnsideratins. 3. At this time, ESC can nly be used fr the initial cnfiguratin and shuld nt be used fr cnfiguratin updates/maintenance. 4. The illustratin abve nly shws ne ptential use f Divisins. Divisins are useful fr a nn-legal Entity based hierarchy. The cncept f divisins in mst implementatins is actually a slice thrugh Legal Entities and nt an aggregatin f them. 5. The fllwing ERP bjects are nt addressed by the ESC and will require utilizing the apprpriate tabs in the RapidImplementatinFrGeneralLedger.xlsm rapid implementatin spreadsheet: a. Chart f Accunts, Calendar, Ledger b. Cst Centers c. Chart f Accunts Segment Value Hierarchies d. Dcument and Jurnal Sequences Fr additinal infrmatin n utilizing ESC, please refer t the sectin Establishing Enterprise Structures Using the Enterprise Structures Cnfiguratr: Explained in the Oracle Help Center. In the fllwing sectins, we will address Rapid Implementatin Templates fr Financials Anther methd fr enterprise cnfiguratin is t use the Define Financials Cnfiguratin fr Rapid Implementatin task list in FSM t streamline yur setup cnfiguratin. The rapid implementatin task list minimizes the time needed fr yu t cmplete yur key setups and enable the day-t-day use f Oracle Financials Clud. Here is an example f sme f the setups that can be dne using rapid implementatin template: Figure 5 Example f Rapid Implementatin Template 9 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

11 Rapid implementatin is a way t cnfigure a financial enterprise and financial reprting structures quickly using sheets in a wrkbk that uplad lists f: Cmpanies (legal entities) Ledgers by cuntry Business units Chart f accunts and segment values Segment value hierarchies Financial sequences Required subledger accunts Fllwing are key cnsideratins fr utilizing Rapid Implementatin Spreadsheets as part f yur implementatin: A primary Ledger is created fr each unique cuntry entered in the Cmpanies and Legal Entities sheet. Yu cannt change the Chart f Accunts, Accunting Calendar, r Currency fr yur Ledgers after the setup is created. Yu can create mre than ne hierarchy fr any f yur Chart f Accunt segments after the initial enterprise structure setup There is n rllback capability with Rapid Implementatin Templates. Fr additinal infrmatin n utilizing rapid implementatin templates, please refer t the sectin Define Financials Cnfiguratin fr Rapid Implementatin: Overview in the Oracle Help Center. Nte: Yu are nt restricted t nly use the setup cnfiguratin in the rapid implementatin task list. Yu can manually add the standard Financials ffering task lists and tasks t yur rapid implementatin prject t change and update yur setup. Legal Entities Legal Entity is a legally recgnized entity that can wn and trade assets and emply peple in the jurisdictin that it is registered. Legal Entities can wn prperty, trade, repay debt, accunt fr themselves. Each Legal Entity is accunted fr in nly a single Ledger, but ne Ledger can serve multiple Legal Entities. As a first step, it is imprtant that key stakehlders acrss Financials and HCM agree n the legal structure. Each registered cmpany (with its wn tax ID) that perfrms financial transactins shuld be defined as a Legal Entity in Oracle Clud services. Sequencing by Legal Entity: yu can assign different dcument, accunting and reprting sequences t each Legal Entity within a Ledger and / r Business Unit. Sequencing by Legal Entity is enabled at the Ledger level in the Ledger Optins page. Frm a HCM perspective, there are tw key cnsideratins when creating Legal Entities: 10 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

12 Will the Legal Entity hire and manage emplyees? If yes, then the Legal Entity must be dented as a Legal Emplyer. Will the Legal Entity be respnsible fr cllecting and reprting payrll taxes n behalf f emplyees? If yes, then the Legal Entity must be dented as a Payrll Statutry Unit. When a Legal Entity is defined as a Legal Emplyer, yu can create emplyee infrmatin in HCM. Figure 6 Example f a Legal Entity defined as a Legal Emplyer and Payrll Statutry Unit Designating a Legal Entity as a Legal Emplyer enables the Legal Entity t be available in HCM. In the illustratin belw yu will see hw we are able t assign an emplyee t the Legal Emplyer we previusly created. Figure 7 Example f a Persn assigned t Legal Emplyer 11 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

