“We are much better prepared for
answering the need for reliable
and transparent data.”
auditor who performed DONG
Energy’s first nonfinancial data
audit. “When no consolidated
CSR reports are prepared in an
enterprise, there is no need for
group accounting instructions,
and I often experience that this
is forgotten by those responsible for reporting at the group
level,” Mogensen says.
So the executives at DONG Energy turned to Oracle
Hyperion Financial Management to replace a cumbersome
and error-prone spreadsheet-based system for tracking sustainability data. In the process, they dramatically improved
data quality, gained visibility into every part of the business,
and created new appreciation for the company’s environment,
health, and safety goals.
“When the external auditors
came to us, they said, ‘How do
you know that you get all the
data from all the companies
into your accounts?’” Peulicke-
Andersen says. “They took the
legal entity chart of DONG
Energy. They just put their finger through a few of them and
said, ‘What is happening in that company? What kind of pro-
duction? What activity is happening? What data are you gather-
ing from that specific entity?’ And it was a completely new way
for us to look at the company.”
It became clear that Peulicke-Andersen and his team needed
to overhaul data gathering and reporting at DONG Energy. A
spreadsheet wouldn’t cut it.
“We knew that we needed a database to put the data into,
instead of spreadsheets, and we knew that we had to import or
use all of the basic principles of financial reporting,” Peulicke-
Andersen says. “We researched the market for suitable software
solutions and asked around: what did other companies use?”
As it turned out, Peulicke-Andersen’s department wouldn’t
need to invest in a new solution. The answer to its problem was
already within the organization.
—Niels Strange Peulicke-Andersen, Manager, DONG Energy
FINDING THE RIGHT SOLUTION
The first audit went poorly for several reasons. First,
Peulicke-Andersen’s team was collecting data using a Microsoft
Excel spreadsheet. Every month, people in different business
segments e-mailed their spreadsheets to Peulicke-Andersen’s
team, which copied and pasted the numbers into the master
spreadsheet. But spreadsheets are prone to human error; it’s
all too easy for someone to accidentally delete a formula in a
cell, overwrite someone else’s data, or overwrite an entire file
version. The spreadsheet owners might never know that something was incorrect.
Even if users were careful to avoid breaking formulas
or overwriting data, the data itself was sometimes bad. For
example, the spreadsheet required users to record things such
as “production” and “emission,” but those terms didn’t have
universal meaning throughout the company. People were also
using different conversion factors when entering data, resulting
in apples-to-oranges comparisons.
“You can measure something at different points in the
system,” Peulicke-Andersen says. “But you need to agree: is
it, for example, net or gross production? You have to have the
same definition of the data.”
In addition, DONG Energy’s current power generation
ownership structure is far more complex than it was in the past.
For example, the data reporting must allow for partial owner-
ship of wind farms. If DONG Energy owns only a portion of
a facility and partners own the rest, the spreadsheet would
need to indicate that the company is
responsible and consolidate only a
portion of the facility’s production.
Finally, it was almost impossible
to know whether all relevant data—
correct or incorrect—had even been
collected. DONG Energy has more
than 160 legal entities, and some of
those entities were being overlooked
in the spreadsheet.
RAISING THE BAR FOR DATA QUALITY
Elsewhere in the company, complex reporting was already
being done without a hitch every day: on the financial side.
When Peulicke-Andersen learned that the finance department
used Oracle Hyperion Financial Management, he asked his colleagues in finance to show him how the tool worked.
“I saw that it’s a very flexible tool,” he says. “You can specify
your own accounts, so they don’t really have to be financial
accounts.” Using this approach, Oracle Hyperion Financial
Management would let Peulicke-Andersen’s team track things
such as CO2 emissions or waste. He was intrigued, but the
finance department wasn’t eager to open up its Oracle Hyperion
server to the nonfinancial side until Peulicke-Andersen and
his team could dramatically improve their data quality. So they
started with a separate database on a separate server. But one
thing that Peulicke-Andersen could use was the finance department’s in-house knowledge of the Oracle Hyperion solution and
its map of the corporation’s complex structure.
The results came quickly. Oracle Hyperion Financial
Management helped DONG Energy improve visibility into
every area of the energy production
chain and spot where the greatest
improvements could be made. The
Oracle Hyperion solution not only
improved the quality of the non-
financial data collected; it also gave
Peulicke-Andersen’s team the ability
to look beyond raw numbers and
understand the relationships
between them.
>>SNAPSHOT
DONG Energy
dongenergy.com
Headquarters: Fredericia, Denmark
Employees: 6,000
Revenue: DKr 54, 6 billion in 2010
Oracle products: Oracle Hyperion Financial
Management
