Raising the bar Shared services, value creation & business finance optimisation. Mark Pickett VP Finance EMEA Hardware, Oracle

Transcription

1 Raising the bar Shared services, value creation & business finance optimisation Mark Pickett VP Finance EMEA Hardware, Oracle

2 Today s Crisis Can Drive Tomorrow s Transformation Sometimes a crisis can provide you with an opportunity to transform your organization in ways that wouldn t be possible during good times. In the late 1990s, when Oracle s operating margins were under pressure, we embarked on an initiative to consolidate and standardize our IT infrastructure. By the time Oracle had emerged from the dot.com bust in 2003, we had more than doubled our operating margins, and created a strong, integrated platform to support our M&A and organic growth strategies. Jeff Henley, Chairman of the Board Oracle Corporation

3 Oracle Corporation SCALE $37.2B in revenue in FY13* #1 in 50 product/industry categories 380,000 customers in 145 countries 20,000 partners 120,000 employees 15 million developers in Oracle online communities * GAAP revenue reported in USD as of May 31, 2012 INNOVATION 32,000 developers and engineers 18,000 customer support specialists, speaking 27 languages 17,000 implementation consultants 2 million students supported annually 850 independent Oracle user groups with 800,000 members

4 Oracle s Shared Services Journey Phase I : Get Oracle s internal operations in order Simplify. Standardize. Centralize. Automate. Implement plain-vanilla Oracle software to run our business Enhance decision-making and accountability Increase margins

5 Simplify. Standardize. Centralize. Automate & Beyond 65+ financial apps instances Fragmented Data: tens of thousands of Excel spreadsheets Inconsistent Processes Local Support Local Decision Making Autonomous Countries Geographic Functions Country Infrastructure Global Single Instance (ERP) Global Data Warehouse Global Processes Shared Service Centers Centralized Decision Making Multi National Corporation Global Functions Simplified Global Infrastructure

6 EMEA Finance SSC Phase I scope countries 15 processes Dublin

7 Value Creation (1) in Shared Service Centers Allowed to doing things right: Operational Excellence Reducing Cost of business processes Improving Quality of products and services Increasing Speed of operations. and doing the right things: Management Excellence

8 Importance of GPO role Linchpin of Standardization Program GLOBAL PROCESS OWNER In Business Evaluate Shared Service Center Process Use of technology Responsibility profiles and organizational structure Efficiency, effectiveness, relevance, best practices Global headcount requirements Act as Champion of Global Process & Articulate Strategic direction Understanding of global requirements Business needs and service level standards GLOBAL APPLICATION OWNER...In IT Partner with the Global Process Owner Global process definition Best use of technology Support Single Instance and Shared Services Strategy Application support & implementation services

9 Oracle s Business Transformation PHASE II ( ) Business Objectives: Undertake an aggressive acquisition strategy to expand our portfolio Add a new line of business hardware Utilize proven best practices from Phase I to accelerate operational savings Scale business profitably

10 Oracle Acquisitions over 85 Acqns since 2005 APPLICATIONS Middleware Platform and Management Business Intelligence Data Integration MIDDLEWARE Identity & Access Management (pending) Performance Management Enterprise Content Management DATABASES OPERATING SYSTEMS & VIRTUAL MACHINES Operating Systems Systems Management Virtual Machines SERVERS, STORAGE AND NETWORKING

11 Oracle s Shared Services Journey : Phase II Utilize proven best practices from Phase I to accelerate operational savings Simplify, Standardize, Centralize, Automate Transform Dublin SSC to Global Controllers Organization new focus on Control & Acquisitions Establish new Global Centers (Romania, Bangalore) for a number of new centralized processes (Finance/non Finance) / FP&A Value Creation (2) in Shared Service Centres Provides Control Agility & Flexibility Scaleability

12 Shared Service Centre Structure SSCs,197 Countries, 22 Languages Controllers Revenue Recognition Procurement Comp Admin Exp Reporting Customer Contracts Credit & Collections 11 Countries 50 Countries Controllers Revenue Recognition 113 Countries Customer Contracts Credit & Collections Exp Reporting Procurement Comp Admin 113 Countries Controllers Order Entry AR / Cash Apps Exp Reporting Purchasing Fixed Assets Project Acct Credit & Collections Customer Data AP Comp Admin 197 Countries

