Compared to enterprise software which relies on passive algorithms to simplify tedious tasks, intelligent enterprises depend on the power of machine learning to empower employees.
Every day, technology is used in thousands of ways to bridge the gap between human needs, products, and services. From the ubiquitous smart phone which uses your location data to suggest eating spots, to smart cities and even smart factories—anticipating human needs has always helped businesses to increase sales, reduce waste, and give personalized services. Automation and machine learning have changed our lives in the past decade and now businesses are looking at ways to incorporate these technologies into their core operations. The idea of using real-time software-based solutions to help make work flow seamless and cut down on repetitive tasks is gaining popularity.
Central to this new school of thought is the concept of ‘intelligent enterprises’. The term refers to a management approach that applies technology to the challenge of improving business performance, and is driven by a blend of technology-based services and a higher understanding of human behaviour. But how are intelligent enterprises different from traditional knowledge-based business solutions and what are its benefits for companies?
What is an intelligent enterprise?
Traditionally, businesses have depended on Enterprise Resource Planning (ERP) systems to run smoothly. However, in the knowledge economy, traditional advantages like larger production capacity, lower costs, and proprietary technology are counting for less and less. Nowadays, technologies such as mobile, cloud computing, Internet of Things (IoT), big data, and predictive analytics can be employed to make superior judgments and choices.
Compared to enterprise software which relies on passive algorithms to simplify tedious tasks and run operations on schedule, intelligent enterprises depend on the power of machine learning to empower employees with actionable information provided at the right time.
Digital enterprises can make the way they function more seamless by embedding active algorithms directly into customer-facing systems, which will not only handle repetitive tasks such as invoice and payment matching, but also uncover usage patterns and insights to drive as much efficiency and flexibility from available infrastructure as possible. This elevates the role of the company’s ERP from a mere tool to an important driver of the company’s growth.
How Intelligent Enterprises create value
According to the MIT Sloan Management Review, a journal published by Massachusetts Institute of Technology, intelligent enterprises today are being shaped by “two distinct forces. The first is the growing power of computers and big data, which provide the foundation for operations research, forecasting models, and artificial intelligence (AI). The second is our growing understanding of human judgment, reasoning, and choice. Decades of research have yielded deep insights into what humans do well or poorly.”
This means that companies are not only looking into digital solutions to cut waste and anticipate customer demands but also monetizing their new found data driven capabilities to create new business models that generate revenue.
As sensors and connectivity become more common, enterprises have an increasing ability to measure the outcomes of the services they deliver. However, to fully harness this information and turn big data into “smart data”, companies need intelligent software such as SAP S/4HANA, which is built for medium enterprises, sister concerns of larger corporations, and local public sector institutions. It can integrate all business processes, turn real-time data into actions, and in effect, increase employee productivity and enable businesses to innovate.
As work forces get leaner and business cycles get shorter, top executives can no longer afford to postpone important business decisions till they can fully interpret the data. SAP’s enterprise software is designed to continuously learn and adapt to new data as it comes in, without a user having to be involved. Additionally, this information is presented in formats they are familiar with, and enhanced with recommendations to make them more effective.
For example, with enough historical data about previous sales, an intelligent system can tell a sales rep which opportunities that they are working on will likely close this quarter, and recommend what steps one should take to make this more likely.
Surviving the relentless innovation
In a digital economy, the pace of innovation is relentless. A white paper by the World Economic Forum said that as the revolution is already transforming companies and even entire industries, analog incumbents – large, successful companies that predate the digital revolution – can feel like they are being ‘hunted’ from all sides, with hundreds of startups attacking traditional markets.
While most companies already understand the power of using AI, IoT, cloud, robotics, and mobile in daily operations, to become a fully-digital enterprise requires far deeper changes than merely investing in the latest technologies.
This involves fundamentally rethinking their business model to see where technology can increase efficiency and a new policy towards fostering digital talent.
According to SAP, to become an intelligent enterprise, businesses need to invest in three key areas: an intelligent suite, intelligent technologies, and a digital platform.
Leading industry software giant SAP, which is engaged with companies in over 25 industries, said in a research paper that successful companies working towards enterprise intelligence focus on the following five capabilities:
Discover how advanced solutions from SAP can help your mid-sized business transform intelligently.