Cloud computing. The Internet of Things. Everything-as-a-service (XaaS). Artificial intelligence (AI).
The ongoing wave of technological advancements is changing every aspect of how we live and do business. The high-tech industry is the primary architect of these innovations. Yet because many have the potential to enhance myriad services and products, other industries are adopting them. For example, Johnson & Johnson is developing personalized joint replacements using 3D printing. Several companies are exploring how to use virtual reality (VR) to improve special-needs education. And a company in Sweden is outfitting its employees with implanted microchips that replace everything from keys to ID cards to PINs.
Today many high-tech companies have extensive, complex systems and networks. They’ve been developed over time – frequently in a siloed structure. In today’s marketplace, this typically results in a number of challenges to the high-tech supply chain:
- Lack of visibility, communication, and coordination
- Inconsistent and inaccurate information across functional areas
- Inability to predict future supply and demand
- Lack of real-time data, resulting in inefficient planning
- Inability to integrate data across disparate systems
- Inefficient strategies
These issues adversely impact companies’ ability to fulfill orders efficiently, accurately, and on time. This diminishes the customer experience and can result in customer attrition. Moreover, the complex structures complicate the user experience for employees. They make it difficult to integrate new functionalities, and they affect security. Finally, these inefficiencies compromise overall performance and result in wasteful processes.
So many high-tech companies are looking to simplify and digitalize their process, across their entire value chain, to improve communication and coordination within the organization, as well as with suppliers and customers. They want to provide an improved customer experience, streamline their business processes, and remain scalable, agile, and responsive to opportunities and challenges.
High-tech companies redefine their core activities
At the same time, high-tech companies aren’t immune to the changing business landscape. To remain competitive, they must redefine their core activities. They must recognize and embrace the opportunities innovation offers them and adjust their strategies. Adobe is a good example of this. It started as a company that offered software in a box. Now it’s the market leader for creative and document management solutions in the cloud. Lexmark, which used to be a manufacturer of printers, is another good example. It’s now positioning itself as a provider of print management solutions.
In this new digital world, customers expect personalized service and more value-based solutions. This is driving the creation of new business models. Many high-tech companies are moving towards providing outcome-based solutions for their customers. These are comprehensive solutions that can include software, hardware, and services. Outcome-based solutions frequently require companies to partner with multiple suppliers from their networks. To do this, companies need powerful, scalable platforms that connect customers, companies, and suppliers.
High-tech companies need a powerful digital core
To compete effectively, high-tech companies need to consolidate networks and systems. They also need to reduce complexities and increase visibility by streamlining all aspects of their operations.
User experience is key; employees, customers, partners, and suppliers expect a mobile-first, anywhere, any-device user experience. Improving user experience can improve employee productivity and engagement. With centralized launch pads, multichannel supply-chain management can be simplified to the point that a single employee can manage the entire process from input to payment.
Some of the capabilities that are critical for high-tech companies include powerful inventory management, accelerated material requirement planning (MRP), and enhanced scheduling tools that enable accurate available to promise (ATP) functionality. This enables companies to fulfill orders accurately and on time. In addition, data analytics and graphical simulations enable the projection of various scenarios for sales and operations planning (S&OP) purposes. This also facilitates accurate response planning, providing rapid corrective action to be taken when necessary.
SAP S/4HANA as a digital core provides a robust platform for high-tech companies’ operations and can be supplemented with point solutions as needed. This rapid pace of change is likely to continue, so having a foundation that allows you to run your business and innovate on the same platform is a competitive differentiator. Read the value paper to find out the value that SAP S/4HANA can bring to your company now and how it will set you up for success in the future.
Learn how to innovate at scale by incorporating individual innovations back to the core business to drive tangible business value by reading Accelerating Digital Transformation in High Tech. Explore how to bring Industry 4.0 insights into your business today by reading Industry 4.0: What’s Next?