Case Vaisala OyjHFM-kehitysprojektiTiedon Oracle Hyperion EPM –iltapäivä 26.11.2015Tytti Erkama & Antti Kolkka

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Vaisala Organization

Sep 2015

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Weather Business

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Our Markets Mega TrendsOur Observation Solutions

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Controlled Environment Business

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Our Markets Mega TrendsOur Measurement Solutions

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Key Vaisala Characteristics from Viewpointof Financial Reporting Architecture

International, many subsidiaries (parent + 11 subsidiaries in 11 countries)need for clear communication, common rules and ability to manage transfer pricestransparently

Matrix organization; Profitability responsibility cascaded down to Business Areas andforward to Business Units/Regions according to customer responsibility, Factories andService Units working for all or several customer groups

need for cost allocations and working hour charges

Many business types: product business, delivery project business, calibration and repairservices, field services, information services…

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About the project

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Project Key TargetsImprove Management reporting flexibility and transparency to needed dimensions

Align HFM with new reporting dimensions applied in Vaisala ERP (Oracle EBS)All key reporting views consolidated in own dimensions– Flexibility: enables cross-dimensional analyses– Reliability, efficiency and simplicity: less values in each dimension reduces work

and risks in system maintenance (less complex hierarchies)– New dimensions fully added to Management Reporting via GL/HFM

Internal transaction processing and reporting renewal providing transparency tofinancial information with and without internal marginHFM reporting capability improved with new information from EBS, reduction of manualwork related to acquisition eliminations and notes reporting

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Towards Simplicity via Clever Utilization ofGeneral Ledger DimensionsAnalysing Gross Profit in old HFM

Weather

Transportation

Airports

Airports Oyj AirportsServices Oyj

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Analysing Gross Profit in new HFMLegal entity Business Organisation Business Type

VaisalaOyj

APS FISR

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HFM 2015 – High level timetable

May14 – Contract negotiation

June14 – Design (2 days)

August14 – Build starts: Meta data creation, acquisition cost calculation renewal, ruleschanges

September14 – HFM build continues, testing starts with 2014 data, FDM EE design

October14 – HFM history conversion for 2013 & 2014, HFM testing with EBS test data, FDMbuild and testing

November14 – HFM testing with EBS test data

December14 – 2014 November data to new HFM

January15 - 2014 December data to new HFM, New HFM and FDM EE implementation toproduction environment

February, March, April15 – support for closing (risk for rule changes must be kept in mind)

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May-2014 Jun-2014 Jul-2014 Aug-2014 Sep-2014 Oct-2014 Nov-2014 Dec-2014 Jan-2015 Feb-2015 Mar-2015 Apr-2015

Contractnegotiation

Design phase,Conversionstrategy holiday

HFM build,Testing

HFM build,FDM design,Conversions

HFM testing,FDM build &testing

HFM testing,FDM testing

Nov dataconv

Dec data conv,Prod 'migration'22.1.15

GO LIVE,closing support

Closingsupport

Closingsupport

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Successful project executionScope Management

Scope is clear to all parties and officially approvedRealistic and detailed plan

Project planned in sync with the ERP project and datawarehouseproject timetablesTask level project plan done on daily level to ensure key resourcesavailability on site on critical daysEnough time reserved for the history data conversion and validation

Risk plan updated regularly and mitigations designed in advance

Key improvements

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MET DEF DEV APS RDS MAR ERG

EBIT

CoGS and OPEX Reporting in Vaisala P/LFunctional P/L

CoGSPICOPS VariancesWork hoursCRS PIC + variancesOther direct costs(travel, subcontracting)Uncharged(OPS, PMO, SER)

Business costs: Partially posted to segment and others allocated in HFMSales cost: Partially posted to segment and others allocated in HFM

R&D cost: Partially posted to segment and others allocated in HFMAdmin cost: Allocated to segments in HFM

Net Sales (NS)

