Taming Technology: The Run Simple Approach to Transforming Your Business

Irfan Khan

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It’s not a pretty sight when an air compressor blows at a wastewater facility. It’s not pretty for the environment, and the repair bill can be pricey. That’s why predictive maintenance is a top priority for the CEO of Kaeser Compressors, a company that prides itself on delivering state of the art solutions for a range of industrial activities like drilling, pressurizing and vacuum packing. To improve the lifecycle of their products and provide customers with greater insight into maintenance needs, Kaeser measures the performance of their machines through sensors by the second, amassing one million measurements per day, adding up to over one hundred terabytes of data per year.

Kaeser, like many other companies, has been creating big data through machine to machine communications for over 15 years, making them experts on the Internet of Things (IoT). What differentiates them is the way they analyze the data on SAP HANA and use the insights for collaborative research and development projects with their customers and partners, impacting not only their own sales and service teams, but their entire ecosystem. Instead of just managing data, they are getting value out of it, enabling the field force to react faster to customer requirements.

Falko Lameter, the CIO of Kaeser, says the IoT has radically changed the business. Five years from now, Kaeser will be a service provider, not just selling machines but selling a holistic package of services and usage models including fleet management so that the customer just uses the product without having to maintain it. To me, this is a perfect example of the technology trends changing the world around us: connected things generate data, data must be stored and managed, data can be analyzed to gain knowledge which in turn shapes the way business is done.

 

A secret business weapon

Technology has often been used as a secret business weapon, a tool to out perform the competition, increase efficiency and cut down costs. Technology is now becoming so prevalent that it is no longer just a tool to improve the way we do business – it is a disruptive force that is completely reshaping our economy. Black cabs in London, for example, are driven by people who spend three years memorizing every possible route in the entire city and learning how to apply that knowledge to get passengers from point A to B in the fastest, most efficient way. GPS has eliminated the need for that skill, and Uber’s drivers need nothing but a driver’s license to get paid for driving people around, disrupting a traditional business and 70 years of conditioning around the fixed price of taxis.

Many of the dramatic Fortune 1000 changes over the past 10 years had deep roots in technology. For better or worse, the inability to embrace new technology trends is what triggered the demise of such powerhouses as Kodak and Blockbuster. Conversely, the ability to leverage new technologies is what enabled the emergence of companies such as Amazon, Apple, and Netflix.

 

From atoms to bits

Our world is shifting from atoms to bits. Our economy is increasingly dealing with intangible goods and many of the most valuable companies in the world only trade bits. Think about the profound transformations companies must go through to survive that shift. Take the example of a game company. Ten years ago, games were shipped on physical media: cartridges and CDs that ended up as boxes on the shelves of retailers. Their supply chain and order-to-cash processes were not that different from the ones of a company manufacturing furniture or clothing. But who ever buys games on a physical media these days? The same applies to book publishers or the movie industry.

This transition from atoms to bits entails a lot of other things beyond the fact that companies no longer ship boxes. Enterprises today must adapt their complete business models and payment systems to the new consumption models and behaviors which now translate into subscription models and micro-payments.

 

From complexity to simplicity

Without a doubt, technology is a key transformer, constantly reshaping the world we live in. Each new shift in technology, however, adds more layers of complexity. Consequently, companies are often overwhelmed by business challenges and need guidance along with simplified solutions.

For us at SAP, the way to combat complexity is to run simple and to do so, you need to have one truth, one platform and one experience. By one truth we mean having a holistic view of the entire business. To provide a holistic view, we offer just one platform, SAP HANA, for computing, consuming, and storing all data, and this platform can be run on premise or in the cloud. And finally, experience is the key to adoption, because if the user experience for consumers and developers is not beautiful, the platform will not be adopted.

In my next three blogs, I will explain in detail how SAP’s Run Simple approach helps enterprises benefit from the great technology trends shaping the world today: cloud, big data and the IoT, and the business networks of the new connected economy. Companies that are already running simple, like Kaeser Compressors, will not only survive technology trends but thrive as leading innovators in the years to come.

 

Stay tuned!

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