Predictive Finance. Can CFOs connect the dots looking forward? Shridar Jayakumar. Copyright 2014 Oracle and/or its affiliates. All rights reserved.

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1 Predictive Finance Can CFOs connect the dots looking forward? Shridar Jayakumar

2 Analytics and the CFO Predicting & forecasting Trends & disruptions to Finance Analytics Predictive analytics in Finance Key takeaways 2

3 Analytics and the CFO Predicting & forecasting Trends & disruptions to Finance Analytics Predictive analytics in Finance Key takeaways 3

4 Senior executives want scenarios and simulations that provide immediate guidance on the best actions to take when disruptions occur. 4

5 Consumer Demand Global Financial Instability Maintain Margins Ability to Forecast Results

6 Data quality & completeness Technology innovations & disruptions Communicating & Collaborating Drowning in Spreadsheets & Business-as-Usual Lack of Analytic Skills in Finance

7 Analytics is a Top CIO and CFO Priority, Too Source: Gartner Inc.: Survey Analysis: CFOs' Top Imperatives From the 2013 Gartner FEI CFO Technology Study Published: 2 May 2013 ID:G

8 Analytics and the CFO Predicting & forecasting Trends & disruptions to Finance Analytics Predictive analytics in Finance Key takeaways 8

9 Connecting Analytics and Action What Happened? Descriptive Why Did it Happen? Diagnostic Historical What shall we do next? Prescriptive What is likely to happen? Predictive Future

10 Challenges in Forecasting 40% Can Forecast Only 3 Months Ahead 1 month in advance 12% 40%: 3 months or less 3 months in advance 28% 6 months in advance 29% 12 months in advance 20% More than 12 months in advance 5% Not sure 7% 0% 20% 40%

in advance 28% 6 months in advance 29% 12 months in advance

11 Finance Managers Drowning in Spreadsheets 93% Using Spreadsheets in Financial Processes Process % Using Spreadsheets Financial Planning and Budget Control 75% Financial Reporting and Analysis 74% Scenario Planning 40% Tracking KPIs 53% Monitoring Profitability 59% Other 3% Source: Performance Management: An Incomplete Picture. Study carried out by Dynamic Markets for Oracle Corporation, April 2011

Scenario Planning 40% Tracking KPIs 53% Monitoring Profitability 59% Other 3% Source: Performance

12 Moving away from spreadsheets Enabling best practice planning & forecasting Predictive Modeling & Simulation Long-Term Financial Planning Workforce Planning Capital Assets Planning Project Financial Planning Cost Analysis Planning, Budgeting & Forecasting Financial Detail Operational Detail

Planning Workforce Planning Capital Assets Planning Project Financial

Analyze range of outcomes and probabilities Assess model sensitivities

13 Integrating predictive into forecasting Fully integrated scenario modelling Assign probability distributions to uncertain assumptions. Analyze range of outcomes and probabilities Assess model sensitivities Statistical prediction built into Hyperion Automatically forecast best and worst case scenarios

Develop best practice rolling forecast process Focus on targets & gaps with confidence in projections Targets Performance Gap Excerpted by permission of Harvard Business School Press 2006 Actuals

14 Develop best practice rolling forecast process Focus on targets & gaps with confidence in projections Targets Performance Gap Excerpted by permission of Harvard Business School Press 2006 Actuals Performance Gaps management between forecasts and targets Incorporate market condition changes that drive to new business opportunities Forward-looking performance management process Forecast against a meaningful target

Performance Gaps management between forecasts and targets Incorporate market condition changes that

15 Analytics and the CFO Predicting & forecasting Trends & disruptions to Finance Analytics Predictive analytics in Finance Key takeaways 15

16 Digital Technologies Transforming How CFOs Create Value MOBILE SOCIAL BUSINESS BIG DATA / ANALYTICS CLOUD SERVICES $1+ trillion in mobile ecommerce revenue by 2017 $29+ billion in social media revenue by 2015 $17+ billion in Big Data revenue by 2015 $200+ billion in cloud services revenue by 2015

ecommerce revenue by 2017 $29+ billion in social media revenue by 2015

competitive position 22% Will improve customer interactions Source:

17 How CFOs View Impact of Digital Technologies 90% Will change how Finance is structured and run 43% 27% Will support growth initiatives Will improve competitive position 22% Will improve customer interactions Source: Real-Time Survey Results from 2013 CFO Summit at Oracle OpenWorld (190+ executives)

Digital Technologies Social Transforming How CFOs Create Value MOBILE $1+ trillion in mobile ecommerce revenue by 2017 SOCIAL BUSINESS $29+ billion in

18 Digital Technologies Social Transforming How CFOs Create Value MOBILE $1+ trillion in mobile ecommerce revenue by 2017 SOCIAL BUSINESS $29+ billion in social media revenue by 2015 BIG DATA / ANALYTICS $17+ billion in Big Data revenue by 2015 CLOUD SERVICES $200+ billion in cloud services revenue by 2015

in social media revenue by 2015 BIG DATA / ANALYTICS $17+ billion in Big

19 Mobile Device Finance Trends With more demand to move financial data to a mobile device, certain financial activities and business processes will need to evolve Mobile finance trends Previous: Expense reporting Approvals Static financial reports Current: Month-end close Dashboards Interactive reports Planning/Forecasting Workflow/Approvals

