New Data Triggers for International Supply Chain Finance

Global Business recently interviewed over one hundred major retailers and manufacturers, global transportation and logistic companies, financial institutions, and global trade vendors to assess existing and emerging trade data and document solutions. As part of that exercise, we discussed, with each segment, their views on international supply chain finance.

There are four transformative forces driving corporate global supply chains:

* Globalization

* Outsourcing

* Security and regulatory mandates, and

* Technology

Our discussions with corporation after corporation indicated that many have drastically changed their global supply chain models in a relatively short time. The degree of international sourcing or third-party manufacturing in most industries is forcing the redesign of processes, partner relationships, systems, etc. to improve cycle time, delivered costs, order fill rates, and on time performance. In virtually every industry, companies operate their supply chains on a global basis to compete.

By using arm's length contracts to source product, engineer, manufacture components, or sub-assemble products, companies have now put themselves in a position to be much more concerned about managing inventory and working capital.

The Forces at Work

We see many driving forces behind the opportunities in international supply chain finance, but will focus on three dominant ones:

Force #1: Companies are rapidly increasing their planned direct imports and global procurements over the next five years.

This has major balance sheet implications, as many companies are accruing in-transit inventory at some point overseas. In the past, buying domestic enabled companies to smooth out demand (their domestic suppliers held extra inventory at a cost, in order to mask the difficulties of forecasting and bad behavior on both sides). Now companies must incur additional lead times, transportation transit times, and associated bottlenecks. This can add forty-five days or more to the order. Additionally, companies are using letters of credit (LC) less and less to finance these imports.

Force #2: The number of consumer brand manufacturers using third parties to manufacture outside the US has exploded.

The automotive and high tech sectors have been most progressive in sharing information (designs, forecasts, etc.) with contract manufacturers, and other industries are following suit, given the aforementioned transformative trends. In some cases, brand companies no longer pay tier one and two suppliers directly. Instead, the consolidating manager or third party logistics (3PL) providers manage and pay these suppliers, adding layers and additional time in the supply chain.

Force #3: Internet-based technologies enable the real-time exchange of information about product data between trading partners.

Determining how much banks would lend against your receivables was once a manual effort; now technology has changed the landscape. Banks used to look at boxes of aging reports to prepare their borrowing-based reports, and then credit analysts would take these reports and eliminate ineligibles to come up with the lending amount. Today the process can be automated, so the borrower can capture all key receivable and payment information to create all these reports on the fly.

In addition to these main forces, various others are at work, and they are demanding a new way for banks and logistic providers to work together.

Supply Chain Finance Trigger Points

In our research, we found the market is in the early stages of migrating to data triggered finance. Our study found six trigger points in international supply chain finance, defined as lending to a party based on a relationship to another party.


(click here for larger verison)

A brief discussion of each trigger follows.

The Six Triggers

Trigger #1: Purchase Order Issuance

While suppliers desire more access to offshore funds, traditionally pre-shipment finance has been seen as a pure supplier responsibility and in the domain of local Asian banks. There are some banks that are playing in this space using buyer master purchase orders for working capital facilities for key suppliers.

Trigger #2: Work in Progress Payments

We found a small number of large (usually regional or global) banks with buyer support programs and master purchase order contracts with medium to large tier one and two suppliers who have performed well and contract over many years. These suppliers are critical to the buyer in product and design and are therefore dedicated and usually a part of a long-term relationship. For example, Ford will identify suppliers and provide performance history to the bank to assist in provision of pre-shipment facilities.

Trigger #3: Vendor Managed Inventory

Many high tech manufacturers in the made-to-order business are using vendor managed inventory programs with overseas suppliers to provide a more cost-effective and efficient flow to inventory management. Lead logistic providers and major third-party logistics providers are behind these programs, and as a result, there will be a growing interest in trigger finance and payment when inventory is pulled from a warehouse.

Trigger #4: Inventory In-transit Financing

There are a select few vendors that are going beyond the GT Nexus, Inttra, and Tradebeam supply chain visibility models to enable international in-transit inventory to be funded on a non-recourse basis to emerging market suppliers.

Trigger 5: Proof of Delivery via Forwarder Cargo Receipt and Other Documents

In our survey group, we did not find any banks involved in receiving electronic forwarder cargo receipt (FCR) or inspection certificates to trigger finance. We believe that to date, traditional collection products emulate having FCRs and other documents, such as certificate of origin (CofO), inspection certificates, etc. But as more cargo is exported with electronic messages such as FCRs and advanced shipment notices, then there will be more opportunities to develop liquidity off these messages. This trigger remains to be explored and developed.


SOURCE:
http://www.technologyevaluation.com/research/articles/new-data-triggers-for-international-supply-chain-finance-18048/

Integration and Consolidation of Business Intelligence within Business Performance Management

Widespread confusion still persists over the difference between business performance management (BPM) and business intelligence (BI). The difference is best described this way: if BPM is the goal, then BI is the way to reach that goal. Combined, they assess performance management, which helps organizations align strategies by tracking and analyzing key performance indicators (KPI). BPM is the dashboard of the enterprise; it helps decision makers by providing accurate, detailed, and timely information on the status of the enterprise. BI, on the other hand, turns data into information, and BPM uses that information for accurate decision-making. BI technologies and analytics have enabled performance management to mature significantly in recent years. As a result, organizations are currently using performance management components such as financial consolidation and management reporting, planning, budgeting, dashboards, and scorecards to map their strategies.

Financial management systems are a core part of any performance management strategy. According to some analyst reports, between 60 to 70 percent of performance metrics are based on financial measures. Due to this heavy demand, a new application area is growing: financial performance management. Financial performance management integrates data from disparate financial areas, such as human resources, budgeting, and forecasting systems, to conduct analyses and develop reports.

The integration of enterprise-wide BI tools with financial management is increasingly becoming important for producing accurate budget and financial reporting, which is crucial for c-level managers like CEOs, and CFOs. BI focuses on the nature and trends of business and business transactions, rather than on business operations or processes. For example, BI also focuses on finance, rather than business operations, much the same way it functions in the financial services industries such as banking, securities, and international finance. Thus, integration between BI and financial management is important for better performance management. Major software vendors like Cognos, Hyperion, and Systems Union have been expanding into this new arena of financial performance management.

Systems Union's Consolidated or Best-of-breed BI Solutions

Europe-based Systems Union Inc. is a global company, headquartered in Hampshire, England, with a portfolio of financial management, performance management, and BI applications. The company has two operating divisions: financial management and BI. The financial management division includes the subsidiaries Pegasus Software, RED Technology, and Sun Systems. In 2003, the company started its BI operation by acquiring MIS, headquartered in Germany. It expanded its BI division in 2004 by acquiring Lasata, based in Australia. Currently Systems Union has offices in 19 countries and operates with 500 resellers from 73 countries.

Through its recent acquisitions, it has been developing a global focus to capture more mid-market business and is selling its full range of products to clients, irrespective of whether they currently uses Pegasus or Sun Systems solutions. It is pursuing an aggressive strategy, both tactically and practically, to establish a "global", end-to-end platform of solutions for every facet of corporate financial operations. Rather than creating a single, monolithic brand, it appears to be swallowing up companies completely, adopting an integrative approach to consolidate a suite of best-of-breed point solutions. To maximize the opportunities from its integrated solutions suite, Systems Union's organizational focus is on geographic regions rather than product families or legal structure.

Systems Union solution integrates with financials and other existing applications like enterprise resource planning (ERP), customer relationship management (CRM), supply chain management (SCM), BI etc. Also, its consolidated suites offer a full range of BI tools globally. It has a platform of solutions for many facets of corporate integrated financial solutions. Systems Union's MIS, for example, integrates full financial solutions, and covers solutions for legal and management consolidation, risk management, balanced scorecard, strategic planning, and subsidiary management.

The Importance of Application Integration and Consolidation

As technology advances, systems need to integrate to create better performances. Recently, some vendors are heading towards consolidating their systems to better meet user needs through joint collaboration. The importance of business applications integration becomes clear by answering questions like,

* Does your accounting clerk input the same HR information that sales has?

* Does your finance staff have to re-key information from printed spreadsheets?

* Are there discrepancies in the financial data from different departments?

Unfortunately, if these situations occur in an organization, its applications are not integrated into a cohesive system. Since the center of all business functionality is finance, financial management is central to performance management strategy, and accurate financial reporting is important for complete, consolidated view of financial performance.

But, different systems and technologies have grown over time, and the market has become further complicated through recent merger and acquisition trends, global expansion, and the development of e-business, and now there are numerous tools on the market. Consequently, because of the lack of BI standards, it is difficult to combine and centralize real-time information located in various sources across the enterprise. Such discrepancies further exasperate inconsistent data and analysis. Given the far sweeping consequences of inaccurate finance reporting, as seen by recent corporate scandals, government is stepping in with financial reporting regulations and compliance. For example, the US Sarbanes-Oxley Act (SOX) puts companies under more pressure than ever to guarantee the accuracy of financial information.

The most important part of SOX to BI and BPM are sections 302, 404, and 409, which deal with reporting procedures and internal control. Many companies comply with SOX by using spreadsheets, which can be a feasible, temporary solution, but compliance is a continuous process, and one which companies have to face every year. Spreadsheets lack the sophistication, for example, in terms of data sharing and report generation.

Some, but not all BI vendors are automating processes to be SOX compliant, and by automating and integrating most of the financial, auditing jobs reduces costs and makes compliance more accurate. However, not all are embracing BI standardization and consolidation. Small vendors in particular are reluctant because standardization means cutting down from many tools to one, or at least a few, under a single platform. Systems Union's global reach attempts to solve the regulatory and compliance problem by dividing the world into regional groups. However, big BI vendors like Business Objects, Hyperion, and Cognos are in competition to become a standard BI vendor, which will push smaller and consolidated vendors like Systems Union to face tough challenges.

