In case you didn’t get the memo: The future has just arrived. You probably saw it coming but never thought it would actually get here. The Internet of Things (IoT), artificial intelligence (AI), machine learning (ML), blockchain: Not long ago, all of these technologies were little more than buzzwords and thought experiments.
Meanwhile, rising consumer expectations are impacting every kind of business. Your customers have come to expect same-day deliveries, two days at worst, and every single order has to be right. Now people want to subscribe to your products instead of buying them. Your investors expect you to predict demand precisely and fulfill it just in time. And regulators expect you to trace all your ingredients back to their source to help troubleshoot supply chain issues and even save lives.
The best companies are learning to adapt to this “future-is-now” world – and quick. Outpacing change is no longer option. It’s a mandate for business survival and success.
New financial models
The problem with keeping up with the future is that businesses are constrained by legacy systems that can’t support the businesses model changes they need to survive. For example, most on-premises accounting systems aren’t equipped to handle the new world of “product-as-a-service” subscription models that require new revenue recognition capabilities tailored to this environment.
The cloud removes that obstacle. Oracle, for example, built a subscription-management capability into its ERP cloud to help companies sell products as services, if that’s what they need to drive their business forward.
These types of new cloud technologies also help enterprises successfully execute mergers and acquisitions. Cloud solutions have changed the M&A game, allowing new business units to be onboarded quickly and their books consolidated and closed just as fast.
Predicting the future
Take another example: In the not-so-long-ago world, maintaining a factory floor or enterprise asset used to be a reactive, timebound, scheduled activity. So when something broke, it was a big and expensive problem. But in the future-is-here world, companies are using machine learning to make predictions about when equipment is wearing out and then schedule repair and maintenance activities before anything breaks.
It’s clear that these formerly futuristic technologies are delivering a lot value for businesses and the people who work there. By the way, it’s not about taking people out of the equation but allowing them to shift to more value-added work. Instead of just managing transactions, they can focus on analyzing data and trends and making better decisions.
Business planning is so much better today in the cloud. This is largely because cloud solutions can integrate business planning, sales and operational planning, and supply chain planning all on one platform. Oracle’s unified data model, for example, can bring together core operational data with product info, with machine data, and now third-party data. When you integrate all that intelligence into your supply chain planning process, you now have the power to match supply and demand with unprecedented precision, creating a huge competitive advantage.
One Oracle customer – a contract manufacturer for top brands such as Newman’s Own – leveraged a cloud-based demand management system to save 5-10 percent from inventory reductions while eliminating 50% of food waste. It turns out that matching supply with demand – a collaborative process we call “plan to produce” – can help you achieve valuable strategic goals like environmental sustainability.
No science project required
Today there are a lot of vendors that are “playing” with AI, ML and IoT. The difference with Oracle is that it’s building real industrial strength apps based on proven, market-tested versions of these advanced technologies. One of Oracle’s financial management solutions, for example, comes with built-in machine learning that allows companies to detect financial fraud and anomalies and improve compliance.
More recently, Oracle delivered a blockchain app that you can use “out-of-the-box” to manage entire supply networks. This helps companies track and trace goods across the supply chain and provides complete trust and transparency for all parties.
Remember that IoT sensor data is great to have, but it’s only as good as what you can do with it – which is why it’s important to apply machine learning to your data feeds. Oracle leads the way in proven ML solutions that gives companies a clear vision of how to react to changing operational conditions.
In the future that is upon us, finance and operations will need to work in unison to help companies thrive with leaner inventories, more precise product costing, and more profitable product-as-a-service business models. The fundamentals of business haven’t changed – profitability still drives success – but the way to success will require enterprises to take a more future-leaning path.
Is your enterprise equipped to outpace change?