13 Fr additinal infrmatin n implementatin cnsideratins fr Legal Entities please refer t the sectin Define Legal Entities in the Oracle Help Center. Divisins Divisins are used in HCM t define the management rganizatin hierarchy, using the generic rganizatin hierarchy. This hierarchy can be used t create rganizatin-based security prfiles. Yu can rll up Business Units int HCM Divisins if (a) Business Units prcess transitins acrss multiple Legal Entities, and (b) yu structure yur Chart f Accunts with a hierarchical management structure. In Financials, Divisin is mre f a cnceptual design (ex. Line Of Business) that can be implemented as a segment within the Chart f Accunts. Fr example, a Divisin can represent a prfit center r gruping f prfit and cst centers, where the divisin manager is respnsible fr attaining business gals including prfit gals. Divisin is nt a required field in Financials r HCM. Divisins and Legal Entities are independent cncepts. In practice, Divisins are useful fr a nn-legal entity based hierarchy. The cncept f Divisins in mst implementatins actually is a slice thrugh Legal Entities and nt an aggregatin f them. Nte: Divisin is strictly a Clud HCM cnfiguratin bject. Utilizing HCM Divisin(s) will have n impact n yur Financials cnfiguratin. Fr additinal infrmatin n implementatin cnsideratins fr divisins please refer t the sectin Decisins Explained Wrkfrce Deplyment Planning in the Oracle Help Center. Ledgers Oracle Financials clud reflects the traditinal segregatin between the general ledger and assciated subledgers. Detailed transactinal infrmatin is captured in the subledgers and peridically imprted and psted in summary r detail t the Ledger. A Ledger determines the currency, chart f accunts, accunting calendar, ledger prcessing ptins, and accunting methd fr its assciated subledgers. Each accunting setup requires a primary ledger and ptinally, ne r mre secndary ledgers and reprting currencies. Fllwing are key cnsideratins fr yur shared Ledger structure: The number f ledgers and subledgers are unlimited and determined by yur business structure and reprting requirements. Lcal and crprate cmpliance can be achieved thrugh an ptinal secndary ledger. The apprach n hw perid clse activities are managed is a key cnsideratin. If perid clse activities are cmpletely independent acrss accunting rganizatins perating within a cuntry with different business plicies and perid clse cycles, then separate Ledgers may be apprpriate. Ensure that yur Legal Emplyer s Payrll Expense jurnal can pst t the crrespnding Legal Entity s primary ledger. A specific Legal Emplyer s Payrll Expense jurnal cannt pst t multiple Ledgers. One per Ledger currency generally means ne Ledger per cuntry. Fr additinal infrmatin n implementatin cnsideratins fr Ledgers please refer t the sectin Implementing Enterprise Structures - Ledgers in the Oracle Help Center. 12 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

14 Oracle s best practice recmmendatin is that Ledgers shuld nt span cuntries. Failing t fllw this guidance is likely t result in undesirable cnsequences dwn the line. Business Units A Business Unit is a unit f an enterprise that perfrms ne r many business functins that can be rlled up in a management hierarchy. A Business Unit can prcess transactins n behalf f ne r many Legal Entities. Cnsider the fllwing illustratin: Figure 8 Example f an enterprise structure Fllwing are key cnsideratins fr yur enterprise Business Unit structure: The first step in defining yur Business Unit structures acrss Financials and HCM is t review the features assciated with each type f Business Unit / business functin befre deciding what rganizatin levels Business Units will represent. 13 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

