Name: Effective Manufacturing Planning with Oracle EPM
Uploaded: 2026-08-19T19:33:56.300Z
Duration: 33 min 4 s
Description: Effective Manufacturing Planning with Oracle EPM

Transcript for "Effective Manufacturing Planning with Oracle EPM": Blast off. Well, good day, everybody, and thank you for joining us for today's this week in EPM session for effective manufacturing planning with Oracle EPM. So I'm joined today with, a good friend of mine, Sam Snow, who he will introduce himself in a minute, but quick a few housekeeping items. So, if you do have questions today, we have a q and a box over to your right that you can submit questions via the chat. We have, individuals monitoring this and will let us know if we happen not to see, any questions that you submit, but we'll be sure to follow-up with them in today's session. We also have a closed caption option. So if you're sitting at your at your desk and you're unable to listen to your audio, you can get the hit the CC icon and, you'll be able to hear our transcript, or read our transcript rather. Lastly, today's recording and the presentation itself will be accessible, will be sent out. You'll be able to access both of these. So looking forward to sharing some good information with you. Now who who we have presenting today? So I'll introduce myself and Sam's gonna introduce himself as well. My name is John Schopaska. I lead our, EPM solution architect team here at Argenault. I'm a finance person at heart. So, I speak that finance language, came from public accounting in the private equity world, and start started with the Hyperion products, before the cloud. So looking forward to sharing a little bit more about EPM today, and I'll hand it over to you, Sam, so you can do a quick introduction. Yeah. Thanks, John. My name is Sam Snow. I've been, working at Itron for about ten years, but in the finance, working in corporate finance, accounting and finance for about, twenty years now. Yeah. I have on my team, I have the system admins for the for the EPM tools, and and my team also does the, planning for g and a and and all of the internal, reporting for, you know, budgets and planning and all the FP and a reporting fund that we do. Great. Well, why don't you share with, the viewers a little bit about Itron, if you don't mind? Yeah. Itron's a public company. We're we're global, have lots of customers in lots of different places as you see there. What we do is really help connect, utilities and help enable utilities to be successful with their customers. So we we help provide hardware, software, and other services, helps them deliver electricity, natural gas, and water, to their customers and and do so efficiently. It's all about, resources and and guarding those resources to to help, us all have an efficient, well working world. That's great. Everybody needs to get their water and their utilities, so you guys provide a very, very valuable service. I know I've been running water here, all day pretty much trying to keep, keep the grass green in this hot weather. It's hot right now. Yeah. So we're gonna we're gonna talk a little bit more about this, but Argonos had the pleasure of working with, you, Sam, and Itron for a while now. What you have today, you're gonna dive into a little bit, but, we're gonna tell Sam tells their their journey. But, we were fortunate enough to bring many of your business processes under the FP and A and the office of the CFO, you know, out of the on prem world and and the Excel world and bring it up into the cloud planning, consolidations and flows, profitability and cost management reconciliation, and then managing all of that with EDM as well. So we're gonna jump into that a little bit more, but that's a little, precursor to to what we're going to, be talking about today. And then thirty seconds on Argano. So Argano is, a global, service implementer. We've we implement, primarily Oracle, but we have business units as well outside of Oracle in other technologies as well. The Oracle business unit, specifically the EPM that we're gonna be talking about today, has been around for over twenty five years. We have, over a thousand cloud implementations under our belt as well as six cloud EPM partner of the year awards, since our first one back in 2014. So we're very proud of that. Another thing we're very proud about is our net promoter score, which is really top of the the industry. So most, most of other, system implementers, the average net promoter scores in the forties. Argonos is in, the upper eighties to nineties range, and we are extremely proud of that. What that really means to you is that our customers are satisfied. They enjoy working with Arbno, and they tend to, come back and and, ask for additional additional work as well. So we're very, very proud of our relationships with our customers. So we're gonna move into, you know, why we're all here today and and hear more from Sam, around the manufacturing planning process. And when I think about, you know, operational planning or manufacturing planning, however you wanna call it, it's it's the details from your revenue down to your gross margin essentially essentially. And I think, you know, what this looks like from each customer is different. But, Sam, I'm curious if there was a a tipping point or or a point where Itron realized, you know, we we need to supplement our financial planning at a different level than than just the the p and l, right, the balance sheet, the cash flow. So was there anything that kinda happened that made Itron feel like, yeah, we're ready to make this move? Yeah. Over the last, you know, I joined ten years ago, but really over the last, let's say, five or six years, Itron's really become more effective, more meaningful, more predictable. Being predictable with the market is