A recent Digital Transformation study by SAP, supported by Oxford Economics, surveyed more than 3,000 executives in 17 regions around the world. In the study, 84% executives agreed that digital transformation is critical to their survival – especially in the next five years. But only 3% had completed company-wide transformation efforts. While the CXOs understand this need, there is still a big gap between their level of awareness and actual deployment of the technologies that enable true digital transformation. Kamolika Peres, Vice President & Head – Strategic Customers, SAP India, in an interview with Priyanka Bhattacharya, talks about the state of digital transformation in the Indian enterprise. She explains how SAP is working with its customers to co-innovate to help them in digital adoption. Excerpts:
What is the state of digital transformation globally today? How much of it is a hype and how much of it is a reality?
Companies are beyond the stage of awareness when it comes to digital. CXOs have already realised the power of technologies like AI, IoT and cloud, while ones like blockchain and augmented reality are cropping up on their horizon. This has led to the pace of digital adoption to go from 10 years to as little as a week. Digital leaders are expecting their firms to grow their revenue by 10-15% and reduce costs by 15-20%.
In a recent Digital Transformation study by SAP, supported by Oxford Economics the top 100 companies that reported some of the biggest transformations acknowledged substantial benefits that were brought in as a direct result: 85% witnessed increased market share (vs. 41% for the rest), and 80% mentioned increased profitability (vs. 53% for the rest). The upcoming decade will see increasing tectonic shifts, as the true indicator for success will be a company’s ability to embrace digital technologies.
How mature are the Indian companies when it comes to digital transformation? What is the rate of adoption of technologies that enable digital transformation?
Last few years have witnessed a sense of urgency among Indian conglomerates to embark on their digital transformation journeys. An influx of new-age technologies like AI, ML, big data analytics coupled with the rise of younger ‘digital age’ start-ups is a primary reason behind this trend. In India, CEOs are realising the importance of a digital core. However, the need of the hour is to close the gap between digital strategy and execution – which is one of our primary goals while working with India Inc.
Are Indian organisations willing to move from legacy systems and processes to innovation to become intelligent enterprise?
Having said that, we are witnessing a clear shift in vision amongst Indian corporations, as CXOs look to drive a complete digital transformation of the enterprise. As a matter of fact, non-traditional sectors like manufacturing and utilities, that were once perceived as laggards, have also realised the importance of digital. Case in point, Kansai Nerolac, an industrial paints company, decided to move on from its legacy-based systems in early 2000s and is currently in the process of deploying new-age technologies through SAP Leonardo. This is a prime example of how enterprises are not realising the value of future-facing technologies but are also constantly on the lookout for a digital “upgrade”.
How does SAP co-innovate with its customers to help them in digital transformation?
At SAP, we have always believed in collaborative innovation to make a larger impact on the industry and in turn the economy as a whole. It is a proven fact that harnessing the expertise of a digital transformation leader is a key solution way for businesses to avoid being disrupted.
SAP is the world’s largest enterprise software provider with more than 404,000 customers in 180+ countries. One of the key challenges faced by our company ecosystem was to figure out how to work together internally and with our partners, to effectively and collaboratively serve our customers. To address these challenges, the SAP Co-Innovation Lab (COIL) was created in 2007, to provide a physical environment for SAP, customers and partners to collaborate on solutions and offerings that can help address pressing business challenges and opportunities.
Case in point – the L&T Group, which was one of our first customers in the APAC region and has been using SAP across most of its divisions since 1992. This 360-degree relationship between the two parties unique, and positions L&T well to design, implement and evolve the SAP landscape. L&T Infotech is a client, a Services Partner and a Value Added Reseller of SAP. As a part of this on-going relationship, SAP and L&T also collaborate to offer innovative customised industry solutions.
The next generation of tech you are working with to co-innovate with your customers?
In the recent past, we have had deployed various co-innovation initiatives dealing with new-age technologies like Analytics, Blockchain, AI etc. Our ever-increasing portfolio of offerings has helped speed up innovation across the value chain.
SAP Leonardo, one of our most versatile and recent offerings, is a digital innovation system combining machine learning, IoT, blockchain, analytics and big data backed by the power of Cloud. Last year we globally launched the SAP Leonardo Blockchain Co-Innovation program, giving our customers and partners the opportunity to explore applications including registering events to blockchain from product inception and design to manufacturing and logistics phases for product track and trace.
As a part of this program, companies including Capgemini, Deloitte, HCL Technologies, and NetApp are collaborating with us globally to validate use cases and business models for blockchain usage for product and asset lifecycle management solutions from SAP.
What is the scope of business growth for SAP, as organisations move towards digital transformation?
In today’s enterprise landscape, companies are facing challenges from all directions. Additionally, as speed becomes the prime characteristic of winners in the digital economy, it is the large conglomerates that will face the biggest hurdles. The Intelligent Enterprise builds upon the promise of digital transformation by applying data-driven intelligence to drive automated actions and decisions based on superior insights. With the underlying power of cloud technology, an intelligent enterprise helps companies of all sizes predict change while leveraging human intelligence to drive key decisions. Therefore, by adopting the capabilities of an intelligent enterprise, our customers can achieve game-changing outcomes faster, more effectively, and with less risk.
With this in mind, we recently launched SAP C/4HANA, an integrated offering designed to modernise the sales-only focus of legacy CRM solutions. This development helps SAP tie together solutions to support all front-office functions, such as consumer data protection, marketing, commerce, sales and customer service. Our intelligent suite of integrated applications offers a best-in-class user experience, that is consistent across the entire value chain. With better data orchestration, access to a growing number of intelligent use cases, and stronger integration capabilities, the SAP portfolio will create a virtuous cycle that delivers on the vision of the Intelligent Enterprise.