15 Financials has mre dependencies n hw Business Units must be defined, s start with yur Financials requirements first befre addressing yur HCM requirements. SCM Prfit Center Business Units must nt span Legal Entities. Requisitin Business Units will usually nt span legal entities (but there is n prhibitin). Payables Payments Business Units will nrmally crrespnd with the disbursement bank accunt(s). The general recmmendatin is t define ne Ledger and ne Business Unit per cuntry. This apprach will maximize the user prfile default value capabilities and streamline data entry. If yu have security requirements whereby yu want t segregate areas f the business int secure sils, OR If yu have very different business and perating terms fr different segments f the business and they are run almst as separate cmpanies, then yu shuld cnsider different Business Units within the Legal Entity. Yu can tie yur list f Departments, Jbs, and Grades t the HCM Business Unit s that parts f yur enterprise have different setups. General Practice: When a jint pillar implementatin is being designed, the Business Units are initially defined frm a Financials perspective. HCM then needs t use this baseline, althugh yu may require creating additinal Business Units if defining a shared service peratin r utilizing Psitins. Having multiple Financials Business Units (BU) enables shared services Prcurement mdel (with requisitining BUs t prcurement BU), security by BU (as data rles are BU based) and Intercmpany invicing between departments (BUs). Key cnfiguratin decisins fr a single versus multiple ERP Business Unit structure: Payments prcessing by each BU r acrss BU (Clud Financials supprts crss BU payments). 1 r multiple bank accunts fr payment prcessing and supprting intercmpany rules. Clud ERP des nt supprt cash receipting / lckbx acrss Business Units. This will require cash receipting / lckbx prcesses setup at the Business Unit level. Fr additinal infrmatin n implementatin cnsideratins fr ERP Business Units, refer t the sectin Business Units in the whitepaper Oracle Financials Clud: Shared Service Centers (SSC). Reference Data Sets Oracle Clud has a reference data sharing feature. The reference data sharing functinality supprts peratins in multiple Ledgers, Business Units, and warehuses. As a result, there is a reductin in the administrative burden and the time t implement new Business Units. Fr example, yu can share sales methds r transactin types acrss Business Units. Yu may als share certain ther data acrss asset bks, cst rganizatins, r prject units. 14 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

16 Figure 9 Examples f Setup Data that can Shared Using Reference Data Oracle Clud Applicatins cntains a reference data set called Enterprise in Financials and Cmmn in HCM. Define any reference data that affects yur entire enterprise in this set. Fr additinal infrmatin, please utilize the fllwing link t see a list f the reference data bjects that can be shared acrss business units (link). Reference data is nt the nly ptin f cnfiguratin sharing available in Oracle Clud Services. Fr example, COAs can be shared acrss Ledgers; Lcatins are shared acrss lcatin sets. This detailed sharing ptin prvides yu the flexibility t further refine cnfiguratin data sharing in Oracle Clud Services. Leading Practice: Reference Data Sets and Business Unit values shuld be discussed at the same time given their interdependencies. Jbs and Psitins As yu implement yur enterprise mdel, ne f the earliest decisins yu face is whether t use Jbs, Psitins, r a cmbinatin f bth. Jbs and Psitins represent rles that enable yu t distinguish between tasks and the individuals wh perfrm thse tasks. A jb can be defined glbally in the cmmn (i.e. Enterprise) Reference Set, whereas a psitin is defined within ne Business Unit. One f the earliest decisins yu will make is whether t use jbs r a cmbinatin f Jbs and Psitins. Nte: At a minimum, yu need t create Jbs t supprt yur rganizatinal structure. As part f yur discussin, it is imprtant t nte the ptential impact that psitins and jbs may have n Prcurement apprvals. There are ptins fr using Jb Levels as an alternative t psitin hierarchies just fr the purpse f Financials apprvals. Psitin hierarchies may require additinal maintenance. Fr additinal infrmatin n Jbs and Psitins implementatin cnsideratins please refer t the Jbs and Psitins: Critical Chices sectin in the Oracle Help Center. 15 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

