Oracle is undoubtedly one of the ERP powerhouses in international and local markets today, and they’ve certainly been making further developments in recent times within their Oracle ERP cloud.
We sat down with Wayne Goodall Oracle senior director for cloud applications development and ERP for Asia-pacific and Japan (APJ) to find out how cloud is changing ERP and how it’s being implemented.
Goodall also talked about the AI and machine learning craze, as well as the changing nature of the CFO.
How has cloud changed the ERP landscape?
In terms of the businesses that we’re engaged with it’s definitely a change in ethos for what they do. The traditional business looks at managing systems, environments and IT infrastructure in terms of making those elements perform as the need to perform.
With the evolution of the cloud, there has been a very central, business practice focus, with standardised business practices in the back office, which is what ERP obviously does. This basically allows a further focus on what they’re actually in business to do, rather than managing systems.
While there has been a big change in mindset for organisations, there has also been a change in their ability to roll out innovation faster and take advantage of emerging technologies more proactively.
ERP is just one pillar in a bunch of different business application pillars, but it has certainly got scale now and we’re seeing volumes of customers convert.
What are some of the advantages that cloud deployments have over on-premise?
The rate of returns is certainly a big one. It is quicker to get value from that systems and deploy it, and because it's standard practice and there's no customisation they’re adopting what’s there already so it’s a short configuration. Implementations become more about data migrations and change than they do about the software themselves.
It really changes the way people think. When you allow people to customise, you can guarantee that they will, but when you don’t allow that customisation, then they have to make sure that they adopt what is there already, which has been already been tried, tested and utilised, especially in the back office. We do allow customisation through the PaaS layer, but the SaaS layer will not be touched.
With cloud deployments, how are customer expectations changing?
Some expectations are unrealistic. I’ve seen customers that think they’re going to get everything that they have with their current solution with a cloud deployment, which there are good reasons why they wouldn’t. It’s definitely a change in how they deploy and utilise the system, but using the best-practice process allows people to switch off from that mindset.
The ultimate strategic goal is to get the required information to make strategic decisions, how we get there is largely irrelevant. With emerging technologies like machine learning and artificial intelligence, mundane processes that used to occur are being done by automation or robotics, allows efficiencies through an overload of manual processing, which is part of why the platform can be more useful for clients.
Do you see adoption rates of automation exponentially increasing going forward?
Without a doubt, and I think process efficiency will dictate the automation side of things. ERP is traditionally a back-office function, being finance procurement and project related tasks and it’s labour intensive. In the old days we collected information and fed it into the system, and it was only at the end that we were able to start analysing things that occurred.
Now we’re shifting that to be probably half a day at the beginning of the week and the rest of the time we can look at analysing and making strategic decisions, modelling innovation and changing the way customers think and deploy their goods and services.
In our roadmaps, we see a lot of growth in touchless processing that will occur at some point. We see all that starting to come into the application, and that’s only helped by things like AI and robotics process automation.
How will automation change hire patterns of large organisations?
There is a definite shift in automation, which we saw through the industrial revolution machinery and things like that, where tasks are being taken away from human interaction, and there's no doubt about that.
What we’re saying to customers though, is that it is about re-deploying those people who already understand your business to be more of a stakeholder in your business. What I mean by that is, rather than someone who just transacts or something like that, they’re focused something that could impact the business going forward.
So it’s changing the mentality of the office per-se and it’s moving them to be more critical to the survival of the company.
Cloud-based ERP used to be a differentiator but is now becoming standard practice. How can companies continue to innovate with ERP?
The best way to differentiate yourself in the market is simply to focus on what you do. Traditionally people within the organisation have been responsible for managing systems to get information for what they need, in the future - or now realistically - you have someone else managing your systems. This essentially means you’re less focused on the process of getting information and more focused on your own innovation.
Companies today have to innovate in both goods and services. People used to more commonly stick with products all the way through it’s lifecycle because it’s the product they know and it’s a brand. Brands are going out of business because they’re not innovating, so to move away from managing systems and be more focused on your own business and your own innovation, that gives a massive advantage for customers. That’s what SaaS and our ERP-cloud products are about.
How do data-driven business models change the role of the CFO?
It does change massively. Modern CFOs now are generally coming out of millennial timelines, and they’re more trusting of data, whereas your traditional CFOs aren’t as trusting. Older CFOs would be more concerned with the reconciliation of the data and making sure checks and balances are in place. New CFOs focus on what they can do with data and how they can change the path of the organisation.
I think we’re armed with information and it’s almost considered as a natural resource like gold and oil. Data is the way forward I think, and it gives us the power to make strategic decisions. With trust comes that strategic decision making, and allows us to model the future.
This is evidenced by tools like the Enterprise Performance Management (EPM) suite and cloud, which allows us to make financial model decisions. It’s the stylistic decision making that allows CFOs to drive the ship in the right direction, and look at beating their competition. Any competition that focuses on themselves and their IT, will sadly lag behind.