Future Belongs to Intelligent Enterprise Apps: Veera Swamy Arava, SAT Infotech
Intelligent ERP will take over a lot of mundane tasks that the employees need to perform to get some data out of the ERP system.
Veera Swamy Arava, CEO and director, SAT Infotech, tells us more. Excerpts from an interview.
BW CIO: Tell us about the emergence of intelligent ERP? Why is this conversation relevant for today’s enterprises?
Veera Swamy Arava: Intelligent ERP has been a strategic discussion in the enterprise tech world for a while now and organizations have already begun adopting it. From a technology stand point, the main characteristics of an intelligent ERP system is the use of machine learning and predictive analytics to bring in advanced levels of automation. The system will invent on its own based on the data received from the users and become more of a proactive system rather than a reactive system.
For instance, intelligent ERP will take over a lot of mundane tasks that the employees need to perform to get some data out of the ERP system. The biggest demand that digitization brings forth is the need for this kind of augmented user experience. IDC predicts machine learning as a key way to provide this differentiated, assistive user experience.
You will also notice that most of the application suppliers have announced their roadmap for incorporating machine learning in their applications. I would say, the emergence of intelligent ERP systems is part of the enterprise transformation from the pre-digital era. It is the most relevant component of an enterprise’s digital transformation strategy.
BW CIO: What are the concerns that intelligent ERP is promising to address, which the traditional ERP systems could not resolve?
Veera Swamy Arava: There is a very interesting analogy about intelligent ERP and traditional ERP systems. Sticking to traditional ERP is like trying to slice a pineapple with a toothpick. You might eventually cut the pineapple, but it would have been more logical to use a sharp knife. I think this pretty much sums up the role of intelligent ERP or i-ERP systems.
The first generation of ERP systems have been integral in driving automation and optimization of business processes for two decades. Businesses that implemented an ERP software did gain a competitive advantage in the market, because they had more streamlined processes.
That said, ERP was still a back-end system; something that did not contribute directly to your sales. However, in this digital era, the business asks have changed drastically, and traditional ERP systems are often not able to keep up with the demands.
I think the i-ERP system brings about changes predominantly in three areas—flexibility, complexity and agility. The traditional systems are very complex to implement and manage. They are more linear or monolithic in nature and involve significant amount of mechanical processes.
These approaches evidently don’t work for today’s agile businesses—not just ERP, but any other application for that matter. In fact, about 85 percent of a customer’s brand experience will reportedly occur without any human interaction in the next two years. And the new-age ERP systems will be crucial in enabling those experiences.
BW CIO: Cost has always been a big parameter in ERP implementations. How is i-ERP addressing this?
Veera Swamy Arava: Traditionally, ERP implementations are associated with huge and unpredictable costs. This is primarily because implementation time-lines take longer than expected, due to the sheer complexity associated with it. Even if the implementation is completed within the expected time period, there will be significant cost associated with maintenance, management and updates. Add to this the cost of resources to manage this complex system, and the economics becomes a lot more volatile.
This is bound to change. Intelligent ERP systems are easier to install, use and reduce the overall operational cost, since manual, time-consuming processes are replaced by automated, streamlined processes with real time business information. Besides, the cloud model of it adds further cost efficiencies to the equation.
BW CIO: What kind role does cloud play in accelerating the journey to i-ERP
Veera Swamy Arava: All intelligent ERP systems have to be cloud-native. In fact, it’s the cloud model of it which empower the core features of an i-ERP system—the flexibility, ease of use, mobility, agility and the cost benefits. Traditionally complex on-premise models fall short in many aspects in realizing these very essential goals of an enterprise today.
Businesses today have extremely challenging infrastructure requirements. They need to make sense out of massive and heterogeneous data sets, almost on a real-time basis, to support quick decision making. Without a cloud architecture—an open cloud architecture at that—businesses will struggle to achieve this.
I would say, cloud is an absolute necessity for organizations for this shift towards intelligent applications. Which is also why we are seeing enterprises increasingly preferring a hybrid cloud model. Existing investments on any on-premise application infrastructure isn’t an excuse to stay away from cloud any more. When it comes to new ERP implementations, more than half of the organizations are already moving to cloud.
BW CIO: Which are the industry verticals that see faster adoption of i-ERP? And why?
Veera Swamy Arava: I think, irrespective of the industry, intelligent ERP will become a necessity for most organizations. However, i-ERP will have more relevant use cases in the manufacturing sector, because that’s where automation is making giant strides. The advent of IoT, industry 4.0 frameworks and smart factories certainly call for an intelligent core—the ERP.
Studies show that only a meagre 16 percent of IoT decision makers in the industrial companies consume IoT data in ERP software. This is limiting these organizations’ digital transformation potential, considering that IoT is the main driver of digital transformation in the manufacturing sector. In the next two years, this proportion is expected to change drastically, as manufacturers automate large-scale processes and speed up their execution times with the help of systems like i-ERP.
Reports predict that the future belongs to intelligent enterprise applications, which also includes the ERP. What does this mean for organizations going forward and what are the challenges they will face?
The use of machine learning and natural language processing is predicted to have a broad impact on most enterprise applications. The collaborative effort to incorporate intelligence will be the next disruption in enterprise application space. This will have a lot of impact on user experience, business process, and data, and they way we currently define them.
In next three years, “intelligence” will be a key parameter for enterprise application purchases, according to research agencies. I think the biggest challenge will be how these intelligent applications can eventually be integrated with the “not-so-intelligent” parts of the enterprise, which will include some existing applications, the infrastructure and our current data strategies.