One Single BI Solution or Consolidated BI Solutions

Ultimately, you cannot manage what you can't see or measure. Since many large organizations have more than one BI application, management does not receive a single, big picture of the company's business. Based on this argument, one single BI solution is better than fragmented or consolidated BI solutions. Some argue that a consolidated BI solution under a single ownership is better, because it helps avoiding duplication and overlap, which is the approach Systems Union is taking. However, there are advantages and disadvantages between these systems. Fragmented BI is cheaper in short term but expensive in long term, whereas consolidated BI is cheaper in long term. Though, fragmented departmental BI solutions give fragmented views of the corporation and have lower maintenance and training costs, because they are already installed and operating. While consolidated BI solutions give a single view, they are initially expensive. Nonetheless, they will save money in staffing and training in the long term. A consolidated solution also requires one group licence for the software, which is cheaper than having many licenses for different solutions.

The truth is, no system is perfect, and no single vendor has all the functionality required to fulfill all the needs of a client. If you mix and match different tools or modules from different vendors, the system might do a job better. But, in reality it is not possible to force vendors to build one system with modules for various solutions. Systems Union is trying to leverage the benefits of different tools from different vendors, while bringing the consistency that comes from one service provider. It has consolidated groups of BI solutions under one umbrella, keeping the entity of the product brand and functionalities the same. It is not alone in its strategy. Companies like Hyperion Software, Business Objects, and Cognos are trying their hand at offering consolidated solutions. Hyperion acquired Brio and several small private companies such as Appsource; Business Objects acquired Crystal Decisions; and Cognos acquired Adaytum, among others. Again, these big players will also present challenges to Systems Union, while they may offer a more competitive landscape, giving users more options.



SOURCE:
http://www.technologyevaluation.com/research/articles/integration-and-consolidation-of-business-intelligence-within-business-performance-management-18064/

Best-of-breed Approach to Finance and Accounting

CODA Group, a finance and systems specialist headquartered in the United Kingdom, offers financial solutions that help companies grapple with international business issues such as language, currency, and compliance. Designed to be an "upgrade friendly system", CODA applications offer open and standards-based reporting tools. CODA's alliance with Microsoft Corp. has allowed it to deliver a range of financial and management accounting systems, and it has made several strategic acquisitions to further strengthen its position as a compliance solution.

Part Three of the Composing Collaborative Financial Applications, CODA series.

Among its recent endeavors, CODA has recently announced new set of financial planning and budgeting products: CODA s-Planning ("s" standing for "standard") and CODA c-Planning ("c" standing for "collaborative"), as well as a range of improved analysis and reporting tools, which will be detailed shortly. Nevertheless, to date, these corporate performance management (CPM) capabilities have targeted mainly existing customers of the CODA transactional systems. These users have focused on financial analytics, budgeting, and planning, either through Microsoft Excel integration within CODA c-Planning and CODA s-Planning, or through a partnership with Cognos for enterprise-level planning and budgeting. CODA's consolidation capabilities have traditionally been limited to the basic ones inherent in Coda-Financials. While these are adequate for simpler enterprises, the vendor has thus far been unable to successfully compete with offerings from specialists such as Hyperion Solutions, Geac (formerly Comshare), Applix, Longview, Outlooksoft, or Cartesis. Yet, the importance of these functionalities has been witnessed by Cognos' acquisition of Adaytum in 2003 and Business Objects' recent acquisition of the specialist SRC. See Financial Reporting, Planning, and Budgeting as Necessary Pieces of EPM for information on the functionality.

Thus, this merger deal should benefit both parties for many reasons. While Simple Concepts should get access to CODA's well developed global distribution channel and benefit from its financial stability, CODA should fill the financial consolidation gaps in its solution. Immediate cross-selling opportunities into CODA's install base will expand further as CODA translates OCRA into more languages. Not to mention, there are opportunities coming from OCRA's prior integration with SAP, Oracle, and other leading enterprise resource planning (ERP) solutions. The acquisition also gives CODA a base for strengthening its direct sales operation and presence in Scandinavia.

The two recent acquisitions came at the heels of CODA's June 2005 launch of a suite of add-on applications that extends the range of planning and budgeting requirements: CODA s-Planning and CODA c-Planning . These could offer more benefits for CODA-Financials users. The suite includes Version 3 of the much talked about CODA-XL application. CODA-XL allows the fairly simple and secure output, manipulation, display, sharing, and input of CODA-Financials data within Microsoft Excel. s-Planning and c-Planning were seen to enable users to carry out a range of day-to-day tasks, such as producing and sharing statutory reports; processing expenses; or even developing and setting financial budgets using CODA-Financials alongside Excel and the other familiar Microsoft Office tools that most organizations probably already have in place. These new products were meant to make CODA-Financials the launch pad for a quicker and easier budget cycle. By combining the functionality and embedded control of CODA with the familiarity and convenience of Microsoft Excel, CODA s-Planning and CODA c-Planning should streamline the seeding, preparation, manipulation, and production of budgets, based on (or update) the user's CODA-Financials data. Moreover, CODA continues to develop its relationship with Cognos, offering the Cognos Enterprise Planning product where clients have wider enterprise requirements. The vendor also uses a mix of partnership and in-house development to address other CPM elements, such as activity-based costing (ABC), strategic planning and scenario analysis, shareholder value measurement, activity monitoring, information distribution, etc.

In addition to the "standard" budgeting and forecasting facilities provided by CODA s-Planning, users have the option to make their entire cycle more coordinated, efficient, and controlled by opting for the "collaborative" add-on of the CODA c-Planning product. This interfaces with the CODA-Control process management solution, adding a facility to publish budgets as CODA-Control web sites and tasks. This will keep all participants informed and aware of the input needed and when it is required. There are also audit trails and document history to support compliance reporting. CODA c-Planning aims to help organizations set financial budgets and collaboratively develop plans, which both reflect top-down business objectives and assess the need to account for bottom-up creativity and realities. For example, it will give budget managers visibility of process bottlenecks, including vacation and sick days of department managers, information on groups waiting for information from subsidiaries, and vice versa. Conversely, many other peer products focus purely on bringing together and reporting the figures in the system, and not on collaborative processes that are key to collecting and verifying the figures in the first place. The application's aggregation features often make the budgeting and planning process quicker, more dependable, and more predictable, giving financial professionals more time to analyze and consider their overall budget before making decisions crucial to the organization's mid-term plans.

Another analytic module worth mentioning is the CODA Collaborative Scorecard, which helps user organizations link corporate goals through group objectives and individual performance. Designed to be deployed to every desktop in the enterprise, the product supports multiple performance management methodologies. Generally speaking, scorecards assist organizations in monitoring their business performance beyond bottom-line results by tracking both financial and non-financial measures, and then reporting them in a graphical user interface (GUI). A key element is the way they cascade corporate goals through the organization, helping managers to set individual objectives, and then aggregate performance results back up through the company structure, so that management can review the contributions made by individuals and groups. This aligns corporate strategy with the activities of individuals within the organization.

CODA believes that scorecards should be a strategic pillar of any analytic framework, bonding personal accountability to the enterprise's overall performance management. Initial releases of CODA Collaborative Scorecard have complied with commonly used performance management methodologies, such as the European Foundation for Quality Management (EFQM) balanced scorecard, Six Sigma, etc. to provide a relatively functional and flexible method of managing and aligning enterprise, group, business unit, and personal objectives. However, one should note that, although scorecards should be the fundamental link between personal performance and the overall objectives of the enterprise, they are frequently the weak link in the CPM closed-loop cycle, either because they are too difficult to deploy widely in the organization, or because they have fixed, inflexible methodology (see Why Most Balanced Scorecards are Subverted).

Related to the above line of products is CODA Analytic Explorer, which is a business intelligence (BI) tool that allows CODA users to carry out multidimensional browsing across CODA-Mart and any other relational data source. It is a generic, on-line browsing tool with both two-dimensional and multidimensional browsing capabilities built in, and has a separately licensable cube builder that provides extra performance. As finance departments struggle to add value to their businesses, performance management enables them to deliver better decisions more efficiently. However, CPM is not about static plans that sit on the shelf and get dusted off at board meetings, but rather about continuously adjusting to the range of inputs that the business is constantly receiving. To that end, CODA Analytic Explorer provides the ability to investigate exceptions and trends quickly and easily, so that corrective actions can be taken, and forecasts and plans reviewed.

CODA-XL is now in its third release. It provides a two-way bridge between Excel, which is indisputably the most popular spreadsheet, and CODA's enterprise-level financial and CPM products. CODA-XL was launched in 2003 and brings the familiarity of the Excel interface to CODA-Financials. It should provide customers with several benefits, such as reduced training for end users of CODA-Financials during implementation. Other benefits typically include the elimination of transcription errors and file-handling overheads during the transfer of data between CODA-Financials and Excel. Thus, it may prevent the proverbial "islands of information," where local systems containing great value and insight are locked on individuals' desktops and personal computers and cannot be shared across the organization. However, unlike some similar products from competitors, CODA-XL goes beyond exploiting the familiarity of the user interface (UI) and makes use of the success that Excel enjoys as an informal business modeling and planning tool. It provides "What If?" scenario testing with the option of writing back from the spreadsheet to CODA-Financials. For example, the CODA Security Model is fully embedded within CODA-XL, thus ensuring consistent data security. This means that while add-ins to Excel deliver rich CODA functionality accessed directly from the Microsoft Office desktop, they must respect the same CODA security, validation, and business rules. For example, Excel formulas referencing live account balances are stored directly in CODA Database, with all necessary authorizations for users appearing down to the spreadsheet cell level. For more on the advantages and the inherent risks of Excel-based tools, see Vendors Harness Excel (and Office) to Win the Lower-end of Business Intelligence Market.



SOURCE:
http://www.technologyevaluation.com/research/articles/best-of-breed-approach-to-finance-and-accounting-18267/

Merging Global Trade Management with Global Finance

On January 7, JPMorgan Chase Bank, N.A. (NYSE: JPM), a leading global financial services firm with assets of $1.1 trillion (USD) and operations in more than 50 countries announced an Agreement and Plan of Merger with Vastera (NASDAQ: VAST). What is significant about this merger, is that JPMorgan is a leader in investment banking and financial services and Vastera is the only publicly traded software company focused exclusively on global trade. Vastera's services includes global trade management (GTM) software, managed services, global trade content, education and high-end consulting services. Under the agreement, Vastera will be acquired by and combined with the Logistics and Trade Services businesses of JPMorgan Chase's Treasury Services unit.

