JD Edwards Reporting Strategy
JD Edwards Reporting Strategy
Ravi Adhi | Project Manager
The purpose of this article is to highlight an alarming pattern seen regarding companies not optimizing their JD Edwards Reporting Strategy. I have also seen some companies invest thousands of dollars in Business Intelligence (BI) solutions, and third-party tools, thinking that will solve their problems with reporting, but the fact is that any external solution will be only good as data beneath it. Even more reason as to why you need to get a strong foundation to get your reporting strategy right.
If we take a step back, there are two broad reasons why companies invest multi-million dollars in an ERP: 1. to be able to process transactions efficiently (For example receive and send Invoices through EDI and Automate Cash Application) and 2. to be able to provide timely, relevant, and reliable information to aid decision making to the stake holders.
During implementations, while companies focus on efficient transaction processing, the JD Edwards reporting strategy seems like an afterthought and as a result, companies spend a lot of time creating ad hoc reports after going live, adding insurmountable pressure to the accounting department especially, to be able to close the month on time.
The Symptoms that an Organization’s JD Edwards Reporting Strategy is broken:
- The stakeholders are constantly asking for new dimensions for reporting, and you are jumping through hoops to get the information out in a timely manner.
- You do not have one source of truth, the classic example is Sales reporting, the numbers for sales in the G/L and the Sales Order module do not match.
- Information from JD Edwards is downloaded to Excel and functions such as Vlook up, Pivot Tables and manual calculations are done to get the information out to the Stake Holders. It takes developers weeks to develop a new report, as opposed to a couple of days.
- The reporting across the company is duplicated, disconnected, and redundant. The primary source for reporting is the G/L so much so that, the chart of accounts has numerous accounts and you have run out of room.
Symptom 1. The stakeholders are constantly asking for new dimensions for reporting, and you are jumping through hoops to get the information out in a timely manner.
- Failure to consult senior managers during the design stage of implementation.
- Ideally, before an implementation, an organization should have already gone through the exercise to verify if the current reporting addresses the Key Success Factors (KSF) and the Key Performance Indicators (KPI) tied to the 5-year strategy of the company, but the budget for the ERP implementation assumes that this exercise has already been done and the implementation team uses the current reports as a starting point. This exercise is typically done during the tail end of the implementation.
The following are the issues with this assumption:
- It is important to understand that the current reports are constrained by the existing technology, namely the ability of the legacy ERP to slice, dice & tag transactions.
- In most organizations, most reports that are produced have a tiered look and are run “because they have been run for years”, so much so that sometimes there are some reports that are produced that are not even reviewed by anyone.
- I have a fellow CPA, who specializes in strategy mapping and balanced scorecard creation, who once told me that whenever he interviews Senior Managers & Managers of a company, to establish Key Success Factor (KSF)s and the Key Performance Indicators (KPI), the answers that he gets are all over the map!
- To rejuvenate the tiered looking reports that are produced in a Company, before starting an ERP Implementation, conduct a formal workshop with all the senior managers (Including the CEO & CFO) and middle managers and get sign off on the following by setting the tone that if we think “something is important, let’s measure it”.
- What is the 5-year strategy and the Key Success Factors of the Company?
- To achieve the 5-year strategy what are the Key Performance Indicators that can measure the Key Success Factors of the Company
- The common problem is the focal point usually is to establish financial measures, at a company level, but the most important part of this exercise is that the KSF & KPI & need to be established first for the company and then for every single department. The premise of this exercise is that there needs to be goal congruence across the organization, for a company to achieve the 5-year strategy.
- JDE software can help address these challenges.
- Some companies do a formal Balanced Scorecard (By Kaplan and Norton) which ties the Business Strategy to the following perspective
- Financial Perspective
- Customer Perspective
- Internal Business Perspective
- Learning and growth perspective
- Once the above exercise is done, the JD Edwards reporting strategy workshop needs to be done as a cross-functional workshop, from day one of an implementation, as opposed to only focusing on transaction processing, which is usually done in silos (Which beckons another article that implementation teams need to be organized in process streams as opposed to, in functional silos).
- To address the reporting need at the tail end of a project (Which is a very common mistake in the industry), after the configuration is done is akin, to asking where to install the electric and cable outlets after the house is built. The only way this can be done is by tearing down the wall and starting all over!
Symptom 2: You do not have one source of truth, the classic example is Sales Reporting, the numbers for sales in the G/L and the Sales Order module do not match.
- The reporting strategy is done in silos as opposed to a cross-functional exercise.
- Failure to be on top of integrity reports is the other reason why companies don’t have one source of truth.
Cross-Functional JD Edwards Reporting Workshop:
- To make sure that there is one truth for reporting it is important to have the mindset Strategic, Tactical & Operations reporting, should lead to the other, as a drill-down (As opposed to duplicating the details).
- For example, the G/L ideally should have the first layer of information at a strategic level, which should flow to the other modulus for Tactical and Operations reporting.
- There are so many ways to tag data for example: category codes in every single module at various levels, sub-ledgers, item masters, Business Units, Object Account Subsidiaries, Sub-ledgers, etc. One of the ways you can make sure that the information drills down logically is to first establish all the reporting requirements and through a cross-function workshop determine the levels of detail and the appropriate module to have the data tag.
Being On Top of Integrities:
- Integrity reports in JDE help to have one source of truth, by making sure that there is data integrity within a module and the sub-modules reconcile to the G/L. For example, when the A/R Subledger and the G/L do not reconcile this implies the numbers reflected in the Sales Order module never made it to the G/L.
- If you take a step back, compared to pre-ERP times, where a typical accounting department had numerous people working, because of ERP, most of the accounting is automated so much so that the accountant’s job has evolved from compiling the numbers to making sure that there is integrity in the numbers.
