Product Configuration

1
Project Management andOracle Project Accounting
Oracle NCOAUG February 25, 2000

2
Project Management and Oracle Project Accounting

• TOPICS
• Business Case Why integrate with a Project
  Management Tool?
• What do the business process flows look like?
• What are likely enhancements?
• What is a Proven Approach?

3
Problem with disjointed systems
Project Manager
Credit Analyst
Project Plan
Order Entry Shipping Systems
Billing Revenue Systems
GL
Sub Contract System
Revenue Recognition
Financial Analyst
Financial Project Reporting
Manual and Automatic Project Info
4
Symptoms

• High cost and inaccuracies in tracking project
  PL
• Duplicate entry of data
• Some project managers able to construct solid
  plans and manage to plan, others are not
• High risk exposure
• Excessive reconciliation efforts
• Delays in billing
• Problem growing with business volume

5
Whats it going to take to solve the problem

• Implement a project office
• Standardize Project management process and tools
• Integrate the operational and financial tools

6
Business Case for Implementing the Project Office

• Realign and formalize a project management
  infrastructure
• Assist in reaching predictable outcomes from a
  variety of project management situations
• Develop, maintain and support the ABT Project
  Management Tool
• Research, develop, and administer project
  management curriculum, project standards, best
  practices, and work breakdown structure
• Resource management
• Develop a profit center approach to providing
  certain project management services
• Centralized repository of project management
  experience

7
What is the ABT Project Management Tool Kit?

• Common Repository of data
• Pre-define standard WBS
• Common tasks and task dictionary
• Common resource estimate based on project
  characteristic
• Standard tasks all projects must have - revenue
  milestone, equipment shipment, project expenses
• Common Resource Management across projects
• Employee time entry and assignments
• Flexible views and reporting for all project
  stakeholders
• Managers workbench

8
ABT Enterprise Project Management
9
Add Oracle PA To The Solution

• Create project sub-ledger that holds detailed
  costs and revenues.
• Automate collection and dissemination of project
  financial information.
• Revenue Recognition
• Cost of goods sold
• Draft invoice generation
• Deferred cost collection
• Collect all costs and revenues for project
  Forecast at Complete (FAC)
• Hardware
• Direct Labor
• Subcontract/Other direct project costs
• Improve accuracy and timeliness of project
  information reporting.
• Use Internet to collect project costs
• Eliminate duplicate entry - generate GL from PM
  tool
• Up to date project status across the enterprise

10
Solution
Project Manager
Financial Analyst
Sub Contract System
ABT
Order Entry Shipping Systems
Billing Revenue Systems
GL
Oracle Projects
Credit Analyst
11
Business Flow View

• How does this work?

12
ABT Integrator Information Flow

• From ABT to Oracle
• Project and WBS definition
• Time phased cost budget by resource
• Actual labor time
• Completion of tasks and milestones
• From Oracle to ABT
• Actual cost of equipment
• Actual cost of sub-contracts and other POs
• Actual cost of expenses
• Resource definition
• Can choose direction of some transactions

13
Project Creation and Maintenance
ABT Project Manager plans project resources and
estimates
Integrator Project is Transferred to Oracle
ABT Project is Baselined
Oracle Finance creates Agreement and adds misc
header information
Oracle Finance creates or interfaces revenue
budget
ABT Project Manager maintains WBS and project
estimates
14
Cost Collection
ABT Project Manager/Resource Manager approves
time sheets
Integrator Actual Labor hours transferred to
Oracle
ABT Labor resource reports time against task
ABT Time Posted
AMG Labor cost is calculated - Oracle rates and
burdening
Oracle Labor cost distributed and GL
transactions created
Oracle Usages posted or imported for Equipment,
Expenses, Inter-departmental or Vendor Invoices
Integrator Pull charges from non-labor resources
into ABT as actuals
ABT Project Manager maintains project
estimates and tracts variance
15
Enhancements

• What did we add?

