The Budget Planning Wizard at Bayer: Oracle and arcplan inSight
/ dynaSight working together
In virtually every company, the budgeting
process can be, to varying degrees, cumbersome
and tedious. In fact, a large percentage of the
people responsible for strategic budget planning
probably wish they could wave a magic wand,
say the magic word, and pull an accurate, comprehensive
budget out of a hat like the proverbial rabbit.
At the Pharmaceutical Division of Bayer Corporation
in West Haven, Connecticut, they don’t have a magic wand. They
do, however, have a Wizard. Not the kind
that you’re likely
to read about in a fairy tale. This wizard
- appropriately named the Planning Wizard
- is a high-tech, financial graphical reporting,
web-based tool that allows managers
of the company's hundreds of cost centers
to create yearly budget plans with
a level of speed, accuracy and efficiency
that they have never experienced before.
The developed software includes capital
budgeting as well as activity based
costing. What’s more, the
system allows for seamless communication
between the Pharmaceutical Division’s
North American headquarters in West Haven - and
its sister facilities in Clayton and Raleigh,
North Carolina; Berkeley, California; and
corporate headquarters in Leverkusen, Germany.
But that only scratches
the surface of the system’s benefits. The Planning Wizard has
effectively integrated cost center activity
based budgeting with capital budgeting and
headcount planning (a particularly crucial
element in Bayer’s planning
process). Furthermore, the system produces management-level
reports that
are easy to read and easy to incorporate into
the company’s
existing decision-support process.
Through the development and implementation of
the Planning Wizard, cost center managers were provided with
an effective desktop tool that allows access from multiple
sites, provides transparency to information with a user-friendly
front end, and enables line management to plan for and manage
their cost centers. And as a result, the Pharmaceutical Division
of Bayer Corporation has one of the first-ever, web-enabled
planning applications to streamline the Planning Process and
ultimately make the cost center managers responsible for both
planning and executing results. Plus, the audit trail creates
full accountability in the system.
The system is completely integrated with the
existing SAP BW system as well as
a legacy
Hyperion system. The core of the
application is an Oracle database
with inSight
/ dynaSight (arcplan) running
as a front-end for the reports and input
screens. The application features an actual wizard icon whose
presence
helps liven up the work screens. Other creative
graphics not only add more color but also
help guide the user through the budgeting
process. In addition, it makes the system
less intimidating to the non-accounting-oriented
managers who use it.
Users access their
planning information via Bayer’s corporate intranet from
any of the company’s North American locations or its
German headquarters. The web-based aspect
was chosen due to the ease of distribution
of applications over the Internet.
The application-design criteria required
a user-friendly approach in aiding non-financial
cost center managers to prepare, analyze
and change their own budgets
Amazingly, the project
was implemented, start to finish, in
a scant nine weeks. This included
not only the development of the inSight
/ dynaSight-based Planning Wizard but the
implementation of the back-end. The short
timeframe for implementation of the system
was part of the reason that inSight / dynaSight was
chosen as the preferred front-end tool.
The interface of inSight / dynaSight with
the
Oracle back-end system was also
a key element in the purchase decision. inSight
/ dynaSight also excels because of its multitude
of performance features such as corporate-wide
applications, short development times,
and internet / intranet capability - all
important considerations in the development
of the Planning Wizard.
After going through the first budgeting cycle,
Bayer examined ways to refine it, a relatively
easy task given inSight / dynaSight’s dynamic character
and flexibility.
Oracle provided the
project with a solid relational database
as a data store. The extensive use
of PL/SQL procedures, functions
and packages for manipulating data and
verifying integrity constraints are completely
invisible to the end-users who access
the system through the inSight / dynaSight front-end.
The fact that the system has a relational
database was a strategic choice that
allows the system to easily accommodate
modifications to the business process
in a systematic and economic way.
Further, the amount of time managers actually
spend on the computer, as well as the time
handling paper, is greatly reduced, not to
mention the cost of the paper itself.
Plus, the system is updated every night with
current actuals, so the accuracy and timeliness
of the information is assured.
Pat Greenbaum, the Bayer project manager under
who's leadership the project was developed,
summed up the system’s
benefit succinctly: "Under the old system, the budgeting
and planning rules were not being enforced," she said. "The
new system has brought a new level of discipline
to the planning and budgeting process, as
well as a new level of confidence
that can be credited to the way that the
system has been accepted by our users."
Not quite magic out of a hat, but pretty impressive by any
standard.
Here are some of the features of Budget Planning
Wizard at a glance:
- cost center budgeting for hundreds of cost
centers
- hundreds of end users with a concurrency
rate in the dozens
- budgets on a
yearly or monthly basis
- seasonalized
budgets
- project based budgeting
- bottom-up as well as top-down functionalities
- integrated capital expenditures budgeting
- multi-phase and multi-pencil-down process
- budgeting of headcount and associated salaries
- automatic compensation for salaried personnel
- cost templates available for personnel
to help cost center managers speed up
budgeting process
- "scratch-pad" concept allows
cost center managers to experiment
with budget before "publishing"
their numbers
- cost-center hierarchy reporting
at all levels
- audit trail allows system administrators to track modifications
- reporting of current actuals
for comparison
- finely granulated security
for end-user access
- central administration
over all budgeting phases, chart
of accounts, users, permissions etc
- intranet
and browser based application, no
client-server access required for
end-user
- back-end: Oracle, front-end: inSight / dynaSight
- complete integration to SAP BW and legacy Hyperion
systems
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