USING HYPERION PROFITABILITY & COST MANAGEMENT WITH HYPERION PLANNING FOR RCM SESSION MARCH 8, 2016

Transcription

1 USING HYPERION PROFITABILITY & COST MANAGEMENT WITH HYPERION PLANNING FOR RCM SESSION MARCH 8, 2016

2 PRESENTERS Andy Rosenau AVP Budget & Administration Rutgers University Andy is the University Budget Director and had been at Rutgers since Andy is the functional owner of Hyperion Planning and HPCM. Andy is the current chair of the HEUG Budgeting Product Advisory Board Ida Quamina Director Huron Consulting Group Ida focuses on implementing best practice technology solutions and business processes for the Higher Education Industry with experience and expertise in the areas of operational budgeting, position budgeting, cost allocation and analysis, business intelligence and student information system applications.

3 RUTGERS UNIVERSITY THE STATE UNIVERSITY OF NJ

4 Rutgers was founded as one of nine colonial colleges in 1766 and became The State University of New Jersey in 1956 Largest and most comprehensive higher education institution in New Jersey with schools and colleges in every field from business to engineering to medicine and public policy

5 Quick Facts 45,000 undergraduates and 20,000 graduate students from all 50 states and more than 115 countries More than 9,000 full and part-time faculty More than 15,400 full and part-time staff Approx. 450,000 alumni live in all 50 states and on six continents Approx. two-thirds of alumni live in NJ Campuses & Locations Rutgers University, New Brunswick Rutgers University, Newark Rutgers University, Camden NJ Agricultural Experiment Station with locations Statewide 32 schools and colleges With more than 300 research centers and institutes Research $700 million annually in research R&D expenditures, among the top 25 in the nation $430 million annually in life sciences R&D expenditures, among the top 25 in the nation $550 million in annual sponsored research grants Rutgers bring more federal research dollars to NJ than all other NJ colleges and universities combined 60 percent of Rutgers undergraduates engage in original research

6 HURON S EPM & ANALYTICS PRACTICE Deep Higher Education industry expertise The largestand most experienced Hyperion Planning and Integrated Planning practice in the world, with more than 200 certified Hyperion Planning and/or Essbase specialists and three Oracle ACEs. More than 250 successful Oracle Hyperion and BI implementations. Top 5 Oracle Partner for the past five years Silver Level partner of the Salesforce.com partner network. INDUSTRY REMOTE DELIVERY CLOUD Huron has partnered with 90 of the top 100 research universities and more than 50 of world s top universities

7 SELECT HURON HIGHER EDUCATION ENGAGEMENTS 2015 HURON CONSULTING GROUP. ALL RIGHTS RESERVED. PROPRIETARY & CONFIDENTIAL. 7

8 RUTGERS UNIVERSITY & ORACLE

9 RUTGERS TECHNOLOGY PeopleSoft HCM Oracle ebusiness Financials Oracle Financials Cloud Homegrown Student Information System Oracle Hyperion EPM The integration of ERP applications is a major initiative currently in the implementation phase

10 RUTGERS HYPERION APPLICATIONS Hyperion Enterprise Performance Management Suite On Premise: (Version ) Hyperion Profitability & Cost Management (HPCM) Hyperion Financial Data Management Enterprise Edition Hyperion Planning, Fusion Edition Hyperion Financial Management (HFM) Hyperion Data Relationship Management (DRM) Hyperion Financial Close Management (HFCM)

11 AGENDA 1 HPCM OVERVIEW 3 USING HPCM FOR STUDENT/COHORT /PROGRAM COSTING 2 RCM AND USE OF HPCM SPECIAL DEMO 4

12 HYPERION PROFITABILITY & COST MANAGEMENT OVERVIEW A brief technical and functional overview of HPCM

13 WHAT IS ORACLE HYPERION PROFITABILITY & COST MANAGEMENT Enterprise performance management (EPM) application that provides insights into cost and profitability. Transparent Drives organizational performance by discovering drivers of cost and profitability, empowering users with visibility and flexibility to improve resource alignment Flexible Uses Essbase a powerful online analytical processing (OLAP) server for multi-dimensional analysis and scenario modeling Powerful