With more than 50,000 clients and a presence in 36 countries, the Treasury Services business of JPMorgan Chase is the world's largest provider of treasury management services. Its full-services include innovative payment; collection; liquidity and investment management; trade finance; commercial card; and information solutions for corporations; financial services institutions; middle market companies; small businesses; governments; and municipalities worldwide. Under the planned merger agreement, Vastera shareholders will receive $3.00 for each of their outstanding shares of Vastera common stock. The total transaction value will be approximately $129 million (USD), about 50 percent premium over the annual revenue of Vastera.

Vastera's solutions automate the required trade management processes associated with the physical movement of goods internationally. The acquisition should further provide JPMorgan Chase clients with a "one-stop-shop" service that addresses the increasing challenges and risks associated with moving goods internationally. The JPMorgan Chase solution currently facilitates the seamless management of information and processes in support of the movement of physical goods movement and the financial settlements when the trade process is completed. Through this combination, JPMorgan Chase is believed to be the first global financial institution to offer a complete, integrated cash, trade, and logistics solution across the physical and financial supply chains in a way that maximizes benefits to its clients.

Vastera already had an extensive working relationship with JPMorgan Chase by providing it with GTM solutions. Now the two tout they will be able to build on that relationship as part of the same firm offering a broader GTM infrastructure to bring tangible benefits to their clients. Namely, this acquisition should give current JPMorgan Chase's clients the benefits of broader GTM solutions. In turn Vastera's clients will receive the benefits of JPMorgan Chase's comprehensive financial services platform and product set. Vastera will continue to independently market its software and services and manage complex export-import paperwork. However, much more growth opportunity is expected from bundling Vastera's software and services with JPMorgan Chase's offering, which will supposedly track trade goods and the payments needed at each step of the process.

The merger, which was subject to the approval of Vastera shareholders, and the approval of various banking and other, customary regulations, took place in April. The transaction was previously approved by Vastera's board of directors who recommended that shareholders vote in favor of the transaction at a subsequent shareholder meeting. Two major shareholders, Ford Motor Company and Technology Crossover Ventures, representing approximately 28 percent of the Vastera shares outstanding have reportedly committed to vote their shares in favor of the transaction pursuant to voting agreements entered into with JPMorgan Chase.

With approximately 650 professionals in 14 countries and with over 400 clients throughout the world, Vastera is the worldwide leader in providing solutions for GTM and serves an international client base, including companies such as Alcatel, Dell, Ford, General Electric (GE), Lucent, Fonterra, Goodyear, Nortel Networks, and Seagate. Clients use Vastera's solutions and services to manage information flows associated with the cross-border components of importing and exporting goods. As a result, they can navigate the complexities and inefficiencies inherent in global trading in a manner that allows them to capitalize on the large, highly fragmented, and rapidly growing opportunity that exist in the international market. These clients reportedly realize significant cost reductions when managing their global trade operations, while improving compliance with government regulations and service levels to end customers.

This is Part One of a three-part note. Part Two will cover Vastera.

Part Three will discuss the merger rationale.

Vastera Background

Dulles, Virginia-based (US) Vastera began life in 1991 as a software vendor assisting companies with the complex world of global trade with software to guide manufacturers through logistics planning and customs regulations. The applications kept up with duty rates, regulations, licensing requirements, and value added tax (VAT) rates, to focus mainly on country-specific trade regulations and compliance. Vastera's initial solutions consisted almost exclusively of software solutions and implementation services associated with the installation of the software products.

In July 2000, the company undertook a fundamental shift in its product and services offerings when it acquired Ford Motor Company's global customs import operations, including a number of Ford's employees. The acquisition has enabled Vastera to significantly broaden its solutions offerings allowing it to provide trade management BPO services to its clients in the form of its managed services provider (MSP) offering. By striking a sound ten year deal with Ford, Vastera has leveraged its global trade systems and deep content knowledge into an MSP model. In turn, Ford can focus on its core competencies of designing and building cars and trucks while gaining the collaborative advantages of Vastera's business-to-business (B2B) GTM offerings.



SOURCE:
http://www.technologyevaluation.com/research/articles/merging-global-trade-management-with-global-finance-17937/

Financial Fusion ~ E-Finance Wireless Leader?

WESTPORT, Conn., /PRNewswire/ -- Confirming its commitment to lead the e-finance marketplace into the rapidly emerging wireless marketplace, Financial Fusion, Inc. announced the formation of its new Web and Wireless Division along with the launch of its patent-pending Total Wireless product family - available for immediate implementation.

Financial Fusion's focus on wireless technology will allow financial institutions to provide consumers and small businesses with seamless access to important financial information. Consumers can conduct time-sensitive financial transactions such as funds transfer, bill payment, and stock trading on a wide range of popular wireless devices including Palm Pilots and other web-enabled PDAs, cell phones, and pagers. In addition, Total Wireless delivers personalized stock portfolios, one-to-one messages, news, weather, and e-commerce features. (Source: Financial Fusion)

Market Impact

Financial Fusion has formed a wireless branch of their operation to provide financial organizations, such as Old Kent, with full wireless connectivity for their clients. While Old Kent and Financial Fusion are not the first to offer wireless e-finance, the venture represents yet another step forward to the wireless age.

Financial Fusion offers a pre-packaged wireless solution aimed directly at e-finance. The package will allow a financial institution's clients access to day to day banking transactions, as well as to stock trading, quotes, sports, news and weather. The advent of wireless in the e-finance arena gives the client control. From this point forward a client can bank anytime, anywhere, without limitation. (Of course your cell phone will not suddenly start spurting out cash.)

The wireless offering will utilize existing physical wireless technology from Palm Pilot (Palm VII PDA), Nokia, Motorola, Qualcomm, and Ericsonn Wireless Access Phones (WAP). Financial organizations such as Fidelity Investments have also offered wireless access via a two-way Research In Motion Pager and the Palm VII PDA, so what makes Financial Fusion's offering unique? Simply because Financial Fusion's Stage III Architecture is based on java objects, eliminating the need to re-code HTML pages for wireless devices.

In addition, Financial Fusion's product is entirely removed from the user interface, regardless of whether the user has a PDA or a WAP, code can be written once and used across all devices without modification. Due to Financial Fusion's Java technology, the Stage III Architecture auto-detects the type of wireless device a client is using and serves multiple wireless interfaces concurrently. Wireless Interfaces include the Wireless Access Protocol (WAP), Palm Query Applications (PQA), Short Messaging Standard (SMS) and Dynamic Hyper Text Markup Language (DHTML) with Wireless Markup Language (WML) emerging presently.


SOURCE:
http://www.technologyevaluation.com/research/articles/financial-fusion-e-finance-wireless-leader-15632/

Merging Global Trade Management with Global Finance

On January 7, JPMorgan Chase Bank, N.A. (NYSE: JPM), a leading global financial services firm with assets of $1.1 trillion (USD) and operations in more than 50 countries announced an Agreement and Plan of Merger with Vastera (NASDAQ: VAST). What is significant about this merger, is that JPMorgan is a leader in investment banking and financial services and Vastera is the only publicly traded software company focused exclusively on global trade. Vastera's services includes global trade management (GTM) software, managed services, global trade content, education and high-end consulting services. Under the agreement, Vastera will be acquired by and combined with the Logistics and Trade Services businesses of JPMorgan Chase's Treasury Services unit.

With more than 50,000 clients and a presence in 36 countries, the Treasury Services business of JPMorgan Chase is the world's largest provider of treasury management services. Its full-services include innovative payment; collection; liquidity and investment management; trade finance; commercial card; and information solutions for corporations; financial services institutions; middle market companies; small businesses; governments; and municipalities worldwide. Under the planned merger agreement, Vastera shareholders will receive $3.00 for each of their outstanding shares of Vastera common stock. The total transaction value will be approximately $129 million (USD), about 50 percent premium over the annual revenue of Vastera.

Vastera's solutions automate the required trade management processes associated with the physical movement of goods internationally. The acquisition should further provide JPMorgan Chase clients with a "one-stop-shop" service that addresses the increasing challenges and risks associated with moving goods internationally. The JPMorgan Chase solution currently facilitates the seamless management of information and processes in support of the movement of physical goods movement and the financial settlements when the trade process is completed. Through this combination, JPMorgan Chase is believed to be the first global financial institution to offer a complete, integrated cash, trade, and logistics solution across the physical and financial supply chains in a way that maximizes benefits to its clients.

Vastera already had an extensive working relationship with JPMorgan Chase by providing it with GTM solutions. Now the two tout they will be able to build on that relationship as part of the same firm offering a broader GTM infrastructure to bring tangible benefits to their clients. Namely, this acquisition should give current JPMorgan Chase's clients the benefits of broader GTM solutions. In turn Vastera's clients will receive the benefits of JPMorgan Chase's comprehensive financial services platform and product set. Vastera will continue to independently market its software and services and manage complex export-import paperwork. However, much more growth opportunity is expected from bundling Vastera's software and services with JPMorgan Chase's offering, which will supposedly track trade goods and the payments needed at each step of the process.

The merger, which was subject to the approval of Vastera shareholders, and the approval of various banking and other, customary regulations, took place in April. The transaction was previously approved by Vastera's board of directors who recommended that shareholders vote in favor of the transaction at a subsequent shareholder meeting. Two major shareholders, Ford Motor Company and Technology Crossover Ventures, representing approximately 28 percent of the Vastera shares outstanding have reportedly committed to vote their shares in favor of the transaction pursuant to voting agreements entered into with JPMorgan Chase.

With approximately 650 professionals in 14 countries and with over 400 clients throughout the world, Vastera is the worldwide leader in providing solutions for GTM and serves an international client base, including companies such as Alcatel, Dell, Ford, General Electric (GE), Lucent, Fonterra, Goodyear, Nortel Networks, and Seagate. Clients use Vastera's solutions and services to manage information flows associated with the cross-border components of importing and exporting goods. As a result, they can navigate the complexities and inefficiencies inherent in global trading in a manner that allows them to capitalize on the large, highly fragmented, and rapidly growing opportunity that exist in the international market. These clients reportedly realize significant cost reductions when managing their global trade operations, while improving compliance with government regulations and service levels to end customers.

