Infosys’ blog on industry solutions, trends, business process transformation and global implementation in Oracle.

March 29, 2017

Cross Docking - An Enabler to Quicken Turn-Around in QSR Industry

QSR Industry and the concept of quick turn around

The success of the QSR (also known as fast food industry) is driven by the timeliness with which the products are delivered, without compromising on the quality. The name itself, Quick service restaurants, suggests the fact that the delivery of products in this industry needs to be quick and the lead time involved in minimal. Organizations need to be ready to fulfill the orders in short notices which can even be a few hours. Also, given the dynamics and competition in this sector, along with the strict rules and regulations for any food products, organizations have an ever increasing pressure of quickening the delivery without any compromise in quality. Long term sustainment of growth and success are only possible if the above criteria are not neglected. Some very common QSR names like McDonalds, Starbucks etc have diligently followed these rules to become what they are today.


Nature of order placing in QSR industry

Most of the orders in the QSR sector which are placed to the warehouses comprise food products and preparations which are highly perishable in nature. Items like burgers, pastries, sandwiches etc which cannot be prepared and stored in the warehouse like other packaged items. These items are made to order and arrive in the warehouse only a few hours before the actual shipment needs to leave from the warehouse to fulfill the orders. Most of the QSR players have their company owned stores and hence the nature of orders is very similar for all stores. In ideal cases, these stores place their orders with the warehouse a day before the actual delivery.

The nature of the items is such that the warehouse doesn't have these items stocked in the premises beforehand and the order is passed to the manufacturing unit / supplier only after summing up the cumulative quantity of each item asked by all stores.

There are certain scenarios, especially during festive or holiday seasons when the stores place a lot of emergency orders with the warehouse where the lead time is only a few hours. These are the times when the warehouse has to ensure that there is quick turnaround of the order and needs to facilitate quick supply of the items from the vendor and then quick delivery of the same to the store.


Pain Points: How to Reduce Turn around

Given the nature of business for the QSR Industry, the efficiency and productivity are dependent on the fact that how quickly the turnaround is done or the turn around time reduced for the orders to the stores. However much the regular picking process is expedited, there is a fair bit of delay expected in the process of picking the items from the receiving area after they have arrived and bringing them to the shipping area. This can cause delay in the delivery deadline and business can suffer. Also, there is high labor cost and transportation cost which distribution centers want to reduce especially for these items where there is no storage and items are directly sent out for shipping.


Recommendation: Cross Docking

An optimum solution for this type of situation can be Cross Docking. Cross docking means skipping the receiving and temporary storage part and unloading the goods directly in the cross dock area from where they are loaded into the delivery trucks. This can serve as a good opportunity in case of QSR warehouses as the items themselves don't require storage. Hence they can be sent directly to cross dock area. Also, this will help in quick turnaround of orders from supplier till the actual store and increase the supply chain velocity.

For efficient cross docking, there are a few important points which need a special mention:

·         Physical layout of the warehouse: Cross docking will not make any sense if the distance between the receiving and the shipping area is very huge. Although in most warehouses, the layout is such that the receiving and shipping are at two ends of the warehouse. But that is more suitable to industries where storage forms a major activity in the warehouse. In case of QSR sector where storage is minimal, it would be ideal to have the receiving and shipping in close proximity to facilitate easy cross docking.

·         Carrier routing information: As mentioned earlier, the nature of orders from various stores in the QSR industry is very similar to each other. More often than not, the shipments are clubbed based on the carrier's route for the various stores. If this information is available much ahead of time, the items can be bulk picked from the cross dock area and put into the respective trucks as per the routing schedule.

·         Task management can serve as an effective enabler to avoid stock out situations and facilitate cross docking. Task management when linked to employee scheduling helps optimize staff requirements, based on sales history and other factors. This could even be linked to overall employee productivity and a number of reports could be made available to determine it. RF devices when paired with a WMS could be used effectively to avoid inventory shortfall situations for a retailer. What is needed is an inventory source of record, wireless infrastructure and a WMS with a Task Management engine.


There are a few impediments for the cross docking process as well. These are:

·         Inventory levels in the warehouse system: One major barrier in cross dock process is that during cross docking, the items are not actually received in the WMS system of the warehouse and hence the inventory levels are not brought up to show the entry and exit of the items from the warehouse. Since the orders are sent and pick / ship documents are created a day prior to the actual transit of items, the warehouse has to find a way to capture the information of these cross dock items arriving and leaving the warehouse for auditing and tracking purpose.


One way of doing this is to bolt up the warehouse inventory with dummy values via receiving screens and then bring them down through the pick screens.

The other way can be to make the cross dock location a valid receiving as well as shipping location of the warehouse. So from one screen, the inventory level in the WMS can be increased by receiving items from the cross dock location and from the other screen, the inventory can be brought down by shipping them out from the same location.

·         Merging of cross dock product with products coming out of picking belts: Though most of the items from the stores would be the highly perishable, JIT items, there can be certain items which are non JIT in nature and are stored inside the warehouse. For ex: packaged foods, liquids, lids, cups etc. These are picked and shipped via the conventional picking method and are brought to the shipping area via the conveyor belts or manually. If the warehouse is doing cross dock of some items which have arrived externally from the supplier and is also picking items from the shelves for the same order, care needs to be taken to properly pack all the items of a single shipment of a store together and nothing should get missed or mixed with other orders. Also timing of the arrival of items from the two sources becomes important in a way that the shipment doesn't get delayed.


A New Beginning

Cross docking has still not gained its fullest popularity in the world of distribution centers and is still a vast area to explore. Cross docking can greatly reduce the turnaround time of delivery of orders and can act as a trigger to increase the velocity of the logistics system of the QSR industry. No customer likes to hear that the dish or item they have ordered from the menu has still not arrived and will be there in a few minutes. Customer delight in terms of time and taste is the key to the success of this highly competitive QSR world and can only be achieved with the combined efforts of all participants in the supply chain. Cross dock can be once such contribution from the distribution center.

Continue reading " Cross Docking - An Enabler to Quicken Turn-Around in QSR Industry " »

March 24, 2017

Key Emerging BSS-OSS Trends Impacting IT and Shift Towards Cloud Technologies

Telecommunication companies across the globe, up until late 90s, have largely operated as network oriented set-ups with disintegrated and at times non-existent business and operations IT support systems. Starting early 2000, there was a focused shift towards major technology investments in packaged CRM, Billing (BSS) and Order Manager (OSS) systems in telecommunication companies. These investments were necessitated largely because of expanding product lines and emergent telecom technologies. Most of these packaged BSS-OSS technologies were bought, designed and implemented on-premise.  This was a welcome move as integrated BSS-OSS-Network is extremely core to the existence of any modern day telecom operator. However, BSS-OSS implementations so far have been highly technology centric with below features in common (up until the start of this decade and prevalent still specially in developing marketplaces):

  • Complex product structures with limited/negligible differentiation between commercial and service offers.

