SAP describes intelligence as what sets us apart as humans. Yet it’s digital brainpower that SAP is championing as the key to building what it calls the intelligent enterprise. It has adopted this term to encourage enterprise customers to think about where they can use automation controls inside their operations to create digitally driven workflows.
These automation controls are software components designed to run definable and repeatable business tasks. The goal is to help much of a business run these core functions more efficiently all while delivering the visibility, focus, and agility needed to remain competitive in this new age of disruption.
The Office-Linking SAP Architecture
When functions, processes, and workflows happen automatically, that makes the business smarter because employees are freed up to focus on higher-level activities that can help their organizations innovate or break into new markets.
Essentially then, we can think of the SAP intelligent enterprise a cloud-based set of technology tools. These are designed to work together to integrate traditional back-office ERP systems with front-office solutions that prepare businesses to bring in leading technologies such as artificial intelligence (AI) or machine learning (ML).
Running the Intelligent Enterprise
What does this mean in practice and how does an intelligent business run? One analogy to consider is how auto manufacturers are moving from building traditional cars to electric cars to autonomous vehicles. There are many processes that traditional car manufacturers would have to stop doing or transform in order to have the resources to devote to create a more innovative product.
SAP points to tasks such as invoice and payment matching as perfect candidates for intelligent automation. We can also consider workplace functions involving stock ordering, employee vacation requests, or administrative functions involving office maintenance. These are all areas we can automate now.
SAP Intelligent Customer Examples
SAP first introduced the intelligent enterprise in 2018 on the keynote stage at SAPPHIRE NOW. It has showcased a number of customers including Costco and Adidas, which are both already on their journey to becoming more intelligent.
But these are big companies with massive strategic planning departments and huge process frameworks. We know that not every ASUG member can consider itself a Costco or an Adidas, so there is a question of whether there is a cultural readiness for this approach to enterprise intelligence. Smaller companies can benefit from this approach, though they may not have the resources they need to take it on as a total transformation.
Intelligence as a Mindset
It is possible to break down the components of SAP’s intelligent enterprise and to implement what your company needs the most. According to SAP, these components include customer experience, manufacturing and the supply chain, the digital core (ERP), people engagement (HR), and network and spend management. SAP understands that it may not make sense for your business to purchase only their systems to manage these functions. The idea is that you can put the pieces together in the right way, based on your organization’s needs and maturity model.
But the one thing that is essential is that you rethink your processes. One big reason why digital transformations fail is when companies simply replicate their existing processes in digital form, even though they may no longer make sense. Franck Cohen, SAP president of digital core and industry solutions has said that if the intelligent enterprise is going to be effective, companies must evolve their ways of thinking.
Heads in the Clouds
That changing mindset issue came up for close SAP watcher Jon Reed who works as an analyst and journalist for Diginomica. Reed has talked about SAP’s move away from SAP HANA and SAP Leonardo and suggested that the intelligent enterprise is less of a product play and more of a push toward the SAP Cloud Platform.
“It’s a little bit tricky because SAP doesn’t own that [intelligent enterprise] term and it’s not self-evident to customers what the intelligent enterprise means,” Reed said. “It’s also not a new term, and SAP’s not the only vendor that’s pushing this strategy. Having said that, it’s refreshing that the discussion isn’t product centric—as long as customers understand that.”
Simplifying the Swelling Stack?
Some may wonder what’s behind this initiative. With so many elements now populating the total SAP stack, could this be a way for customers to think about the bigger picture of where they are trying to get to operationally, commercially, and technologically?
Yet it’s a long list of items on the intelligent enterprise menu: SAP S/4HANA for ERP, SAP SuccessFactors for human capital management, SAP C/4HANA for customer experience management, SAP Ariba for procurement, SAP Concur for travel and expense management, and then SAP Fieldglass for workforce management. That’s a big meal to swallow in one mouthful for some, especially if they’re also looking to use SAP Fiori for user interface management.
Your Business IQ
For all these efforts then, will the idea of intelligent enterprise enthuse or alienate most ASUG members and SAP customers? Many organizations are intelligent enough to have built a business in the first place. Why should they have to re-engineer themselves to SAP’s version of smartness?
The answer is that organizations don’t have to re-engineer, re-architect, or (in some cases) replatform to what SAP is showcasing. But they do have to accept the fact that no matter how successful they are today, there are always processes to improve or reinvent. You don’t have to call it digital transformation or by any other name to benefit from it.
Business is getting smarter through intelligence in many forms—that comes through better use of real-time data, analytics, machine learning, and automation—and the truth is, you’d have to be a little unwise to ignore that.