SOURCE:
http://www.technologyevaluation.com/research/articles/merging-global-trade-management-with-global-finance-17937/

Best-of-breed Approach to Finance and Accounting

CODA Group, a finance and systems specialist headquartered in the United Kingdom, offers financial solutions that help companies grapple with international business issues such as language, currency, and compliance. Designed to be an "upgrade friendly system", CODA applications offer open and standards-based reporting tools. CODA's alliance with Microsoft Corp. has allowed it to deliver a range of financial and management accounting systems, and it has made several strategic acquisitions to further strengthen its position as a compliance solution.

Part Three of the Composing Collaborative Financial Applications, CODA series.

Among its recent endeavors, CODA has recently announced new set of financial planning and budgeting products: CODA s-Planning ("s" standing for "standard") and CODA c-Planning ("c" standing for "collaborative"), as well as a range of improved analysis and reporting tools, which will be detailed shortly. Nevertheless, to date, these corporate performance management (CPM) capabilities have targeted mainly existing customers of the CODA transactional systems. These users have focused on financial analytics, budgeting, and planning, either through Microsoft Excel integration within CODA c-Planning and CODA s-Planning, or through a partnership with Cognos for enterprise-level planning and budgeting. CODA's consolidation capabilities have traditionally been limited to the basic ones inherent in Coda-Financials. While these are adequate for simpler enterprises, the vendor has thus far been unable to successfully compete with offerings from specialists such as Hyperion Solutions, Geac (formerly Comshare), Applix, Longview, Outlooksoft, or Cartesis. Yet, the importance of these functionalities has been witnessed by Cognos' acquisition of Adaytum in 2003 and Business Objects' recent acquisition of the specialist SRC. See Financial Reporting, Planning, and Budgeting as Necessary Pieces of EPM for information on the functionality.

Thus, this merger deal should benefit both parties for many reasons. While Simple Concepts should get access to CODA's well developed global distribution channel and benefit from its financial stability, CODA should fill the financial consolidation gaps in its solution. Immediate cross-selling opportunities into CODA's install base will expand further as CODA translates OCRA into more languages. Not to mention, there are opportunities coming from OCRA's prior integration with SAP, Oracle, and other leading enterprise resource planning (ERP) solutions. The acquisition also gives CODA a base for strengthening its direct sales operation and presence in Scandinavia.

The two recent acquisitions came at the heels of CODA's June 2005 launch of a suite of add-on applications that extends the range of planning and budgeting requirements: CODA s-Planning and CODA c-Planning . These could offer more benefits for CODA-Financials users. The suite includes Version 3 of the much talked about CODA-XL application. CODA-XL allows the fairly simple and secure output, manipulation, display, sharing, and input of CODA-Financials data within Microsoft Excel. s-Planning and c-Planning were seen to enable users to carry out a range of day-to-day tasks, such as producing and sharing statutory reports; processing expenses; or even developing and setting financial budgets using CODA-Financials alongside Excel and the other familiar Microsoft Office tools that most organizations probably already have in place. These new products were meant to make CODA-Financials the launch pad for a quicker and easier budget cycle. By combining the functionality and embedded control of CODA with the familiarity and convenience of Microsoft Excel, CODA s-Planning and CODA c-Planning should streamline the seeding, preparation, manipulation, and production of budgets, based on (or update) the user's CODA-Financials data. Moreover, CODA continues to develop its relationship with Cognos, offering the Cognos Enterprise Planning product where clients have wider enterprise requirements. The vendor also uses a mix of partnership and in-house development to address other CPM elements, such as activity-based costing (ABC), strategic planning and scenario analysis, shareholder value measurement, activity monitoring, information distribution, etc.

In addition to the "standard" budgeting and forecasting facilities provided by CODA s-Planning, users have the option to make their entire cycle more coordinated, efficient, and controlled by opting for the "collaborative" add-on of the CODA c-Planning product. This interfaces with the CODA-Control process management solution, adding a facility to publish budgets as CODA-Control web sites and tasks. This will keep all participants informed and aware of the input needed and when it is required. There are also audit trails and document history to support compliance reporting. CODA c-Planning aims to help organizations set financial budgets and collaboratively develop plans, which both reflect top-down business objectives and assess the need to account for bottom-up creativity and realities. For example, it will give budget managers visibility of process bottlenecks, including vacation and sick days of department managers, information on groups waiting for information from subsidiaries, and vice versa. Conversely, many other peer products focus purely on bringing together and reporting the figures in the system, and not on collaborative processes that are key to collecting and verifying the figures in the first place. The application's aggregation features often make the budgeting and planning process quicker, more dependable, and more predictable, giving financial professionals more time to analyze and consider their overall budget before making decisions crucial to the organization's mid-term plans.

Another analytic module worth mentioning is the CODA Collaborative Scorecard, which helps user organizations link corporate goals through group objectives and individual performance. Designed to be deployed to every desktop in the enterprise, the product supports multiple performance management methodologies. Generally speaking, scorecards assist organizations in monitoring their business performance beyond bottom-line results by tracking both financial and non-financial measures, and then reporting them in a graphical user interface (GUI). A key element is the way they cascade corporate goals through the organization, helping managers to set individual objectives, and then aggregate performance results back up through the company structure, so that management can review the contributions made by individuals and groups. This aligns corporate strategy with the activities of individuals within the organization.

CODA believes that scorecards should be a strategic pillar of any analytic framework, bonding personal accountability to the enterprise's overall performance management. Initial releases of CODA Collaborative Scorecard have complied with commonly used performance management methodologies, such as the European Foundation for Quality Management (EFQM) balanced scorecard, Six Sigma, etc. to provide a relatively functional and flexible method of managing and aligning enterprise, group, business unit, and personal objectives. However, one should note that, although scorecards should be the fundamental link between personal performance and the overall objectives of the enterprise, they are frequently the weak link in the CPM closed-loop cycle, either because they are too difficult to deploy widely in the organization, or because they have fixed, inflexible methodology (see Why Most Balanced Scorecards are Subverted).

Related to the above line of products is CODA Analytic Explorer, which is a business intelligence (BI) tool that allows CODA users to carry out multidimensional browsing across CODA-Mart and any other relational data source. It is a generic, on-line browsing tool with both two-dimensional and multidimensional browsing capabilities built in, and has a separately licensable cube builder that provides extra performance. As finance departments struggle to add value to their businesses, performance management enables them to deliver better decisions more efficiently. However, CPM is not about static plans that sit on the shelf and get dusted off at board meetings, but rather about continuously adjusting to the range of inputs that the business is constantly receiving. To that end, CODA Analytic Explorer provides the ability to investigate exceptions and trends quickly and easily, so that corrective actions can be taken, and forecasts and plans reviewed.

CODA-XL is now in its third release. It provides a two-way bridge between Excel, which is indisputably the most popular spreadsheet, and CODA's enterprise-level financial and CPM products. CODA-XL was launched in 2003 and brings the familiarity of the Excel interface to CODA-Financials. It should provide customers with several benefits, such as reduced training for end users of CODA-Financials during implementation. Other benefits typically include the elimination of transcription errors and file-handling overheads during the transfer of data between CODA-Financials and Excel. Thus, it may prevent the proverbial "islands of information," where local systems containing great value and insight are locked on individuals' desktops and personal computers and cannot be shared across the organization. However, unlike some similar products from competitors, CODA-XL goes beyond exploiting the familiarity of the user interface (UI) and makes use of the success that Excel enjoys as an informal business modeling and planning tool. It provides "What If?" scenario testing with the option of writing back from the spreadsheet to CODA-Financials. For example, the CODA Security Model is fully embedded within CODA-XL, thus ensuring consistent data security. This means that while add-ins to Excel deliver rich CODA functionality accessed directly from the Microsoft Office desktop, they must respect the same CODA security, validation, and business rules. For example, Excel formulas referencing live account balances are stored directly in CODA Database, with all necessary authorizations for users appearing down to the spreadsheet cell level. For more on the advantages and the inherent risks of Excel-based tools, see Vendors Harness Excel (and Office) to Win the Lower-end of Business Intelligence Market.

Within CODA e-Finance (a Web-based version of the product), all reports validated and cross-checked on-line to validate, to eliminate separate, unsecured reporting tables. "Lights out" scheduling and Web document publishing also eliminate manual intervention. In addition, the data manipulation capabilities of Excel mean that management accountants can build and model scenarios that can be tested against real data relatively quickly, which can be very useful for creditor and debtor management, customer profitability analysis, and ad hoc queries. Furthermore, US Security and Exchange Commission (SEC) submissions can be made through Microsoft Word documents with embedded "live" Excel documents that do not have cut and paste, export, and manipulation functions, which can introduce the potential for errors. Non-programmatic, wizard-driven automation of data entry with real time validation direct from Excel (transactions, allocations, masters, budgets, and forecasts) also eliminates open database connectivity (ODBC), direct structured query language (SQL) updates, relational database management systems (RDMBS) logons, etc., which are also points of risk.

Last but not least along collaboration lines, CODA Collaborative Close is yet another application built using Microsoft Office technologies, one that is designed to help organizations close their books more quickly, more dependably, and more predictably, giving financial professionals more time to analyze and consider data before making crucial decisions. The product was designed to recognize and support the neglected collaborative processes that underpin period close. Other products in this area focus merely on consolidating and reporting the finance figures, but not on collaborative processes that are key to collecting and verifying the figures in the first place. Unfortunately, verification is traditionally carried out manually, which can be time-consuming and makes the process hard to track and improve.

Period-end reporting has always been a challenge for all accounting departments, and this challenge grows when an organization is distributed. The cost of an extended period close in human resources is considerable, since each extra elapsed day can cost a finance department many days of labor. Period-end closing is a collaborative process of questions and answers, of confirming detailed information, and of individuals collaborating to arrive at the answer and generate a picture of numbers about the organization's current financial situation. Every organization in the world has to address this, and they all have different processes; often, financial processes across corporations vary due to merger and acquisition activity, which has absorbed different groups using different business models. This adds complexity to the task of gathering information to close the financial period, and makes it all but impossible to fully automate using conventional systems. Ironically, the aim is to ensure that accountants spend more time adding value to management and performance information, and less time "chasing" data.

