IBM and SAP Come Together to the AI Table

Published: 15/September/2023

Reading time: 7 mins

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Key Takeaways

⇨ IBM has infused IBM Watson’s powerful, enterprise-grade AI capabilities into SAP’s leading ERP platform to help businesses reimagine customer experiences, boost productivity, and fuel growth.

⇨ SAP and IBM are collaborating on generative AI and large language models aimed to deliver consistent continuous learning and automation.

⇨ Watsonx is IBM’s enterprise-ready AI and data platform that is designed to augment AI’s impact across business.

Businesses want to speed up their transformations by leveraging data to overhaul their operations. This helps them make informed decisions and boost agility, innovation, and efficiency. Many are also reassessing core processes tied to major systems like SAP. As these businesses delve into novel methods, such as AI, to tap into their transformative potential and gain a competitive edge, they are looking holistically at every aspect of their operations. This includes coding, development, employee engagement, and change management, all in a bid to incorporate AI and Generative AI features for comprehensive business reinvention.

Generative AI garnered widespread attention from businesses, offering a new set of tools that present many opportunities to streamline and enhance their operations. In particular, IBM’s AI solutions, including generative AI, are empowering organizations to secure a leading edge in the market as they cater to diverse practical applications.

For SAP, IBM services encompass upfront envisioning, solutioning, implementation, and sustained application management. In addition to natively embedding IBM Watson AI capabilities into SAP solutions, SAP and IBM are collaborating on generative AI and large language models aimed to deliver consistent continuous learning and automation based on SAP’s mission-critical application suite.

IBM has infused IBM Watson’s powerful, enterprise-grade AI capabilities into SAP’s leading ERP platform to help businesses reimagine customer experiences, boost productivity, and fuel growth. Watsonx is IBM’s enterprise-ready AI and data platform that is designed to augment AI’s impact across business.

“Watsonx is a comprehensive toolkit designed for hybrid AI models. AI is much more than just a transactional command prompt akin to GPT, where you input a query and receive a response. It encompasses text, video, images, and the capability to interpret elements such as tables, histograms, and pie charts within documents. Watsonx provides the foundational tools that unify various AI models, seamlessly integrating their inputs and outputs to address complex business problems. Our clients seek IBM’s expertise in harnessing AI to derive substantial business value, especially when facing intricate challenges. These aren’t mere straightforward database issues or simplistic structured text dilemmas; they are of a grander scale. We are confident that with the right tools in watsonx, we can effectively address these challenges,” says Piotrowski.

The IBM watsonx suite includes three distinct products intended to expedite and enhance the scalability of AI within organizations—the watsonx.ai studio for new foundation models, generative AI, and machine learning; the watsonx.data fit-for-purpose data store, built on an open lakehouse architecture; and the watsonx.governance toolkit, to accelerate AI workflows that are built with responsibility, transparency, and explainability.

watsonx.ai studio: This solution is built with a studio for foundation models, generative AI, and machine learning. Users can train, validate, tune, and deploy foundation and machine learning models with ease. AI creators can utilize pre-trained models from both IBM and the Hugging Face community to handle a multitude of AI development tasks in watsonx.ai. These models are designed to carry out various Natural Language Processing (NLP) tasks such as answering questions, generating content and summaries, and text classification and extraction.

watsonx.data: A fit-for-purpose data store built on open lakehouse architecture that is optimized for governed data and AI workloads. It is supported by querying, governance, and open data formats to access and share data. Watsonx.data provides non-technical users with the ability to independently access their enterprise’s high-quality, reliable data through a unified collaborative platform. It also assists in ensuring the data’s security and adherence to compliance processes by utilizing centralized governance and local automatic policy enforcement.

watsonx.governance: The AI governance toolkit that enables AI workflows to be built with responsibility, transparency, and explainability. It is set to be introduced at the end of 2023.

IBM Watson for SAP

IBM’s AI approach centers on business capabilities and value creation pools, followed by leveraging the right technologies to realize that value. This method streamlines the client’s transformation program initiation, making it quicker. As Piotrowski states, “By segmenting innovation into a distinct phase, we can prioritize and expedite the migration process. Once the migration concludes, we then integrate the innovative solutions that were conceptualized and developed parallelly. This layered approach not only unburdens the migration from excessive design complexities but also minimizes risks by avoiding simultaneous change. It effectively turns the process into a comprehensive transformation journey.”

SAP will harness Watson capabilities to enhance its digital assistant within SAP Start, a consolidated gateway for SAP’s cloud solutions. The introduction of IBM’s AI features in SAP Start aims to enhance user efficiency through natural language processing and predictive insights.

These solutions are anchored in IBM’s commitment to trust, transparency, and data privacy. As Piotrowski comments, “IBM and SAP recently announced that IBM Watson technology will be embedded into SAP solutions. As part of this SAP will integrate IBM Watson to power its digital assistant in SAP Start, the gateway to SAP’s cloud offerings.”

These new IBM Watson capabilities in SAP Start will also support applications such as SAP Success Factors to help answer diverse questions and ultimately provide task automation for managers and employees using natural language.

