Simple, logical and efficient Anaplan models contain hierarchies which are natural, intuitive and robust. Why then do we see so many that are overextended, too long and clunky?
Hierarchies in your Anaplan modelling allow your to formalise relationships between lists and dimensions. They enable you to declare and solidify parent and child mappings between adjacent dimensions and use these structures to create far more intuitive modelling processes, data flows and end user reporting.
However, for hierarchies to be successful they must not be too extended, contain too many layers and seek to force unnatural or illogical associations.
During a model health check carried out on a group forecasting model of a prominent high street food chain we discovered a hierarchy with in excess of 15 levels!
It had been dubbed the 'central spine' of the data model. It contained every possible association relevant to the leaf level or lowest level item which in this case were the individual high street restaurants. From warehouse, product category, region to business unit and entity every single association was represented in this monster of a hierarchical structure.
We were brought into the project to research, assess and diagnose why the project was struggling to model the FP&A processes. It didnt take long to spot the primary reason was due to this 'central spine' data model.
Because the hierarchy was locked down modelling was extremely challenging. There were no flat master lists or alternative hierarchies with shorter, more direct and relevant structures. Everything in the model revolved around using this single 'central spine' from street level modelling to supply chain and work force planning to product category and profitability analysis.
How did they resolve the challenges?
They broke up the 'central spine' into more than a dozen smaller parallel or twin hierarchies. These are structures which contain identical leaf level lists but roll up into a series of different parent and grand parent dimensions.
Multiple hierarchies were created which had street level restaurants rolling up into region and warehouse lists.
Product category was reassigned as a leaf item in it's own right rolling up into street level restaurant which then provided a true view of how each category was distributed across the portfolio of restaurants. This was not possible when using the previous approach.
Supply chain planning become more intuitive as it was clear which warehouse serviced which restaurant across which mix of product categories. Again, these insights were extremely difficult to realise when using the old 'central spine' approach.
The result was a leaner, more logical and natural modelling and reporting environment. The shorter hierarchies were easier to model and created reporting which was more satisfy to navigate.