Integration: The Key To Digitizing Procurement Processes

Vasudha Karanam

People in procurement, supply chain, and finance functions often choose the best software for their individual responsibilities so they can take advantage of the innovative capabilities it has to offer. However, this creates challenges for IT – with different systems for different but related functions across the organization.

What’s more, IT is also increasingly dealing with transitions from on-premise to cloud solutions, along with the need to manage multiple cloud or hybrid infrastructures. Add in the rapid adoption of business networks to extend procurement processes for collaboration with partners and suppliers, and the IT challenges become even more complex.

For IT staff, all of this can seem daunting, as they must deal with fragmented data; disrupted, inefficient processes; multiple sources of truth; and inconsistent communication. So what’s an IT organization to do?

Striving for excellence, despite the challenges

IT departments work diligently to integrate disparate solutions into their existing infrastructures so they can provide a unified user experience.

This also holds true for companies that want to truly realize the benefits of digitizing procurement processes, and in particular, business networks. A seamless integration between cloud-based solutions and existing infrastructures is key to driving performance, speed, agility, visibility, and control.

Simplifying the path for business networks

For procurement, supply chain, and finance functions, business commerce networks have become an integral part of how companies manage their buying, selling, and supply chain management processes. With more and more buyers and suppliers joining these networks, IT must find an integration path that is scalable and empowering. The optimal option is an underlying integration process that provides self-service capabilities which are simple enough for organizations to quickly navigate on their own.

In fact, simple, self-service, and fast are three core requirements for innovative, best-in-class integration solutions. Here’s why:

  • Simple: Buyers and suppliers want an easy-to-use integration setup that guides them through the process step by step with a single sign-on.
  • Self-service: People who use business commerce networks regularly want a user-friendly interface so they can configure, test, and deploy the solution quickly, without any need for outside help.
  • Fast: Speed is also key for users that want to get into production rapidly. Integration that can be completed within hours is ideal.

Solutions with these advantages allow suppliers to interact with multiple customers by connecting just once, with a single configuration for all customers. With greater visibility into a single source of truth, suppliers can make more informed and confident decisions.

Ultimately, this leads to a faster market-to-cash cycle, greater order and invoice accuracy, lower processing costs, and higher customer satisfaction. And integration processes like this alleviate the burden on IT, which saves time and money for the organization overall.

To learn more about how to digitize and integrate your procurement processes, join SAP for an informative Webinar on simplifying integration on June 29. You’ll also hear from our customer, Devon Energy, on the benefits of integrating procurement, supply chain, and finance operations into a single source of truth. Register now.

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Vasudha Karanam

About Vasudha Karanam

Vasudha Karanam is an IT/Platform product marketer with SAP Ariba. With over 11 years of experience in IT, she has spent the last 8 years focused on the procurement solutions sector. She is actively involved in creating product marketing strategies for IT/Platform solutions. She is responsible for integrated marketing plans, growth initiatives, and go-to-market plans for IT/Platform solutions from SAP Ariba. Vasudha was previously responsible for various roles including marketing release readiness and business analytics for SAP Ariba sales and marketing. She holds an MBA from Birmingham City University, UK.

Consider Choice, Consistency For Your Cloud Strategy

Carl Dubler

Cloud applications have evolved beyond those narrowly focused on a specific line of business. You can now run enterprise resource planning (ERP) solutions that that support complex, end-to-end processes for multiple areas such as finance, supply chain, and manufacturing. This shift is resulting in many CIOs being called on to answer one critical question: What is our cloud strategy?

Do you have a quick answer and a clear strategy that you can articulate? Here are some ideas to help you as you structure and formulate your software deployment plans.

100% cloud won’t work for everyone

If you listen to some vendors, it seems that the cloud is the answer to everything, and it is an answer they often give before fully understanding your operations. They cite the advantages of deploying solutions quickly, receiving automatic updates, and scaling up or down according to your changing business needs, all while saving costs.