The use of technology to render the process less painful, to enable people to collaborate, to progress tasks, and to automate the final postings may be of help in delivering a true, fast closing process to business. Another potential benefit is that CODA's Collaborative Close may uses only information technology (IT) infrastructure and technology that a customer likely already uses. CODA Collaborative Close uses the latest technologies and features from Microsoft Office 2003, Microsoft SharePoint Portal Server, and Microsoft Office Infopath. These, together with task modeling technology from CODA, allow CODA Close to manage approvals, exception reporting, stock reconciliations, aged debt processes, and a string of other potential bottlenecks in the period-end closing process. The application automatically generates a period-end web site through the Microsoft SharePoint Portal Server. Related links then automatically bring up InfoPath forms to gather information from different participants and to drive period-end processes, while the web site dynamically reflects data in the back-office finance system. Real time information sharing between CODA and Microsoft applications is driven through Office Research Panes in Microsoft Excel, Word, and Outlook.



SOURCE:
http://www.technologyevaluation.com/research/articles/best-of-breed-approach-to-finance-and-accounting-18267/

Financial Fusion ~ E-Finance Wireless Leader?

WESTPORT, Conn., /PRNewswire/ -- Confirming its commitment to lead the e-finance marketplace into the rapidly emerging wireless marketplace, Financial Fusion, Inc. announced the formation of its new Web and Wireless Division along with the launch of its patent-pending Total Wireless product family - available for immediate implementation.

Financial Fusion's focus on wireless technology will allow financial institutions to provide consumers and small businesses with seamless access to important financial information. Consumers can conduct time-sensitive financial transactions such as funds transfer, bill payment, and stock trading on a wide range of popular wireless devices including Palm Pilots and other web-enabled PDAs, cell phones, and pagers. In addition, Total Wireless delivers personalized stock portfolios, one-to-one messages, news, weather, and e-commerce features. (Source: Financial Fusion)

Market Impact

Financial Fusion has formed a wireless branch of their operation to provide financial organizations, such as Old Kent, with full wireless connectivity for their clients. While Old Kent and Financial Fusion are not the first to offer wireless e-finance, the venture represents yet another step forward to the wireless age.

Financial Fusion offers a pre-packaged wireless solution aimed directly at e-finance. The package will allow a financial institution's clients access to day to day banking transactions, as well as to stock trading, quotes, sports, news and weather. The advent of wireless in the e-finance arena gives the client control. From this point forward a client can bank anytime, anywhere, without limitation. (Of course your cell phone will not suddenly start spurting out cash.)

The wireless offering will utilize existing physical wireless technology from Palm Pilot (Palm VII PDA), Nokia, Motorola, Qualcomm, and Ericsonn Wireless Access Phones (WAP). Financial organizations such as Fidelity Investments have also offered wireless access via a two-way Research In Motion Pager and the Palm VII PDA, so what makes Financial Fusion's offering unique? Simply because Financial Fusion's Stage III Architecture is based on java objects, eliminating the need to re-code HTML pages for wireless devices.

In addition, Financial Fusion's product is entirely removed from the user interface, regardless of whether the user has a PDA or a WAP, code can be written once and used across all devices without modification. Due to Financial Fusion's Java technology, the Stage III Architecture auto-detects the type of wireless device a client is using and serves multiple wireless interfaces concurrently. Wireless Interfaces include the Wireless Access Protocol (WAP), Palm Query Applications (PQA), Short Messaging Standard (SMS) and Dynamic Hyper Text Markup Language (DHTML) with Wireless Markup Language (WML) emerging presently.




SOURCE:
http://www.technologyevaluation.com/research/articles/financial-fusion-e-finance-wireless-leader-15632/

New Data Triggers for International Supply Chain Finance

Global Business recently interviewed over one hundred major retailers and manufacturers, global transportation and logistic companies, financial institutions, and global trade vendors to assess existing and emerging trade data and document solutions. As part of that exercise, we discussed, with each segment, their views on international supply chain finance.

There are four transformative forces driving corporate global supply chains:

* Globalization

* Outsourcing

* Security and regulatory mandates, and

* Technology

Our discussions with corporation after corporation indicated that many have drastically changed their global supply chain models in a relatively short time. The degree of international sourcing or third-party manufacturing in most industries is forcing the redesign of processes, partner relationships, systems, etc. to improve cycle time, delivered costs, order fill rates, and on time performance. In virtually every industry, companies operate their supply chains on a global basis to compete.

By using arm's length contracts to source product, engineer, manufacture components, or sub-assemble products, companies have now put themselves in a position to be much more concerned about managing inventory and working capital.

The Forces at Work

We see many driving forces behind the opportunities in international supply chain finance, but will focus on three dominant ones:

Force #1: Companies are rapidly increasing their planned direct imports and global procurements over the next five years.

This has major balance sheet implications, as many companies are accruing in-transit inventory at some point overseas. In the past, buying domestic enabled companies to smooth out demand (their domestic suppliers held extra inventory at a cost, in order to mask the difficulties of forecasting and bad behavior on both sides). Now companies must incur additional lead times, transportation transit times, and associated bottlenecks. This can add forty-five days or more to the order. Additionally, companies are using letters of credit (LC) less and less to finance these imports.

Force #2: The number of consumer brand manufacturers using third parties to manufacture outside the US has exploded.

The automotive and high tech sectors have been most progressive in sharing information (designs, forecasts, etc.) with contract manufacturers, and other industries are following suit, given the aforementioned transformative trends. In some cases, brand companies no longer pay tier one and two suppliers directly. Instead, the consolidating manager or third party logistics (3PL) providers manage and pay these suppliers, adding layers and additional time in the supply chain.

Force #3: Internet-based technologies enable the real-time exchange of information about product data between trading partners.

Determining how much banks would lend against your receivables was once a manual effort; now technology has changed the landscape. Banks used to look at boxes of aging reports to prepare their borrowing-based reports, and then credit analysts would take these reports and eliminate ineligibles to come up with the lending amount. Today the process can be automated, so the borrower can capture all key receivable and payment information to create all these reports on the fly.

In addition to these main forces, various others are at work, and they are demanding a new way for banks and logistic providers to work together.

Supply Chain Finance Trigger Points

In our research, we found the market is in the early stages of migrating to data triggered finance. Our study found six trigger points in international supply chain finance, defined as lending to a party based on a relationship to another party.


(click here for larger verison)

A brief discussion of each trigger follows.

The Six Triggers

Trigger #1: Purchase Order Issuance

While suppliers desire more access to offshore funds, traditionally pre-shipment finance has been seen as a pure supplier responsibility and in the domain of local Asian banks. There are some banks that are playing in this space using buyer master purchase orders for working capital facilities for key suppliers.

Trigger #2: Work in Progress Payments

We found a small number of large (usually regional or global) banks with buyer support programs and master purchase order contracts with medium to large tier one and two suppliers who have performed well and contract over many years. These suppliers are critical to the buyer in product and design and are therefore dedicated and usually a part of a long-term relationship. For example, Ford will identify suppliers and provide performance history to the bank to assist in provision of pre-shipment facilities.

Trigger #3: Vendor Managed Inventory

Many high tech manufacturers in the made-to-order business are using vendor managed inventory programs with overseas suppliers to provide a more cost-effective and efficient flow to inventory management. Lead logistic providers and major third-party logistics providers are behind these programs, and as a result, there will be a growing interest in trigger finance and payment when inventory is pulled from a warehouse.

Trigger #4: Inventory In-transit Financing

There are a select few vendors that are going beyond the GT Nexus, Inttra, and Tradebeam supply chain visibility models to enable international in-transit inventory to be funded on a non-recourse basis to emerging market suppliers.

Trigger 5: Proof of Delivery via Forwarder Cargo Receipt and Other Documents

In our survey group, we did not find any banks involved in receiving electronic forwarder cargo receipt (FCR) or inspection certificates to trigger finance. We believe that to date, traditional collection products emulate having FCRs and other documents, such as certificate of origin (CofO), inspection certificates, etc. But as more cargo is exported with electronic messages such as FCRs and advanced shipment notices, then there will be more opportunities to develop liquidity off these messages. This trigger remains to be explored and developed.

Trigger #6: Buyer Approved Invoices

There is both great interest and a high degree of market confusion about the buyer-supported, supplier early payment model. These programs are not without single buyer concentration, accounting, and loss of flexibility risk to the buyers. These challenges must be overcome before a more rapid acceptance of the program.

Entering a Transition Period

We are entering a period where banks and finance houses have major opportunities on the "supplier side". We see that most solutions are developing from the buy side as a point of lower risk.

Our survey on supply chain finance showed 63 percent of companies strongly agreed or agree with the following statement:

"We are interested in helping our overseas vendors with supply chain finance solutions and recognize their overhead costs come back to us in freight on board (FOB) prices, and I am willing to work with my banking group to find solutions here"

Thus there is strong market support for international supply chain finance solutions based on the aforementioned figure.

From our discussions, no bank, finance house, or logistics company is doing all six forms of trigger point international finance. The trigger points that generate the most cross-industry interest are buyer-supported vendor early payments that trigger the approved invoice, and pre-export financing that trigger an established purchase order.

Market Predictions

To date, most banks focus on major corporate buyers and help with finance for a few key international suppliers to mitigate supply chain costs, but as the market moves away from documentary-based trade, such as LC and documentary collections, opportunities exist to help a broader number of trading partners.

We believe

1. Banks need data triggers to be smarter about payment and finance, and that means figuring out how to work with global transportation and logistics players.

2. Banks will need to get smart about industry sectors and the global flow of suppliers, the tiered nature of specific supply chains, etc. The old "formula of wallet", where banks measure market share by calculating a percentage of their corporate client's account, does not make as much sense in this global supply chain world.

3. New credit and business policies will need to be put in place to deal with this new world. The opportunity for open accounts is now a supply chain finance structure. It cannot be ignored and traditional products will not suffice. The time to start making the transition is now.


SOURCE:
http://www.technologyevaluation.com/research/articles/new-data-triggers-for-international-supply-chain-finance-18048/

Best-of-breed Approach to Finance and Accounting

CODA Group, a finance and systems specialist headquartered in the United Kingdom, offers financial solutions that help companies grapple with international business issues such as language, currency, and compliance. Designed to be an "upgrade friendly system", CODA applications offer open and standards-based reporting tools. CODA's alliance with Microsoft Corp. has allowed it to deliver a range of financial and management accounting systems, and it has made several strategic acquisitions to further strengthen its position as a compliance solution.