16
Challenges

• ABT Integrator is a new product
• Current version requires modifications for
  differences in set-up and added data (ie user
  defined fields)
• Next version is supposed to greatly improve
  flexibility
• Performance is slow, also being addressed by ABT
• Very few people have integrator knowledge

17
Challenges

• Oracle and ABT have some differing operational
  parameters
• Net negative costs allowed in Oracle but not ABT
  -Mapped negative to an ABT user defined field and
  project managers will be trained to manage
• Difference in definition of start and finish
  dates - modification removed from interface to
  Oracle
• Different Users have different level of detail
  requirements
• PM needs estimate by resource (ie Joe Smith)
• Finance needs estimate by expenditure type (ie
  Project Management)
• Created cross reference roll up for budgets -
  modification

18
Other Enhancements

• Representing equipment in the WBS
• Customized an interface from order entry to ABT
  to represent equipment cost and schedule within
  the project
• Normalizing labor hours for salaried resources
• Want actual number of hours worked in ABT for
  accurate history to base future estimates. Want
  standard work week in costing because employee
  only gets paid for 40.
• Budget transfer from ABT to Oracle is for
  baseline only
• Needed a forecast at complete budget in Oracle
  which is equal to the estimate remaining plus
  actuals. Created our own budget import for
  current estimate to complete from ABT.

19
Purchases

• AP invoices has an interface with Oracle PA but
  invoice actuals are not currently picked up by
  integrator
• Not an issue for our implementation because
  invoices were custom interfaced to PA as usages
• May want ABT schedule to interface with
  purchasing system
• Suggest the date/manage the date required for PO

20
Implementation Approach
2 4 weeks
4 12 weeks
1 4 months

• Review business
• Identify problem area boundaries
• Estimate costs benefits

• Analyze problem areas
• Prototype high risk areas
• Collect functional requirements
• Define To-Be processes
• Conduct Conference Room Pilots
• Test business case
• Define organization change requirements
• Develop conceptual design
• Define implementation roadmap

• Complete functional specifications
• Complete design specification
• Define and populate rules and data
• Build and test
• Training
• Implement organizational changes

21
Implementation Recommendations

• Assign dedicated team
• Full-time resources (include functional and IT
  personnel)
• Executive sponsorship and participation
• Design for enterprise, implement for business
• Plan for organizational changes
• Focus first phase
• Dont underestimate rule development and testing
• Building a standard WBS
• Limits of integration

22
What to Look For in A System Integrator Partner?

• Demonstrated leadership in end-to-end solutions
• Project Management Tools experience
• Electronic Commerce
• Data Warehousing
• ERP
• Supply Chain Management
• Experienced professionals
• Extensive industry and best practice knowledge
• Both functional and technical skills
• Commitment to build strong partnership for
  success
• Proven implementation methodologies
• Deliverable-based arrangements
• Focused on knowledge-transfer

23
Kathy J Ferree

• KPMG Consulting, LLCManager High Technology
  PracticeWork [phone]Email
  kferree_at_kpmg.com
• Ms. Ferree has more than 10 years of professional
  experience, primarily within the manufacturing
  and high technology industries. Since joining
  KPMG in 1995 she has worked within the Oracle ERP
  group focused primarily on large integration
  projects. Her current focus is in helping
  companies derive effective solutions to business
  problems in the areas of information technology
  and operations management, including project
  management. Her primary role as Manager includes
  program management, business analysis and
  justification, and project quality assurance. She
  was involved in the update of the KPMG
  international implementation methodology for ERP.
  
• The industries in which Ms. Ferree has specific
  experience include financial services,
  communications equipment, manufacturing, and
  consumer products. Her clients include the
  following corporations
• Motorola ? Ryder ? Culligan ? General
  Electric
• Burns Aerospace ? UCFC ? Akzo Nobel ? Jenn Air
• Ms. Ferree is a graduate of The Ohio State
  University where she received a BS in Business
  Administration with a concentration in
  Productions and Operation Management and
  Information Systems. Ms. Ferree is certified in
  Production and Inventory Management by APICS.

24
Sandip Banerjee

• KPMG Consulting, LLCConsultant Communications
  Content PracticeWork [phone]Email
  skbanerjee_at_kpmg.com
• Sandip has a functional grounding spanning over
  five years in different management and consulting
  activities. He has experience in analysis and
  design techniques, as well as the entire life
  cycle of application software package
  implementation. Presently he is focused on Oracle
  Applications package software implementation.
• The industries in which Sandip has specific
  experience include high-tech, communication,
  power, steel, dry cell and service industries in
  the functional areas of production planning,
  financial operations and project management. His
  clients include the following corporations
• Motorola
• IXC Communications
• PricewaterhouseCoopers LLP
• INDAL
• EIIL
• Sandip graduated from Indian Institute of
  Technology, Kharagpur and received his BTech
  degree in Mechanical Engineering. Sandip
  completed his MBA with a concentration in Finance
  and and Information Systems from Indian Institute
  of Management, Calcutta.