Sections

Why You Need To Rethink The Way Your Business Operates

Simon Dale

The pace of change in business today is staggering. As expectations for quality user experiences rise ever higher, this need for speed is driving enterprises to embark on digital transformation.

Rising expectations

You could call it life imitating art, but customers’ online behavior is now setting sky-high expectations for real-world encounters. Customers demand a single, consistent experience across every touch point.

Everyone has access to multiple channels, which puts pressure on companies to provide an integrated experience. You just can’t deliver a slick experience on a mobile device in isolation. You can’t expect your customers to be happy with one great experience that doesn’t extend beyond the confines of their mobile screens.

But it’s not just about meeting customer expectations. Inside the enterprise, employees are leading the charge. They want to collaborate with their coworkers in the same way as they can with friends. At work, you expect the same powerful technology that you use at home.

Yet on the customer experience side, many of the executives I speak with in manufacturing, retail, services, life sciences, and other sectors are still struggling to create the perfect cross-channel experiences for their customers. Many organizations persist with clunky apps even though they’re a serious drag on productivity.

We are all technology companies

These days, all successful companies are technology companies that just happen to produce other things as well. So it doesn’t matter whether you’re selling beauty products, manufacturing industrial cement, or educating young minds, the market and people have changed.

Adopting digital technologies is crucial if you want to meet modern expectations. You need to take advantage of digital tools and technology to provide customers with what they want in a targeted, effective, and seamless way.

Getting ahead in the digital journey

While large traditional companies—with decades of history and legacy—are very different from nimble digital entrants, clearly only those organizations that take advantage of an always-on, digitally connected and Big Data-driven world can hope to succeed.

Cloud and mobile computing combined with endless streams of data have created the potential to transform nearly everything.

For established organizations there’s an urgent need to rewire your end-to-end business processes for the digital world. You need to modernize core systems to support new kinds of digital interactions.

Accumulating and analyzing more valid data

Take the case of a long-established cement producer based in Thailand. While Siam City Cement is not an obvious early candidate for digital transformation, its needs were compelling. Digital transformation is now well underway in its business as the company strives to respond to changing consumer behavior.

For Siam City, the only way to keep up with customer demand was to understand customer data better. Using a next-generation ERP business suite as its digital core, it now has critical information available in real time, helping the company make decisions quickly and ensure it is offering customers the best products and services possible. The organization has also cut month-end closing in half.

In pursuit of excellence

Over in Australia, Melbourne’s La Trobe University went from having a fragmented finance system with over 15 years of customizations to an ERP-based finance solution in under 20 weeks.

By simplifying its entire IT landscape and architecture, the university’s financial process is now much faster. Access to real-time data is leading to swifter decision making. By comparison, under the old finance system, 72 customized reports were produced each month. Now, there are just five. This has eliminated an entire day of work from the university’s finance administration team, freeing them up to focus on more useful projects.

But more than this, with reliable financial data, the university can now make informed decisions on which programs to increase or which facilities to enhance.

Pioneering a new beauty category

And for the Korean beauty products startup Memebox, within six months of going live with an ERP-based finance solution, the company saw a dramatic uptick in sales productivity.

These efficiencies stem from improved inventory accuracy. With real-time tracking, Memebox has reduced product delivery lead times, so customers are receiving the right products more quickly while revenue for Memebox continues to grow.

Customer experience is the heart of digital transformation

These days, attracting, winning, and retaining customers requires personalized cross-channel interactions and individualization of products and services. Organizations that embrace digital technologies and modernize their end-to-end processes will place themselves in the strongest position to succeed.

Read more SAP S/4HANA success stories and follow me at @SimonDWork to stay on top of the latest developments.

Comments

Simon Dale

About Simon Dale

Simon Dale has the responsibility at SAP Asia Pacific and Japan to establish and scale the business for SAP S/4HANA, the next-generation business suite from SAP. His portfolio encompasses both the traditional on-premise solution go-to-market strategy, as well as the latest cloud solutions. Prior to this role, Simon launched and ran SAP's managed service for SAP solutions, SAP HANA Enterprise Cloud, in Asia. A veteran of 25 years in the IT industry, Simon sits on the advisory boards of both the Singapore Management University of Information Systems as well as the Nanyang Polytechnic School of IT. Simon is an occasional angel investor in startups and committed to active mentoring and coaching, especially to early talent and women in IT.

Collaboration: The Effective Finance Function’s Magic Ingredient

Joan Warner

Part 4 in a series. Read Part 1,  Part 2, and Part 3.

When we set out to study what the most successful finance executives do differently, we determined that regular collaboration with other parts of the organization is a must for what we call “finance leadership.” Our hypothesis: Business performance improves when the finance team exerts widespread influence.