- JD Edwards provides numerous reports that act as pieces of puzzles to solve integrities, and unless companies are diligent in making sure that these integrities are clean, it will become a nightmare to clean this up and result in reporting inaccurate numbers to the stakeholders, so much so that I have spent months on data integrity cleanup projects!
Symptom 3: Information from JD Edwards is downloaded to Excel and functions such as Vlookup, Pivot Tables, and manual calculations are done to get the information out to the Stakeholders. It takes developers weeks to develop a new report, as opposed to a couple of days.
- In JDE Reporting, there are various ways of tagging data, as explained above, the root cause as to why companies resort to Excel-based reporting and developers struggle to code reports is because of not optimizing the functionality in JD Edwards to tag the data appropriately.
- Over time when there is staff turnover and when the implementation team leaves, failure to maintain the configuration document that was initially created and reluctance to provide continuous training in JDE to the new staff, results in the new hires do not understand the logic of the configuration that was done. This invariably leads them to Excel, a product that they are familiar with, compared to JDE, that they do not trust.
Not using the financial report writing tool in JDE, for financial reports
- One of the well-kept secrets in JDE is the sophistication of the Financial Report Writing tool (Called FASTR in World). This is very efficient for reporting based on the F0902 table, to leverage the level of detail reporting along with out-of-the-box smart fields for example for periods.
- I have seen developers spinning their wheels to create tabular reports using other tools, which do not lend themselves too well to create reports based on the F0902 table, forcing them to use the F0911 table for reports.
Not maintaining a Model Chart of Accounts
- The model chart of accounts is a way to make sure that there is uniformity in the object account across multiple companies. The main reason for this is because if you have a division 1 that has an object account 87900, used for Stationary the system is flexible in that it also lets you use the same object account with a description of Phone Expense in another division. Oracle’s recommendation is to always copy accounts from the Model Chart when new accounts are created.
- I have worked in numerous companies wherein failure to maintain a model causes grief to developers to be able to quickly create reports.
JD Edwards Reporting Strategy Solution
- One of the ways that you can continue to get value out of the multi-million-dollar investment in JDE is to keep the configuration document, that was initially created, up to train date & continuously, especially the new hires.
- To emphasize the value of continuous training, I can recall reading somewhere that companies instead of having the mindset “What if we train the staff and they leave” ……they should be asking “What if we don’t train, and they stay!”
- For critical reports wherein the configuration and data resides in multiple tables across modules, instead of assuming that the developers can easily join the tables, it is prudent to do a proof-of-concept report, with a developer, to make sure the configuration will be lent itself to efficient coding.
- Be diligent in maintaining the Model Chart of Accounts (Ironically in World software there is functionality to prevent accounts not in the model to be added to a Business Unit, if enough clients make this request in EnterpriseOne, this will help the cause)
- Re-visit the JDE reporting strategy every 5 to 10 years, if the vision and the strategy of the company have changed, and if need be, re-implement the chart of accounts to coincide with a major upgrade, to leverage the testing efforts that need to be done anyways.
Symptom 4: The EnterpriseOne reporting strategy is duplicated, disconnected, and redundant. The primary source for reporting is the General Ledger (G/L) so much so that, the chart of accounts has numerous accounts and you have run out of room.
- The JD Edwards reporting strategy is done in silos as opposed to a cross-functional exercise.
- The root cause of the over-reliance of G/L is because, since it is the accountants that are usually responsible for reporting, in an implementation, the mindset of accountants usually is to want to see all the information in a G/L account, as opposed to in a submodule such as Sales Orders, because they trust the G/L, being dear and near to their hearts (I being a CPA with an accounting background can completely relate to that).
- The G/L transaction table (F0911), being the central repository of all the entries, is rich with a lot of fields, and at a high level, gives the false perception to users that all the reports can be driven from it, but generally this is very limiting for detailed reporting.
Cross-Functional JD Edwards Reporting Strategy Workshop
- There are so many permutations and combinations of tagging data in JD Edwards, there are category codes in every single module at various levels, sub-ledgers, item masters, Business Units, Object Accounts, Subsidiaries, Subledgers, etc.
- One of the ways you can avoid duplicate and redundant configuration is first to establish all the reporting requirements, and then through a cross-functional workshop collectively determine the appropriate module to have the data tag.
- A good design should have a logical drill down from the Strategic level (G/L) to the Tactical and Operations level of reporting. For example, the G/L ideally should have the first layer of information at a strategic level, which should flow to the other modulus for Tactical and Operations reporting.
How to avoid creating a monstrous Chart of Accounts
- In order to avoid creating a monstrous chart of accounts Ideally, the chart of accounts should only be capturing information only at a high level for strategic reporting.
- The Business Level should be defined as the “Where” and the Object should be defined as the “What”.
- For example: The object should be defined as sales (What) and Division 1 and Division 2 should be defined as Business Unit (Where).
- A sign of a bad design would be to have the objects reflect the division.
- If the company is selling pens, a sign of a bad design would be to have object accounts for each colored pen in the Chart of Accounts, as opposed to this being defined as item masters, in the Sales order Module.
- It is ideal to use the G/L balance table F0902 for Strategic reporting (P&L and Balance Sheet).
- Since the G/L transaction table – F0911 is also very rich in details, this table should also be leveraged for tactical and operational reporting (illustrated below) in addition to the tables available in the sub-modules such as Sales Order and A/P.
There is an adage that “there are a million ways to skin a cat”, likewise, there are many ways of achieving the goal to rejuvenate the reporting strategy of a company, which I mentioned is one of them. If what I had mentioned makes sense and you want to re-vamp your reporting strategy, GSI’s JD Edwards consulting team would be glad to be of help.