Gross Profit

Product: NS, PIC, Variances, Other CoGS, OPS Uncharged

Systems: NS, PIC, Variances, Work hours, Other CoGS, PMO, OPS and SER Uncharged

Project: NS, PIC, Variances, Work hours, Other CoGS, PMO, OPS and SER Uncharged

CRS: NS, Service item PIC, material PIC, SER Uncharged

Information, Rents: NS, Work hours, Other direct costs, SER Uncharged

Field service, Spares: NS, PIC, Work hours, Other CoGS, SER Uncharged

AME EME CHN OAPJAP

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About Vaisala HFMScenarios: Actual, Forecast, Target; Forecast pre (previous)Years: 2013 onwardsEntity hierarchy used for legal companiesCustom1 used for audit trailCustom2 used for fixed assets movements and country informationCustom3 used for cost centerCustom4 used for business organisation => Vaisala profitability responsibilityCustom5 used for business type => Vaisala business model with the customerChart of accounts used ’normally’

supports two different P/L’s: functional and cost type basedtwo cash flows: direct and indirect

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Key Improvement: Intercompany transactionsAll intercompany transactions are posted to Vaisala group level and thus eliminated onlyin the operating unit dimension (not by business organisation or by business type)

Intercompany sales, receivables and payables are posted to own internal accounts in EBS; IC (Intercompany) with partner code informationFor material transactions the intercompany margin share is posted to a separate account in EBS

Inventory, Deferred CoGS and CoGS PIC (product inventory cost)

Intercompany eliminations in profit and loss statement are done based on Intercompany sales information inHFM

sales eliminated and same amount eliminated from CoGSCoGS elimination adjusted with the change of IC-margin in the inventories/ project WIP if the goods are still in the inventory

Intercompany balance sheet items are reconciled and eliminated from both sides in Vaisala Group in HFMinternal AR eliminated, internal AP eliminated and potential mismatch eliminated from a ’plug account’IC margin in inventories and project WIP eliminated

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Key improvement: Data transfer with FDMEE

Vaisala uses FDMEE to transfer data from ERPFDMEE relies on Oracle Data Integrator (ODI) as the engine that extracts datafrom the defined sources (Oracle E-Business Suite 12)most of the data transferred with the standard FDMEEFixed assets movements transfer done with Oracle Open Interface Adapter anddirectly accessing data from relevant EBS tables– Befimports script to load data from FA tables to OI table

In the transformation project all history data was converted with FDMEE as wellFDM conversions rules defined once but reused tens of times for several yearsand scenarios of data

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Data mapping rules in FDMEEData loaded from GL will be validated in FDMEEData load mapping rules have been created to mapEBS data to HFM dimensionsThe main rule is to keep the dimension as it is inthe source system (except account)

6 digit- EBS accounts will be mapped to HFM accounts(5 digits)Accounts in EBS are more detailed than in HFM –multiple EBS-accounts have been mapped to one HFMaccountAll P&L accounts in HFM are revenue-type accountsSign of expense accounts must be changed in FDMEE

Data load mapping rules:AccountEntityICPCustom1Custom2Custom3Custom4Custom5

Management reportingRoadmap

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Management reporting development roadmap2015

Go-live of major EBS ERP and HFM projects Jan-1st 2015Vaisala’s new business structure announced Mar-6th

April Management Accounts provided in May according to new business structureNeeds for stabilization and continued trainingLearning to capitalize new capabilities

YearlyVaisala patches HFM continuously; compatibility with IE, MS etc.

TBDPlanning process and tool development

Current planning process based on HFM Smartview uploading Excels governed by dozens ofusers

Top Management Reporting Packages (Powerpoint) based on linked MS applicationAutomation through Vaisala Business Intelligence solution and potential other tools

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HFMReportingStudio

Smartview

Monthly

Reporting system architecture overview

eBS 12.2 Spreadsheet

FDMEE

HFM•Monthly statutory and management reporting•Allocations of operating expenses•Consolidation of budget and forecast

Datawarehouse

DailyMonthly

OBIEE –Intuitive Subject areas &Dashboards• Sales and orders reporting• GM analyses: Product profitability• Vaisala to business type/region analysis• Process KPIs and performance analysis

Monthly

Monthly

ETL

SpreadsheetSpreadsheetSpreadsheet

Spreadsheet2016: Mgmt

reportingtool/ portal

Custom builtstarmodels

SalesForce.com

Daily

Operationalreporting

?

Thank you!

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