Sure enough, our new research bears this out. In “How Finance Leadership Pays Off: Six Ways CFOs Stay Ahead of the Pack,” SAP partnered with Oxford Economics to survey 1,500 executives across industries and global regions. The select 11.5% of survey respondents who qualified as “finance leaders” work closely with business areas where finance may not traditionally have been highly visible, including functions like marketing, sales, research and development, and customer service. Their involvement in these areas could explain why, among our survey respondents, leaders were more than twice as likely as non-leaders to reported their organization’s market share grew over the past year.

Effective collaboration between finance and other functions is a hallmark of successful businesses. For example, a whopping 87% of companies with 5.1%–10% revenue growth say finance collaborates effectively with IT, vs. 65% of companies with revenue growth below 5%. And three-quarters of the fastest-growing companies report effective collaboration between finance and R&D, compared with 54% in the 0.1%–5% growth group.

“Collaboration is not a ‘nice to have’—it’s a requirement,” says Julian Whitehead, CFO of Airbus Defence and Space. “Clearly, if you want to be in the front end of the business, you’ve got to have a trusting relationship with sales and marketing, you’ve got to be involved with the engineering and operations teams, and you have to have some relationship also with the human resources team.”

The power of analytics

Collaborative finance can have a powerful impact on performance. In fact, we found that 46% of companies with zero or negative revenue and profit growth say an isolated finance function is keeping them from achieving their business goals. That percentage shrinks to 28% among respondents whose revenues are growing by 5.1%–10%.

According to Deloitte Consulting LLP managing director Sam Parikh, who advises organizations on large-scale financial transformation projects, improvements in information technology, especially analytics, are helping finance executives work more closely with their internal customers—the business operating units. CFOs are reaching out and becoming more client-facing, he says. The relationship then becomes mutually beneficial.

“Once the operating units see the power of analysis that finance can provide, they understand the value of the finance function, which in turn allows the CFO to play the strategic role more effectively,” Mr. Parikh explains. “It’s a win-win situation.”

Please click here to explore the full study, and check back with Digitalist Magazine for future blogs featuring more results.

Comments

Joan Warner

About Joan Warner

Joan Warner is managing editor and senior analyst for Financial Services at Oxford Economics. Joanie joined Oxford in February 2016 from The Financial Times, where she managed subsidiary publications covering the wealth management industry and corporate governance. Prior to that, she covered international finance and European business for BusinessWeek magazine, where she worked for nearly 20 years. Joanie was also a contributing editor at Institutional Investor and has written and edited reports for Morgan Stanley, McKinsey, PwC, and former hedge fund FrontPoint Partners. She holds an MA in Comparative Literature and a BA in Classics, both from Harvard University.

The Role Of AI In Financial Trading – It’s Not What You Think

Susan Galer

The financial industry has been all over artificial intelligence (AI) supporting front-end trading processes, leaving much of the rest of the business in the last century. That won’t be true for much longer if Bikram Singh, founder and CEO of EZOPS, has his way.

I caught up with Singh during the recent kick-off of the SAP Next-Gen Innovation Community for Financial Services at the SAP Leonardo Center in New York City.

“A lot of functions in the middle and back office typically have been neglected in the AI revolution, and we see a tremendous opportunity here to radically transform the landscape,” said Singh. “We are specializing in applying AI and machine learning to address use cases in the back office, including data reconciliation.”

According to Singh, up to 15% of a financial institution’s staff focused on trading are conducting repetitive, mundane tasks to reconcile data. He co-founded EZOPS three years ago to provide cloud-based, AI-fueled services that support these processes that take place after trading is done. Based in the United States with offices in Dublin and India, this fintech is designing a product called ARO to help companies predict and resolve breaks. The software can help institutions streamline operations, reduce risk, and redirect workers to higher-value responsibilities. It’s aimed at top-level asset managers and fund administrators in any financial institution involved with heavy trading volume, including equities, cash, and commodities at banks and insurance firms.

“Our passion is to connect with the C-suite, giving them the satisfaction that at the end of the day, after they have executed trades in the front office, they don’t have to worry about the back office,” said Singh. “Applying AI in the middle and back office has benefits up and down the entire value chain, and this is where the industry is headed.”

Time to trade up pre-2008 systems

Singh began his financial career at the trading desk, where he fell in love with the back-end processes. “I wasn’t a great trader, but loved processes and what happened on the back end, how if I pressed a certain button from the front office, everything fell into place through settlement. I’ve spent my entire career building products and services around that middle- and back-office spectrum.”

