In May 2019, SAPPHIRE NOW + ASUG Annual Conference in Orlando, Florida brought together SAP leaders, partners and customers to discuss the latest ideas, technologies and platforms transforming businesses today. This blog is the second in a series highlighting the most important lessons we took from this year’s event.
Lesson 2: Megatrends will disrupt the financial landscape
Money is moving into and out of organizations faster than ever and finance leaders, as a result, are facing challenges on all fronts. To remain competitive, organizations need solutions that take advantage of the latest technology and leverage intelligent automation. Find out about the four megatrends that were in the center of discussion at SAPPHIRE and how you can leverage them to achieve efficiency, visibility and secure financial processes.
Trend #1: Process transparency and efficiency from end-to-end
Your organization can achieve great benefits by connecting all parts of the payment process. This means automating not only one particular sub-process but also the pre- and post-processes. Look at the inbound payment side: the goal is to create a straight-through process incorporating customer orders, credit risk assessments and limit approvals, cash application as well as collections measures and dispute resolution. On the outbound payment side, an end-to-end process includes supplier evaluation and management, invoice and accounts payable processing as well as payment management. All of this is supported by processes in cash and treasury management as well as a method for securely retaining the data and documents generated by these processes. The result is a hyper-connected universe of payments, increasing efficiency and transparency for all involved departments.
What does this mean for your business and what should you do now? Well first, you should critically assess your current processes. Where can you overcome silos? Where do you have roadblocks? Are your processes technologically integrated or do you use different solutions for different areas, which can hinder collaboration and a free flow of information? Look at solutions that do not only cover parts of your overall process but the entire spectrum.
Trend #2: Moving business to the cloud
Cloud gives you advantages you will need for your digital future: It provides the additional cost reduction and flexibility required to adapt to the rapid pace of business change. It also allows you to focus on your core business by getting rid of unnecessary IT complexity and makes it possible to take advantage of advanced cognitive applications such as machine learning and artificial intelligence, which run on cloud platforms. According to Gartner, in 2019, cloud first strategies are essential and hybrid IT will be the standard.
If you are looking into the cloud, you should evaluate the potential benefits this technology can offer your organization. Do you want greater flexibility regarding costs? Do you need to scale your solutions globally? Do you want to standardize processing using proven and state-of-the-art solutions? These and many more critical questions come to mind.
Trend #3 Cognitive computing is conquering the world of finance
Automatically processing transactions and providing real-time information can increase the velocity of entire business processes. Organizations benefit from faster, better decision-making by integrating machine learning into key finance processes. However, organizations need to keep in mind that the “learning” process takes time and a tremendous amount of data to become as effective as a knowledgeable staff member. Similarly, many organizations still have a long way to go to integrate artificial intelligence (AI) and deep learning into their business processes. But as more companies migrate from traditional on-premise systems to enterprise cloud solutions with embedded AI components there will be a rapid increase in the use of AI in daily business operations. Robotic process automation on the other hand is best used to automate repetitive and rule-based transactions that are not very complex.
When it comes to cognitive technologies, you should think longer-term. You might not have use cases today, but with ever-growing data and applications getting smarter and more connected, you will probably identify potentials for machine learning and AI sooner than you think. Consider how algorithms and predictive analytics can give you greater insight and visibility. Alternately, think about how chat bots can automate your customer support and engagement, enhancing the digital experience of your clients.
Trend #4: Blockchain – taking out intermediaries
The benefits of blockchain are intriguing: A distributed ledger, which is transparent and accessible for anybody, allowing parties to reach agreement on a unique and common digital history. Digital assets and transactions are protected without the need of a trusted third party. Blockchain eliminates intermediaries from the process, reducing cost and increasing processing speed with direct peer-to-peer communications and transactions. It creates an “unchangeable” reality to maximize security and avoid fraud.
When you look into blockchain, think about scenarios in which this technology makes sense.
Does the process involve multiple parties? Could you gain more value from a trusted multi-party relationship? Can you digitize agreements with partners? Do you need to improve traceability along supply chains? Could you benefit from blockchain-based digital identities? There are many ways how blockchain can assist you in differentiating yourself from your competitors. However, of course you need to make a solid business case.
Eager to learn more about the most important learnings from SAPPHIRE NOW 2019? Stay tuned for the next blog in this series: Lesson 3: Successful Companies Need the “X-data” Factor