14 BENEFITS OF HPCM Accurate Traceable Integrateable Easy Accurately allocate costs with a flexible allocation engine that supports any methodology Traceability maps and audit trail capabilities provide transparency for greater confidence in the analysis, reported results and the business rules underlying them HPCM is easily integrated with Hyperion Planning other EPM and ERP applications. Owned and managed by the functional owners not IT

15 RCM & HPCM How RU & Huron used HPCM to solve a RCM problem

16 WHAT IS RESPONSIBILITY CENTER MANAGEMENT? Revenues are credited to the Responsibility Center that generates them Schools must then pay for their direct expenses as well as a share of the expenses to fund the Support Units REVENUE Tuition and Fees F&A Return Other Income RESPONSIBILITY CENTERS Schools Research Centers Auxiliaries DIRECT & INDIRECT COSTS Direct Expenses System-wide Support Units Local/ Regional Support Units 16

17 RCM INDIRECT COST POOLS

18 ALLOCATION OF COSTS University-wide Campus Divisions Costs that are incurred by university-wide support units providing services to all Rutgers campuses Costs that are incurred by support units providing services at the campus or chancellor level 18

19 ALLOCATION METRICS Cost pools are developed and then allocated to the Responsibility Centers using a metric. The metrics used should be: the best measure of the activity based on best practices verifiable, easy to understand, and uniform Unit Expenditures Enrollment & Tuition Data Faculty, Staff, and Student FTE Net Assignable Square Footage Research Expenditures Data

20 TRANSITIONING THE MODEL RCM Model Pain Points RCM Model Developed in Excel: Main File = 12MB File 40 Tabs/15 Pivots/6 Data sheets/10 Allocation Calculations/9 Reference sheets 25+ additional worksheets that have backup data second recalculation time for single cell change Version Control 100 s of versions with many sub-versions Alternations in organizational structure would require hours/days of work to change the model Modeling of effects on use of metrics would take many hours Determining Cost Pools over 2 GL s and 7 distinct cost pool locations The Solution Implement Hyperion Profitability & Cost Management module Leverage existing Hyperion Planning capabilities at RU Use new Chart of Accounts structure Unit segment Who Business line segment - Why Location segment Where/ For Whom Use of HPCM beyond RCM Indirect Costs for ICR Negotiation & Audit Student/Cohort/Course costing Selected Huron as our Implementation Partner

21 RUTGERS USE OF HPCM Project Scope Standardization of business drivers and supporting calculations: Allocate cost pool expenses across Responsibility Centers Allocate State Appropriation revenue across Responsibility Centers Ability to perform What If analysis Ability to provide allocation data that will be integrated into the university budget process Consistent reporting and analysis capability across the enterprise, subject to user security configuration Streamlined allocation process

22 RUTGERS USE OF HPCM Project Outcomes The creation of a common allocation model that facilitates transparency of drivers and the consistency of allocation methodology The provision of an integrated platform that supports financial planning and key management reporting requirements. Making information accessible across the appropriate levels within the organization Increased confidence in RCM!!

23 RUTGERS USE OF HPCM - FLOW

24 RUTGERS USE OF HPCM ARCHITECTURE & SCHEMA Driver Staging Hyperion Planning (RCMStage) application to consolidate and review revenue, cost and systematic driver data The existing Hyperion Planning application, is the source of Revenue and Expense data PCM (RCMProf) application to execute all allocations. HPCM generates two Essbase database to support executing the allocations and preliminary analysis Planning Web Forms, also accessible from SmartView, are used to input non-systematic driver data and adjustments into RCMStage

25 HPCM FOR STUDENT COHORT/PROGRAM/COURSE COSTING Going Beyond RCM

26 WHY STUDENT COHORT/PROGRAM/COURSE COSTING Understand the financial stability of programs and courses Aid in program prioritization and strategic planning of new programs & courses Understand the true cost to education cohorts of students

27 THE FLEXIBILITY OF HPCM Flexibility to allocate without a restructure of the Chart of Accounts Use the data you have as a starting point Identify and understand the data gaps Facilities Costs Square Feet Expenses Faculty Costs Instructional Hours Student Cohort, Program, Course Support Services Weighted Credit Hour Tuition & Fees Record/ Instruction Revenue Other Revenue % Distribution Student Cohort, Program, Course Margin

28 SPECIAL DEMO Bringing it all together

29 QUESTIONS

30 THANK YOU!