17 Departments and Cst Centers A Cst Center represents the smallest segment f an rganizatin fr which yu cllect and reprt csts. A Department is an rganizatin with ne r mre peratinal bjectives r respnsibilities that exist independently f its manager and has ne r mre wrkers assigned t it. The financial perfrmance f Departments is generally tracked thrugh ne r mre Cst Centers. Oracle HCM Clud assigns wrkers t Departments, and tracks the headcunt at the departmental level. Emplyee cunt within a Department is frequently used t perfrm allcatins in Oracle Financial and Oracle EPM prducts. HCM can als utilize persn, psitins, cuntry, LDG, and Payrll t establish data security scpe fr users. Lk at yur reprting needs frm bth an HCM and Financials perspective befre yu define yur Cst Centers and Departments. Best Cnfiguratin Practice: HR Department(s) lgically align t Financial Cst Center(s). This apprach will minimize the cnfiguratin required t transfer Payrll expenses t General Ledger (i.e., n detailed mapping r individual emplyee distributins required fr payrll csting). Fr additinal infrmatin n Departments and Cst Center implementatin cnsideratins please refer t the Manage Departments Wrkfrce Structures sectin in the Oracle Help Center. Security and Rles Bth Oracle Financials and HCM Clud services utilize the same simplified security mdel t implement user applicatin security via the Clud Security Cnsle. Users are granted access t applicatins with the additin f Rles t their user and, in turn, these rles are made up f multiple duties which dictate the applicatin access (i.e. user navigatin menu paths available). It is als imprtant t cnsider whether yu plan t implement a shared services mdel. Mst large custmer will have users perating at all levels: enterprise shared services, legal entity respnsibility, reginal respnsibility, and line management respnsibility. The tw mst cmmn areas f securing data within the tw pillars are: Financials utilizes Business Units and their relatinships t Ledgers and Legal Entities t secure transactin prcessing by business functins, management reprting, and transactinal data security fr cmpanies perating shared service centers, and reference data. HCM utilizes Organizatins and Departments t establish data security scpe fr users. Bth Oracle Financials and HCM prvide the flexibility t define exceptins t the standard default f data security and, in additin, have mre user definable security ptins available fr enhanced cntrl - Data Access Sets & Segment Value security fr ERP and Psitin Hierarchies & Areas f Respnsibilities (AR) fr HCM. The HCM enterprise structure can als play a rle in aut-prvisining rules. Fllwing are the HCM fields that can be used t autmatically assign jb rles t users based n the cnditins specified. 16 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

18 Figure 10 HCM fields that can be used fr Aut-prvisining Jb Rles Fr additinal infrmatin n security implementatin cnsideratins please refer t My Oracle Supprt Advisr Webcast Security Cnsle Overview and Prvisining Rles t Applicatin Users in the Oracle Help Center. Data Cnversin Althugh HCM and Financials bth have strng file based lader capabilities, there are slight nuances abut using each which are imprtant t understand and different places t get yur questins answered mst efficiently. 1. Data Lading Oracle ERP Clud utilizes tw methds fr lading data (transactins): ADF Desktp Integratr spreadsheet tl (ADFDI) Use this MS Excel-based imprt feature t imprt small vlumes f data that typically change n a peridic basic. Currently, ADFDI spreadsheets are available fr Budgets, Currency Rates, GL Jurnal Entries, etc. File-Based Data Imprt (FBDI) - Use the file-based data imprt feature t imprt large vlumes f data frm third-party r ther Oracle applicatins. Data is first laded int interface tables in Oracle ERP Clud, then a separate prcess is used t lad validated data int applicatin tables. Fr a cmprehensive list f Data Imprts fr ERP please refer t the File-Based Data Imprt fr Financials Clud n Oracle Help. Oracle HCM Clud s primary methd fr data cnversin is utilizing HCM Data Lader (HDL). HDL supprts bth c-existence and full deplyment mdes f HCM Clud. A great resurce fr guidance is the Data Migratin and Integratin Advisr dcument n My Oracle Supprt. 2. Data Validatin Data validatin is a key activity within the data cnversin prcess. Oracle has prvided the fllwing guidance t assist yu with validating data in the Oracle Financials and HCM Clud services. 17 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

