Project Description: Streamlining Cost Control with Oracle Fusion Cloud ERP
Problem Statement:
A company with 53,000 employees and 128 logistics businesses worldwide faced significant challenges due to the integration of 160 different applications. This resulted in immense pressure on the back office, causing delays and a lack of a single source of truth. The client sought a solution to consolidate their disparate applications from multiple providers into one cohesive system and enhance cost control.
Description of Solution:
To address the client’s challenges, we implemented Oracle Fusion Cloud ERP, which encompasses finance, human resources, and supply chain domains. However, despite the integration, challenges persisted in obtaining a unified view of project costs and maintaining cost control. To overcome this, we introduced Oracle Fusion Portfolio Management (PPM).
Oracle PPM allows for the comprehensive capture, tracking, and reporting of project-level information, including cost, revenue, and invoicing. It also facilitates efficient budget management. Notably, the client had two types of projects, Capex and Opex, with a critical need to control Capex project costs within budgetary constraints. Given the diverse sources of project costs, precise tracking and cost containment posed challenges. To address this, we implemented budgetary control without encumbrance accounting features in Oracle PPM.
Budgetary control was established at an absolute level for all Capex projects at both the project and resource levels. This approach offered flexibility in controlling and revising budget amounts based on evolving cost needs during projects. By implementing this solution, the client achieved comprehensive budgetary control in Oracle PPM, meeting their requirements while effectively addressing cost-related issues.
Tools and Technologies Used:
- Oracle Fusion Project Portfolio Management
- Budgetary control features of Oracle PPM without encumbrance accounting
Business Benefits:
The implementation of budgetary control features in Oracle PPM delivered several significant benefits:
- Enhanced Cost Control: The client gained better control over project costs, preventing them from exceeding estimated budgets.
- Funds Check Validation: The system validated funds for each transaction before importing costs into Oracle Projects, reducing the risk of overspending.
- Real-time Reporting: Real-time reports were generated to compare actual project costs against the budget, enabling proactive decision-making.
- Improved Project Management: Project managers could track overall project performance more effectively, ensuring projects stayed on course.
- Overall Spend Control: The budgetary control feature enabled better management of the overall project spend.
- Detailed Cost Reports: Comprehensive reports provided insights into various cost types incurred during projects, facilitating informed financial planning.
In summary, the implementation of Oracle Fusion Cloud ERP and Oracle Fusion Portfolio Management (PPM) with budgetary control features addressed the client’s challenges of integrating numerous applications and achieving cost control. The solution not only streamlined project management but also empowered the client with real-time insights into project costs and budgets, ultimately contributing to better decision-making and cost containment.
By adopting these technologies and practices, the client positioned itself for more efficient operations and improved financial management, ensuring the successful execution of their diverse logistics businesses worldwide.