  • Hard coupling of design and systems.

  • Extremely long C2M (concept to market) cycles.

  • Maze of entitlements, thresholds and value added services often charged as different price points. This is probably seen as a revenue enhancer strategy keeping product managers busy, however one has to be mindful of the costs involved in managing order fulfilment/ and billing issues associated with these services.

  • Service disruption/outages owing to IT (not network) - yes, disintegrated IT systems can do enough to initiate disconnection timely but fail to trigger reconnection on time. 

  • Extremely long lead time to deliver a relatively small change often because of hardly coupled upstream/downstream systems.

Telecom business and operations support systems have been evolving, systemically changing the role, architecture and overall placement of IT systems in telecommunications. In the very recent years, thanks to customer centricity, there has been a re-look into BSS-OSS design & implementations for telecommunications. It would be fair to state that conventional technology centric BSS-OSS is becoming more and more customer centric. Overall, majority of telecommunications players (at least in developed markets) are revamping their IT strategy to align with below imperatives.

  • Modular plans with a clear demarcation of a service vis-à-vis commercial offer.

  • Loose coupling of design and systems - doing just enough to link but avoid hard dependencies. Rightly thought through designs (especially during foundational releases) help in containing consequential impacts; makes it simpler and cheaper to deploy improvements/changes. In my previous project, to integrate a CRM system with external API to enhance basic customer delivery options, it actually eventuated into changes across 15+ systems across BSS-OSS (most of them consequential regression impacts).  

  • Reduced Concept to Market cycle. This has been an explicit ask not only in Telcos but across industries. Product managers do not have the liberty to wait out a year to deploy a new product offer or launch a new product category.

  • Simple plans with unlimited entitlements (all things included) - this is a very exiting trend. Unlimited voice and text is extremely common. For a single price point, we often also see unlimited internet and so on and so forth. This in itself reduces a lot of overheads associated with maintenance and fulfilment of n-combinations of offers/services. With a single price point for unlimited entitlements, there is effectively no bill shock, no usage traction needed and no billing issues.

  • Eliminate any IT specific service disruption/outages - Deploy fully integrated (easy to integrate) solutions especially for critical scenarios (customer re-location, transition etc.) mitigating the probability of such incidents.

Shift towards cloud technologies is vital to realize these imperatives. While on-premise solutions have helped in establishing the relevance of BSS-OSS systems, these solutions have also introduced high entry/exit barriers and created 'non-core' tasks/operations for a Telco to manage. For a modern day Telco, short lead time to market, agility to deliver, and managing network (not IT systems) are more critical objectives and hence the move towards cloud is becoming more pertinent. At the outset, below are some (not exhaustive) of the critical success factors for cloud:

  • Low entry barriers - just pay for licences and commence use; eliminating unnecessary lead time for planning set-ups.

  • Outsourcing non-core tasks - no need to maintain captive data centres.

  • Shorter lead times to deliver - changes can be quickly designed and implemented in truly agile manner.

  • Reduced concept to market - cloud solutions are better fit for simpler and modular products, light weight designs etc.

  • Adaptive and easy to integrate - cloud solutions are extremely adaptive; easy to integrate using APIs and micro-services. These integrations are re-usable, scalable and much easier to change/deploy.

A case in hand would be comparison of on-premise CRM vis-à-vis on-cloud CRM system in lieu of the newer imperatives. Siebel ecommunications is probably one of the largest implemented on-premise CRM system in telecommunications industry. While no one can argue on the functional depth of this CRM system, however given the new world order (new imperatives), telecommunication players probably don't need most of its functionality. A cloud CRM system, on the other hand, could easily help deliver customer service and order management functionalities for simple modular products much more effectively and efficiently. With renewed focus on light weight design, unnecessary functions and excessive data capture/information processing can be avoided. A lot of time and efforts indeed gets saved in a cloud implementation - configure over code, direct check-ins, integrate using APIs and test/validate alongside build.

There has been a conscious shift by almost all leading BSS-OSS product companies to move towards cloud. Even the heavy weight order managers and billers are now available on-cloud; in fact cloud packaged offerings are much more optimized compared to on-premise packaged offerings. This presents a fantastic opportunity for telecommunications players to use cloud technologies as a mean to align with their new imperatives, and continue focussing on what really matters the most - 'Network'.  All leading telecom and broadband operators globally are majorly measured on their network roll-out and customer reach, which ultimately are the critical factors to manage and enhance customer experience perpetually. Cloud solutions can truly become enablers for these operators. Having exclusively worked for Telcos in the last few years, I am witnessing this shift. Almost, all operators (developed marketplaces) have embarked upon cloud implementations in part or wholly.

It is also interesting to note that new operators and MVNO (mobile virtual network operators) would find it much easier to adopt cloud. Entry barriers are pretty low for new operators/MVNOs. Large enterprise operators would perhaps find it more challenging to switch to cloud primarily owing to large captive legacy on-premise systems.

While cloud shift presents an opportunity, it is not fully off the hook as yet. As cloud adopters, one needs to be aware, constantly examine and challenge cloud security, storage, licensing costs etc. to ensure sustainable long term benefits.

Continue reading " Key Emerging BSS-OSS Trends Impacting IT and Shift Towards Cloud Technologies " »

March 23, 2017

CPQ for Professional Services Industry

Professional Services Industry (e.g. software services, training and certification industry etc.), sales process aligns to standard Sales process of a CRM application. The products and services sold are not too complex in terms of product structure and rules around it. However, every organization has different way of pricing and providing discounts to customers. CPQ Cloud offers a solution to meet the pricing calculation needs through configuration and customization options. Professional Services sales flow also ends with project creation to track the activities based on Services sold to the customer. This can also be supported via the CPQ cloud.  

Let us look at the Lead to Quote to Project Use case for a Professional Services organization:


For most of the Industries, Quote to Order flow works well and hence CPQ Cloud integration with Order Management modules is readily available. However, there is no prebuilt integration between CPQ Cloud and Oracle EBS Projects. It needs to be established for this Industry specific use case.

In order to simplify this integration and determine what details will flow from CPQ Cloud to EBS Projects, we need to design the product such that all required inputs will be captured for subsequent project creation.


While a Service Offering is setup as a Product in CPQ, it captures attributes for Service Module, Role and against each role, details about location, rate, effort etc. Once a Service Offering is configured for a customer, it may have various modules that have several roles. Once all these details are captured against each role and activity, price can be calculated directly or Commerce process can be configured to apply pricing logic by reading other parameters like Customer rates etc. which may override manual entries or retain edits post calculations are done.

Once the quote is finalized and approved, the quote line item details for role, duration and effort can flow in specific format to EBS Projects to create project line items/activities for roles.