19 Yu shuld als leverage the fllwing My Oracle Supprt Dcument Oracle Enterprise Resurce Planning Clud Service: Hw t Verify Data Cnversin Results (Dc ID ). Oracle HCM als has a data file validatr tl fr HDL - Data File Validatr Tl fr HCM Data Lader (Dc ID ) Nte: Bth Oracle HCM and Financials data lading tls d nt have the ability t rllback transactinal data nce it has been cmmitted t the clud service envirnment. Integratin Bth Oracle Financials and HCM Clud Services ffer the same types f integratin ptins t 3 rd party external systems: 1. Predefined Extracts. 2. Web Services. There are sme slight nuances that need t be addressed t ensure effective planning is perfrmed. Frm a technlgy perspective the majrity f Oracle HCM web services are based n the REST service architecture while Financials web services are based n SOAP and REST service architecture. The web services and data requirements may be different hwever the end results are the same. Best Practice: If yu are implementing mre than 10 interfaces then it is advised that yu purchase a dedicated GSI instance fr interface develpment s yu can minimize ptential cnflict with functinal user activities such as cnfiguratin and testing. Fr additinal infrmatin n HCM integratin ptins refer t the Integrating with HCM Clud dcument in Oracle Help Center. Fr additinal infrmatin n Financials integratin ptins please refer t the Clud ERP Integratins dcument in My Oracle Supprt. Key Interfaces Glbal Payrll As a best practice, yu shuld set up accunts in payrll fr the equivalent accunt cmbinatins maintained in General Ledger. By using a similar structure, yu avid discrepancies, minimize maintenance, and imprve cmmunicatin between departments when reslving questins abut jurnal entries. Fr example, specify the same natural accunt segment fr the payrll cash accunt as used in General Ledger, s that yu can recncile the cash accunt and bank balance fr transactins that share the same bank accunt. Additinal evidence fr ur recmmendatin f ne Ledger per Cuntry has t d with Glbal Payrll. One Ledger per Cuntry simplifies Glbal Payrll as nly nce cst allcatin flexfield is definable per Ledger. As such, if multiple Ledgers are used within ne Cuntry, careful thught must be given t the structure f the flexfield (CKFF) and the shared values frm any Chart f Accunts structures and List f Values frm multiple Ledgers. 18 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

20 Oracle Glbal Payrll integrates with Oracle Cash Management and Oracle General Ledger. This integratin facilitates the setup f banks, branches, and bank accunts, and the recnciliatin f bank statements with payment transactins. Fr additinal infrmatin n the Glbal Payrll integratin please refer t the Distribute Payrll Accunting Infrmatin sectin in the Oracle Help Center. Key Interfaces Planning and Budgeting Single Sign On (SSO) and rle-based security are cntrlled by Oracle Identity Management, which defines a security dmain fr each service instance. After a successful lgin, access t the service is determined by the rle assigned t the user. An identity dmain cntrls the accunts f users wh need access t service instances. It als cntrls the features that authrized users can access. A service instance belngs t an identity dmain. Users are shared between the instances; hwever, access privileges are granted t users separately fr each instance belnging t an identity dmain. Yu can integrate Oracle General Ledger Clud data with the Oracle Enterprise Perfrmance Management Clud if yu use Fusin Clud Release 11 r higher. This integratin enables yu t simply pick the desired surce ledger frm General Ledger Clud, set up mappings and then initiate the prcess t pull the data int the EPM Clud applicatins. This integratin can be run manually, r scheduled fr a specific time. Fr additinal infrmatin n the EPM Clud integratin with General Ledger Clud, refer t the Integrating the General Ledger with the EPM Clud sectin in the Oracle Help Center. Wrkflw Apprval HCM and Financials have each prvided sme specialized extensins t the cmmn apprval management features. It is imprtant t understand bth and ptimize the maintenance prcedures fr the custmer. Cnsider the illustratin belw: 19 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

21 Figure 11 Hw Financials Apprval Services leverage HCM Persn and Assignment Infrmatin Bth Financials and HCM utilize Oracle Clud Apprvals Management (AMX) fr wrkflw apprval management. AMX utilizes the fllwing list builders t build yur apprval list. List Builder Human Resurces (HR) Supervisry Jb Level Psitin Apprval Grup Functinality The HR Supervisry hierarchy levels are selected. The number f levels available fr apprval is specified. A relative dllar amunt is attached t a jb. The apprval list mves up the HR Supervisry hierarchy t the pint where apprval finds a jb with the necessary apprval amunt. A relative dllar amunt is attached t a psitin. Apprver grups represent functinal r subject matter experts utside the transactin s managerial chain f authrity, such as Legal r Human Resurce persnnel. These grups are static. Nte: Financials wrkflw has an inherent dependency n HCM emplyee infrmatin and HCM rganizatin structure. Best practice is t ensure that the Oracle HCM Clud rganizatin structure can supprt the required Financials wrkflw apprval lists. Fr additinal infrmatin n Oracle s Clud Apprval Management, refer t the Define Apprval Management sectin in the Oracle Help Center. 20 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