These vendors are not wrong. Cloud-based solutions can deliver all these things. However, the reality of your operations may not be that straightforward. You may want to have more control over updates. Or you might need customizations, features, or industry support that aren’t yet available in a public cloud ERP. Or you could have regulatory requirements. For example, defense companies may be obligated to keep critical solutions on premises. A government organization in Europe may not allow its data to be stored in the United States.

A two-tier approach can be a better option

There may also be some situations where a mixture of cloud and on-premises technology is appropriate to meet complex business requirements. For example, a company may choose to get a newly acquired subsidiary up and running quickly by deploying a cloud-based ERP solution, while continuing to use an on-premises solution to manage core operational processes at company headquarters.

This two-tier, or hybrid, approach may also help specific areas of the business such as HR to function more productively. For example, a company may take advantage of a specialist cloud application to enable warehouse workers to log their hours efficiently while keeping its warehouse management processes on premises.

Keep your options open

Even if a two-tier approach isn’t right for your company today, it may be in just a few years’ time. After all, it’s hard to predict what the future will bring in dynamic business markets. You may pursue new opportunities or gain a new client, necessitating a change in your current setup.

It’s important to keep your options open to stay flexible and respond to new challenges successfully. The ability to adapt your strategy to meet changing requirements is crucial. However, some vendors don’t make it easy for companies to combine or switch approaches.

Consistency is key

Some ERP vendors don’t have private cloud or on-premises options. For those that have all the deployment choices, they have entirely different solutions for cloud and on premises. It’s not only the look and feel that differ. All too often, there is no straightforward integration between solutions either. This necessitates costly and time-consuming data work to get different solutions to talk to each other.

To ensure that you don’t slow down your operations due to poor integration, you therefore need to be sure to select ERP software that works consistently from on premises through private cloud to public cloud to on-premises deployments. Solutions that provide this consistency – based on the same code line, data model, and user interface – unify the way people work across the enterprise, improving productivity and efficiency.

For example, employees need to be able to follow exactly the same steps to close an invoice, whether they are using a cloud-based solution at a subsidiary company  or an on-premises solution at headquarters. And financial figures can be easily consolidated into management reports across an enterprise without the painstaking process of matching up data, column by column.

Stay agile to face the challenges ahead

Choice and consistency in your software deployment strategy are essential if you are to achieve true business agility. By giving yourself room to maneuver and choosing software that enables you to change your deployment approach when you need to, without replacing your entire ERP solution, you are in a stronger position to face new challenges effectively and maintain a competitive edge.

To learn more about achieving consistency across your cloud-based and on-premises ERP solutions, read our white paper, “SAP S/4HANA: From Two-tier ERP to the N-tier Enterprise.

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Carl Dubler

About Carl Dubler

Carl Dubler is a senior director of Product Marketing for SAP S/4HANA. With an IT career stretching back to the late 1980s, he has done nearly every role in the business. In his ten years at SAP, he also managed SAP’s first commercially available cloud product and first cloud product on SAP HANA.

Harnessing The Power Of A Single Universal Data Set

Kristin McMahon

Every organization’s digital journey begins by rapidly transforming data—the currency of digital transformation—into insight so people can act in the moment and innovate without constraints.

But enterprise data is an unwieldy thing, isn’t it? New kinds of data from new data sources (for example, streaming data from IoT-enabled sensors, or social media data) are being created all the time, resulting in massive data sets. This data is diverse in format and location, making it difficult to collect and connect for timely transactions or analysis. And often, it’s simply become too huge for your systems, applications, or analytical tools to handle or too unstructured to turn into timely insights. As noted by Forrester in a recent paper, “The 7 Laws of Universal Data: Create a Road Map For Real-Time, Agile, Self-Service Data Platform,” you know you have a data problem when it takes too long to:

  • Measure business performance
  • Provide insights for strategic and operational decision-making
  • Get intelligence into business processes and push it to employees
  • Tap unstructured data, and human analysis can’t scale efficiently

Some companies have tried to solve these issues by maintaining two sets of data: one for transactions and one for analysis. But this is not only costly and inefficient; it also leads to discrepancies because it’s hard to keep them in sync. And discrepancies lead to inaccurate analytical outcomes, with the obvious negative impact on decision-making.