Part Three of the Composing Collaborative Financial Applications, CODA series.

Among its recent endeavors, CODA has recently announced new set of financial planning and budgeting products: CODA s-Planning ("s" standing for "standard") and CODA c-Planning ("c" standing for "collaborative"), as well as a range of improved analysis and reporting tools, which will be detailed shortly. Nevertheless, to date, these corporate performance management (CPM) capabilities have targeted mainly existing customers of the CODA transactional systems. These users have focused on financial analytics, budgeting, and planning, either through Microsoft Excel integration within CODA c-Planning and CODA s-Planning, or through a partnership with Cognos for enterprise-level planning and budgeting. CODA's consolidation capabilities have traditionally been limited to the basic ones inherent in Coda-Financials. While these are adequate for simpler enterprises, the vendor has thus far been unable to successfully compete with offerings from specialists such as Hyperion Solutions, Geac (formerly Comshare), Applix, Longview, Outlooksoft, or Cartesis. Yet, the importance of these functionalities has been witnessed by Cognos' acquisition of Adaytum in 2003 and Business Objects' recent acquisition of the specialist SRC. See Financial Reporting, Planning, and Budgeting as Necessary Pieces of EPM for information on the functionality.

Thus, this merger deal should benefit both parties for many reasons. While Simple Concepts should get access to CODA's well developed global distribution channel and benefit from its financial stability, CODA should fill the financial consolidation gaps in its solution. Immediate cross-selling opportunities into CODA's install base will expand further as CODA translates OCRA into more languages. Not to mention, there are opportunities coming from OCRA's prior integration with SAP, Oracle, and other leading enterprise resource planning (ERP) solutions. The acquisition also gives CODA a base for strengthening its direct sales operation and presence in Scandinavia.

The two recent acquisitions came at the heels of CODA's June 2005 launch of a suite of add-on applications that extends the range of planning and budgeting requirements: CODA s-Planning and CODA c-Planning . These could offer more benefits for CODA-Financials users. The suite includes Version 3 of the much talked about CODA-XL application. CODA-XL allows the fairly simple and secure output, manipulation, display, sharing, and input of CODA-Financials data within Microsoft Excel. s-Planning and c-Planning were seen to enable users to carry out a range of day-to-day tasks, such as producing and sharing statutory reports; processing expenses; or even developing and setting financial budgets using CODA-Financials alongside Excel and the other familiar Microsoft Office tools that most organizations probably already have in place. These new products were meant to make CODA-Financials the launch pad for a quicker and easier budget cycle. By combining the functionality and embedded control of CODA with the familiarity and convenience of Microsoft Excel, CODA s-Planning and CODA c-Planning should streamline the seeding, preparation, manipulation, and production of budgets, based on (or update) the user's CODA-Financials data. Moreover, CODA continues to develop its relationship with Cognos, offering the Cognos Enterprise Planning product where clients have wider enterprise requirements. The vendor also uses a mix of partnership and in-house development to address other CPM elements, such as activity-based costing (ABC), strategic planning and scenario analysis, shareholder value measurement, activity monitoring, information distribution, etc.

In addition to the "standard" budgeting and forecasting facilities provided by CODA s-Planning, users have the option to make their entire cycle more coordinated, efficient, and controlled by opting for the "collaborative" add-on of the CODA c-Planning product. This interfaces with the CODA-Control process management solution, adding a facility to publish budgets as CODA-Control web sites and tasks. This will keep all participants informed and aware of the input needed and when it is required. There are also audit trails and document history to support compliance reporting. CODA c-Planning aims to help organizations set financial budgets and collaboratively develop plans, which both reflect top-down business objectives and assess the need to account for bottom-up creativity and realities. For example, it will give budget managers visibility of process bottlenecks, including vacation and sick days of department managers, information on groups waiting for information from subsidiaries, and vice versa. Conversely, many other peer products focus purely on bringing together and reporting the figures in the system, and not on collaborative processes that are key to collecting and verifying the figures in the first place. The application's aggregation features often make the budgeting and planning process quicker, more dependable, and more predictable, giving financial professionals more time to analyze and consider their overall budget before making decisions crucial to the organization's mid-term plans.

Another analytic module worth mentioning is the CODA Collaborative Scorecard, which helps user organizations link corporate goals through group objectives and individual performance. Designed to be deployed to every desktop in the enterprise, the product supports multiple performance management methodologies. Generally speaking, scorecards assist organizations in monitoring their business performance beyond bottom-line results by tracking both financial and non-financial measures, and then reporting them in a graphical user interface (GUI). A key element is the way they cascade corporate goals through the organization, helping managers to set individual objectives, and then aggregate performance results back up through the company structure, so that management can review the contributions made by individuals and groups. This aligns corporate strategy with the activities of individuals within the organization.

CODA believes that scorecards should be a strategic pillar of any analytic framework, bonding personal accountability to the enterprise's overall performance management. Initial releases of CODA Collaborative Scorecard have complied with commonly used performance management methodologies, such as the European Foundation for Quality Management (EFQM) balanced scorecard, Six Sigma, etc. to provide a relatively functional and flexible method of managing and aligning enterprise, group, business unit, and personal objectives. However, one should note that, although scorecards should be the fundamental link between personal performance and the overall objectives of the enterprise, they are frequently the weak link in the CPM closed-loop cycle, either because they are too difficult to deploy widely in the organization, or because they have fixed, inflexible methodology (see Why Most Balanced Scorecards are Subverted).

Related to the above line of products is CODA Analytic Explorer, which is a business intelligence (BI) tool that allows CODA users to carry out multidimensional browsing across CODA-Mart and any other relational data source. It is a generic, on-line browsing tool with both two-dimensional and multidimensional browsing capabilities built in, and has a separately licensable cube builder that provides extra performance. As finance departments struggle to add value to their businesses, performance management enables them to deliver better decisions more efficiently. However, CPM is not about static plans that sit on the shelf and get dusted off at board meetings, but rather about continuously adjusting to the range of inputs that the business is constantly receiving. To that end, CODA Analytic Explorer provides the ability to investigate exceptions and trends quickly and easily, so that corrective actions can be taken, and forecasts and plans reviewed.

CODA-XL is now in its third release. It provides a two-way bridge between Excel, which is indisputably the most popular spreadsheet, and CODA's enterprise-level financial and CPM products. CODA-XL was launched in 2003 and brings the familiarity of the Excel interface to CODA-Financials. It should provide customers with several benefits, such as reduced training for end users of CODA-Financials during implementation. Other benefits typically include the elimination of transcription errors and file-handling overheads during the transfer of data between CODA-Financials and Excel. Thus, it may prevent the proverbial "islands of information," where local systems containing great value and insight are locked on individuals' desktops and personal computers and cannot be shared across the organization. However, unlike some similar products from competitors, CODA-XL goes beyond exploiting the familiarity of the user interface (UI) and makes use of the success that Excel enjoys as an informal business modeling and planning tool. It provides "What If?" scenario testing with the option of writing back from the spreadsheet to CODA-Financials. For example, the CODA Security Model is fully embedded within CODA-XL, thus ensuring consistent data security. This means that while add-ins to Excel deliver rich CODA functionality accessed directly from the Microsoft Office desktop, they must respect the same CODA security, validation, and business rules. For example, Excel formulas referencing live account balances are stored directly in CODA Database, with all necessary authorizations for users appearing down to the spreadsheet cell level. For more on the advantages and the inherent risks of Excel-based tools, see Vendors Harness Excel (and Office) to Win the Lower-end of Business Intelligence Market.

Within CODA e-Finance (a Web-based version of the product), all reports validated and cross-checked on-line to validate, to eliminate separate, unsecured reporting tables. "Lights out" scheduling and Web document publishing also eliminate manual intervention. In addition, the data manipulation capabilities of Excel mean that management accountants can build and model scenarios that can be tested against real data relatively quickly, which can be very useful for creditor and debtor management, customer profitability analysis, and ad hoc queries. Furthermore, US Security and Exchange Commission (SEC) submissions can be made through Microsoft Word documents with embedded "live" Excel documents that do not have cut and paste, export, and manipulation functions, which can introduce the potential for errors. Non-programmatic, wizard-driven automation of data entry with real time validation direct from Excel (transactions, allocations, masters, budgets, and forecasts) also eliminates open database connectivity (ODBC), direct structured query language (SQL) updates, relational database management systems (RDMBS) logons, etc., which are also points of risk.

Last but not least along collaboration lines, CODA Collaborative Close is yet another application built using Microsoft Office technologies, one that is designed to help organizations close their books more quickly, more dependably, and more predictably, giving financial professionals more time to analyze and consider data before making crucial decisions. The product was designed to recognize and support the neglected collaborative processes that underpin period close. Other products in this area focus merely on consolidating and reporting the finance figures, but not on collaborative processes that are key to collecting and verifying the figures in the first place. Unfortunately, verification is traditionally carried out manually, which can be time-consuming and makes the process hard to track and improve.

Period-end reporting has always been a challenge for all accounting departments, and this challenge grows when an organization is distributed. The cost of an extended period close in human resources is considerable, since each extra elapsed day can cost a finance department many days of labor. Period-end closing is a collaborative process of questions and answers, of confirming detailed information, and of individuals collaborating to arrive at the answer and generate a picture of numbers about the organization's current financial situation. Every organization in the world has to address this, and they all have different processes; often, financial processes across corporations vary due to merger and acquisition activity, which has absorbed different groups using different business models. This adds complexity to the task of gathering information to close the financial period, and makes it all but impossible to fully automate using conventional systems. Ironically, the aim is to ensure that accountants spend more time adding value to management and performance information, and less time "chasing" data.