22 Deplyment Cnsideratins HCM and Financials Cncurrent (Big Bang) In additin t the guidance prvided abve please cnsider the fllwing as part f yur deplyment strategy: Resize Stage/Test envirnment befre User Acceptance Testing (UAT). Cnsider yur UAT activities as a Dress Rehearsal fr the g-live event. There will be user activity frm bth a Financials and HCM perspective. Even thugh there are subtle infrastructure differences between Stage/Test and Prductin envirnments, resizing yur Stage/Test envirnment will ensure that any ptential fr disruptin f user activities are minimized. Test acrss prduct services business prcesses cver multiple prducts and pillars. There can be a tendency t address a business prcess by functinal areas (HR, Payrll, Benefits, General Ledger, and Cash Management). This is typically a divisin f labr t supprt parallel wrk streams/activities and accelerate implementatins. Hwever, care must be taken t ensure that wrk steams/activities refcus n business prcesses that may be supprted acrss multiple mdules. Example: Cnfiguring and validating the Payrll prcess shuld include bking the payrll expense t the General Ledger. Tight crdinatin acrss the implementatin prjects. Majrity f ur custmers implementing HCM and Financials cncurrently have separate implementatin prjects fr each prduct family. This apprach enables several implementatin activities t be perfrmed in parallel and effective prject resurce allcatin. Hwever, this prmtes an increased risk in cnfiguratin and requirements cnflicts between the prduct families. We recmmend that a crss-functinal team acrss HCM and Financials meet n a weekly basis t discuss key cnfiguratin decisins and crdinatin f jint activities (e.g., testing, instance management, security). Nte: Bank infrmatin t pay emplyees frm Oracle Payrll and the bank infrmatin t pay emplyees frm Oracle Expenses Clud, needs t be managed separately. In Oracle Expenses, the emplyee has t enter their bank infrmatin. Deplyment Cnsideratins HCM First then Financials (Phased) In additin t the guidance prvided abve the fllwing must be addressed as part f the slutin cnfiguratin: In rder fr HCM t be cnfigured there are fundamental structures that are required in Financials as part f the implementatin: Chart f Accunts Accunting Calendar Ledger Legal Entity Currently, the integratin between the Financials structures created by HCM Clud s ESC and Financials Clud s Rapid Implementatin templates are nt cmpletely integrated, and it is unreasnable t assume 21 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

23 that HCM Implementatin Cnsultants can design the Chart f Accunts and Ledgers befre the HCM prject starts, which can take mnths requiring effrt frm the finance team. Nte: In this example, we will assume that the initial HCM implementatin is NOT including Subledger Accunting r General Ledger t supprt Payrll Accunting. In the interim, Oracle suggests that HCM Implementatin Cnsultants create the bare minimum setup fr Financials r a dummy setup and then later crrect and cmplete the Financials enterprise structures when they are ready t implement Financials Clud. Define yur Calendar with a starting date early enugh t bring ver yur histrical GL Balances when yu implement Financials. Define the Chart Of accunts structure with the minimum required segments and values. Define a Retained Earnings accunt. Manually define a Primary Ledger using the required Retained Earnings accunt yu defined in the previus step. D NOT create any Secndary Ledgers r Reprting Currencies. D NOT pen any GL Perids. D NOT cmplete yur accunting cnfiguratin. D NOT create and Financials transactins. D NOT create any Accunt Cde Cmbinatins. In the future, when the custmer is ready t implement Financials Clud, the fllwing activities shuld be perfrmed t safely mdify the Chart f Accunts definitin: Make the changes t the Chart Of Accunts definitin. Fr example, when yu created yur COA when implementing HCM Clud, yu may have nly defined three segments: Balancing segment, Cst Center, and Accunt. Hwever, after meeting with the finance team, they have decided n a seven segment chart f accunts. Create a new accunt cde cmbinatin fr Retained Earning and reassign it t the Ledger definitin. Disable the riginal Retained Earnings Cmbinatin (it is nw crrupt). Run the ESS jb t rebuild the Essbase cube. Nte: The abve changes shuld be dne in Test/Stage first and everything tested, validated and reviewed n bth HCM and Financials befre attempting t d it in Prductin. Financials must have at least ne Business Unit assigned t a primary ledger, and a default Legal Entity. Financials als utilizes Business Units t establish data security, and business functins, such as prcurement, invicing and payment ptins, expense reprt templates and reprting ptins (filtering, gruping). 22 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