A modern universal data strategy

The solution to these challenges is simple, elegant, and powerful: the creation of a single, universal source of enterprise data that’s always up to date and can be used for both transactions and analysis. This way, you are better able to quickly deliver the right answers and insights based on the very latest data.

According to Forrester, it’s never been more important to have a single, enterprise-wide data set to drive business growth and achieve goals. When this data set is based on a unified, intelligent, real-time data management platform, it can be the foundation of a modern data strategy that frees your business to go beyond traditional business intelligence (BI) and reporting. Now, you have the way forward to innovate new processes and business models, understand what’s happening across your enterprise instantly, collaborate in real time across your extended enterprise, and more.

The seven laws of universal data

SAP has defined seven laws for the concept of universal data. By ensuring that your data management and utilization approach adheres to these laws, you can maximize the value of your data today—and in the future.

The first law is about performance, because in the era of Big Data, real-time processing of data, regardless of size, is critical. The second law focuses on freedom, because in a modern data platform, the data cannot be constrained. It must have the freedom to flow between the cloud, hybrid environments, and on-premise applications so that data can be shared across the enterprise regardless of where it resides. The third law is about the use of models, because the data must be integrated for a 360-degree business view. It’s critical to find and understand all of your data so you can model it effectively to meet business goals.

Want to learn about the last four laws defining the concept of universal data—and explore Forrester’s four-phase roadmap to successfully realizing the goal of universal data? Then register for the upcoming Webinar on October 18 at 11:00 a.m. ET. You’ll hear from Michele Goetz, principal analyst at Forrester, and me, Kristin McMahon, senior director, Solution Marketing at SAP. See you there!

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Kristin McMahon

About Kristin McMahon

Kristin McMahon is a solution marketing director for SAP Enterprise Information Management (EIM) solutions with expertise and focus on data services and data quality tools.

Diving Deep Into Digital Experiences

Kai Goerlich

 

Google Cardboard VR goggles cost US$8
By 2019, immersive solutions
will be adopted in 20% of enterprise businesses
By 2025, the market for immersive hardware and software technology could be $182 billion
In 2017, Lowe’s launched
Holoroom How To VR DIY clinics

Link to Sources


From Dipping a Toe to Fully Immersed

The first wave of virtual reality (VR) and augmented reality (AR) is here,

using smartphones, glasses, and goggles to place us in the middle of 360-degree digital environments or overlay digital artifacts on the physical world. Prototypes, pilot projects, and first movers have already emerged:

  • Guiding warehouse pickers, cargo loaders, and truck drivers with AR
  • Overlaying constantly updated blueprints, measurements, and other construction data on building sites in real time with AR
  • Building 3D machine prototypes in VR for virtual testing and maintenance planning
  • Exhibiting new appliances and fixtures in a VR mockup of the customer’s home
  • Teaching medicine with AR tools that overlay diagnostics and instructions on patients’ bodies

A Vast Sea of Possibilities

Immersive technologies leapt forward in spring 2017 with the introduction of three new products:

  • Nvidia’s Project Holodeck, which generates shared photorealistic VR environments
  • A cloud-based platform for industrial AR from Lenovo New Vision AR and Wikitude
  • A workspace and headset from Meta that lets users use their hands to interact with AR artifacts

The Truly Digital Workplace

New immersive experiences won’t simply be new tools for existing tasks. They promise to create entirely new ways of working.

VR avatars that look and sound like their owners will soon be able to meet in realistic virtual meeting spaces without requiring users to leave their desks or even their homes. With enough computing power and a smart-enough AI, we could soon let VR avatars act as our proxies while we’re doing other things—and (theoretically) do it well enough that no one can tell the difference.

We’ll need a way to signal when an avatar is being human driven in real time, when it’s on autopilot, and when it’s owned by a bot.


What Is Immersion?

A completely immersive experience that’s indistinguishable from real life is impossible given the current constraints on power, throughput, and battery life.

To make current digital experiences more convincing, we’ll need interactive sensors in objects and materials, more powerful infrastructure to create realistic images, and smarter interfaces to interpret and interact with data.

When everything around us is intelligent and interactive, every environment could have an AR overlay or VR presence, with use cases ranging from gaming to firefighting.