The solution provides the following key benefits:

Improved Quote Accuracy - A Quote may go through multiple iterations due to changes to various parameters. E.g. a role is expected at onsite for some duration, an activity duration is revised etc. CPQ Cloud automates pricing impacts to be calculated automatically for all these changes and maintains the Quote with accurate price as per planned resources for the project. Each time quote is reconfigured and submitted, it may require similar steps for pricing approval. CPQ Cloud can be configured to have approvals triggered for each change automatically.

Reduce Quote and Project data mismatch - As generally the Sales data is maintained in a separate system which may not be integrated with the project management system, it causes lot of problems due to data mismatch between what was quoted and what is planned for the project. The integration between CPQ Cloud and EBS Projects eliminates problems of data mismatch for activity durations, resource roles, rates etc.

Streamline Quote Revisions - It is a very common process to have some change request or amendment to the contract after the project has been initiated. CPQ Cloud offers Quote revision process to meet requirements for any amendments to existing project. With enhanced features like subscription ordering available now, CPQ cloud can be extended to manage change requests quote process for a project.

Here is a view of flow for amendments and change requests.

March 22, 2017

Leveraging Oracle Policy Automation integration architecture, will it make a paradigm shift?

Decision making is one of the key aspect embedded within any business process workflow cutting across all domains. Increasingly in today's world, there is a definite need for performing what-if analysis in driving right business decisions/outcomes in a shorter time aligned towards the organization revenue growth and high performance. To promote it consistently one must not only focus on reducing operational costs but also make a differentiation in the way business is executed by adopting innovative methods to perform the what-if analysis in an intelligent way to build quick, smart decision making capabilities within each of the key business process in the organization.

In this blog one such technology product Oracle Policy Automation (OPA), designed as a specialized decision making technology platform, an offering from Oracle Corporation will be looked at to see if this product makes a significant difference to the cause explained. Imagine a product which can nicely sit in your desktop and allows you to write your business rules specs using plain English (supports other languages such as German, Danish, Spanish etc.) in a Microsoft office word or excel spreadsheet, compile them together logically, construct a model to deploy them as a stand-alone or as a package in your application server where business logic evaluation is expected to happen. Sounds really interesting, right? This is Oracle Policy Automation solution framework. The cherry on the cake is that the package can act as a web service that can be well consumed for meeting integration needs in an enterprise architecture.

Flowchart: Connector: CONNECTOR 
(Cloud as well On Premise)


Fig. Oracle Policy Automation - High Level Architecture

With the same interest, let's take a look at OPA technology architecture depicted above. As evidenced from the architecture shown above, at high level OPA has below

  • Policy Modeler - simple eligibility rules can be written in native languages using Office products available in one's desktop.
  • Determinations Engine - a library performing all the business logic evaluation against the user input data received to make clear determinants.
  • Web Determinations -   runs the web surveys and interacts with Determinations Engine for making decisions.
  • Determinations Server - Used for exposing Determinations Engine in the form of a web service.

OPA architecture can be integrated with any on premise as well cloud applications, there is a cloud connector is readily available for cloud based integrations. This architecture if implemented will reap the below direct benefits

  • Business team will own the rules creation, authorization and maintenance leading to significant reduction in cost of support staff, significant improvement in accuracy and establishes consistency in evaluation of policies.
  • Enhances competitive edge in the market as this directly enhances the end customer experience and business team experience.
  • Manage the core business rules centrally establishing more control to business team
  • Brings agility, promotes reusability and reduces redundancy across the organization
  • Plug and play architecture enables easy integration with all major applications

With the understanding of OPA architecture, its components and benefits. Let's go through list of common problem statements which when exists within an organization warrants OPA or a similar policy automation solution to remain agile.

  • The experience and skill set of service personnel in the delivery organization front ending the customers towards probing, data collection for evaluation against defined policies is not sufficient. The turnaround time could be improved.
  • The organization expects customer to fill a questionnaire at front desk or during an interactive call/chat every time to seek some information to understand and process their queries.
  • The frequency towards policy evaluation for new as well existing customers, which the organization performs is quite high.
  • The organization believes that agility and transparency across the board towards customer policy compliance, evaluation and adherence can be boosted.
  • The organization process to track and audit the decisions made by customer service team is manually done and not consistent.
  • Organization is spending significant time & cost on interactions with customers
  • Organization is looking for a common automated solution across all channels to make fruitful interactions with customers
  • The policy framework and related decisions making process is complex with due factoring done towards the relevance of legislations & compliance regulations, which the organization expects to follow.
  • Lack of business support for formulating & promoting new policies exists because of managing too many pain points experienced in the current processes.
  • Business team dislikes the idea of business corporate policies or rules being owned by programmers towards implementation.

With its dual capability, OPA offering stands out as a go to product for quick deployment as well for greater yield on return on investments in the longer run.  OPA offering with its plug and play architecture allows it be used for What if analysis on policy making & amendment decisions to assess logical gaps, operational and financial impacts by testing applicable scenarios using OPA architecture modeling the rules and feeding them to get the results for verification.

OPA scores over other products or alternatives easily, a short illustration on prime factors is given below for better understanding. The key capability of OPA is that it offers an optimized, easy to use solution to build and maintain complex policies to derive critical business decisions.





Fig. Oracle Policy Automation vs. Alternatives - Comparison

In spite of all its compelling features OPA is not the best solution for all rule based business problems cutting across domains in public and private sector. Also OPA doesn't come for free, it has a license cost associated hence every organization should evaluate if the there is a real need for policy modeling and automation. OPA against its initial cost and time cannot be justified truly for business cases involving modeling rules unless a fitment exercise is undertaken and cost benefit analysis is made in detail and presented to stakeholders for a decision on the shift this product offers towards revenue growth or reduction in operations costs.

***Chart of Account (COA) Design Considerations***

Chart of Account (COA) structure is the heart of an ERP implementation enabling business to exercise its day to day operations. This has very influence on how an organization wants to record monetary, contingent and statistical impact of different transactions taking place across the line of businesses, report it out to external entities to fulfil regulatory and statutory requirements, leverage it internally to gain insight on performance of different departments on both top and bottom lines. In order to be able to embark efficiently on these essentially require a modern chart of account mapped to different business modalities and dimensions that does not only takes care regular requirements as said but helps facilitate automation, rein in need of creating duplicate segment value pool, one segment does not override others i.e. maintains uniqueness of purpose mapped to each segment etc. Investing enough to lay down the foundation of COA structure would be the first step to lock down a successful ERP implementation and to drive innovation for businesses throughout the life of application. Note: Combination of segments (e.g. Company, Department/Cost Centre, Account etc.) forms a Chart of Account.