Mobile finance trends Previous: Expense reporting Approvals Static financial reports

20 Digital Technologies Big Data/Analytics Transforming How Businesses Create Value MOBILE SOCIAL BUSINESS BIG DATA / ANALYTICS CLOUD SERVICES $1+ trillion in mobile ecommerce revenue by 2017 $29+ billion in social media revenue by 2015 $17+ billion in Big Data revenue by 2015 $200+ billion in cloud services revenue by 2015

mobile ecommerce revenue by 2017 $29+ billion in social media revenue by 2015

21 For CFOs, Social Is All About Collaboration The average worker collaborates with 10 or more people to accomplish daily tasks

Finance Modernization Oracle Social Network in Action Initiative spearheaded by SVP of Oracle Global Business Finance Enables team members across continents to collaborate efficiently and securely

22 Finance Modernization Oracle Social Network in Action Initiative spearheaded by SVP of Oracle Global Business Finance Enables team members across continents to collaborate efficiently and securely Acts as a secure, searchable knowledge repository for all content, including chats, documents, videos, webinars, etc. Social analytics & finance applications online collaboration integrated with internal social

23 Digital Technologies Big Data /Analytics Transforming How Businesses Create Value MOBILE SOCIAL BUSINESS BIG DATA / ANALYTICS CLOUD SERVICES $1+ trillion in mobile ecommerce revenue by 2017 $29+ billion in social media revenue by 2015 $17 billion in Big Data revenue by 2015 $200+ billion in cloud services revenue by 2015

Analytics at Oracle Dashboards Marketing Sales Support Partners Finance Ordering & Contacts IT Event Intelligence Marketing Contribution Analysis Segmentation Campaign Intelligence Data

Management Install Base Intelligence Partner Ordering Analysis Partner Enrollment Partner Analytics Revenue T&E Analysis Expense Actual vs.

24 Analytics at Oracle Dashboards Marketing Sales Support Partners Finance Ordering & Contacts IT Event Intelligence Marketing Contribution Analysis Segmentation Campaign Intelligence Data Quality Monitoring Pipeline Intelligence Forecasting Account Analysis White Space Analysis Up-Sell / Cross-Sell Opportunities Executive Dashboards Operational Dashboards Contract Renewal Management Install Base Intelligence Partner Ordering Analysis Partner Enrollment Partner Analytics Revenue T&E Analysis Expense Actual vs. Budget Expense by Manager Headcount Ordering Analysis Ordering Queue Monitoring Quote to Order Flow & Analysis License Contract Intelligence Key Performance Indicators Total Cost Of Ownership Consumption & Utilization Error Free Services

25 Big Data: Manufacturing Execution System Exception Count Impacted Jobs 25

26 Digital Technologies Cloud Services Transforming How Businesses Create Value MOBILE SOCIAL BUSINESS BIG DATA / ANALYTICS CLOUD SERVICES $1+ trillion in mobile ecommerce revenue by 2017 $29+ billion in social media revenue by 2015 $17 billion in Big Data revenue by 2015 $200+ billion in cloud services revenue by 2015

27 Global CFOs Embrace Finance in the Cloud CFOs see the cloud delivering: GREATER INSIGHTS, through embedded BI and advanced analytics BETTER SERVICE, through rapid delivery of new tools and functionality BUSINESS SUPPORT, through collaboration and personalization OPERATIONAL EFFICIENCY, through automation, digitization of finance processes 24% HAVE ALREADY ADOPTED A CLOUD- BASED SYSTEM FOR CORE FINANCIALS 45% ARE PLANNING A ROADMAP FOR ADOPTING CORE FINANCIALS IN THE CLOUD Source: Empowering Modern Finance: the CFO as Technology Evangelist, February 2014, Oracle and Accenture Research

28 Oracle Planning & Budgeting Cloud Service Enterprise ready, fully cloud optimised Software-as-a-Service Based on the industry-leading Hyperion Planning Specific enhancements for the cloud for rapid deployment/adoption Full functionality of Hyperion Ready for Finance Workflow Simulations Office integration Mobile Analytics Oracle Confidential Internal/Restricted/Highly Restricted 28 28

29 Analytics and the CFO Predicting & forecasting Trends & disruptions to Finance Analytics Predictive analytics in Finance Key takeaways 29

31 Moving from Insight to Foresight What Happened? Descriptive What is likely to happen? Predictive Why Did it Happen? Diagnostic Insight could be either a descriptive account of the past or present using any data from any source, or diagnostics of causality and relationships What shall we do next? Prescriptive Foresight is applying insight to predict future outcomes or forecasts and prescribe recommendations/actions

32 32

Manufacturers: Transform Your Data Into Actionable Business Insight. Daniel Caringi (dcaringi@bdo.ca) March 2014

Manufacturers: Transform Your Data Into Actionable Business Insight Daniel Caringi (dcaringi@bdo.ca) March 2014 WHAT WE WILL COVER This presentation is intended to provide Manufacturers an overview of