We could see a backlash touting the superiority of the unmediated physical world—but multisensory immersive experiences that we can navigate in 360-degree space will change what we consider “real.”


Download the executive brief Diving Deep Into Digital Experiences.


Read the full article Swimming in the Immersive Digital Experience.

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Kai Goerlich

About Kai Goerlich

Kai Goerlich is the Chief Futurist at SAP Innovation Center network His specialties include Competitive Intelligence, Market Intelligence, Corporate Foresight, Trends, Futuring and ideation. Share your thoughts with Kai on Twitter @KaiGoe.heif Futu

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Blockchain: Much Ado About Nothing? How Very Wrong!

Juergen Roehricht

Let me start with a quote from McKinsey, that in my view hits the nail right on the head:

“No matter what the context, there’s a strong possibility that blockchain will affect your business. The very big question is when.”

Now, in the industries that I cover in my role as general manager and innovation lead for travel and transportation/cargo, engineering, construction and operations, professional services, and media, I engage with many different digital leaders on a regular basis. We are having visionary conversations about the impact of digital technologies and digital transformation on business models and business processes and the way companies address them. Many topics are at different stages of the hype cycle, but the one that definitely stands out is blockchain as a new enabling technology in the enterprise space.

Just a few weeks ago, a customer said to me: “My board is all about blockchain, but I don’t get what the excitement is about – isn’t this just about Bitcoin and a cryptocurrency?”

I can totally understand his confusion. I’ve been talking to many blockchain experts who know that it will have a big impact on many industries and the related business communities. But even they are uncertain about the where, how, and when, and about the strategy on how to deal with it. The reason is that we often look at it from a technology point of view. This is a common mistake, as the starting point should be the business problem and the business issue or process that you want to solve or create.

In my many interactions with Torsten Zube, vice president and blockchain lead at the SAP Innovation Center Network (ICN) in Potsdam, Germany, he has made it very clear that it’s mandatory to “start by identifying the real business problem and then … figure out how blockchain can add value.” This is the right approach.

What we really need to do is provide guidance for our customers to enable them to bring this into the context of their business in order to understand and define valuable use cases for blockchain. We need to use design thinking or other creative strategies to identify the relevant fields for a particular company. We must work with our customers and review their processes and business models to determine which key blockchain aspects, such as provenance and trust, are crucial elements in their industry. This way, we can identify use cases in which blockchain will benefit their business and make their company more successful.

My highly regarded colleague Ulrich Scholl, who is responsible for externalizing the latest industry innovations, especially blockchain, in our SAP Industries organization, recently said: “These kinds of use cases are often not evident, as blockchain capabilities sometimes provide minor but crucial elements when used in combination with other enabling technologies such as IoT and machine learning.” In one recent and very interesting customer case from the autonomous province of South Tyrol, Italy, blockchain was one of various cloud platform services required to make this scenario happen.

How to identify “blockchainable” processes and business topics (value drivers)

To understand the true value and impact of blockchain, we need to keep in mind that a verified transaction can involve any kind of digital asset such as cryptocurrency, contracts, and records (for instance, assets can be tangible equipment or digital media). While blockchain can be used for many different scenarios, some don’t need blockchain technology because they could be handled by a simple ledger, managed and owned by the company, or have such a large volume of data that a distributed ledger cannot support it. Blockchain would not the right solution for these scenarios.

Here are some common factors that can help identify potential blockchain use cases:

  • Multiparty collaboration: Are many different parties, and not just one, involved in the process or scenario, but one party dominates everything? For example, a company with many parties in the ecosystem that are all connected to it but not in a network or more decentralized structure.
  • Process optimization: Will blockchain massively improve a process that today is performed manually, involves multiple parties, needs to be digitized, and is very cumbersome to manage or be part of?
  • Transparency and auditability: Is it important to offer each party transparency (e.g., on the origin, delivery, geolocation, and hand-overs) and auditable steps? (e.g., How can I be sure that the wine in my bottle really is from Bordeaux?)
  • Risk and fraud minimization: Does it help (or is there a need) to minimize risk and fraud for each party, or at least for most of them in the chain? (e.g., A company might want to know if its goods have suffered any shocks in transit or whether the predefined route was not followed.)