There are numerous essential characteristics including, but not limited to, below 5 that must be considered while designing COA structure:

Selection of business modalities/dimensions as segments of COA:

The selection of modalities as segments is not an objective matter but a very subjective in nature. While some are mandatory one irrespective of everything and anything but some are invariably vary based on types of industries, organizations and products or services offered, geographies where businesses have its operations, internal and external reporting needs, future considerations and volume of inter or intra company transactions etc. Each one of these are key drivers to design an idealistic, futuristic and holistic chart of account. For an example, manufacturing organizations may want to consider cost type as a segment to represent say fixed and variable cost in order to better assess contribution margin at the product level. They may look at a segment exposing sales destination location of a product to clearly articulate the strategy for multi-fold growth in determined geographies. In banking industry, companies may choose to introduce reference to a relationship manager/cost centre in order to measure performance at product portfolio level. In retail industry, looking at product categories instead of individual product can be the favourable option.

One segment should not override or make other ones redundant:

This is one of the vital discussion points while designing a COA structure in any ERP systems. While a thought leadership on this can offer long term benefits to organizations in account of easier maintenance, minimal master value pool for each segment, no duplication etc. On the other hand immature decisions, however, may erode the benefits eventually. A COA structure and value set for each segment should intelligently be designed in such a way that one segment does not make other one redundant, does not enforce introduction of similar type of values for a segment and most importantly they must be structured "relative" to each other. To understand it better, let's take an example of a COA structure that has 4 segments called Company, Cost Centre/Department, Natural account and Sub-Account. There are 3 companies COMP1, COMP2 and COMP3 and each company operates with its 4 own departments as Sales, IT, Purchase and Inventory. As a strategic and sustainable approach, a) one would recommend only 4 different cost centre value sets representing each of the 4 departments. These 4 can be associated with either of the 3 companies while actual transactions are taking place. On the other side as a poor design, b) organization can undoubtedly be enforced to introduce 12 different cost centre codes representing 4 departments working for 3 different companies. It is self-evident that option "a" firstly cascades the behaviour of relativity where Cost Centre is relative to a company and thereby does not lead to a redundancy and secondly avoids creation of duplicate codes for similar type of departments. This can further be well understood with postal code numbering system where it navigates through State, District and finally City. Here City is relative to a District and a District itself relative to a State for a given country. In regards to option "b", shortcomings are clearly countable as creation of duplicate codes while departments are of similar nature for each company, can't share segment values, certain to experience huge volume of cost centre values over the period of time etc.

Automation for Intra/Inter Company Transactions:

Organizations like GE who has leading business presence almost all over the world deal with huge volume of transactions b/t two or more internal business units. Transactions taking place b/t 2 business units ideally lead to inter/intra company transactions and that is where it is essential to consider a placeholder for inter/intra company segment in the COA in order to efficiently track referencing inter/intra company and enable opportunities for automation. ERPs like Oracle Application R12/Fusion Cloud offers an automation to create inter/intra company accounting entries by introducing pre-configured rules. For example, Oracle Fusion Financials automatically creates Intercompany Payable accounting entry corresponding to the Intercompany Receivable inter/intra company accounting entry by looking at the rules. Such entries have a counterparty reference in the COA code combination as in company (balancing segment) and designated inter/intra company segment.

Give meaning to each digit/character within a segment rather than just treat as code:

While a business meaning is tagged to each segment, a COA design can further be advanced by injecting an appropriate meaning to digits or characters within a segment. For example instead of just coding a company as COMP1 with no meaning to individual or set of characters, one can strongly advocate for "013060" where first 2 digits represents Country, next 2 region and last 2 State. Such logical combination may take away the need of an individual segment in a COA to signify location. This is additionally very helpful for easy reference.

Business Rules With Valid COA Code Combinations:

In regular business practice while creating different transactions, allowing only valid COA code combinations is usually the core business requirements. For example, although a COA code combination with Cash Account does not require any specific product code however the same would be needed while booking revenue. Thus, identification of such scenarios and implementing rules accordingly in the system is the key to rein in undesired code combination values.

Emerging SPM Trends and Realities

Digital Disruption - The Threats and Opportunities

The digital revolution has created a flurry of business opportunities, but has also presented a more complex and well-informed buyer. Customers today have access to a treasure trove of information which greatly influence their buying decisions. Sweet talking - though a great trait to have as a seller, won't impress much, unless there is that valuable insight about the customer and what could influence them to buy. Sales organizations are beginning to see the need to adapt to these threats to stay relevant.

The focus is on sales optimization by aligning selling to purchasing interests. This is possible only when there is relevant, reliable and readily available data. Here-in lies the opportunity for sales performance applications than can mine and churn volumes of information from varied sources to give that extra bit of perspective and trait when selling


Feeling the Pinch

With shrinking IT budgets, companies today are aggressively pursuing a cloud strategy. Service based models for software and applications are the new normal. This keeps the customer interested and the product vendor committed. There is also a pressing need to be modern, technologically relevant and also adhere to governance, auditing and other compliance standards.

Modern Sales Performance SaaS systems are technologically advanced, high on standards and also drive better selling while simultaneously freeing up internal IT costs by eliminating infrastructure and administration hassles and also reducing the dependence on individuals for maintenance and support


Get 'SMAC'ed

The four 'disrupters' of the digital world - social, mobility, analytics and cloud have shaken the SPM market like never before. SMAC has changed selling dynamics. It has had a profound effect on what and how to sell to whom. SMAC has empowered buyers with all they need to know about what they intend to buy. It is therefore so much more significant for sellers to get 'SMAC'ed to improve operations and get closer to the customer with minimal overhead and maximum reach.

Today's selling models are built upon data fed by the customers themselves. Tablets, smartphones and other mobile devices create a dynamic framework for data. Cloud-based solutions enable mobility. Data analytics reveal insights and opportunities for optimizing sales performance. 

And so, there's an escalating demand for sales performance management software with mobile and social capabilities, integrated and real time Business Intelligence (BI) through cloud deployments. This fundamental development is throwing up new players in the SPM segment who are threatening the old order and creating a niche for themselves in this market


Inspire and Incent

Businesses thrive on profits and every strategy is intended to drive them higher. To get the sales force to rake in those profits, it's imperative to have a sales incentive plan that inspires and rewards salespeople for profitable selling. The right behavior needs to be inculcated by making it easy for the sales reps to understand what needs to be done and then motivating them with accurate and timely monetary and non-monetary benefits.

The perspective brilliance can be achieved by automating the sales-compensation processes and providing real-time insights into actual performance. That requires a comprehensive sales performance management (SPM) solution to inspire and incentivize profitable selling.

Yes They Can!!!

The modern SPM solutions help inspire sales reps and managers alike.

Sales reps can

    • Understand what they're required to do
    • Keep a real-time tab on their progress
    • Raise and resolve disputes effectively.

