USING HYPERION PROFITABILITY
& COST MANAGEMENT WITH
HYPERION PLANNING FOR RCM
SESSION 35090
MARCH 8, 2016
PRESENTERS
Andy Rosenau
AVP Budget & Administration
Rutgers University
[email protected]
Ida Quamina
Director
Huron Consulting Group
[email protected]
Andy is the University Budget Director
and had been at Rutgers since 2009.
Andy is the functional owner of Hyperion
Planning and HPCM. Andy is the current
chair of the HEUG Budgeting Product
Advisory Board
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.
RUTGERS UNIVERSITY – THE
STATE UNIVERSITY OF NJ
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
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, NewBrunswick
• 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
HURON’S EPM & ANALYTICS PRACTICE
• Deep Higher Education industry expertise
• The largest and 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
© 2015 HURON CONSULTING GROUP. ALL RIGHTS RESERVED. PROPRIETARY & CONFIDENTIAL.
RUTGERS UNIVERSITY &
ORACLE
RUTGERS’ TECHNOLOGY
Oracle eBusiness Financials PeopleSoft HCM Oracle Hyperion EPM Homegrown Student Information SystemThe integration of ERP
applications is a major initiative
currently in the implementation
phase
Oracle Financials
Cloud
RUTGERS’ HYPERION APPLICATIONS
Hyperion Planning, Fusion Edition Hyperion Financial Management (HFM) Hyperion Financial Close Management (HFCM) Hyperion Data Relationship Management (DRM) HyperionProfitability & Cost Management (HPCM) Hyperion Financial Data Management Enterprise Edition
Hyperion Enterprise
Performance Management Suite
On Premise: (Version 11.1.2.3)
AGENDA
1
HPCM OVERVIEW
2
RCM AND USE OF
HPCM
3
USING HPCM FOR
STUDENT/COHORT
/PROGRAM
COSTING
4
SPECIAL DEMO
HYPERION PROFITABILITY &
COST MANAGEMENT OVERVIEW
A brief technical and
functional overview of
HPCM
WHAT IS ORACLE HYPERION
PROFITABILITY & COST MANAGEMENT
Enterprise performance
management (EPM) application that provides insights into cost and
profitability.
Drives organizational performance by discovering drivers of cost and profitability, empowering users with visibility and flexibility to improve resource alignment
Uses Essbase – a powerful online analytical processing (OLAP) server—for multi-dimensional analysis and scenario modeling
•Transparent
• Flexible
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
RCM & HPCM
How RU & Huron used
HPCM to solve a RCM
problem
WHAT IS RESPONSIBILITY CENTER
MANAGEMENT?
16
REVENUE
• Tuition and Fees • F&A Return • Other Income
RESPONSIBILITY CENTERS
• Schools • Research Centers • AuxiliariesDIRECT & INDIRECT COSTS
• Direct Expenses
• System-wide Support Units • Local/ Regional Support Units
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
ALLOCATION OF COSTS
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Costs that are
incurred by
university-wide
support units
providing services
to all Rutgers
campuses
University-wide
Costs that are
incurred by
support units
providing services
at the campus or
chancellor level
Campus Divisions
ALLOCATION METRICS
Net Assignable
Square
Footage
Research
Expenditures
Data
Faculty, Staff,
and Student
FTE
Enrollment &
Tuition Data
Unit
Expenditures
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
TRANSITIONING THE MODEL
• 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
• 18-20 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
RCM
M
odel
P
ai
n
Poi
nt
s
Th
e
So
lu
tio
n
• Implement Hyperion Profitability & CostManagement 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
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
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
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
HPCM FOR STUDENT
COHORT/PROGRAM/COURSE
COSTING
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
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 Faculty Costs Support Services
Student Cohort, Program, Course
Tuition & Fees
Other Revenue
Square Feet Instructional
Hours Credit HourWeighted
Record/ Instruction
% Distribution
Revenue
Expenses
Student Cohort, Program, Course