AI is tailor-made for a financial industry increasingly squeezed by new regulations on selling products and resultant decreasing revenues. Calculating ROI at a molecular level, meaning costs by trade against worker productivity, has become a must-have. That’s where AI comes in.

“You can’t have a back or middle office set up for pre-2008. Institutions must become more streamlined and nimble,” said Singh. “Banks are realizing even if policies change, certain regulations and cost pressures are here to stay. If they don’t adapt and be one of the first movers, someone else will do it.”

Singh said EZOPS is having serious conversations with several of the world’s largest banks about the company’s AI-based solution, now in proof of concept (POC), which runs machine learning algorithms on a cloud platform, and uses analytics for reporting.

“We are getting over 90% accuracy in predictions from our [proof of concept] in results that are off the charts,” he said. “Because of the intelligence in our algorithms, based on our understanding of the processes, we can deliver results that are immediately promising and translate into cost savings. For banks, we feel like we are their BFFs, providing them with results they can show their board and investors and benchmark against their peers.”

For more on the disruptive effects of AI, see Artificial Intelligence Will Require Very Real Brainpower In Finance.

Comments

Taking Learning Back to School

Dan Wellers

 

Denmark spends most GDP on labor market programs at 3.3%.
The U.S. spends only 0.1% of it’s GDP on adult education and workforce retraining.
The number of post-secondary vocational and training institutions in China more than doubled from 2000 to 2014.
47% of U.S. jobs are at risk for automation.

Our overarching approach to education is top down, inflexible, and front loaded in life, and does not encourage collaboration.

Smartphone apps that gamify learning or deliver lessons in small bits of free time can be effective tools for teaching. However, they don’t address the more pressing issue that the future is digital and those whose skills are outmoded will be left behind.

Many companies have a history of effective partnerships with local schools to expand their talent pool, but these efforts are not designed to change overall systems of learning.


The Question We Must Answer

What will we do when digitization, automation, and artificial intelligence eject vast numbers of people from their current jobs, and they lack the skills needed to find new ones?

Solutions could include:

  • National and multinational adult education programs
  • Greater investment in technical and vocational schools
  • Increased emphasis on apprenticeships
  • Tax incentives for initiatives proven to close skills gaps

We need a broad, systemic approach that breaks businesses, schools, governments, and other organizations that target adult learners out of their silos so they can work together. Chief learning officers (CLOs) can spearhead this approach by working together to create goals, benchmarks, and strategy.

Advancing the field of learning will help every business compete in an increasingly global economy with a tight market for skills. More than this, it will mitigate the workplace risks and challenges inherent in the digital economy, thus positively influencing the future of business itself.


Download the executive brief Taking Learning Back to School.


Read the full article The Future of Learning – Keeping up With The Digital Economy

Comments

Dan Wellers

About Dan Wellers

Dan Wellers is the Global Lead of Digital Futures at SAP, which explores how organizations can anticipate the future impact of exponential technologies. Dan has extensive experience in technology marketing and business strategy, plus management, consulting, and sales.

Tags:

Why Millennials Quit: Understanding A New Workforce

Shelly Kramer

Millennials are like mobile devices: they’re everywhere. You can’t visit a coffee shop without encountering both in large numbers. But after all, who doesn’t like a little caffeine with their connectivity? The point is that you should be paying attention to millennials now more than ever because they have surpassed Boomers and Gen-Xers as the largest generation.

Unfortunately for the workforce, they’re also the generation most likely to quit. Let’s examine a new report that sheds some light on exactly why that is—and what you can do to keep millennial employees working for you longer.

New workforce, new values

Deloitte found that two out of three millennials are expected to leave their current jobs by 2020. The survey also found that a staggering one in four would probably move on in the next year alone.

If you’re a business owner, consider putting four of your millennial employees in a room. Take a look around—one of them will be gone next year. Besides their skills and contributions, you’ve also lost time and resources spent by onboarding and training those employees—a very costly process. According to a new report from XYZ University, turnover costs U.S. companies a whopping $30.5 billion annually.

Let’s take a step back and look at this new workforce with new priorities and values.

Everything about millennials is different, from how to market to them as consumers to how you treat them as employees. The catalyst for this shift is the difference in what they value most. Millennials grew up with technology at their fingertips and are the most highly educated generation to date. Many have delayed marriage and/or parenthood in favor of pursuing their careers, which aren’t always about having a great paycheck (although that helps). Instead, it may be more that the core values of your business (like sustainability, for example) or its mission are the reasons that millennials stick around at the same job or look for opportunities elsewhere. Consider this: How invested are they in their work? Are they bored? What does their work/life balance look like? Do they have advancement opportunities?

Ping-pong tables and bringing your dog to work might be trendy, but they aren’t the solution to retaining a millennial workforce. So why exactly are they quitting? Let’s take a look at the data.

