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518 Part Four Building and Managing Systems

day-to-day activities and problems. This new process orientation has moved
MoneyGram from the old siloed departments to cross-functional work groups
that collaborate closely with a long-range view of what’s best for the business.
For the technology to support its new global processes, MoneyGram selected
Oracle’s E-Business Suite with the Oracle Incentive Compensation module.
Oracle E-Business Suite consists of enterprise resource planning (ERP),
customer relationship management (CRM), and supply chain management
(SCM) applications using Oracle’s relational database management system.
Oracle Incentive Compensation module automates the process of designing,
administering, and analyzing variable compensation programs. Management
believed the Oracle software was capable of handling the customization work
required to integrate with the processes used by the company’s back-office
and proprietary agents and to handle other unique business requirements.
The Oracle system included capabilities for creating, viewing, and managing
customer information online.
MoneyGram started implementing Oracle E-Business Suite in September 2012.
The new software and business processes streamlined most of MoneyGram’s
back-office operations, making it easier to process more customer transactions
and settlements with agents and billers and to update the company’s General
Ledger. New partners can be added at a much faster rate.
Commissions are critical for driving profitability in MoneyGram’s existing
and new products. MoneyGram must track a large number of different plans
for calculating the commissions of its partner agents throughout the world.
Its legacy system was unable to automate many of the commission plans, so
MoneyGram had to use spreadsheets and manual processes to manage several
hundred commission plans. MoneyGram built a flexible commission model
using Oracle Incentive Compensation that has been able to automate more
than 90 percent of its nonstandard commission plans.
In the past, new regional innovations took months to plan, but the Oracle
implementation has cut that time by approximately 40 percent. New product
introductions will integrate seamlessly with MoneyGram's back-end processes
so that new transactions are recorded and accounted for correctly. The new
Oracle system allows MoneyGram to configure the processes simply by
adjusting currently existing parameters instead of developing new software.
MoneyGram is less likely to go to market with a product that has to be initially
run on manual processes.
Having an enterprise-wide repository of data located centrally allows
MoneyGram employees to better serve customers and agents conducting the
money transfers. Centralized data are up-to-date and easily available. Reports
used to take 40 hours and three employees to create but now take 80 percent
less time. Those workers can spend more time analyzing reports and less time
putting them together.
The cost savings of consolidating more than 40 MoneyGram legacy IT
systems into one enterprise-wide implementation of Oracle E-business Suite
amount to millions of dollars. The company can now handle more transactions
without having to hire additional staff. The company estimates that the Oracle
software will pay for itself within one year.
Sources: Alan Joch, “On the Money” and “MoneyGram Exploits the Flexibility of Oracle
Incentive Compensation,” Profit Magazine, February 2012; MoneyGram, “MoneyGram,
Advance America Renew Contract at Over 2,400 Stores Across USA,” August 6, 2012; and
www.moneygram.com, accessed August 26, 2012.

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