Managers can

    • Set the right expectations
    • Use gamification to instill the competitive spirit and embed best practices in every rep's day
    • Measure performance across sales teams
    • Identify leaders and laggards
    • Motivate those that need a helping hand and inspire the high-performers to greater heights
And last but not the least, these fine-tuned complex calculation engines can churn out incentives with great accuracy and on time


Complexity - no more a wet blanket

Businesses are growing fast but are changing even faster. The changes to sales geographies, sales demographics, performance measures and compensation structures are so rapid that SPM solutions need to be nimble to adapt.

Spreadsheets can no longer keep a business operating at digital speed. They also do not address the complexities of the sales organization itself, including employee churn, promotions, territory re-alignments, unaligned quota targets, incorrect data and more. The clamor for real time integration and data migration is getting louder too.

Modern SPM applications are expected to address all these complexities without having to customize/extend them or then rely on third-parties to fill in the gaps. The more the gaps, lesser the likelihood of success. Customers are ready to go the extra distance and spend the extra bucks to replace their existing SPM applications if they are found wanting on flexibility, agility and alignment.


It's all about Winning

Of late, there is widespread acceptance about the benefits of sales performance management software and services among the users. The vertical flavors add to the excitement.

PM makes it easy to analyze behaviors and thereby helps in devising tailored performance plans to help both the leaders and laggards succeed. It enables real-time performance assessment and provides instant feedback. It helps managers to get the right mix of winning teams and foster healthy competition in driving up sales.

There is the tough customer to deal with and a motivated competition to beat. Since it's all about winning, the need of the hour is a comprehensive, feature-rich, flexible and aligned SPM solution. An effective SPM system is intended to plan, motivate and reward right. The better it does that, the greater are the chances of its adoption.


Go after SPM!!!

The sales performance management market is segmented

By geography: North America (NA), Latin America (LA), Europe, Middle East, Africa and Asia-Pacific (APAC);

By solution: Sales On-boarding, Sales Training, Territory Management, Quota Management, Sales Incentives, Sales Coaching, Sales Appraisals and Gamification

By deployment options: Public Cloud, Private Cloud, Hybrid and On-premise

By service type: Consulting, Implementation, Training, Support and Managed Services;

By industry: BFSI, retail, healthcare, IT and telecom, manufacturing, energy and utilities, travel and hospitality, transportation and logistics, media and entertainment, and others.

Oracle Financial Accounting Hub (FAH) - A True Value Enabler

For any business organizations, recording accountings for its different transactions taking place with internal or external entities is an obvious objective. It is essential to measure the overall performance of the organization, gain insight to penetrate the new markets and to control cost expenses, fulfil the statutory and regulatory reporting requirements and so on. To efficiently support all these any modern organizations need a reliable, scalable, centralized fulfilling global and local accounting requirements, quick enough to implement a change and importantly economical solution. The answer is Financial Account Hub (FAH) and embarking on it is a first step to plant a foundation for innovation. FAH is an intuitive accounting engine that consumes business transactions' attributes interfaced from legacy systems, apply the accounting rules and mapping to eventually create accounting entries. For a better reference and understanding, it is similar to Sub-Ledger Accounting (SLA). While SLA is an accounting processor for business transactions originated from different sub-ledgers like AR, FA and AP etc within Oracle ERP, FAH is to deal with transactions originated from legacy systems and interfaced to Oracle ERP. Here are the 5 key value enablers that innately help drive organizations to inject FAH in their accounting solution footprint:


Centralized Accounting Solution:

In a traditional approach, consider a scenario where accounting entries are created for 10 different types of business transactions in 10 different front-office systems and finally interface it to Oracle where general ledger operation is supervised. This apparently counts some of the inefficiencies like:

a) Maintaining business accounting rules in 10 different systems

b) Requiring multiple resources with different product specific skills to implement accounting solution, change and support.

c) Lack of governance and control over accounting

d) Lost opportunity of reusing different components e.g. mappings and common accounting rules.

e) Have to invest on front-office applications for something which they don't primarily mean to do.

To overcome all these, FAH is one of the best options that offers centralized accounting engine empowers organizations cultivating a strategic roadmap to consolidate the accounting solutions lying at different places to just one at enterprise level.


Quicker and easier implementation:

Unlike Oracle EBS 11i and prior lower versions, both Oracle EBS and Oracle ERP Cloud offer front-end configurable capabilities to mimic business accounting rules on FAH setup components to eventually derive accounting entries for interfaced business transactions. Configurations are simply divided into logical groups likes Accounting Derivation rules, Journal Line Type rules (Dr and Cr) and optionally line/header descriptions rolling up starting from transaction, application, accounting method and finally to ledger. All these are configured corresponding to its relevant entity, event type and class model. An accounting solution for an interface can be ready in one month or so. 


Minimize dependencies on IT teams for maintenance:

Unlike custom accounting solution, most ongoing maintenance requests like capturing additional details to the journal line description can easily be achieved without even involving developer and a code change. Consider another scenario where there is a regulatory requirement to book asset expenditure to expense account instead of asset account for certain asset categories. Unlike in traditional back-end accounting engines where a medium size IT project may require, FAH can deliver it to business as part of the BAU processes without involving IT teams and notably in a quicker, easier and cheaper manner. In this particular case, accounting derivation rule will require a change to accommodate expense account for certain asset categories.


Capability to handle exceptions and complex mapping/rules:

While FAH is capable of handling most of accounting requirements with out-of-the-box configurable features, it also provides a powerful custom source concept where you can code your own accounting logic and link it to a custom source available for use in FAH. Consider a scenario where you want to derive BSV (balancing segment value) of COA based on the complex mapping and exceptions, a custom source can be defined for the same linked to a custom s/w code. FAH invokes the custom source at run time while interface processing to derive the BSV based on the logic coded in the custom s/w program.


Cost avoidance:

With FAH is in place for interface processing, organizations can avoid multiple licensing cost by eliminating the need of licenses for all front-office applications having its own accounting engine. It naturally avoids the salary costs needing for product SMEs with different skills set related to core legacy systems.

 Thus, FAH is categorically a strategic accounting hub be it Oracle EBS or Oracle ERP Cloud that offers agility extensively enabling modern organizations gain radical benefits of faster responsiveness to the regulatory and statutory accounting requirements, cost effectiveness, and importantly consolidation of accounting solution on a single platform.

March 20, 2017

Credit Bureau Reporting in North American Financial Services Industry

Financial Services Industry is all about risk and return. This is as valid for lenders as it is for investors.

A Lender(or) a Creditor is a person or a financial institution that have provided some financial amount to borrower(s) (customer), which may or may not be backed by a security / asset, based on the policies and business model of the lender. Lender expects to earn the interest income through these lending arrangements. A borrower could be either an Individual or an Organization.

