Driving a Digital Transformation on a Central Integration Platform

Bill Metallo, VP Sales, SEEBURGER, joins SAPinsider on a podcast to discuss what it means to integrate activities onto a single platform in a digital transformation. Topics of this discussion include:

• How a reliance on legacy systems to run digital processes hampers a true digital evolution
• Why the IT department is often the strategic leader in driving digital innovation
• The importance of adopting a holistic integration approach in tying digital processes and technologies to a back-end system

Ken Murphy, SAPinsider: Hi, this is Ken Murphy with SAPinsider and I am pleased to be joined on this podcast by Bill Metallo, who is the VP of Sales with SEEBURGER, which is a platform and business integration company that helps companies of all industry types undertake successful digital transformations. Bill, thanks for joining me today.

Bill Metallo, SEEBURGER: Glad to be here Ken.

KM: Bill, I’d like to start with a definition of digital transformation. Tell us what it means for the enterprise and maybe address some of the hurdles for companies that stand in the way of making that digital transformation.

BM: I’d first say that digital transformation can be a bit of a far-reaching buzzword and it’s certainly a hot buzzword today, but I’d like to break it down really to two more simple areas. One is it’s the use of digital technologies to change a business model and produce more revenue opportunity. At the end of the day, that’s what we’re looking to help companies do. And I think the transformation stage means that you’re now using new digital processes and new types of innovation and creativity rather than depending on traditional methods you may have at your disposal. We see companies that try to leverage old technology, legacy technology I should say, to do these new digital processes and sometimes get themselves in a little bit of trouble. And I think you’ve really got to look at the speed and agility today that the new technologies offer in developing new business models.

KM: Speaking of that speed and agility, what are the challenges that the enterprise has, those with a complex landscape of cloud and on-premise legacy systems – what are their challenges in adapting to that digital framework?

BM: I see the challenge as really as both cultural and technical. And frankly I think the cultural challenges are the tougher ones to deal with for most companies. As an example, I see a lot of IT organizations that built up siloes of technology through the years and they can be very protective of these previous technology decisions. We’re seeing a big shift in IT today, and IT is evolving very quickly into a more strategic business role leading innovation within these companies and primarily supporting new business models. And I think IT leaders need to be willing to knock down these siloes of technology that they’ve been dependent on, or at least look at more creative and faster ways to tie them together. The technology element often demands the integration of these various on-premise, cloud-based systems integrated into an ERP like SAP and what we’re seeing is a pretty big shift with IT leaders coming to us and asking us how we can help them through the integration layer of tying all this together.

KM: Are there any challenges unique to companies that are running SAP for mission-critical processes, either in the cloud or on-premise or hybrid?

BM: Yes, and any time you have a very complex and sophisticated system like SAP you’re going to have challenges. SAP from our experiences is very efficient at running mission-critical processes once they’re implemented. And as an SAP partner with over 2,500 SAP integrations we advocated the best practice to keep the mission-critical decisions and business processes within the ERP. We’re certainly advocates of that. However, SAP implementations are very large, they’re global and they usually come in waves that span many years. These extended timeframes can present challenges just by the nature of the time and complexity it takes to pull all this together. And that is probably what we see as the challenge within the SAP ecosystem most often. You’ve got these new digital business processes evolving very rapidly, but yet the roll-out of SAP may span over a number of years. And that’s where again we think maybe the integration layer is a place where you should take a look to address some of these challenges.

KM: To that point, then, how does SEEBURGER Business Integration Suite address some of those complex integration challenges you mentioned?

BM: We think the approach is, you have to be very holistic in your integration approach and you have to stay standards, standards, standards as much as possible. We have a very standardized approach to integration. The SEEBURGER platform addresses all forms of integration from traditional EDI to API and web service integration which you’re seeing very much driving the digital transformation area suite. It can integrate systems, we can integrate connected devices through Internet of Things (IoT) and so-forth. So by having a single platform that manages all this, all these integrations of people, processes, devices, all done in standard processes where every connection is basically set up the same way within the platform and so-forth. This is going to lower your costs and decrease the implementation timeframes.

KM: Can you touch on a specific use case or two for the SAP customer, for how they would use Business Integration Suite?

