Hit Reset with Technology as the Trusted Advisor

Guruprasad Gaonkar, APAC SaaS Leader - Office of Finance (ERP) & Digital Supply Chain, Oracle | Thursday, 20 August 2020, 12:03 IST

Hit Reset with Technology as the Trusted Advisor

 

1. Can you pls explain more about the Reset that you are talking about and why is it only in ERP

The world is no longer linear. Changes that used to happen over one decade are happening in couple of weeks. This change is not just about the technology, but it is also about the culture and reception of this culture. What started as a temporary situation, has turned into a definitive change in the world. Overnight switch to work-from-home, ingrained rapid decision making in business & strategy and “zero-touch” world. The genie is not going back in the bottle. Fast-forward into the future 2030, a job market in transformation with 85% of the jobs then do not exist yet, advanced robots that can recognize objects and handle tasks that previously required humans will promote the Intelligent operation of factories and other facilities 24/7. 75% of the current S&P 500 company will be replaced. The next normal is going to be here faster than we think. For the same reasons where a legacy car cannot be converted to an autonomous car, your legacy ERP on-prem or cloud hosted ERP cannot be converted to self-driving ERP as a service application. This evolution of ERP as a service platform will be measured on business outcomes driven by continuous frictionless innovation as a service, not just a point technology application aimed at production or operations.

2. What are the various components of this reset? How will this reset make sure that businesses withstand any such disruption in future?

Over next few years, agility will take on a new meaning - the ability to explore multiple cash flows and supply chain domains at once and combine them into something valuable. CFOs will need to work with all stakeholders, to synthesise transformative ideas, supplementing them with data, and then working with the CEO to bring it all back to the board. In order to make a greater impact, businesses need to go slowly, as they need to prioritize building trust amongst its employees and other key stakeholders; collaborating across functions; assessing liquidity and conserving cash; and reaching out early and often to investors to reset performance expectations.

Traditionally, On-prem or even cloud hosted ERP was built on the principles to serve systems of records. Every new  release of ERP packed on more and more functionality with growth in business requirements but worked exactly the same way as the last version. By today’s standards, those ERP are museum pieces. Cloud computing, artificial intelligence, and big data have fundamentally changed IT and the workplace.  In today’s context traditional  ERP is the biggest obstacle in  the way of organizations looking to reset to the next normal. Inverting the ERP pyramid is about ditching these complexities for self-driving “ERP as a service” platform leading to business outcomes driven by continuous frictionless innovation as a service, not just a point application aimed at production or operations. Consider this, 92% of transactions automatically reconciled; global intercompany balances across hundreds of legal entities reconciled in 90 minutes; expense allocations reduced by 98%; accounting for open purchase order accruals globally is complete in just three hours; and, the company reducing its manual accounting by 35% with multi-ledger, multi-currency journals. In other words, this evolution of ERP as a service into enterprise business capabilities is driven and controlled more by the business measured by business outcomes than by IT.

3. What are the key things that CFOs need to bear in mind while opting to reset?

CFOs need to make sure that they do not take their eyes off from the control panel. In coming months, the new normal will unveil itself and the CFOs have to be in the driver seat to steer the organisation by adjusting the performance of the organisation as the situations unfold themselves. The CFOs need to make sure that they are armed with insights based on real time data. Most importantly, CFOs must now permanently build speed and flexibility into forecasting, planning, and resource-allocation processes and incorporate new tools and rapid decision-making protocols into the finance team’s day-to-day work.

Gartner says that 90% of the organisations lack a post-modern application strategy and execution ability. When you take that into picture, a self-driving ERP as a service will be a platform for leading business outcomes. ERP evolution will not be about functionality, but it will be about business outcomes. ERP will become the centre of business strategy and not a singular piece of technology. So,  we need to hit re-set on ERP which will give rise to the next generation or next evolution of ERP as a service which is more about business outcomes than IT.    

4. You must have witnessed accelerated pace of digital transformation post the health crisis. Can you pls share some examples       with us?

Tech-enabled transformation increases shareholder returns by 9 to 22 percent according to a recent McKinsey report, increase in revenues, expand margins, and to pursue new revenue streams with different business models. We will need to rethink old notions about how we connect data and intelligence across Cash flow, liquidity, and supply chains. Specifically, we will have to manage two profound shifts from resetting iteration to everything as a service that will force us to widen and deepen connections between business partners, technology, and information rather than just moving fast and breaking things.

Hindalco Industries Ltd, the aluminium and copper manufacturing major, was facing multiple challenges when it came to seamless collection of data from various locations and then filing financial reports on a real-time basis. The ability to close books quickly – with quality, accuracy and in full compliance with regulatory standards is a critical challenge that can impact a company negatively, if standards are not met. To simplify their processes, Hindalco adopted Enterprise Performance Management (EPM) Cloud and streamlined their financial management and regulatory reports by utilizing the power of data and smart automation in a cost-effective manner.

Aurobindo Pharmaceuticals integrated their ERP, Oracle transport management on cloud and Logistics Service providers systems and has been able to address most of the operational challenges successfully. They have brought operational excellence, cost optimization that too with a lean team. They can achieve productivity enhancement, complete process visibility, and tracking improved compliance on claims and complaints resolution. We have automated around 80% manual process related to export operations which have helped them in reducing the FTEs by 30%. It also has contributed significantly to cost optimization on overall logistics operation. Aurobindo has been able to run their logistic operation in a truly digital way. Going forward, as part of OTM Phase II, they are planning to include import-related logistic process as well on the OTM cloud. This will include financial controls related to Imports and Domestic transactions –- 100% financial transaction control and visibility.

 5. What are the various innovations that Oracle offering finance leaders in building resilience and return of growth?

Oracle announced important updates to Oracle Fusion Cloud Enterprise Resource Planning (ERP) and Oracle Fusion Cloud Enterprise Performance Management (EPM) to help finance leaders face the biggest challenge of their careers. These important updates help finance teams leverage technologies including AI, digital assistants, and analytics to enhance productivity, reduce costs and improve controls. In addition, new industry solutions enable customers in Oil & Gas, Manufacturing, and asset intensive industries to improve business processes and achieve faster time to value. New AI and machine learning, analytics and security capabilities of ERP include:

  • Predictive Planning: Helps organizations identify and leverage trends and patterns in financial and operational data. With access to predictions at data load time, organizations can see prediction and forecast variances, identify variance patterns, and make plan revisions on the fly to improve the quality and timeliness of decisions. Predictive Planning is now available in EPM.
  • Intelligent Code Defaulting: Helps organizations improve the accuracy and efficiency of processing payables transactions by leveraging machine learning to recommend account codes. The algorithm adapts based on past actions to evolve with business changes.
  • Intelligent Document Recognition: Improves the accuracy and efficiency of financial information ingestion from PDF and other popular financial document formats to reduce (or even eliminate) manual invoice entry. The system learns over time and adapts to changes within invoice formats to increase accuracy as businesses evolve.
  • Digital Assistant Skills for Time Entry and Projects: Help organizations reduce the effort required to submit and review time sheets, track the status of projects, and escalate time entry and project management issues. As a result, the new conversational user interface improves the user experience and increases business efficiency. 
  • Embedded Incident Management: Helps organizations enhance data protection by providing intuitive, embedded incident reporting workflows that can be used to conduct investigations, create actions, and track and update incident status.
  • These latest innovations are designed to help finance teams rapidly adapt to the current economic climate, explore new business models, improve strategic decision-making, and begin the journey back to growth. While there is no easy solution to the challenges that finance teams face, my team is committed to helping customers adapt as best they can and plan for whatever comes next.

 

 

 

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