always, of top priority. And, you know, when you go back to when I joined ten years ago, you know, manufacturing was doing their thing, and they were planning for the volumes that they needed to make and servicing the customers and getting the hardware out the door. And on the sales team and the business unit side, they were working through with customers what product that they wanted, what they could sell, and that sort of thing. And there was, you know, some coordination month to month on trying to maintain those two things, alignment between those two things, really, keeping people on the same page. But, a lot of times, when things change last minute, or there is an issue with a customer, things of that nature, it would throw a wrench in the works. And so then you end up with big variations of big, differences on manufacturing overhead, labor variances, all sorts of thing. And it was always reactive, going back and trying to figure out, well, why why were we so off with our plan? Why did we have all these costs that we didn't expect? Or why was it even better than we expected? And so one of the things that, as we went into the cloud and and redesigned our processes, one of the main things was we wanted to be more predictable, be more connected between the revenue side or for manufacturing purposes, really, the volume side, And, what what what could we make and what were we going to. make for the customers. Make sure that those two things are more aligned and and more, predictable upfront rather than reactive after the fact. I think you hit the nail on the the head in terms of the relevance of the topic here because there there's so many moving parts between revenue and margin, and that's the scene that often breaks. Right? And that's the scene that's gonna really drive you know, if you can gain another couple points in margin or basis points in margin, it's gonna flow all the way down to your your EBITDA and your your your net income. Right? And so that. relevance is is definitely key in this conversation this afternoon. And then the desire, which we're gonna talk about, you know, for all of our customers, out there who are considering or even already dipped their toe in EPM is that, you know, they get to an end state that Itron got to, which is a connected model between driver, financial plan for your forecast, for your operating plan, etcetera. Now what what we're gonna be diving into next, we got three main topics that we're gonna cover. So, we'll we'll first hit Itron's journey and kinda hear from you, in in part one of this, presentation, you know, where you guys were, where you where you are today. We call it some some key features and benefits that you you chose to do along the way. Second, we're gonna take a look at your driver based planning engine, and then we'll wrap it up with, you know, that that that desired end state. Right? That, you know, what does the world look like? What's changed for Itron since you've moved everything to the cloud? Yeah. Yeah. This is a a timeline that I like to share and kinda talk about, Itron's journey. So back in the twenty ten, twenty eleven time frame is when we went live initially with HFM using FDME to connect things, and NSbase and planning for the inputs on the planning side for forecast. And we did have an instance of DRM. The unique thing there was while we maintained our Charter account structure, there, we, didn't use it to connect to all those environments. So it was really a a multi input thing. It was it was really inefficient. Flash forward to around the time I joined Itron 2016, the the company didn't have an account reconciliation tool. And at the same time, we are talking about, well, with HFM, do we go to the cloud or do we is it ready for us? Do we, do an update first, for Hyperion environment and then prepare for a a larger cloud journey? Ultimately, that's what we did. So we went live with account reconciliation tool in the cloud. Now we that enabled us to dip our toe into the cloud world, you know, do the the access and system setup stuff, understand how turning on a cloud environment worked and a lot of those type of basic things. We we did a Hyperion upgrade to get us, forward to the 2122 time frame, which is when we did our big bang of the majority of the environments that we're using today. So in '20 most of the work happened in 2021. We went live with our instance of EDM first so that we had a standard metadata source data source that was connected to all of our EPM environments. And then we went through the process of getting FCC stood up with couple years of actuals, and getting our planning environments turned on. At the time, we were planning to go live with, revenue and manufacturing planning. But as we got into the details of that, there was just a lot of business process change that we weren't quite ready for. And so we we shelved that temporarily, and and looped back to that later on. But really, it was about standing up the core environment, really connecting our actuals with FCC and consolidation side with the planning side and how we how we were doing our planning processes. And so then flash forward a couple more years, we said, okay. It's time to go live with the revenue and manufacturing planning. And so we were able to turn off some really old environments that have been around for literally decades around planning for revenue and our manufacturing. And so we plan now in EPM at an item level for both the revenue side at an item level, of course, and then getting the volumes from the the revenue planning tool into the manufacturing tool, and then doing the cost planning at an item level as well, all within EPM. And then that, of course, rolls back into at a higher level, more consolidated level into the planning environment so we can do all of our