BM: I’ll address three of the more common ones that we see. If you think about, usually following SAP is a big trigger for how our system gets implemented. So when somebody’s doing an SAP rollout, a lot of time they’ll be a handful of legacy applications that are being replaced. They may be older ERP systems, they may be warehouse management systems and so-forth. And all of these systems typically were supporting four or five critical business processes like Order to Cash or Procurement to Pay. And in our more traditional use case you see the replacement of these Order to Cash or Procurement to Pay type processes through EDI or XML type processes. That’s still the most common for us but it’s a more traditional approach. We are seeing a lot more requirements to integrate the SAP to cloud-based applications. A good example of that may be integrating Salesforce.com to SAP. This is quite a common use case that we’re doing today. For the third example, I’d really point to in my opinion is one of the best digital business use cases that we’re involved in and that’s the omnichannel processes that you’re seeing implemented in retail, CPG, and logistics companies. And basically omnichannel is a concept in retail where you give the customer the ability to purchase your products anywhere at any time. So what this creates is a need to really integrate a lot more situations a lot more quickly. For example, you have web shops, you have handheld devices, smartphones, etc. All these integration points come up very rapidly in an omnichannel scenario. So I think that’s probably one of the more interesting ones that we’re involved with today. And in support of SAP applications within the retail, CPG industries, etc.

KM: What are a few ways that customers can measure results?

BM: I would say that customers still most often measure SEEBURGER results with how did the project implementation go? Were we on time? Were we under budget? As they’re evolving from these legacy applications to SAP, and then all these sub-systems for B2B integration and API integration that need to be integrated now to SAP, it’s all part of executing these business processes. From my experience and talking to customers about one-third of the critical business processes within SAP involve an external trading partner or integration into an external system. So as SAP gets rolled out and these critical business processes get rolled out you have to then do the integration in a timely manner. So we’re successful when we accomplish the enablement of these processes with external trading communities and partners and when we do it, as I said, under budget. The other area where I think we get measured the most is there are defined SLA’s for what we do. What’s the uptime for our system? Have we enabled new partners and processes in a timely fashion? Are we reducing the error rate of orders coming in through SEEBURGER into SAP? Are we reducing the error rates of shipments out from SAP to trading partners? A couple industries that are good examples there would be automotive. If your shipments out of SAP to the OEMs are not on-time and within a threshold of error rates it can impact your supplier rating. The same thing if you’re a CPG company shipping to retailers. If you don’t adhere to timeframes and error rate thresholds it’s going to impact paybacks and chargebacks and so-forth. So those are a couple areas where we’re scrutinized pretty heavily.

KM: You mentioned the legacy applications can’t really support the digital processes which is obviously where we’re heading with digital transformations. So what advice would you have for companies who say that they have a complex, highly customized infrastructure and it’s just too complex to assimilate integration activities onto a central platform?

BM: Well, I like to answer those concerns really with giving customer examples, and we often ask those customers to talk to other large complex SAP shops that we’ve done these types of projects for and we certainly have our share of those reference type accounts. But it’s really good for them not just to validate SEEBURGER but also share their experiences. So we always try to get our customers connected with our prospects and so-forth. But I will say that rarely are these big bang scenarios. We typically advise customers to choose an area to start. That may be a new acquisition that you’ve made or maybe it’s a new digital business model that’s being implemented. But let’s start somewhere – but in all cases we advocate doing a blueprinting exercise on the front-end to look at all the integration points, to look at the SAP rollout schedule. Are you doing a global template of SAP? Are you doing a regional template of SAP? What are the dependencies within the business? What are the most critical trading partners to get connected first? It may be suppliers, it may be distributors, logistics providers, etc. Maybe it’s a new digital business model where you need to connect web services connecting into web shops and smartphones and so-forth and your legacy systems didn’t allow for that. So the blue-printing phase allows us to get a game plan. And as a said, rarely is it a big bang process. And typically it’s going to follow the SAP rollout schedule to some degree. If you’re already implemented with SAP the drivers are typically going to be some of these newer business models or recent acquisitions.

KM: Bill, thanks for joining us today to share a lot of information. I appreciate your time.

BM: Great, thank you Ken.