The use of technology to render the process less painful, to enable people to collaborate, to progress tasks, and to automate the final postings may be of help in delivering a true, fast closing process to business. Another potential benefit is that CODA's Collaborative Close may uses only information technology (IT) infrastructure and technology that a customer likely already uses. CODA Collaborative Close uses the latest technologies and features from Microsoft Office 2003, Microsoft SharePoint Portal Server, and Microsoft Office Infopath. These, together with task modeling technology from CODA, allow CODA Close to manage approvals, exception reporting, stock reconciliations, aged debt processes, and a string of other potential bottlenecks in the period-end closing process. The application automatically generates a period-end web site through the Microsoft SharePoint Portal Server. Related links then automatically bring up InfoPath forms to gather information from different participants and to drive period-end processes, while the web site dynamically reflects data in the back-office finance system. Real time information sharing between CODA and Microsoft applications is driven through Office Research Panes in Microsoft Excel, Word, and Outlook.

It is a well-known fact that many accountants currently use Microsoft Office tools like Excel in their closing processbut in isolation. Conversely, CODA Collaborative Close integrates these tools with a wide variety of corporate finance systems to bring a unified approach to the problem, with the likely result of improved speed and control over information gathering, allowing more time for analysis and planning. The idea is to help user organizations meet the regulatory demands of the Sarbanes-Oxley Act (SOX), International Accounting Standard (IAS), Basel II, etc., and also to give finance managers more time to analyze their finance figures, and to think about and plan for the near future. CODA Collaborative Close has been designed to work with extensible markup language enabled (XML)-financial applications from vendors such as Microsoft Navision, Microsoft Great Plains, SAP, and Oracle (including PeopleSoft), as well as CODA's own CODA-Financials.






SOURCE:
http://www.technologyevaluation.com/research/articles/best-of-breed-approach-to-finance-and-accounting-18267/

Merging Global Trade Management with Global Finance

On January 7, JPMorgan Chase Bank, N.A. (NYSE: JPM), a leading global financial services firm with assets of $1.1 trillion (USD) and operations in more than 50 countries announced an Agreement and Plan of Merger with Vastera (NASDAQ: VAST). What is significant about this merger, is that JPMorgan is a leader in investment banking and financial services and Vastera is the only publicly traded software company focused exclusively on global trade. Vastera's services includes global trade management (GTM) software, managed services, global trade content, education and high-end consulting services. Under the agreement, Vastera will be acquired by and combined with the Logistics and Trade Services businesses of JPMorgan Chase's Treasury Services unit.

With more than 50,000 clients and a presence in 36 countries, the Treasury Services business of JPMorgan Chase is the world's largest provider of treasury management services. Its full-services include innovative payment; collection; liquidity and investment management; trade finance; commercial card; and information solutions for corporations; financial services institutions; middle market companies; small businesses; governments; and municipalities worldwide. Under the planned merger agreement, Vastera shareholders will receive $3.00 for each of their outstanding shares of Vastera common stock. The total transaction value will be approximately $129 million (USD), about 50 percent premium over the annual revenue of Vastera.

Vastera's solutions automate the required trade management processes associated with the physical movement of goods internationally. The acquisition should further provide JPMorgan Chase clients with a "one-stop-shop" service that addresses the increasing challenges and risks associated with moving goods internationally. The JPMorgan Chase solution currently facilitates the seamless management of information and processes in support of the movement of physical goods movement and the financial settlements when the trade process is completed. Through this combination, JPMorgan Chase is believed to be the first global financial institution to offer a complete, integrated cash, trade, and logistics solution across the physical and financial supply chains in a way that maximizes benefits to its clients.

Vastera already had an extensive working relationship with JPMorgan Chase by providing it with GTM solutions. Now the two tout they will be able to build on that relationship as part of the same firm offering a broader GTM infrastructure to bring tangible benefits to their clients. Namely, this acquisition should give current JPMorgan Chase's clients the benefits of broader GTM solutions. In turn Vastera's clients will receive the benefits of JPMorgan Chase's comprehensive financial services platform and product set. Vastera will continue to independently market its software and services and manage complex export-import paperwork. However, much more growth opportunity is expected from bundling Vastera's software and services with JPMorgan Chase's offering, which will supposedly track trade goods and the payments needed at each step of the process.

The merger, which was subject to the approval of Vastera shareholders, and the approval of various banking and other, customary regulations, took place in April. The transaction was previously approved by Vastera's board of directors who recommended that shareholders vote in favor of the transaction at a subsequent shareholder meeting. Two major shareholders, Ford Motor Company and Technology Crossover Ventures, representing approximately 28 percent of the Vastera shares outstanding have reportedly committed to vote their shares in favor of the transaction pursuant to voting agreements entered into with JPMorgan Chase.

With approximately 650 professionals in 14 countries and with over 400 clients throughout the world, Vastera is the worldwide leader in providing solutions for GTM and serves an international client base, including companies such as Alcatel, Dell, Ford, General Electric (GE), Lucent, Fonterra, Goodyear, Nortel Networks, and Seagate. Clients use Vastera's solutions and services to manage information flows associated with the cross-border components of importing and exporting goods. As a result, they can navigate the complexities and inefficiencies inherent in global trading in a manner that allows them to capitalize on the large, highly fragmented, and rapidly growing opportunity that exist in the international market. These clients reportedly realize significant cost reductions when managing their global trade operations, while improving compliance with government regulations and service levels to end customers.

This is Part One of a three-part note. Part Two will cover Vastera.

Part Three will discuss the merger rationale.

Vastera Background

Dulles, Virginia-based (US) Vastera began life in 1991 as a software vendor assisting companies with the complex world of global trade with software to guide manufacturers through logistics planning and customs regulations. The applications kept up with duty rates, regulations, licensing requirements, and value added tax (VAT) rates, to focus mainly on country-specific trade regulations and compliance. Vastera's initial solutions consisted almost exclusively of software solutions and implementation services associated with the installation of the software products.

In July 2000, the company undertook a fundamental shift in its product and services offerings when it acquired Ford Motor Company's global customs import operations, including a number of Ford's employees. The acquisition has enabled Vastera to significantly broaden its solutions offerings allowing it to provide trade management BPO services to its clients in the form of its managed services provider (MSP) offering. By striking a sound ten year deal with Ford, Vastera has leveraged its global trade systems and deep content knowledge into an MSP model. In turn, Ford can focus on its core competencies of designing and building cars and trucks while gaining the collaborative advantages of Vastera's business-to-business (B2B) GTM offerings.

Thus, in recent years, as trade becomes even more complex with "smart ports" and twenty-four hour advanced notice requirements, manufacturers have increasingly been seeking outsourced global trade services. An astute software vendor should do this more efficiently than a manufacturer, since it is a non-core aspect of the manufacturer's operation. As a result of this arrangement with Ford, which currently owns 20 percent of Vastera and accounts for 30 percent of its revenues, Vastera became one of the first software firms to use its core content knowledge in customs and import/export documentation and in compliance application development to become a business service provider (BSP).

Both parties benefited. Ford remained staffed on-site with its former employees, with Vastera maintaining the systems and keeping content updated daily. Vastera gained a long-term customer and the chance to replicate its BSP model and extend its knowledge beyond Ford to other Vastera customers. Additionally, Ford has lent its stability to Vastera and allowed it to build a deep database of automotive and truck industry parts, HTS classifications and duties, and to gain country-specific knowledge where Ford has supplier relationships.

GTM Background

Most supply chain management (SCM), not to mention enterprise resource planning (ERP) vendors typically lack strong international trade logistics (ITL) and GTM capabilities. Specifically, while technology may be rendering the world smaller, the word has also become a lot more complicated. Many barriers to conducting international business over the Internet inevitably exist and most businesses are still not prepared for these challenges.

The Internet has enabled a networked world by providing a communication infrastructure and enterprise applications, and this has opened the door for international trade, but not many applications really offer multi-enterprise services and software to automate the complex, multimodal transportation and Internet-based logistics management needs of a global trading network. Simply put, most modern Web-based buy- and sell-side applications fall well-short of providing automated global trade management and a traditional international trade logistics.

As described in more detail in International Trade or ITL Adoption, ITL and GTM are execution systems specifically designed to automate the import/export business process. Their basic functional components are trade documentation generation and transmission, and regulatory compliance validation. They exchange complex information between multiple entities, including suppliers, carriers, freight forwarders, customs brokers, banking institutions, and other third party transportation and storage providers. A true ITL/GTM system is, in effect, an inter-enterprise resource management system, and requires a data model that takes into account the breadth and depth of information exchanged between the multiplicity of interrelated entities. Thus, ITL/GTM systems should support export and import border-crossing processes, documentation, compliance (which are incomprehensible to ordinary mortals), accounting, and financial reporting in a multicurrency, multilingual, and multi-units of measure (UOM) environment.

When people talk about the risks of globalization, many are usually referring to the threat of domestic jobs moving overseas. The global trade compliance aspect is rarely discussed, even though it poses a risk that affects almost every manufacturer that either imports or exports. Namely, getting these goods and parts shipped from one country to another is a daunting task and needs the support of a GTM software and service provider. This must be combined with global trade domain knowledge, proven processes, and international trade best practices in order to be successful.

Each of the nearly 200 countries in the world has individual governmental requirements for importing and exporting goods. One has to account for factors like tariffs and duties, country-to-country preferences and anti-dumping laws, and there is the danger of incurring hidden costs at every step. If that is not complex enough, the events of September 11, 2001 have increased the scrutiny countries place on global trade and can impact costs adversely. According to the Brookings Institute, the cost of slowing the delivery of imported goods by one day because of additional security checks could amount to $7 billion (USD) per year. Stringent new documentation and homeland security requirements are placing serious legal and financial consequences on importers and exporters violating these constantly changing trade regulations. Moreover, the burden is on the importer/exporter to know exactly what the regulations are and how to comply with them.



SOURCE:
http://www.technologyevaluation.com/research/articles/merging-global-trade-management-with-global-finance-17937/

Composing Collaborative Financial Applications

Founded in 1979, and headquartered in the United Kingdom, CODA Group is a finance management systems specialist, and part of the publicly traded CODASciSys plc. group (AIM: CSY). After a series of changes which began in the late 1990s when it was first acquired and then divested by former Baan to Science Systems, and then in early 2000, CODA changed its name to CODASciSys. (See Baan Posts $236 Million Loss and Sells Off Coda for Nearly $40M Less Than It Paid). The group offers a broad suite of products and services designed to meet the needs of financial and accounting departments. Its offerings range from financial, accounting, and procurement systems linked to a complementary suite of applications that support finance, reporting, and analytic processes across the organization, through to planning, budgeting, consolidation, reporting, and analytics. It also encompasses process control and compliance management. Its traditional transactional systems are applications that optimize accounting, procurement, asset management, and e-commerce across (and beyond) the entire, often distributed, user enterprise.

