Intelligent Enterprise. It is the buzz phrase being echoed around the SAP ecosphere this year and like many of the other phrases that have emerged from previous SAPPHIRENOW conferences, it is a phrase that seems open to interpretation. I set about trying to understand what “Intelligent Enterprise” means and if it matters.
The first thing I did was Google the phrase. Wikipedia says, “The term “Intelligent Enterprise” refers to a management approach that applies technology and new service paradigms to the challenge of improving business performance.” Wikipedia references a book titled “Intelligent Enterprise” written by James Brian Quinn and published in 1992. I bought the book.
In the book Mr. Quinn presents the business case that business is not about the product created but about customer service. A mantra currently in vogue and frequently repeated. Quinn’s book also encourages businesses to benchmark against competitors and to evaluate each process performed by the business and outsource all processes that the business cannot perform better in house. The following excerpts are taken from the books concluding chapter:
One is not selling hours or machines but the perceived value customers place on a given output and whether individual enterprises are delivering that output at lowest reasonable cost.
The keys to future service productivity lie in (1) selling out and effectively delivering new and greater values for customers, rather than in further routinizing internal operations, and (2) reorganizing the entire relationship between customers and the company’s internal structures and work practices. Both require new strategic applications of service technologies.
Service productivity potentials generally will not be determined by hardware systems or the capacity to lay off workers, but by software and the capabilities of human imagination to conceive creative ways service technologies can be used in new strategic applications.
Quinn makes the case for a focus on service technologies regardless of industry, and bench marking against competitors and outsourcing any business process in which the business is not best in class. “Intelligent Enterprise” as SAP is using the term builds on the foundation set by Quinn. SAP is using the term “Intelligent Enterprise” to refer to embedded machine learning to enable ongoing adaptation to data to enable three key things: customer experience, minimizing cost to drive innovation, and a focus on people “people are what makes the company.”
SAP has helpfully provided an on demand webcast series on this topic with Timo Elliott and Paul Khanna. Khanna offers an outline to achieve Intelligent Enterprise:
- start with a system of record
- move to a system of integration
- leverage the full architecture of the system
- add the applications to create a system of action
- layer what Khanna calls the “cool innovative technologies” for systems experience
For the purpose of this article “system of record” refers to SAP S/4HANA. Discussions could be had on any step in Khanna’s outline but those are for another time. In the webcast Paul Khanna notes, “It is easy to see the benefits (of the intelligent enterprise) when the ‘un-intelligent enterprise’ is well understood.”
Kevin Poskitt wrote “Intelligent Enterprise is the concept that the way we work should be seamless.” Helen Dwight sums this is saying “Executives are realizing that they can no longer be competitive in an efficient way with all these data silos.” And Paul Khanna agreed noting that previously companies divided problems into department problems. Something might be determined to be an accounting problem, or a manufacturing problem but companies are shifting to their view, all problems are company problems and are better solved without the silos.
However Poskitt’s reference to a more seamless style of work can be applied both to companies and to individuals. As machine learning enables adaptation to data the Intelligent Enterprise will be able to enable decisions that reflect the data. Both companies and individuals will be able to take action and align priorities based on collected data essentially taking agility to a new level.
Intelligent Enterprise enables a company to access data collected and prioritize it to take action to improve, customer experience, driving innovation, enabling employees.
For more information:
“What Is The Intelligent Enterprise and Why Does it Matter?” Kevin Poskitt https://www.digitalistmag.com/cio-knowledge/2018/05/17/what-is-the-intelligent-enterprise-and-why-does-it-matter-06167321
“How The Intelligent Enterprise Drives Digital Manufacturing” Mike Lackey https://www.digitalistmag.com/digital-supply-networks/2018/12/03/how-intelligent-enterprise-drives-digital-manufacturing-06194567
“The Intelligent Enterprise: The next frontier and key to success” with Helen Dwight, Timo Elliott, Paul Khanna https://www.sap.com/about/events/2018-10-09-online-intelligent-enterprise-success.html