IBM showcased the efficacy of Watson Assistant within its own HR operations as the company transitioned successfully to a conversational AI chatbot. Routine tasks, like moving an employee to a different department, are now overseen by this chatbot. This enables managers to allocate their time to pivotal decision-making, such as client interactions, rather than manual processes within their HR system, currently on Workday. The outcome is a substantial reduction in HR-related administrative time, boosting both productivity and accuracy. As Bill Piotrowski, SAP Leader for IBM Consulting, says, “The tangible business benefits we have reaped serve as a testament to the potential advantages clients can expect as result of SAP embedding IBM Watson Assistant into SAP Start which will support Success Factors.”

The enterprise data primarily sourced from SAP and other apps goes beyond the confines of the enterprise. Watsonx acts as a bridge that facilitates cross-application, cross-ecosystem use cases. IBM prioritizes delivering substantial business value to CEOs, CFOs, COOs, and CHROs. The foundational technology, particularly watsonx, acts as the driving force behind this value.

To harness the transformative power of AI in business, it must be seamlessly integrated into existing workflows and systems. It is essential for businesses to smoothly and safely transition AI tasks, which, in our contemporary setting, encompasses both the cloud and a mix of new and old software and hardware systems. Designed for a broad spectrum of data, analytics, and AI operations, watsonx allows businesses to extend their data analytics and AI capabilities wherever their data exists and optimize workload management.

One such use case is in pharmaceutical industry, where a company had rebates and chargeback agreements and allocated substantial funds towards these rebates in exchange for pharmaceutical sales. Executives in these pharma firms often questioned the true value derived from these rebates. The challenge was in thoroughly examining the rebate contracts, their terms, and ensuring that the pricing configurations in SAP aligned with the actual agreement. Moreover, a comparative analysis of sales uplift between rebated and non-rebated products was also necessary. Similarly, in the context of vendor contracts, the company needed to ensure that all suppliers were compliant with the stipulated terms and conditions. Contracts based on time and materials, with defined rates, hours, personnel, and durations, needed to be scrutinized to confirm that service providers operated within these boundaries. AI-driven insights for documentation assisted this pharma company by extracting valuable information from vast amounts of documents and data and enhanced and simplified workflows.

Another pertinent area is the supply chain, particularly concerning tax optimization. The challenge here pertains to whether there are more efficient strategies to streamline product flow, minimizing tax obligations. Such a process requires AI systems to decode complex regulations and tax codes. Moreover, current operations, including manufacturing sites and logistics centers, need to be evaluated since product flow can’t be redirected through non-existent facilities.

To make a compelling argument for projects under the C-suite’s consideration, IBM’s strategy is to underscore the undeniable business value, process automation, and the distinct advantages of AI.

What this means for SAPinsiders

Better user experience: IBM Watson’s integration into SAP enhances its digital assistant within SAP Start, which serves as the centralized gateway for SAP’s cloud offerings. Through SAP Start, users can search, initiate, and actively engage with applications available in SAP’s cloud services, including SAP S/4HANA Cloud.

Increased productivity: The AI functionalities in SAP Start aim to elevate user productivity by harnessing natural language processing and predictive insights, all underpinned by IBM Watson AI solutions that adhere to IBM’s principles of trust, transparency, and data privacy.

Accelerated innovation: With IBM Watson’s AI capabilities embedded, SAP solutions are likely to offer more advanced features like predictive analytics, natural language processing, and other AI-driven functionalities. With new features and tools within the SAP portfolio, users could benefit from rapid advancements in the platform.

Improved Efficiency: With the integration of AI, routine tasks and processes within SAP applications might be automated, leading to more streamlined operations and freeing up human resources for more complex tasks. SAP Start provides clients with on-the-spot intelligence, leveraging AI and machine learning to pull insights from diverse data sources and address user queries across various business domains.

ChatGPT
Businesses are increasingly relying on data-driven transformations to enhance their operations, fueling informed decision-making, agility, innovation, and efficiency. They are also reevaluating core processes, including those tied to SAP systems. In pursuit of a competitive edge, these businesses are adopting AI and Generative AI methods, encompassing coding, development, employee engagement, and change management, to revolutionize their operations comprehensively.

Generative AI, notably IBM’s AI solutions, is gaining traction, providing tools to streamline and improve operations across various practical applications. IBM’s collaboration with SAP focuses on integrating generative AI and large language models into SAP’s mission-critical applications for continuous learning and automation.

IBM’s Watsonx suite offers three distinct products: watsonx.ai studio for foundation models, generative AI, and machine learning; watsonx.data, a data store for governed data and AI workloads; and watsonx.governance toolkit for responsible AI workflows.

The integration of IBM Watson into SAP Start, SAP’s cloud gateway, enhances user efficiency through natural language processing and predictive insights. This integration is rooted in IBM’s commitment to trust, transparency, and data privacy.

Watson Assistant, powered by IBM, has proven effective in HR operations, automating routine tasks and freeing up time for critical decision-making. This showcases the potential benefits of SAP embedding IBM Watson Assistant into SAP Start.

Watsonx acts as a bridge, facilitating cross-application use cases beyond enterprise boundaries. It aims to deliver substantial business value to various C-suite roles, driven by foundational technology.

In specific industries like pharmaceuticals and supply chain, AI-driven insights are transforming contract analysis, pricing configurations, compliance monitoring, and tax optimization.

For SAPinsiders, the integration of IBM Watson into SAP Start promises a better user experience, increased productivity, accelerated innovation, and improved efficiency, with AI automating routine tasks and offering on-the-spot intelligence. This collaboration between IBM and SAP opens doors to advanced features and tools within the SAP portfolio.

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