reporting and comparisons against actual going forward. Mhmm. So that was our our high level journey. Of course, we use, you know, some reporting tools as well, heavy users, smart view and etcetera, different things where, you know, for different outputs on reporting. But, overall, it's been a a great solution for us. And I the one thing that I love that you guys did was EDM first. So using. EDM to align your metadata, I and and keep it in sync before you even started rolling all of this out. That is essentially the the spine to consolidation and close to planning to PCM, and use it with tax reporting. You guys are not doing that yet. Right? But, starting there is definitely the right move. Curious. Yeah. I agree. EDM first. You you can always do EDM later, but it's just gonna be inefficient. Doing it right from the beginning is is really the best way to go. And we didn't realize that until we got into it. And and we kinda said, well, why don't we just go live with EDM now? It's ready. We can use the metadata for all the other systems, and it was kind of a a nice moment. I agree. I agree. Yeah. We'll other we'll have to wanted to mention real quick before we go on, mhmm. you know, when we were on Hyperion on premise using servers, in house servers and that sort of thing, You know, two two things that I would highlight. One, we are very reliant on IT and the IT organization to support us for running the tools and, issue resolution, things like that, as well as Oracle. The nice thing about the cloud is, know, we get our monthly updates and this is a business owned tool. The the system admins work in my organization. We leverage IT for the Oracle relationship because there's a larger you know, we we run Oracle ERP, so there's a larger relationship there. But we really own the EPM tools, and and we leverage and work with IT on integrations with other systems that we have. But from, for our environments, we really own and and drive what we what we need to there. But the monthly updates is great too because one of the things we had before was we just get behind on versioning, and and updating version was such a big leap. Always needed help with that. It was a big effort. The month to month updates, overall have been really good. That's great to hear. Yeah. Those monthly updates can often, bring a little bit of fear in customers trying to, you know, Mhmm. move towards the cloud. And, you know, we're gonna be patching every single month, so that's fantastic to hear hear that feedback from you. Yeah. Baby steps along the way. And than big leaps, I think. and you mentioned compromising when in 2022 with planning, implementation. Was there any advice you would you would provide in terms of, you know, taking baby steps on this, and how you guys decided, okay. It is okay to do a a a smaller planning, financials only focus in the first go round. Yeah. You know, it depends on your integration methodology. Some people wanna do a lift and shift. We wanted to do a a lift and change, or whatever terminology you wanna use there. We right? We we wanted to do our business processes differently. They were very manual, between, again, revenue and manufacturing. They were in their own worlds. There was not a relationship there. And, to some extent, Itron was getting more efficient too. We were reducing factory footprint and just having fewer locations to manage as well. So there was some business element to it as well. But big picture, you know, we we want to really drive process change and process efficiency with what we are doing and not just continue with with past practice. Fantastic. So before we move on, Sam, to the next topic, around the actual manufacturing process that you have today. I just wanted to let the audience know. You'll notice at the bottom of your screen, you've got a a running banner here. We will be in Argonaut will be in, Houston on September 17 for what we were calling AI Ignite focused on EPM. If you click on that link, it will actually take you to the registration page for this event. We if you're in the Houston area, we'd love for you to join us on September 17 for this, one day adventure. It's gonna have three different work streams, talk tracks from executive to admins to power users, and you'll be able to learn all about the AI capabilities, within EPM and AI capabilities that are soon to be released this year as well. So, wanted to point that out. That's a live a live link there at the bottom of the the screen. Now let's move into some of the nitty gritty around your processes today. And, you know, I I like this image because, the engine. Right? We all if we're driving our car, we're maybe it's a a Friday evening and we're trying to push that that in that car engine to its max. Right? It's important to keep ourselves aware of of the dashboard. Right? The the metrics that is really, you know, telling us how the how the engine is doing underneath the hood. And when I think about planning, that counts inside of my brain, you know, always goes to, you know, you have to be super accurate. But when you jump into the seat of an FPNA position, it's often we're we're we're often weighing being timely and directionally accurate, right, versus being overly accurate and late or not timely. Right? So I I thought, you know, maybe if you wouldn't mind just get describing the architecture and kind of the data flow for for your your manufacturing, queue within EPM. Yeah. And I'd say at a high level, you know, we're really using it for two, separate processes, but having a single engine helps be consistent with what those outputs are. So on one hand, you know, looking forward in the future periods, we might be planning at a detailed level as as long as eighteen months out. And we're able to take the data from our revenue planning, meaning