As can be interpreted from above, the underlying framework of the 'Financial Lending' is Risk and Return.

While interest earned can be easily attributed to the 'Return' factor; it is the 'Risk' associated with a lending arrangement (and borrower, ultimately) which impacts the lending behavior of the lender.

To identify the risk associated with a borrower - performance of the borrower on past loans, borrower's payment habits and information about any specific activities which can be of concern are the aspects which a lender is interested in. These key factors about the customer help the lenders forecast / predict the future performance of borrower and assessing the risk associated with the lending arrangement with the specific borrower(s).

With the knowledge of forecasted performance, risk assessed and the risk appetite; a lender can decide what kind of borrower portfolio is manageable and sustainable, and accordingly, a lender can decide to allow or deny loan to an interested party.

The information to help perform risk assessment is invaluable & of enormous importance to finance business. It has to be accurate and a true representation of past behavior of the borrower/customer. Also, of relevance is to remove bias and subjectivity from this analysis and have the analysis done on a comprehensive dataset through Statistics, and ensure that it is standardized, objective and 'acceptable-by-everyone'. Thus, the need of a centralized credit agency managing these aspects, recognized by Government and other Financial Regulators in USA was identified. This led to establishing Credit Reporting Agencies in early 19th Century.

As per the World Bank, the official definition of Credit Bureaus1 is - "A credit bureau is one of the two main types of credit reporting institutions. It collects information from a wide variety of financial and nonfinancial entities, including microfinance institutions and credit card companies, and provides comprehensive consumer credit information with value-added services such as credit scores to private lenders. Credit bureaus are privately owned and privately operated companies. As privately owned commercial enterprises, credit bureaus tend to cater to the information requirements of commercial lenders. Though there is variation in the type and extent of information they collect, credit bureaus generally strive to collect very detailed data on individual clients. They therefore tend to cover smaller loans and often collect information from a wide variety of financial and nonfinancial entities, including retailers, credit card companies, and microfinance institutions. As a result, data collected by credit bureaus are often more comprehensive and better geared to assess and monitor the creditworthiness of individual clients"

These Credit Bureau Agencies collate the financial and personal data of individuals along with other data which could be of relevance to lenders/financing business. As in USA, there is a limit to gather the personal / private information on individuals, only the fields specifically required towards Credit Reporting are collected by these agencies. The same has been detailed out in sections below. This data is processed through pre-defined (obviously well thought off, based on best practices and regression tested) mathematical algorithm to produce an unbiased, near accurate Credit Rating of the individual (or) an Organization. This information is provided on need-basis to the lenders, for use.

This document details out the Credit Reporting process associated with the individual borrowers although at a high level, it touches upon a few aspect of Business / Commercial Entities related reporting.

Credit Bureau Agencies in the USA

·         In USA, Credit Bureau Agencies can be categorized on basis of the data class they are mastering:

o   Consumer level or

o   Business / Commercial Entities level


Functions of Credit Bureau Agencies

Aggregation of Data

·         As applicable for any Forecasting Model based on statistical analysis - the broader the sample size, more accurate is the forecasted behavior. The same is applicable in Financial Lending business as well and lenders strive to get correct and accurate information and information from as many sources as possible; so as to avoid or minimize risks.

·         While the sources of data can be enormous and different efforts / costs can be involved in extracting and processing the data, the Credit Bureaus have to identify the data sources which are most trust-worthy, have data on a wide variety of consumer and have been involved in providing credit to the borrower in past. These data sources are also knows as 'Data Furnishers'. 

·         In the U.S., following are typical Data Furnishers for Credit Bureau Agencies

Information / Data Type

Data Furnishers


Personal Information (Name, Date of Birth, Social Security Number, Address) - Initial

Social Security Administration (SSA)

·         Typically, SSA office is the initial source of information for Credit Bureaus on individuals

·         This information is used by Credit bureaus to create a record for an individual using SSN, Name and DOB

·         However, on a stand-alone basis, this information is not of much use to Credit Bureaus as there is no financial information, payments habit here which can help prediction of future performance of an individual financially

Personal Information (Name, Date of Birth, Social Security Number, Address) - On-going


Financial Information (loan amount, duration credit taken for, payment behavior, missed payments etc.)

·         Creditors

·         Lenders (Registered Financial Institution)

·         Utilities (Electricity, Gas, Water) Companies

·         Renter Companies

·         Debt Collection Agencies (credit bureaus)

·         These data furnishers are the ones with whom the individuals have been in financial agreement or transaction in past or an on-going basis

·         These data furnishers provide some key information to credit Bureaus like:

o    Payment Rating and Payment History of the Customer

o    Loan/Credit Amount

o    Credit Utilization

o    Total Duration of Loan

o    Amount Paid

o    Balance on Loan

o    Delinquency (non-payment /payment misses) on account

o    Any derogatory action (like charge-off of loan, forceful repossession of asset etc.)

o    Ongoing Bankruptcy

Other Information of relevance

·         Social Security Administration (SSA)

·         Civil Courts (i.e. public records)

·         This information is used by Credit bureaus to consider changes to an individual's record in case of SSN, Name and DOB change

·         Public Access to Court Records (PACER) and Bankruptcy  courts give any information pertaining to filing of Bankruptcy by an individual to Credit Bureaus

·         These two sources can often provide information regarding Death of a consumer

Format for Data Acquisition

·         Due to the varied sources and to have a standard format for these Data Furnishers to report data; Credit Bureaus have laid down specified formats of Reporting. The formats being currently used are:

o   Metro

o   Metro 2

·         Metro 2 Credit Reporting guidelines and standards are the latest and most widely used format in which Data Furnishers provide their data to Credit Bureaus Agencies. It has been clearly defined in Credit Resource Guide and the same is updated on an annual basis to address common issues and any new updates. Use of these format(s) by the data furnishers ensures avoidance of inaccuracies in credit reporting, incorrect results and credit scores for individuals / consumers. 

·         Generally, data furnishers are supposed to generate the Metro 2 Credit Report every month accurately reflecting the activities of consumers with respect to their debt obligations and submit to Credit Bureaus.


Processing of Data

·         Credit Bureaus process the data through the set (internal) automated program to read the file and extract the data. Data about the specific individual from different data furnishers is compiled and ran through a standard pre-defined algorithm (proprietary to Credit Bureaus), the end result which is the generation of "Credit Score".

·         Typically, weighted average of these factors is considered for Credit Score calculation:

Captured below is a pictorial of typical factors considered in credit assessment of an individual


Figure 1: Factors used in Credit Score Calculation

Circulation of Credit Score and Other Credit Information

·         This resultant information computed by Credit Bureaus is available to requestors on a need basis.

·         Usually, the lenders who have been approached by consumer for a loan get a written consent from consumer for doing a 'hard inquiry' on their credit. Upon getting consumer's consent; the financing companies request this data from Credit Bureaus by passing on specific details of consumer including Name, SSN, and Address.

