The reason many of the world’s biggest companies use SAP’s products for their supply chain solutions is that its software helps companies accelerate growth, develop game-changing innovations and drive more value to their bottom lines.
But of course, before the process of transformation can begin, SAP must first connect with customers, and then communicate the benefits of their solutions.
For this, SAP has its very own international SWAT team of industry experts, who travel the globe, supporting knowledge transfer and being hands-on with customer-facing activities. That team - the SAP Digital Supply Chain Centre of Excellence (CoE) - are experts in any given product, and are adept at applying their industrial experience in helping customers overcome their current business problem and to its own internal stakeholders around the globe.
Andy Hancock is Global Vice President of the Digital Supply Chain Centre CoE. Hancock explains exactly how CoE experts provide the necessary support: “We support field sales teams, helping them with product-features knowledge in the early part of a product’s life cycle. We also do internal knowledge enablement. We look after a lot of global projects.”
He adds: “Our people have been out in the field - they've had oil underneath their fingernails. They understand how to run a business. It's not theoretical. They take that knowledge and help our customers achieve their goals.”
The SAP CoE has been around for 50 years and is central to what SAP does, because its teams in the field need to leverage CoE know-how, to enable them to speak the language of their customers.
“You have to understand the terminology,” says Hancock. “You have to be able to speak the language of your customers, and that's what we do. We support sales opportunities in the field.”
CoE has teams all over the world, including in North America, Mexico, central Europe and Singapore. With team members located globally, CoE never sleeps, and it offers expertise across all aspects of the digital supply chain, including on the assets side, as well as in manufacturing and logistics.
“We kind of have a cross-matrix approach, so that we can support any opportunity at any time across our portfolio,” says Hancock.
CoE’s main kind of work is around “the reinvention of business processes”, says Hancock.
“We will go in and get to understand a customer’s steady state. Our guidance will be based both on the capability of the product in question and also on what we know other customers are doing around the world. That's one of the advantages of having a global team - we know what’s happening in Singapore or Australia. The lessons we learn in one place can be brought to bear in another.”
CoE also works closely with its thriving ecosystem of partner firms, says Hancock.These include:
- Movilitas. “A long-standing partner, their extensive experience has helped us scale our manufacturing solutions, and their expertise shines through at every customer engagement.”
- Havensight. “They just know what the customer needs, and they steer them in the right direction. Nothing seems to phase them - whether that is a small change request or a complex large multinational project; They just get it done.”
- Mirata. “They’ve enhanced the capability of our mobility portfolio, and also brought the power of digital forms to our enterprise customers.”
“There are so many great boutique tech firms who have the vision of how a product should be used in real life,” says Hancock. They're invaluable in supporting SAP to make sure projects are implemented correctly.”
SAP doesn’t only work with businesses, it also helps organisations in the public sector. So does its approach differ, from one to the other?
“There's a lot of regulations in the public sector, so you have to understand these,” says Hancock. “In the private sector, it all comes down to an individual company's desire to do something.”
He adds: “If a company in the private sector wants to migrate to the Cloud, for example, they have absolute authority to achieve that. But in the public sector there are constraints - policy constraints and security constraints for instance. Security is a huge thing in the public sector.”
Because public sector rules and regulations differ from country to country, SAP has a completely separate company, called SAP NS2, that deals with national requirements. NS2 employees also usually have to live in the country for whom they are providing solutions.
“For example, if you’re dealing with Ministry of Defence data in the UK then you have to be based in the UK to get the security clearance you need,” Hancock explains.
No one understands SAP’s products better - or earlier - than CoE members, so few are better placed than Hancock to discuss SAP’s strategic priorities in the near- mid- and long-term.
In terms of the now, Hancock says the pandemic was “a shockwave that shook-up the supply chain, and the old model of creating growth through cost reduction got obliterated”.
“Getting stuff manufactured somewhere far away because it’s cheap doesn't work as a model anymore, because if you can't get it on the shelf, then you can't sell anything,” he says. “So in the short term it's all about creating a resilient supply chain, which you achieve through visibility and agility. It's also all about connectivity now. Businesses can’t operate in isolation.”
To achieve resilience, businesses are of course turning to Industry 4.0 technology. Hancock says such tech - in conjunction with 5G - is being deployed most widely in so-called brownfield sites. These are existing factories, warehouses or facilities in which new tech is incorporated into the existing infrastructure.
“Our solutions are helping businesses implement new technologies that allow them gauge the quality of products as they come off the production line, in real time. They can use machine learning to determine, say, if there's a defect on a printed circuit board in a product.”
Hancock says 5G is a “great enabler because it has low latency and you can put a lot of data through a single access point”.
But he warns that 5G’s huge capacity for data might also cause problems, unless today’s computer scientists heed the lessons of yesteryear.
He says: “Although computing has changed a lot since the 1980s the core thing is still data flow. Where was the data created? Where is it stored? Who needs to use it? What's it for? Being a programmer means you want to be very effective in the way you move data from one place to another.
“Think back to the days of dial-up modems, where everyone minimised the amount of data transmitted - because if you didn’t then the whole thing just hung.
“With the huge data capabilities of 5G I think people can get lazy, and end up throwing tons of information around just because they can. The trouble is, when you scale this approach up to enterprise level you soon end up with 50 million data points that flood the network, making it inefficient. Then you end up chucking more technology at the problem, where what you really need to do is come back to the fundamentals.”
Turning to the challenges of the mid-term future, Hancock says the big problems for supply chain will be around staffing.
He says: “We’ve all read about the mass exodus from certain sectors, such as haulage, for instance. People don't want to work where they did before. Shop floors, manufacturing sites, warehouses - they're all struggling to get and retain talent. So we're seeing a convergence of operational tech and information tech around such workplace changes.”
Such changes in workplace practices are driving “hybrid data streams”, says Hancock. “You've got on-premise capability and also cloud capability,” he adds.
The on-premise capability Hancock refers to is so-called edge computing - a distributed computing model that brings computation closer to the sources of data.
“If you have local processing power it can be invaluable,” he says. “For instance, if a machine is going out of tolerance at a paper mill and there was a delay in sending this data up to the cloud and back then you could have lost a hundred metres of product by the time the machine is switched off. So the idea is that local machine-learning tech understands the machine is out of tolerance, and without any human action needed.”
The other benefit of edge computing is that, being a local solution, connected machines never stop communicating.
“They’re chatting 24/7, creating data,” Hancock says. “The idea is that you discard most of this and look for the exception - the piece of data that shows a machine is overheating, or out of calibration, or whatever it is.”
Switching his focus to the supply chain landscape five years hence, Hancock says sustainability - and the circular economy - will be the defining factors.
He says: “I think consumers are going to push the agenda on this. Just telling people a product is made out of recyclable material won’t cut it. People will want to understand about companies’ supply chains - about how sustainable their manufacturers are in the Far East, for example.
“They’ll expect an almost complete genealogy of a product, and also whether products that go to landfill are biodegradable, or if they are reusable. I think these things are going to keep everybody busy for the next ten years.”
He says that achieving such supply chain transparency will mean that data silos will have to become a thing of the past: “Sustainability will be a data-driven process, which means if products are to have sustainability KPIs, then there can no longer be data silos in the supply chain, because that’s like looking at a product through a series of letterboxes, whereas what you need is complete visibility.”