the volumes of what items need to be manufactured, and put that into the, manufacturing, planning environment and get figured out, you know, our our five main inputs. You know, we have, labor, cost, we have material, we have overhead and then we have a material overhead bucket and then, an outside processing item with kind of an other bucket. And so we get those five inputs and we can turn the crank and get cost on items. You know, looking back in history, with our old systems and processes, if we had a manufacturing site that maybe didn't have big swings in volumes or maybe they didn't change what they manufactured very often, or, potentially, maybe it was just older product that was very standard and it didn't and, you know, the the the components of pricing didn't change much, things of that nature. It wasn't a big deal. You know, month to month, year to year, there wasn't a big shift. But as Itron has, really gotten our our manufacturing footprint smaller, we have fewer sites doing a larger variety of items and components. It starts to get a lot more complex. And as we these new products to the marketplace, you have that new new product component as well. So having a flexible tool where we can input the those cost, elements and turn the crank and get cost, figure out what TMCs are for the items, figure out what what the earn hours are and to get to a total cost and ultimately the margin on on those products is is really huge. I I mentioned there's kinda two avenues that we use it. So we're using it for the planning side of things, but we also can use it for, month to month updates to be monitoring where we expect the current month to be based on updated volumes and information. So that's been really, really effective and useful as well. Yes. Whereas, It's previously, that dynamic of that would have been done in spreadsheets for the most part. right. Yeah. That dynamic capability to be able to provide that level of granularity on a monthly basis for forecast is phenomenal. And it's prime for what an EPM is is built was built to do in the first place. Now, you mentioned, you know, the total manufacturing cost and some of some of the the metrics you're using to to drive your your margin calculation. Curious, you know, what what type of conversations did you have? Were they before you started the project? Was it during the design phase around, you know, identifying the correct level of granularity? You know, for example, materials could go down to so many different levels. Labor could go down to multiple different levels, you know, as as you you piece them apart. So how how did you land on a in a happy medium, or where did you land that, that helped you make those decisions? Yeah. I I think that's a great question. There's a lot of different options to choose from there. I think for for our business, we have a different cost profile and a different makeup of what we're manufacturing based on our manufacturing location. So that was a huge part of it, is is that location. I think the item that we're manufacturing was really key. So in our case, we actually cost and plan volumes at an item level. Now in some cases, you know, you might have 10 items that are similar and they're part of a product family, that that, you know, it makes sense to plan at the product family. And then once you know more specifically which specific item that customer is gonna buy, you get down to that level. So there's some flexibility there. But at a at a high level, we're we're really planning both the volumes and the costing at that item level. And those those are really the two big ones. There's some other items that are of consideration, but deciding those two points was was really key. That's that's great information to hear. Now because so much of this is driven by supply chain as well And, you know, we work with customers all the time who have a form of some form of supply chain planning. It could be an Oracle product. It could be a third party that's pulling into their ERP. Did you have to where did you draw the line between what do we pull in from supply chain planning? What do we pull in from the ERP, GL in order to get to this level of granularity? Yeah. Yeah. That that goes back a little bit to supply chain versus finance and who does what and and how that works. Of course, the supply chain team continues to use their their Oracle product, that that helps them manage the factories and and that sort of thing. But, you know, I I think we have a we have a planning meeting that happens, several times during the month, and that's where we we cross and make sure that everything ties out and is aligned, and and continue to maintain that that that, collaboration there. Yeah. Making sure you're balanced on both sides. That makes sense. So, I mean, we're excited that you guys have been using this now for a while. You're getting real results, And may we're gonna transition to this this third topic of, you know, what what's what's life look like now for your team supporting the application, generating the data, the end users as well. And so maybe you could take a little take a we got a few minutes left here. Take some time to kind of talk about what the process looks like from an end user perspective. Like, how has day to day work life balance changed? Yeah. I think there's a a couple of things I'd say. I think that from a global organization perspective, we have, gotten more aligned and consistent in terms of how we do our job. So, you know, somebody in on East Coast US, can cover for somebody that's in France, now. Whereas before, how they perform their job was just much different. So I think there's an organizational benefit there. I think they're, more efficient in what they do, and we continue to to make that better. As, you know, if there are people