·         Individuals / consumers are also entitled to a free copy of their Credit Report from all Credit Bureaus (except Innovis) on an annual basis.


Other Aspects of Credit Bureau Reporting

This section enlists some of the other aspects related to the Credit Bureau Reporting which are of equal importance towards ensuring fair practices in Credit Bureau reporting industry and towards addressing consumer grievances.


Fair Credit Reporting Act (FCRA) and Fair and Accurate Credit Transactions Act (FACTA)

The guiding principles for the Credit Bureau Agencies and the data furnishers in USA towards consumer protections, acceptable practices and general rules are laid down by different acts and laws like:

·         Fair Credit Reporting Act (FCRA)

·         Fair and Accurate Credit Transactions Act (FACTA)

·         Fair Credit Billing Act (FCBA) and

·         Regulation B

There are two regulatory bodies formed by government to ensure that Credit Reporting Agencies and data furnishers are adhering to the above mentioned guidelines / acts and practices. These are:

·         Federal Trade Commission (FTC)

·         Office of the Controller of the Currency (OCC)  - specific to banks


The key principles through which all of the agencies / theories work are:

·         Accuracy and fairness of credit reporting

·         Reporting based on reasonable procedures which are fair, objective and equitable to the consumer

·         Utmost regard to be given to the aspects of confidentiality, accuracy, relevancy, and proper utilization of consumer information


Consumer Rights

It is recommended for consumers to review their credit reports on a regular basis or at least once every year.

·         Individuals are entitled to receive the Credit Bureau Report from Experian, Equifax and Transunion for free on an annual basis.

·         Apart from this, individuals have access to a lot of free websites which provide Credit Score information. These websites can be a good source for individuals to keep a watch on their credit score and any credit related alerts.

In case of any issue identified in their credit reports or any clarification required, individuals have the right to approach Credit Bureaus and seek clarification or raise dispute and get the correction done.


Credit dispute

There are different modes through which consumer can raise a Credit Dispute in case of any issues observed:

1)      Consumer can approach the Credit bureaus for getting clarification and raising dispute to get correction done

2)      Through external systems like e-Oscar, AUD or websites showing Credit scores like CreditKarma, Creditsesame, TrueCredit etc.


Typically, these credit disputes take a long time (2-3 months on an average and sometimes even 6 months!) towards resolution. A detailed follow-up is involved with the data furnisher and Credit Bureaus towards this. There are many instances where a consumer has sued the data furnisher or Credit Bureau upon identification of any inaccuracy in data or incorrect reporting of Credit Scores.

These lawsuits and very tedious and can prove costly for all the parties involve, so essentially, prevention is better than cure in these cases. This implies that, regular monitoring of Credit information is a key necessity from individual's perspective, to highlight any discrepancy as early as possible and get it corrected before any further impact happens due to this.

Skip Tracing

Skip tracing refers to gathering information about whereabouts of any consumer missing from a long time. Usually, the financing companies opt for skip tracing when they are not able to establish contact with a non-paying consumer through different means like:

·         Field Visit (leading to identification that consumer can no more be found on the addresses known)

·         Correspondences (leading to Return Email)

·         Phone calls (leading to no response or wrong phone numbers)

Many financial organizations take pro-active measures to keep the consumer information (home address, work address, home phone, cell phone, work phone and other details) up-to-date in their system of records. This avoids unpleasant scenarios like:-

·         Consumer skipping without making payments leading to charge-off of the account or

·         Consumer skipping while the asset couldn't be recovered / repossessed due to non-payment

Skip tracing services are a lucrative additional stream of revenue to Credit Bureaus who are gathering consumer data from multiple sources and thus creating a huge repository on individual's information.

Upon getting a skip trace request for specific individuals, Credit Bureaus can dig their databases and provide information regarding recent most addresses, phone numbers reported for the given consumers from other data furnishers. Having this 'probable' information on consumer's whereabouts can be helpful for Financing companies to "trace" the non-paying consumer and eventually secure their loaned asset or recover dues leading to minimization of losses.


Consumer credit information is not only a good tool to assess the credit worthiness of an individual; however, it also plays a significant role towards finalization of interest rates and other contract terms.  The credit reporting business is equally beneficial for Credit Bureau Agencies as well as financing organizations consuming the resulting information that can accordingly treat the consumer per the Credit History details and minimize the risk associated with the financing arrangement. Usually, the financing organizations consuming this credit information are also the data furnishers. Its benefits are not just limited to the Credit Bureau Agencies but for also Consumers with good credit history. Having Credit reports available and accessible to potential lenders; benefits consumers with better credit rating to easily avail loans at lesser interest rates. This benefit may have been lost without the existence of Credit Bureau Agencies

By having robust information-extraction and information-processing systems, financing companies stand to gain a lot in terms of better credit information which can help them take correct decisions and avoid potential credit disputes. 


1.       World Bank Definition of Credit Reporting Bureaus -

March 16, 2017

Package Evaluation - Additional Considerations


 As a packaged software product consultant one typical request that comes from client embarking on a CRM transformation is to find out the best packaged application that meets and exceeds their requirement. For one such request I immediately set out to find the product features of each application from various sources and prepared a list of product capabilities that can be used to compare and contrast. Halfway through the exercise I realized that such material is available in public domain and each product vendor display such comparisons on their website. That led me to think if there are some other criteria that are not considered because we are so 'familiar' with such package comparison requests.

I started to question why does an organization choose product X over Y. Should it only be guided by the capabilities of X and Y? Our clients take tremendous effort to implement packaged applications and expect to reap the benefits of the package over a period of time. What are the benefits? We could immediately list out how the product improves productivity, achieves cost reduction by its operation, enhances user experience; etc. But again these are all related to the product capabilities.

If we take a step back, to see the ecosystem of the packaged application we will realize that there are some more factors at play. I am attempting to list some of them here. It is not exhaustive and the reader may have some more to add based on his/her experience.

For the lack of a better word I will use the word "Ecosystem" to define these additional considerations.

Third Party Application/Marketplace

As most applications especially CRM are in SaaS model we should consider how rich is the marketplace of third party applications. More the applications in the marketplace implies that there are people and companies willing to invest resources in building bespoke applications because they firmly believe in the longevity of the said packaged application. For instance has 30000+ applications in Appexchange, Oracle CX Cloud has about 585 applications in Marketplace and MS Dynamics has about 180 applications in AppSource.

For a SMB CX offerings from SugarCRM, Sage, Insightly, SFDC SMB edition, Zoho, Freshdesk the vendors themselves offer bolt on applications.