24 Cnversely, implementing Payrll as a part f the HCM implementatin will require a discussin n key enterprise financial structures (Legal Entity, Ledger, Chart f Accunts, and Cst Centers). Currently ESC des nt cver Ledger and Chart f Accunts setup s plan t manually cnfigure these items. Ratinalize Lcatin and Gegraphy values t facilitate multiple uses. When creating Lcatins, cnsider the varius physical lcatins that can be represented: Wrkfrce structure (i.e. wrk lcatin) Fixed Assets Legal Entity Inventry rganizatin 3 rd Party entities (emplyment agencies, tax authrities) Nte: Sme Oracle Clud Human Capital Management implementatins d nt require recrding f accunting transactins and therefre, d nt require implementatin f a Ledger. Be careful nt t verlk Ledger and financial reprting requirements. Deplyment Cnsideratins Financials First then HCM (Phased) Alng the same lines f thinking, having a minimalist HCM cnfiguratin apprach can have limiting impacts further in the implementatin. If Supervisry Hierarchy is used fr Apprval Management, make sure every emplyee has at least ne supervisr assigned. The same is true fr Jb level. Make sure yu have a hierarchy f Jb levels. Cmplete a resizing request after the Financials phase deplyment but befre HCM deplyment (after UAT is cmpleted). Especially if the HCM deplyment includes mdules that will generate a larger amunt f transactins (e.g., Time and Labr, Payrll). If yu are implementing Financials first, it may be tempting t define a single HCM Business Unit simply as a placehlder t define departments, Jb structures fr tracking emplyees. Adding additinal Business Units after the fact when yu bring HCM n bard will require additinal effrt, s start with yur cmplete list f Business Units fr Financials and HCM. Nte: It is extremely imprtant t have a cmplete and agreed upn definitin n Legal Entities and Legal Emplyers. If emplyee infrmatin is laded t a temprary/placehlder Legal Emplyer the remedy will include terminating all emplyees frm the temprary/placehlder Legal Emplyer and reassigning them t the crrect Legal Emplyer. 23 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

25 Cnclusin Oracle Financials and HCM Clud services prvide yu the flexibility t deply these services in a parallel r phased fashin. Integratin is a key enabler fr bth Financials and HCM implementatins. Oracle prvides tight integratin acrss Financial and HCM business prcesses that minimizes setup and maximizes infrmatin flw. This tight integratin requires a greater understanding f key dependencies and decisin acrss the entire business prcess. The first step in implementing a multi-pillar slutin is t design and cnfigure the enterprise structure. 24 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

26 Appendix Summary f Financials/HCM Cnfiguratin Best Practices Fllwing is a summary f the key cnfiguratin cmpnents and recmmendatins fr an Oracle Financials Clud and HCM Clud multi-pillar implementatin. FINANCIALS/HCM MULTI-PILLAR CONFIGURATION CONSIDERATIONS Cmpnent Best Practice Cnfiguratin Explanatin Ledger, Business Unit Reference Data Chart f Accunts Divisins Ledger and Business Unit shuld nt crss multiple cuntries. Define ne central reference data set fr key cnfiguratins that can be shared acrss all business units Cmmn glbal chart f accunts fr all legal entities. Utilize Divisins in HCM t represent if yu have the cncept f a divisin level within yur rganizatin tday. A Ledger is defined t a single currency. Ledger and Chart f Accunts assciatin derived frm emplyee s assignment Business Unit. The reference data sharing functinality supprts peratins in multiple ledgers, business units, and warehuses. As a result, there is a reductin in the administrative burden and the time t implement new business units. Easier cnslidatin f legal entities financial accunting and financial reprting. Straight frward transfer f Payrll jurnal entries int General Ledger. Divisin is a HCM-nly cncept and Divisin(s) are nt required fr Financials. Ledgers Best cnfiguratin practice is t have ne Ledger and ne Business Unit per cuntry. Oracle ffers three methds fr cnslidatins: (1) Reprting Only Cnslidatins, (2) Balance Transfer Cnslidatins, r (3) Financial Management Cnslidatins using Oracle Hyperin Financial Management. Legal Entities Legal Entities & Legal Emplyer Each registered cmpany (with its wn tax ID) shuld be defined as a legal entity in Oracle Financials Clud. A Legal Emplyer must be a Legal Entity but nt every Legal Entity must be a Legal Emplyer. Each Legal Entity is accunted fr in nly ne Ledger, but ne Ledger can serve multiple Legal Entities. The Legal Emplyer is captured at the Wrk Relatinship level, and all emplyment terms and assignments within that relatinship are autmatically with that Legal Emplyer. Legal Emplyer infrmatin fr wrker assignments is als used fr reprting purpses. Legislative Data Grup A single Legislative Date Grup (LDG) fr each cuntry. Each Legislative Data Grup is assciated with ne r mre Payrll Statutry Units. Create at least ne Legal Entity designated as a Payrll Statutry Unit (PSU) fr each LDG. Legal Emplyer & Payrll Statutry Units The Legal Emplyer and Payrll Statutry Units are the same. When yu set up Legal Entities, yu can identify them as Legal Emplyers and Payrll Statutry Units, which makes them available fr use in Oracle Clud Human Capital Management (HCM). A tax reprting unit is created autmatically when yu add a Legal Entity and identify it as a Payrll Statutry Unit. Payrll Statutry Units are Legal Entities that are respnsible fr paying wrkers, including the payment f payrll tax and scial insurance. A Payrll Statutry Unit can pay and reprt n payrll tax and scial insurance n behalf f ne r many legal entities. 25 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