Lately, the vendor has expanded into a range of integrated business intelligence (BI), planning, forecasting, and consolidation analytic tools to deliver a more complete, near real time picture of the user organization's finances, performance, and opportunities. Among these complementary applications, which will explained in more detail in this article series, is a range of new collaborative applications that will streamline and automate key business processes, such as regulatory compliance, financial period-end close, and corporate responsibility programs.

Currently CODA employs more than 550 people around the world and delivers global sales, service, and support through its own offices in 11 countries. It has a carefully selected network of partners in a further 17 countries to provide implementation services, training, and support for over 2,500 customers in over 100 countries. Of its total number of employees, about 170 are in research and development (R&D), 60 in support (with 15 based in the US), and 110 in consulting. Its worldwide customer base includes medium and large user organizations found across many industry sectors, such as insurance, shipping, transportation and logistics, retail, banking and finance, professional services, and the public sector. While retail is one of the stronger sectors for CODA in the UK, transportation and shipping and financial services companies are the frequent users in North America.

CODA Financials, Inc., located in Manchester, New Hampshire (US) is one part of the CODA Group. Present in the US and Canada since 1988, CODA Financials has a rich history of helping finance departments solve complex problems where issues of scale or high transactional volumes, reliability, and performance are of primary importance. While many may not have heard of CODA itself, many have heard of some of the global, blue chip organizations that are using CODA products and services to support their business. CODA has more than 250 customers in the US and Canada, including Booz-Allen & Hamilton, Maher Terminals, Texas Pacific Group, Lin TV, Pan-American Life Insurance, and Reno Depot, that have delegated their financial intelligence requirements to CODA. Globally, and across some industry sectors, clients include IKEA in retail, AMBAC Assurance Corporation in the financial services, Central Ohio Transit Authority (COTA) in transportation and logistics, and the Fashion Institute of Design and Merchandising in education.

CODA's Strengths

A key attribute of CODA's offerings is its "multi" features. It can handle multiple companies, multiple currencies, multiple languages, and multiple charts of accounts in a single product's instance or database. Thus, its single or "unified" ledger architecture, which processes and holds the user company's financial data in a single ledger and in real time, eliminates traditionally lengthy and tardy batch updates between sub-ledgers. Consequently, a near real time financial position is always maintained, and the entire general ledger (GL) should always be balanced. Additionally, the Multiple Dimensional "Flexchart" capability supports up to eight variable length account code segments, which enable revenue and expense tracking at a highly detailed level. The Hierarchies and Account Groups features add virtually unlimited account "roll-ups" to meet inquiry, reporting, and drilldown needs.

Additionally, the complementary CODA analysis and collaborative solutions have been designed to integrate seamlessly both with CODA applications and other leading operational systems to capitalize on customers' existing information technology (IT) investments. Increasingly, CODA solutions are also being used to address the complex requirements of companies that need to intelligently share information with business partners, customers, and suppliers. Furthermore, "upgrade friendly" interfaces underline the vendor's technical vision for integration. For instance, CODA's application programming interfaces (API) "de-couple" the source and feeder applications, thereby enabling system upgrades without having to reengineer interfaces. Application-driven form and report customizations are preserved during upgrades.

Last but not least, the open and standards-based product architecture supports multiple platforms, third party reporting tools, secure Microsoft Office integration, and extensible markup language (XML) and Web services integration. Earlier in 2005, Microsoft Corp. and CODA announced a multiyear alliance intended to enable CODA to deliver a range of financial accounting, management, analysis, and control solutions that take advantage of the Microsoft platform. In addition to CODA's existing line of financial management products for the Microsoft platform, versions of the company's next generation of analysis and process control solutions—including CODA-Analytics and CODA-Intelligence for corporate performance management (CPM), and CODA-Control for compliant process management—will be built using Microsoft technology. Among these are the Microsoft .NET Framework, Structured Query Language (SQL) Server 2005 Integration Services and Analysis Services, Microsoft Office System, Windows Server 2003, and SharePoint Portal products and technologies. CODA maintains that the alliance should help it deliver solutions that will allow enterprises to analyze, control, and exploit changing business dynamics and realize greater value from their financial systems investments. By building on the Microsoft platform, CODA pledges to deliver greater customer value with solutions that are even easier to use, deploy, and maintain, and will help reduce ownership and integration costs.

The alliance between CODA and Microsoft builds on the late 2004 announcement that highlighted CODA's support for the new Microsoft Development Center in Denmark. CODA was the first Microsoft independent software vendor (ISV) partner to take advantage of the center to design, develop, and improve solutions that use the latest advancements to the Microsoft platform. The resulting system architecture designs now include a number of new technologies that aim to helping performance and customer usability, as well as to accelerate CODA's time-to-market with its new application architecture. The new technologies include

* Information Bridge Framework (IBF). Allows data from line of business (LOB) systems (such as CODAFinancials) to be "brought to life" inside the Microsoft Office Suite and related systems that use MS Office technology (such as CODA Collaborative Control and CODA XL)

* Microsoft BizTalk Server 2004. Microsoft engineers reportedly helped the CODA team understand the tight integration of BizTalk into CODA applications, facilitating complex hub-and-spoke back-end business integrations.

There is also an apparent commitment to Microsoft technologies; for example, analytics solutions like Analytic Explorer and CODA Intelligence will exploit SQL Server 2005 integration services, analysis services, and reporting services, while process automation and modeling solutions like CODA-Control will exploit latest Microsoft Office technologies. However, other CODA transactional solutions for financial management support many other platforms and configurations, including OpenVMS (Virtual Memory System), IBM iSeries (AS/400), UNIX, open source, client/server, Web technologies, and Web services (without imposing the choice between client/server and Web-based configurations on the customer). On the application server side, with the choice of the Microsoft SQL Server, Oracle, IBM DB2/400, or Sybase database platforms and the choice of Windows Server, UNIX (HP UX, Sun Solaris, and IBM AIX versions), and IBM iSeries operating systems (OS), application services provide and enforce business rules, security, and validation. The application server includes a single point of maintenance for users, roles, business rules, account validation, reporting roll-up structures, master file details, document posting rules, inquiry templates, pay, matching, etc. The system features a scalable financial engine that can accommodate between tens and thousands of concurrent connections with a farm enabled Web server.

On the other hand, by leveraging extensible markup language (XML) and transmission control protocol/Internet protocol (TCP/IP), Web servers (which can be either the open source Apache on UNIX/IBM iSeries/Linux or Microsoft Internet Information Server [IIS] on Windows) enable a scalable delivery of CODA functionality to a Web browser and to Web service-enabled user interfaces (UI), and also serve as gateways for integration. They enable location independent, tailored, intuitive user operation. Form modifications are stored as separate XML documents, and thus become "upgrade friendly" as customizations are preserved during future upgrades. In addition, the use of hypertext markup language (HTML) over HyperText Transfer Protocol (HTTP)/ Secure HTTP (S-HTTP) enables multi-window, browser-based access to complete CODA functionality, as well as centralized configuration, rollout of the user's desktop environment, and a zero-client footprint installed across a secure intranet connection. Moreover, CODA-Portal provides a common platform to view both live CODA data and non-CODA data published as Web documents.

Finally, programmatic access to CODA application services are available through XML, Web services, Java, Microsoft .NET, or traditional batch loads. Whichever technology is applied, it must respect the same CODA security, validation, and business rules. The approach, which is both Microsoft .NET and Java 2 Enteprise Edition (J2EE) compatible (see Understand J2EE and .NET Environments Before You Choose), aims at secure integration across the firewall, as well as platform and device independent integration. Furthermore, integration routines are independent of the CODA server version, whereas there is a traditional batch loading of historical/legacy system data.

Despite the technology's nascent nature and the challenges that relate to this, Web services have increasingly been offering the following high level benefits to businesses that subscribe to CODA and Microsoft:

* Application to application (A2A) communication across the firewall. Provides a secure communication method across a standard S-HTTP Web connection. Nowadays, enterprise applications can communicate across geographically diverse locations and networks without the need for highly expensive dedicated links.

* Common integration approach across platforms, vendors and devices. Since Web services have been adopted and supported by a wide variety of technology providers including Microsoft, Oracle, IBM, Sun, and open source vendors (see Liberty Alliance versus WS-I; J2EE versus. .NET; Overwhelmed. YET?). As a result, businesses can be confident that a common integration approach can be employed to provide higher levels of investment protection and reuse resources and skills, regardless of the disparate IT policies used in-house and by their business partners.

* Rapid application development. Modern application development tools are now engineered to accept or "consume" Web services, and greatly reduce the amount of software coding required to develop functionally rich business applications. This typically translates into significantly lower costs when developing, testing, and supporting applications that are built in this way. It can also enable more nimble and flexible platforms for organizations to respond to changing business needs and market conditions.

* Reduced costs of software deployment and integration. Web services provide a framework to integrate existing applications on existing platforms and use existing World Wide Web (WWW) network connectivity. De-coupling applications means that discrete components can be upgraded and modified, and that major code changes will not impact other enterprise applications.

For these reasons, CODA's product architecture may very well embody flexibility in terms of both the platform, such as allowing multiple choices for databases, application servers, Web servers, and interfaces; and the deployment mode, where users can mix and match Web browsers, rich-client Office desktops, and other customized client-side applications. The system is also customizable and yet supportable, owing to the data-driven screen presentation and layout. The screen and UI modifications are stored separately from the CODA supplied forms, while cascading style sheets promote the adoption of special, "homemade" styles. In other words, UIs are de-coupled from the current CODA version. Lower maintenance costs are not atypical either, given that the unified GL requires no batch updates, due to the single point of maintenance for security, rules, reporting structures, and so on. Finally, being standards-based (which is not necessarily exclusive to CODA) should bode well for protecting return on investment (ROI), owing to commonly available industry standard development skills.






SOURCE:
http://www.technologyevaluation.com/research/articles/composing-collaborative-financial-applications-18263/