Quality & Availability of implementation Partners

To provide an unbiased view we should list the number of such vendors available and the ease with which such partners are available. A paucity of quality vendors implies either the packaged application has a bad track record of successful implementations owing to factors such as complexity, product vendor support or just plain monopoly of the product vendor. Either ways it means the client implementing the said package is at the mercy of a few partners for implementation and support. Though a small/medium enterprise may be tempted to go purely based on cost and go with a smaller application provider the enterprise may find it difficult to find system partners to maintain/enhance it.

Cost of Partner Resources

This is a direct fallout of the previous criteria as fewer partners imply higher cost.

Qualified Resources

If the client were to manage the packaged application in-house then would it be easy to get qualified resources. If resources are in short supply then the cost of maintenance goes up adding to TCO. The client is then at the mercy of a few qualified resources and their exit could jeopardize the stability of the application and business operations.

It is relatively easier to get qualified resources for CX applications from large vendors like SFDC, Oracle, SAP or MS compared to vendors like Sugar, Sage, Zoho;etc.


So, in summary the criteria for evaluation of packaged software applications should not be restricted only to the application capabilities but also the accompanying ecosystem.
Do you feel are there more factors to be considered?

March 15, 2017

HCM War in Cloud-"Dynamic Automated solutions on mobility platforms -A Clear winner"


There is a famous saying by Marc Benioff -CEO, - "If someone asks me what cloud computing is, I try not to get bogged down with definitions. I tell them that, simply put, cloud computing is a better way to run your business."

 "Modern HR" understands the importance of computing, specifically "Cloud Computing". HR leaders across the world have realized that, this is an opportunity for innovation of the new HR era.

Growing businesses always have a tendency to pick HCM solutions which cater to their HR needs and as the business grows, it demands a wider range of capabilities with minimal support, deployment time & cost.

There is a term "Choice overload" or "Over choice" which means that it is very difficult to make one decision when faced with many options. This phrase compliments with the current situation in HCM offerings, as a tug of war is already going on between Workday, Oracle, SAP & other players within Cloud.

Criteria for selection of HCM products has undergone a paradigm shift since the last decade. Earlier, budgetary requirements was the key factor while selecting any HCM solution ,but now business focus has shifted to automation, specifically "Dynamic Automated solutions integrated with Artificial Intelligence on mobility platforms."

Modern executives believe that customer satisfaction depends upon the employee's satisfaction and to bring employee satisfaction, modern flexible & best HR practices are required. Over the years, the perception about human resources has changed. The Modern Industrialist uses the term Human capital instead of Human resources.

Conceptually, an employee is considered as a liability to the company which should be acquired at lowest perks, but the modern HR professional believes in a different theory. They believe that an employee is an investment to the company who can transform the company productivity in a more profitable way with his vision and enhanced skills.

Timely, organizations have started realizing that HR is an integral part of the organization. Its role is not restricted to only recruitment, payroll & compensation. CEO's are directly interacting with HR heads. They are now taking all possible measures to enhance employee satisfaction. They have understood that organization growth is directly proportional to employee growth. If an employee's career is properly planned in terms of promotion, perks, bonuses, etc. and if the organization is supporting the employee during tough times in his/her personal life, then the employee will also show his /her loyalty towards the organization for a much longer term and this employee friendly atmosphere will always attract the industry's best talents.

 A recent survey on best performing industries indicates that HR practices are involved in all strategic planning, decision making including financial modeling, risk planning, and security services across all levels of organizations.


Evolution of Technology in HR practices:-

There was a time when the HR practice was completely manual. All employee records from hire to retire were maintained manually and this included payroll, benefits, absence, job details, compensations, and pension/PF.

With the era of computers, automation was introduced and various IT products have since then, been introduced in the market. With the origination of various software languages, there were softwares introduced in the market based on Pascal, FoxPro, COBOL, etc.  As languages like   C, C++ & Java were introduced, applications based on these were also launched for the calculation of payroll & taxes in HR applications.

Organizations had to purchase various softwares for each module which included payroll, compensation, benefits, absence etc. As technology advanced, single-stop solutions for all modules were made available & they were named as HCM products/applications & if we follow the latest trends, cloud based applications are the demand of the new era market.

If you consider only the cloud based HCM applications, even then, there are multiple vendors' available within cloud. Today, Oracle fusion, SAP & Workday are the dominating cloud based applications.


Human Capital applications: - How to select wisely among various options

HCM is a term associated with the human resource of any organization. Actually it defines acquiring, developing, managing, and retaining a company's most valuable resources--its people. The prime activity of an HR personnel in an organization is to identify the skilled matched resource who can adjust   in the organization and can be retained for a longer term for company growth and profitability. There are various activities involved for HR processes which include recruitment, talent management, Core HR, performance management, absence management and workforce management, terminal benefits which include PF/pension & above all payroll. Nowadays, there are various Cloud /Non cloud based HCM applications available in the market, but to select among them for a small & medium size based organization is always being a tough decision.

Let us consider the issues which the small & medium enterprises have to face while selecting any HCM application.

 Small & Medium Size Organization Prime issues:-

Businesses of every size has been impacted by the need for better talent management and the software industry itself has evolved to meet new strategic demands. From a broad perspective, things are looking up. But, small businesses still face a number of more challenges:


Attrition Rate: - Usually   attrition rate is quite high in SME organizations as people prefer higher perks in best industries.

Profitability: - There focus is on profitability rather than on HR. Other business units & functions are on a higher priority list than the HR Unit.

Budget:-Their Budgetary requirements for HR & HR based software are always on lower side.

Employee record management: - As the budget for HR solutions is restricted, SMEs maintain the employee records manually as well as using technology.

So keeping in view of these issues mentioned above, even SME's should think of an HCM application as an investment for retaining talent and should choose such applications which can be best suited within their budget and organization goals requirements .

Criteria for selecting one among the various HCM products:-

HR softwares can help small businesses to get rid of these issues by automating administrative tasks, book-keeping, and compliance, and by giving the HR coordinator a specific HCM application to find and keep the best talent.

In the current market, most solutions are moving towards mobility & automation based solutions which can integrate with other existing applications within the organization. There are various software's which are available for SME - based organizations.

While selecting any HR solution, companies have to perform certain activities & think wisely based on investment, budget, regulatory compliance, infrastructures & employee strength.

Various steps & procedures for selecting any HCM product based on their need is listed below:-

  • Do a strategic roadmap for selecting any vendor & HCM product application.

  • Organization infrastructure, budget requirements, goals for selecting any product.

  • Do a research on various cloud or non-cloud applications, the kind of automation required for mobility solutions, Interface with other technologies developed/available in the organization.

  • Understand what the actual organization requirements are, so that while selecting any vendor, actual scenarios/requirement can be predefined.

  • Third party consultants can be hired for selecting any HCM application while selecting any product/vendor.

In the next post, we shall explore the various market dominating HCM solutions.

Gaurav Arora








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