27 Cmpnent Best Practice Cnfiguratin Explanatin Cst Centers and Departments HR Department lgically align t a FINANCIALS cst center(s) Better leverage f defaulting values (i.e., Departments) frm Jb and/r Psitin data. Simplifies accunting mapping fr Payrll t General Ledger interface. Jb Cdes Supervisry Level Apprvals User Lcatins and Gegraphies A relative dllar amunt is attached t a jb. The apprval list mves up the HR Supervisry hierarchy t the pint where apprval finds a jb with the necessary apprval amunt. If Supervisry Hierarchy is used, make sure every emplyee has at least ne supervisr assigned. The same is true fr Jb level. Make sure yu have a hierarchy f jb levels. Users shuld first be created as emplyees. Ratinalize lcatin values t facilitate multiple uses. Please nte that technically HR Departments d nt need t lgically align t Financials cst centers, hwever, this will require additinal effrt during persnnel changes and increased cnfiguratin fr the Payrll t GL mapping. Leveraged fr General Ledger jurnals and Payables vucher apprvals. Ensures that apprval wrkflw wrks if using the Supervisry Hierarchy. Pre-requisite: Applicatin security requires a legal emplyer, business unit, and a wrk relatinship fr security assignment. Lcatin is shared data element fr FINANCIALS and HCM. Having a cmmn set f values will reduce maintenance. 26 MULTI PILLAR ORACLE CLOUD CONFIGURATION BEST PRACTICES

28 Oracle Crpratin, Wrld Headquarters Wrldwide Inquiries 500 Oracle Parkway Phne: Redwd Shres, CA 94065, USA Fax: C O N N E C T W I T H U S blgs.racle.cm/racle facebk.cm/racle twitter.cm/racle racle.cm Cpyright 2017, Oracle and/r its affiliates. All rights reserved. This dcument is prvided fr infrmatin purpses nly, and the cntents heref are subject t change withut ntice. This dcument is nt warranted t be errr-free, nr subject t any ther warranties r cnditins, whether expressed rally r implied in law, including implied warranties and cnditins f merchantability r fitness fr a particular purpse. We specifically disclaim any liability with respect t this dcument, and n cntractual bligatins are frmed either directly r indirectly by this dcument. This dcument may nt be reprduced r transmitted in any frm r by any means, electrnic r mechanical, fr any purpse, withut ur prir written permissin. Oracle and Java are registered trademarks f Oracle and/r its affiliates. Other names may be trademarks f their respective wners. Intel and Intel Xen are trademarks r registered trademarks f Intel Crpratin. All SPARC trademarks are used under license and are trademarks r registered trademarks f SPARC Internatinal, Inc. AMD, Optern, the AMD lg, and the AMD Optern lg are trademarks r registered trademarks f Advanced Micr Devices. UNIX is a registered trademark f The Open Grup Multiple Pillar Oracle Clud Implementatin Best Practices September 2017 Authr: Brett Beaubuef Cntributing Authrs: Becky Alvarez, James Arthurtn, Vish Gaitnde, David Haimes, Theresa Hickman, Eamn Kearney, Neil Ramsay, Ena Singh