By Tara Swords
Western Digital manufactures products that can be found virtually anywhere data lives. The company makes standalone storage devices as well as storage systems found in homes, computers, phones, and large data center systems, and cloud storage services that power businesses around the world. It’s an enormous organization with 72,000 employees globally, but it reached its size partly through acquisitions. In fact, Western Digital is the combination of three multibillion-dollar Fortune 500 companies: Western Digital, HGST, and SanDisk. That’s why, in 2016, Western Digital’s IT leaders were faced with an enormous challenge: the company set out on a digital transformation journey and was beginning the process of consolidating the applications of all three companies.
“We were looking at rationalizing 3,000 applications across these three companies,” says Western Digital CIO Steve Phillpott. “At a minimum, we had three of every kind of application. But in some cases, we have found dozens of applications doing the exact same service. That’s just not efficient.”
That reality presented leaders with an interesting question: In each instance, which application should they standardize on? When a larger company acquires a smaller company, the smaller company usually switches to the larger company’s applications. But in this case, three similarly sized companies were coming together, and there wasn’t always an obvious solution.
This presented a particular challenge with enterprise resource planning (ERP) applications. Phillpott and his team found themselves faced with three comparable ERP systems and needed to choose just one. But each system would soon need an upgrade—and ERP upgrades are notoriously expensive and can draw ire from a company’s leaders.
“We didn’t want to move the whole company to a single ERP system, which costs a lot of money and time, and then turn around and do another big upgrade just a few years later,” says Jahid Khandaker, vice president of global IT applications at Western Digital.
Already daunted by the need to put two-thirds of the company through a big change, Western Digital’s leaders suddenly decided to look at the question from a different angle.
They realized that with two of the three companies having to switch to new apps, 66% of the organization would have to undergo a major change no matter which application was selected. “So we thought, if that’s the case, why don’t we look at this as a transformation opportunity and change to a totally new application?” Phillpott recalls. “Yes, that will cause 100% of the company to go through a change, but it would give us the chance to make a decision with an eye toward the future and build a foundation for the next 10 to 15 years.”
That change in perspective gave leaders good reason to look into a cloud ERP solution. The biggest advantage would be the agility that a cloud solution enables, although cost advantage came in a close second. After assembling a 100-person team to evaluate dozens of possible solutions, Phillpott and the team agreed that Oracle Enterprise Resource Planning Cloud (Oracle ERP Cloud) was the best fit.
“A typical on-premises ERP solution can take two or three years from the start to realize any benefits,” says Tina Mashiko, vice president of business finance and business systems for finance at Western Digital. “With Oracle ERP Cloud, we were able to chunk it up into phases so we could have a bigger impact on the business sooner.”
Tara Swords is a freelance writer.