Changes for the future companies

Businesses are facing a technological revolution similar to the dotcom boom of the 1990s, and if they fail to keep up with the pace of change they will not survive, says Rodolpho Cardenuto, president of global channels and general business at enterprise software giant SAP.

“In the 1990s, companies looked at the internet and thought, ‘Is this important?’” he says. “Now we couldn’t even imagine business without it.”

Mr Cardenuto says we are at a similar crunch moment with digital transformation, whereby businesses adopt new ways of working, driven by breakthrough technologies such as machine learning.

“Today we’re debating whether or not it’s disruptive. In five years, I don’t think there will be any business that is not touched by it.”

According to Mr Cardenuto, companies that don’t engage with these changes will see customers desert them. “In the old days, if you were a retail business, you’d be competing with retailers in your neighbourhood, or your municipality. Now you are competing with Amazon.

“In the supermarket, you have to park, get your bags out of the boot of your car, pick up the product and put it in a shopping cart, then your car, then your kitchen. There’s a lot of friction; on Amazon, you order it, and it’s there in 24 hours.

If your business isn’t offering that sort of completely frictionless experience, someone else will. The way to deal with this is to review all your processes, rather than just putting out more cashiers.”

Winning Strategies

Mr Cardenuto says that technologies such as blockchain have the potential to revolutionise areas such as shipping – but that the key is to adopt a combination of technologies.

“There are a lot of technologies that are maturing and they’re driving digital transformation,” he says. “It’s like autonomous cars. The technology is already there, we just need the regulations to catch up. Like the autonomous car, we just need people to accept the autonomous business’.”

Key to this is a digital core of interconnected applications, on top of which companies can apply technologies such as machine learning, blockchain or AI, Mr Cardenuto says.

“You need manage these technologies. Everything works around the Enterprise Resource Planning (ERP) software. From there, customers can explore new technologies. I don’t see people shopping for AI, for instance, on its own. What you need is a vendor who understands those technologies and who can support you.”

In many industries, digital transformation is becoming a matter of survival. Mr Cardenuto says: “In the transport industry, we see electric cars, Uber, Lyft – all of whom are changing transport. But even in finance or retail, there is the potential for a small company to disrupt the whole industry.”

Perfect Timing

Today’s cloud technology, and in particular cloud ERP software, now means that even small and medium-sized businesses are no longer at a disadvantage.

“If you look at how things were 20 years ago,” Mr Cardenuto says, “there was some technology that was simply not accessible to smaller businesses. It’s the same as the wider world: everyone is now using a smartphone and using the internet. It has levelled the playing field.”

But nowadays, small businesses have access to “every piece” of technology used by their larger rivals, thanks to the cloud. As Mr Cardenuto says: “I manage the general business market. If you’re talking to a cloud-first company, they don’t want to have an IT department.

They don’t want to manage infrastructure, install software or buy hardware. But they can now have the same ERP software as the largest companies. Before now, you couldn’t do it, because big companies and small companies were segregated. Now the same technology is in the cloud.”