Metrics That Matter: How To Unlock The Full Value Potential Of Digital Transformation

Innovation Metrics That Matter: How To Unlock The Full Value Potential Of Digital Transformation SAP BRANDVOICE Storytelling and expertise from marketers | Paid Program Sep 19, 2022, 07:36am EDT | Share to Facebook Share to Twitter Share to Linkedin digital transformation concept in business, disruption getty By Sam Masri, Global Head, Industry & Value Advisory, SAP and Marcel Hechler, Vice President and Head of Strategy & Operations, Industry & Value Advisory, SAP Milliseconds. When it comes to exciting fans and championing a more sustainable future at the same time, it all comes down to a few milliseconds in motorsport. For the motorsport pioneer Mercedes Benz , there is only one decisive factor for staying at the top of the field – technology.

When the Mercedes-EQ Formula-E Team – a start-up with minimal finance personnel, no operational systems or processes, and no IT infrastructure – sought to enter the highly competitive world of motorsports, it turned to an ERP solution to unlock a winning edge. Armed with highly agile and mobile ERP-powered capabilities that were successfully implemented in a record-breaking time of only three months with a fit-to-standard approach, the team now analyses fan feedback in real-time, uses advanced analytics to make data-driven decisions during races, and wins on the racetrack and in the back-office. 80% of organizations have either moved to the cloud or are in the process of expanding their cloud capabilities.

Today, no dialogue about technological change is complete without passing of cloud-based intelligent processes and process optimization. Why Should Businesses Consider Embarking on Digital Transformation? Because the future of enterprises is being shaped by five converging technologies with massive enterprise implications: Super-computing , that makes real-time data processing and analytics scalable, and commercially viable Cloud Computing and its latest core business-focused innovations, which makes organizations more agile, nimble, and current Hyper-connectivity , where everyone and everything in the world is now connected at scale and with velocity Physical-Virtual convergence , where both worlds co-exist, resulting in phenomenal advancements towards Industry 4. 0, omni-commerce and the metaverse Cyber Security advancements that strive to combat the threat to data, identities and interactions emanating from super-computing and hyper-connectivity.

MORE FROM FORBES SAP BrandVoice: What Digital Transformation Progress Means For Growing Businesses By SAP Guest These advancements are unique in that they are all maturing at the same time and converging with one another to create new innovative use cases that are changing the way the world runs today at an unprecedented scale and speed. For instance, super-computing operations in secure cloud environments is allowing companies to run their business intelligently, autonomously, and in real-time. This convergence is permitting enterprises to run in connected networks where people, assets, suppliers, services, and payment providers are all connected in real-time.

As a result, companies run more efficiently and must no longer make trade-off decisions between running profitably and running sustainably. All of this allows the most digitally enabled to pivot to new business models that change their businesses and industries altogether. And yet, despite the immense possibilities, more than half of the Fortune 500 companies disappeared in the last 22 years.

A closer look reveals numerous multi-faceted challenges causing serious impediments that keep enterprises from realizing the full value of innovations on offer. How To Unlock the Full Value in Digital Transformation By focusing on the digital transformation metrics that matter, which are centered around three key capabilities: Differentiating Business Capabilities: A Cloud ERP with embedded intelligence, business network connectivity, extension capabilities, and efficient business processes, enable companies to create distinct business capabilities to drive growth through industry differentiation – for the top-line, bottom-line, and green-line Continuous Improvement Capabilities: To avoid getting outperformed and squeezed out of the market by their competition, organizations must never stop improving their business processes through continuously monitoring and prioritizing, and leveraging new technologies such as business process intelligence and data mining Value Realization Capabilities: While focusing on their core business and capabilities, organizations now can (and should) run their technology stack and IT infrastructure in the cloud and as a service prior to becoming more resilient to enable the realization of the full value potential of what we call ‘a transformational cloud experience as a service’. At the outset, most companies unfortunately either miss out on innovation or become laggards because they are unable to link technological innovation to business outcomes.

Companies, therefore, need to understand the business-critical metrics of digital transformation and focus on differentiated business capabilities. While a customer-focused approach to facilitate digital adoption can help overcome transformation challenges, the fundamental technology solution offered ought to be a robust one that guides companies to lead with transformation metrics across Value Differentiation, Continuous Improvement, and cloud-enabled Value Realization. While these metrics are critical for companies to be successful in their digital transformation and achieve their desired business outcomes, there is also a critical need for a robust approach that allows customers to leverage the latest converging technologies and overcome roadblocks.

Aligning Vision to Value Organizations often forget to tie their programs to clear value drivers. To ensure effective target setting and planning, efficient project execution, and quick adoption, organizations are encouraged to consider four-steps: Align on vision: Align business and IT strategy and ensure buy-ins across the organization Quantify business outcomes: Build the case for change, identify key initiatives, and quantify business benefits Plan the path forward: Define a clear value-based implementation roadmap and deployment plan Realize the full value potential: Deliver quick adoption and time-to-value while driving continuous innovation and optimization. In fact, it is this alignment around a shared vision with clear outcome definitions that has enabled the Mercedes-EQ Formula-E team to fast-track its transformation – in 13 weeks from go-ahead to go-live.

For more on how organizations across industries have unlocked financial and operational benefits through digital transformation, read SAP S/4 HANA ‘Value Stories’ . SAP Editorial Standards Print Reprints & Permissions.