Connecting blockchain with the Internet of Things

This is where blockchain’s value can be increased and automated. Just think about a blockchain that is not just maintained or simply added by a human, but automatically acquires different signals from sensors, such as geolocation, temperature, shock, usage hours, alerts, etc. One that knows when a payment or any kind of money transfer has been made, a delivery has been received or arrived at its destination, or a digital asset has been downloaded from the Internet. The relevant automated actions or signals are then recorded in the distributed ledger/blockchain.

Of course, given the massive amount of data that is created by those sensors, automated signals, and data streams, it is imperative that only the very few pieces of data coming from a signal that are relevant for a specific business process or transaction be stored in a blockchain. By recording non-relevant data in a blockchain, we would soon hit data size and performance issues.

Ideas to ignite thinking in specific industries

  • The digital, “blockchained” physical asset (asset lifecycle management): No matter whether you build, use, or maintain an asset, such as a machine, a piece of equipment, a turbine, or a whole aircraft, a blockchain transaction (genesis block) can be created when the asset is created. The blockchain will contain all the contracts and information for the asset as a whole and its parts. In this scenario, an entry is made in the blockchain every time an asset is: sold; maintained by the producer or owner’s maintenance team; audited by a third-party auditor; has malfunctioning parts; sends or receives information from sensors; meets specific thresholds; has spare parts built in; requires a change to the purpose or the capability of the assets due to age or usage duration; receives (or doesn’t receive) payments; etc.
  • The delivery chain, bill of lading: In today’s world, shipping freight from A to B involves lots of manual steps. For example, a carrier receives a booking from a shipper or forwarder, confirms it, and, before the document cut-off time, receives the shipping instructions describing the content and how the master bill of lading should be created. The carrier creates the original bill of lading and hands it over to the ordering party (the current owner of the cargo). Today, that original paper-based bill of lading is required for the freight (the container) to be picked up at the destination (the port of discharge). Imagine if we could do this as a blockchain transaction and by forwarding a PDF by email. There would be one transaction at the beginning, when the shipping carrier creates the bill of lading. Then there would be look-ups, e.g., by the import and release processing clerk of the shipper at the port of discharge and the new owner of the cargo at the destination. Then another transaction could document that the container had been handed over.

The future

I personally believe in the massive transformative power of blockchain, even though we are just at the very beginning. This transformation will be achieved by looking at larger networks with many participants that all have a nearly equal part in a process. Today, many blockchain ideas still have a more centralistic approach, in which one company has a more prominent role than the (many) others and often is “managing” this blockchain/distributed ledger-supported process/approach.

But think about the delivery scenario today, where goods are shipped from one door or company to another door or company, across many parties in the delivery chain: from the shipper/producer via the third-party logistics service provider and/or freight forwarder; to the companies doing the actual transport, like vessels, trucks, aircraft, trains, cars, ferries, and so on; to the final destination/receiver. And all of this happens across many countries, many borders, many handovers, customs, etc., and involves a lot of paperwork, across all constituents.

“Blockchaining” this will be truly transformational. But it will need all constituents in the process or network to participate, even if they have different interests, and to agree on basic principles and an approach.

As Torsten Zube put it, I am not a “blockchain extremist” nor a denier that believes this is just a hype, but a realist open to embracing a new technology in order to change our processes for our collective benefit.

Turn insight into action, make better decisions, and transform your business. Learn how.

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Juergen Roehricht

About Juergen Roehricht

Juergen Roehricht is General Manager of Services Industries and Innovation Lead of the Middle and Eastern Europe region for SAP. The industries he covers include travel and transportation; professional services; media; and engineering, construction and operations. Besides managing the business in those segments, Juergen is focused on supporting innovation and digital transformation strategies of SAP customers. With more than 20 years of experience in IT, he stays up to date on the leading edge of innovation, pioneering and bringing new technologies to market and providing thought leadership. He has published several articles and books, including Collaborative Business and The Multi-Channel Company.