Millennials’ common reasons for quitting

In order to gain more insight into the problem of millennial turnover, XYZ University surveyed more than 500 respondents between the ages of 21 and 34 years old. There was a good mix of men and women, college grads versus high school grads, and entry-level employees versus managers. We’re all dying to know: Why did they quit? Here are the most popular reasons, some in their own words:

  • Millennials are risk-takers. XYZ University attributes this affection for risk taking with the fact that millennials essentially came of age during the recession. Surveyed millennials reported this experience made them wary of spending decades working at one company only to be potentially laid off.
  • They are focused on education. More than one-third of millennials hold college degrees. Those seeking advanced degrees can find themselves struggling to finish school while holding down a job, necessitating odd hours or more than one part-time gig. As a whole, this generation is entering the job market later, with higher degrees and higher debt.
  • They don’t want just any job—they want one that fits. In an age where both startups and seasoned companies are enjoying success, there is no shortage of job opportunities. As such, they’re often looking for one that suits their identity and their goals, not just the one that comes up first in an online search. Interestingly, job fit is often prioritized over job pay for millennials. Don’t forget, if they have to start their own company, they will—the average age for millennial entrepreneurs is 27.
  • They want skills that make them competitive. Many millennials enjoy the challenge that accompanies competition, so wearing many hats at a position is actually a good thing. One millennial journalist who used to work at Forbes reported that millennials want to learn by “being in the trenches, and doing it alongside the people who do it best.”
  • They want to do something that matters. Millennials have grown up with change, both good and bad, so they’re unafraid of making changes in their own lives to pursue careers that align with their desire to make a difference.
  • They prefer flexibility. Technology today means it’s possible to work from essentially anywhere that has an Internet connection, so many millennials expect at least some level of flexibility when it comes to their employer. Working remotely all of the time isn’t feasible for every situation, of course, but millennials expect companies to be flexible enough to allow them to occasionally dictate their own schedules. If they have no say in their workday, that’s a red flag.
  • They’ve got skills—and they want to use them. In the words of a 24-year-old designer, millennials “don’t need to print copies all day.” Many have paid (or are in the midst of paying) for their own education, and they’re ready and willing to put it to work. Most would prefer you leave the smaller tasks to the interns.
  • They got a better offer. Thirty-five percent of respondents to XYZ’s survey said they quit a previous job because they received a better opportunity. That makes sense, especially as recruiting is made simpler by technology. (Hello, LinkedIn.)
  • They seek mentors. Millennials are used to being supervised, as many were raised by what have been dubbed as “helicopter parents.” Receiving support from those in charge is the norm, not the anomaly, for this generation, and they expect that in the workplace, too.

Note that it’s not just XYZ University making this final point about the importance of mentoring. Consider Figures 1 and 2 from Deloitte, proving that millennials with worthwhile mentors report high satisfaction rates in other areas, such as personal development. As you can see, this can trickle down into employee satisfaction and ultimately result in higher retention numbers.

Millennials and Mentors
Figure 1. Source: Deloitte


Figure 2. Source: Deloitte

Failure to . . .

No, not communicate—I would say “engage.” On second thought, communication plays a role in that, too. (Who would have thought “Cool Hand Luke” would be applicable to this conversation?)

Data from a recent Gallup poll reiterates that millennials are “job-hoppers,” also pointing out that most of them—71 percent, to be exact—are either not engaged in or are actively disengaged from the workplace. That’s a striking number, but businesses aren’t without hope. That same Gallup poll found that millennials who reported they are engaged at work were 26 percent less likely than their disengaged counterparts to consider switching jobs, even with a raise of up to 20 percent. That’s huge. Furthermore, if the market improves in the next year, those engaged millennial employees are 64 percent less likely to job-hop than those who report feeling actively disengaged.

What’s next?

I’ve covered a lot in this discussion, but here’s what I hope you will take away: Millennials comprise a majority of the workforce, but they’re changing how you should look at hiring, recruiting, and retention as a whole. What matters to millennials matters to your other generations of employees, too. Mentoring, compensation, flexibility, and engagement have always been important, but thanks to the vocal millennial generation, we’re just now learning exactly how much.

What has been your experience with millennials and turnover? Are you a millennial who has recently left a job or are currently looking for a new position? If so, what are you missing from your current employer, and what are you looking for in a prospective one? Alternatively, if you’re reading this from a company perspective, how do you think your organization stacks up in the hearts and minds of your millennial employees? Do you have plans to do anything differently? I’d love to hear your thoughts.

For more insight on millennials and the workforce, see Multigenerational Workforce? Collaboration Tech Is The Key To Success.

Comments