1. Summary
On average one S&P top 500 company is now being replaced once every two weeks by an intelligent enterprise who can quickly integrate their intelligent technology driven product and services into their agile business models, ERP platforms and enterprise architecture.
Many companies are upgrading their ERP platforms (e.g. SAP ECC to S/4 HANA) and enterprise architecture to build an intelligent enterprise architecture with embedded analytics and an application / micro-services extension framework.
The core value streams of an enterprise (e.g. Order to Cash, Source to Pay, Design to Operate) should be improved by utilizing new intelligent (industry 4.0) technologies.
In this article we will answer questions like;
1 What are the design principles of an intelligent enterprise?
2 What is an intelligent enterprise architecture?
3 The roadmap to the intelligent enterprise architecture
4 The agenda of the VNSG seminar ’roadmap to the intelligent enterprise’ on 12 March
The following companies will give a presentation during the VNSG seminar; Shell, Philips, Miele, NS, SAP and Centrient (DSM).
2 What are the design principles of an intelligent enterprise?
The intelligent enterprises are gaining momentum and innovate faster than the competition, create new markets, capture mind-share and accelerate their value proposition creation towards their customers. As switching costs decline, empowered customers expect companies to build intuitive products and provide seamless user experiences.
Intelligent enterprises like amazon are reshaping industries through agile business models and have design principles like;
1 Think Customer centric
2 Serving the segment of ‘One’
3 Digital SMART products
4 Digital supply chain and smart factory
5 Agile servitization business models
The design principles will determine the required transformational capabilities (requirements) for the intelligent enterprise, the following picture gives an overview;
Every company has their own set of intelligent design principles and required capabilities to make the company more successful. The required transformational capabilities should be integrated in the existing business process architecture.
3 What is an intelligent enterprise architecture?
Every intelligent enterprise needs a business (process) architecture which has the core value streams (e.g. market to cash, source to pay, design to operate) interconnected to each other, supported by 2 major governance value streams (business model to project portfolio, enterprise architecture to ITSM application portfolio). The following picture gives a high level overview of a Business Process Architecture for an industrial enterprise;
The core value streams of an enterprise can be improved by utilizing new intelligent (industry 4.0) best practices and data generating technologies, examples are;
1 Market to Cash
a. Smart configurators (personalized product offerings)
b. Servitization (personalized service bundles)
c. CLTV analysis by customer segment (personalized profitability analysis)
2 Source to Pay
a. Smart 3D printing (product on demand)
b. Intellectual asset management (product intellectual licenses)
c. Spend analysis by product category (product cost management)
3 Forecast to demand
a. Smart partnership collaboration (co-design & predict product sales)
b. Smart cross channel collaboration (co-design & predict value sourcing)
c. Integrated business planning (co-design & predict profitability)
4 Design to operate
a. Integrated business planning (optimize production planning)
b. Smart factory (optimize plant management)
c. Digital twin (optimize asset management)
5 Accounting to profitability
a. Block chain (flexible payment networks)
b. Pay per use (flexible billing engine)
c. Automated profitability analysis (flexible profitability analysis)
6 Business model to TOM project portfolio
a. Business model (Prioritization Product Market Combination)
b. Target operating model (Prioritization Key Design Decisions)
c. Project portfolio management (Prioritization Project portfolio)
7 Integration services
a. Industrial platform services (Industrial data science)
b. Co-botics & IoT logistical services (IoT device management)
c. Risk & security services (real-time security audits)
d. Application integration services (API economy)
8 Enterprise architecture to ITSM application portfolio
a. Enterprise architecture framework (EA standards)
b. ITSM standards (ITIL standards)
c. Application portfolio management (Application portfolio standards)
The intelligent technologies should be aligned with the enterprise architecture standards.
More information on enterprise architecture can be found in my previous blogs; https://www.linkedin.com/pulse/how-can-enterprise-architecture-support-digital-business-frank-luyckx/.
4 The roadmap to the intelligent enterprise architecture
Many companies want / have to upgrade their ERP platforms to an intelligent enterprise architecture because of;
A The support of the ERP platform stops (e.g. SAP ECC at 2030)
B The ERP platform does not support the new technologies (e.g. embedded analytics)
C The ERP platform does not support all the cloud integration standards
D High maintenance costs because of modification and complex integrations.
Many companies have the following additional objectives within their ERP upgrade;
A Build future-proof platform and protect the core by simplification & standardization
B Build embedded analytics and connected data sources with cognitive AI services
C Differentiation & innovation at the edge (e.g. IoT)
D Integrate ERP with PAAS capabilities (e.g. SAP cloud platform)
These IT related reasons are mostly not enough to justify the ERP upgrade. Therefore, the ROI must be supported by the impact of the new transformational capabilities on the business model of the intelligent enterprise and on the value streams.
Every value stream owner should define their intelligent enterprise roadmap which consists out of the ERP upgrade project (e.g. the upgrade from SAP ECC to S/4 HANA) and the expected value of the new intelligent capabilities.
Every company should consolidate the input from the value streams within a Target Operating Model (TOM) and build their own roadmap towards the intelligent enterprise.
5 The agenda of the VNSG seminar
On Q1 2021 the VNSG organized a series of 12 webinars based on the industry 4.0 framework.
The follwoing companies have participated within these webinars; Shell, Signify, Miele, Maxeda, ERIKS, NS, Rizing, IDEO, SAP SE en Capgemini. More information can be found in the following blog; https://www.linkedin.com/post/edit/6587683606741692416/
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