ACG Business Analytics Blog

Working with Virtual Dimensions in IBM Planning Analytics 2.0.

Posted by Theo Chen on Mon, Apr, 23, 2018 @ 02:01 PM

Ability to create virtual dimensions from attribute-based hierarchies is a key update in IBM Planning Analytics 2.0 and a huge source of value. This is a major differentiation for IBM PA compared to other similar platforms. It provides even greater flexibility to the user to analyze data using user-defined parameters on the fly. With virtual hierarchies, companies have much greater flexibility in designing solutions that will provide greater efficiency yet maintain the flexibility to include attributes for thorough analysis.

What are Virtual Dimensions

Virtual dimensions are dimensions that are created in an existing IBM Planning Analytics system on demand by selected end users (system administrators). These dimensions are not part of the core system structure / design, but rather are created ad-hoc as needed based on attributes of individual existing dimension elements. Attributes can be created as and when needed while the system is in use and there are no practical limitations to how many attributes can be created for every single member.

Once a virtual dimension is created, it can be used just like any other dimension. It can be selected for reporting, it can be brought into a cross-tab view for analysis or used as a target for input for (plan, forecast) data.

What Virtual Dimensions are NOT

Virtual dimensions in IBM PA are NOT the same as the ability to create alternate rollups / hierarchies or sorting / filtering by attributes. We find that the concept is a bit hard to understand initially and people default to the capabilities they know. Unlike filtering and alternate hierarchies, virtual dimensions go deeper and provide a more thorough way to analyze the data.

Example:

We have a sales reporting application with Customer and Business Unit being the two key dimensions. Other dimensions include Account, Time etc. The Customer dimension is organized by Industry – so Customers rolling up to Sectors rolling up to Industries that roll up to Total Customer.

Let’s say I want to understand my sales by size of company (Enterprise vs Mid-Market vs Small and Medium Enterprise, or SME) in addition to the industry rollup. I do not have “Company Size” defined as a dimension so under previous rules I would have the following options:

  • Redesign the cube to include “Size” as a dimension – depending on the size of the overall model that could be a significant undertaking and could take a lot of time
  • Build an alternate rollup of Customer by size – in this case I would have to choose the Industry or Size rollup for reporting and analysis but I could not use both and would still not get the desired cross-view
  • Embed “Size” inside the existing “Industry” rollup – this would be extremely inefficient as I would have to include multiple rollups within each Industry / Segment for Size and repeat them for each Industry / Segment and deal with conflicting element values – not desirable from maintenance perspective and yet I would still not get the same flexibility for analysis

Enter “Virtual Hierarchies” – with IBM Planning Analytics 2.0 I can simply create a new “Attribute” and label each Customer an Enterprise, Mid-Market firm or SME. Once that is done, I would turn this Attribute into a Virtual Hierarchy and it would show up in my “Set” menu. Once there, I can simply drag the “Size” Hierarchy into the cross-tab view and see the breakdown of customer by size and industry in a simple cross tab view. I am able to drill down or pivot to analyze the data and even input into the virtual intersections to post adjustments or forecast sales. And of course element security still works at the leaf level. Extremely powerful…

Key Benefits

The key benefit implication from this capability include the following:

  • Savings in (RAM) memory due to less number of core dimensions required and thus the size of the core model
  • Better overall performance and usability of the model with less clutter / complexity
  • Much greater flexibility to adjust existing models and get deeper insight
  • Ability to conform with model standards with any customization done locally

What to Look Out For

Some points to be aware of when working with virtual hierarchies include the fact that they can currently only be built with 2 levels – TurboIntegrator scripting is required for deeper hierarchies with more levels. Also, elements in virtual hierarchy are not elements in main itself – each element in virtual has to be unique from every element in dimension. There is no security (yet) for 'virtual' elements, although that should be addressed soon.

The impact of Virtual Hierarchies will be different for existing vs net new applications. For existing models, it will add flexibility through the ability to expand structures without going through a potentially substantial application redesign. For new solutions, it creates an opportunity to design models with more simplicity and rely on Virtual Dimensions to provide scalability and flexibility in the future.

Give us a call to discuss how this great new capability can add value to your platform and review options to provide more insight and analytical power.

Topics: IBM Cognos TM1, TM1 Technology, Performance Management, Financial Planning and Analysis, IBM Planning Analytics

Trends in Enterprise Performance Management...

Posted by Rob Harag on Sun, Jun, 07, 2015 @ 06:13 PM

Enterprise Performance Management (EPM) systems are becoming more powerful, user friendly and more accessible - that is the core theme of an article published recently by CFO Magazine. Advances in technology allow EPM systems to process larger quantity of data on-demand and thus increase their analytical capabilities. Wider choice of specialized products and new features such as compatibility with Excel, predictive analytics, cloud computing or mobile access are transforming the way users interact with the applications and thus help advance many traditional functions and business processes.

While IBM, SAP and Oracle command about 70% of the market, there are plenty of sophisticated systems to choose from in the remaining 30%. Reversing a prior trend of industry consolidation, more companies are entering the market and provide interesting capabilities that are often tailored to a specific market or industry segment. Examples of such focus areas include budgeting, forecasting, profitability optimization or scenario modeling.

Gartner categorizes EPM solutions into two main buckets: Office of Finance Processes and Strategy Processes. Most of today's solutions, however, aim to combine financial and operational data across the company and provide a fully integrated view of the company's performance. Such increased transparency and insight into underlying trends and drivers facilitates a higher focus on key factors affecting financial performance. This in turn helps to more effectively execute a company's business strategy.

There are three primary drivers that are currently changing the way people and companies interact with and deploy EPM solutions:

Speed – with the increased use of in-memory computing, systems are more nimble and flexible to complete calculations in real time and are able to handle the ever increasing quantity of data. The improved performance facilitates a number of benefits such as usability, collaboration, integration and others. These capabilities are further changing the role of Finance and help it to be a more effective facilitator of change, trusted advisor to the business and a driver of value.

Usability – there have been great advances in user friendliness and usability of the tools as vendors continue to make significant investments into more intuitive and easier to understand user interfaces. Dashboarding, visualization, integration with Excel, web-based capabilities and templates are some of the key focus areas. Cloud computing plays an important part in increasing adoption through better flexibility of use. Finally, mobile computing facilitates more distributed data collection and reporting with the ability to drill down directly on the mobile device, typically an iPad.

Integration – EPM systems are becoming increasingly more integrated with solutions expanding far beyond the traditional financial planning and reporting. Operational planning, sales performance management, strategic planning are only a few examples of such new use cases. Integration of these systems and processes provides a higher quality output and facilitates collaboration across groups and departments, which yields more efficiency and improves performance. Predictive Analytics, while still in early stages, is further pushing the frontier on the type of insight and depth included in financial information involved in decision-making.

Topics: Business Forecasting, Performance Management, Financial Planning and Analysis

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