13 Breaking out of the Country FD Structure Traditional FD responsibilities prior to any centralization Overall Fiduciary responsibility Controlling / Strategic Finance Accounting Tax C&C Purchasing Travel IT Payroll Compensation (Planning / Admin) Facilities Labor law Customer visits / disputes Very procedural, inward-looking position, Stewardship, Diligent Administrator TRANSACTION Manager President Safra Catz Finance Operations / Quote-to-Order Controllership / Order-to-Cash / Source-to-Settle Global Business Finance Corporate : Tax, Treasury, Internal Audit, Risk

14 Managing Change & the Changing Culture Sociology, not Technology it s a People thing Don t Over ExIT just do it! Engage your Top Talent & find your Poachers Turned Gamekeepers Talk the language of change: Making the Impossible Possible Reinforce shared values and norms and keep doing it move from a reactive measure into a core agent of innovation and success Manage Organizational Inertia through a Culture of Change

15 Raising the Bar: Value Creation (3) From 2012 GBF provide Strategic Leadership to across all Business Scale up Global Business Finance with GPOs GBF Global Process Owners / Build communities Standardisation around Best Practices & Measurement Move Shared Service Centers up Value Chain More Automation, More Business Support, at Less Cost Refine Engagement Model / Integrate with In-Country teams Establish Global, Best-in-Class Management Systems Provide committed support to Career Development

16 Raising the Bar: Value Creation: Field Value Add Business Partner Provides reactive decision support as challenger Focus on internal tasks Transaction Manager Business Partner Support Improves performance in co-operation with business Driving Change Phase 1 Phase II

17 Raising the Bar: Value Creation: SSCs Value Add Business Partner GFIC / SSCs start to move up Value Chain, taking Business Partnering Support roles Transactions Business Partner Support Field Business Partners develop Strategic Leadership role Automated Phase III

18 Business Intelligence at Oracle Today Marketing Sales Support Partners Finance Ordering and Contracts Event Intelligence Marketing Contribution Segmentation Campaign Intelligence Data Quality Monitoring Pipeline Intelligence Forecasting Account White Space Up-Sell / Cross-Sell Opportunities Executive Dashboards Operational Dashboards Contract Renewal Management Install Base Intelligence Partner Ordering Partner Enrollment Partner Analytics Revenue T&E Expense Actual vs. Budget Expense by Manager Headcount Ordering Ordering Queue Monitoring Quote-to-Order Flow & License Contract Intelligence

19 Business Intelligence at Oracle Today Supply Chain Procurement & Spend Field Service Manufacturing Value Chain Planning Product Quality Revenue & Backlog Inventory Fulfillment Status Customer Status Order Cycle Time BOM Direct & Indirect Spend Buyer Productivity Contract Compliance Supplier Performance Purchase Cycle Time Task & Labor Resource Utilization Order & Shipment Inventory Ageing & Level of Service Cycle Time Inventory Turns Resource Usage Transaction and Inventory Tactical Plan S&OP Scenarios Risk Inventory and Excess & Obsolete Service Plan Hardware System and Part Reliability Annual Failure Rate against Goals Early Warning System

20 Business Intelligence in Finance License Contracts Example Before BI After BI Contract Turnaround = 14 days Increasing Volume and Processing Time Analyzed root cause Decision based on fact vs. conjecture Implemented process to reduce by 66% Business benefit estimated to be worth $7 million Contract Turnaround = 4 days

21 T&E Analytics Help Manage Spend Travel expenses per employee Issue: Unable to efficiently report on T&E expenses, identify top spenders No T&E view for People Managers, as they do not own cost centers Solution: Give people managers transparency into their actual T&E spend vs. plan Enable proactive cost control Q3FY08 Before Q3FY09 After Oracle Products Implemented: Oracle Business Intelligence Enterprise Edition Travel & Expense Analytics

22 Globalising Business Intelligence the learnings Clear and complete definitions and standards for data Master Data Repository for consistent numbers Global Steering Committee with Executive Sponsorship Need cross-lob support, particularly from Apps IT Create GPOs responsible for Reporting Dashboards, with clear understanding of business and business needs Dashboard must be accurate, reflect the requirements of the users, and in step with the process in which it is used Share Usage metrics with the Users Business Intelligence for Finance has been hardest!

23 Outcome: Better Performance Life isn't about waiting for the storm to pass...it's about learning to dance in the rain Lower costs Better information Better customer service Strong internal controls & easier compliance efforts Fast integration of new acquisitions

24

25