still doing things in Excel, we're taking the opportunity to assess that, whether it makes sense to move that into the tool. But just this month, we went live with, three or four new enhancements in the manufacturing planning environment to make, really leverage the tool for what it does, which is calculations, and stop doing one off calculations in Excel. Of course, Excel will always be used. It's a it's a core tool for finance and and what we do day to day. But letting the the tool, the manufacturing planning tool do the calculations that it can do for standardization, always preferred. So that that's a big thing. I think our, our analysts are spending more time, planning and working with the business on what could be done to be more efficient and to, think through business challenges together and less time being reactive when, you know, things were different and coming up with what that answer is. I think those are the the main things that are really what's different now? You know, we started out talking about how revenue volumes and manufacturing volumes were maybe at one point in time aligned and then they deviate and that leads to challenges. The big thing right now is we're much more connected, able to, more quickly respond to, changes on the market side with the business. And so we we have a correct question from Srini, but I think you you may have answered it maybe in part, but, yes, I would I'd love to hear the business benefits or value that EDM, EPM implementation has yielded. And so you you you just stated a few around your team essentially transitioning from a data gathering and organizing to a, you know, a true adviser to the business. And so you're spending time doing the advisory work more rather than than, actually generating and creating data. Anything else you would add to that to help Srini? Yeah. Since he called out EDM specifically, you know, I would say in how we manage EDM, it just saves data input time. Right? Rather than doing, metadata management in all the environments, which, you know, might be seven production environments, might be, you know, might be talking 20 when you talk about the test and and other environments that are out there. You'd you'd do it in one with EDM and then you subscribe, to which environments you want that data element to go into. Plus, you have workflow to manage approvals and a monthly change process. It's just way more efficient and and communicative across the different groups. So that's EDM. EPM more generally, I mean, I mentioned, you know, running in the cloud. We don't leverage IT resources. So from an enterprise perspective, it's much more efficient there. We can get the monthly updates. There's a lot of value there. We're able to, you know, stand up a test environment and and play and do experiments and things like that in a day. Whereas if you're on prem on on a on a different license, that that could take a lot more time, weeks maybe. So there's just a ton of value, end to end. Security is easier, like, you know, there's just a ton of benefits. It's way better on EPM in my opinion. Yeah. Srini, I hope that that helped answer your your question. Couple couple tough questions. So if you had a look at doing this again, is there anything you you would change or consider doing differently? Yeah. That's always a hard question. You know, we've made made it be great for what we, were successful with. I think there are some, dimensionality that if we could go back and do it again, we would. We have, we've used, one of our flexible dimensions to do it's effectively a concatenation of of data points, and it's a very large dimension. And that's to some additional costs on the EDM side, but also, some potential limits from a data perspective. So I would prefer to revisit that. There are some benefits to it on the f on on on the finance team when we're doing planning and data input and with forms and things like that that really make a lot of things easier. But and so it's a it's a trade off, but I think long term for Itron, maybe wasn't the best, the best decision there. There may be other things, but that's the one that really stands out to me that continues to be revisited. Sure. Yeah. I mean, possibly, breaking that up into separate dimensions for yeah. Makes sense. Now, you know, last question. I think we are a little over time. You know, would you consider the investment worth it? You know, considering the the values you spoke about, you know, the change in the the FP and A team and how they're advising now. Any any of the other thoughts on, you know, the overall investment of your journey? Yeah. It's been a long journey, but I think for the organization, what we've done with EPM and and how we run our business and collaborate with our other business groups. It's it's really been a a great journey. We've end of life, handful of old systems that were purpose built for specific areas and really built those that functionality into the various components of VPN within planning. And so, yeah, all in all, I would say and then we would we would do it again. That's great to hear. So, Sam, I really appreciate it. Our audience appreciate you taking, you know, some time out of your day to to share your experience with with them. If anybody has any questions about today's topics, feel free to reach out to me. I'm here to help you. You can see my email address. And again, I'll remind everybody we're gonna be in Houston in September. So we love to see you out there. If you've got some extra miles burning a hole in your pocket and you feel like flying down to Houston for a couple days, we'd love to hang out and take you out to eat, and see you at our event. So with that, we're gonna thank you again all for joining us. I hope you have a fantastic day today. Thank you, John. Appreciate it.