There is a second wave of enterprise resource planning (ERP) transformation underway across industries and businesses worldwide. In conversations with peers responsible for leading IT transformation initiatives, it is clear that many are considering making bold changes to address the long-term priorities and business imperatives of their organizations. For many, this means transitioning to an intelligent ERP system that serves as a foundation to support scale and growth.
This is the decision Ravi Naik, CIO of Seagate Technology, made to enable an enterprise-wide business transformation. Naik explained the impetus for choosing SAP S/4HANA and the thinking behind this decision during a recent interview.
Addressing Business Priorities
Seagate is a pioneer and leader in the data storage infrastructure solutions industry with a strong legacy of innovation. Its technology puts Seagate at the heart of the data economy by delivering the highest capacity storage drives for its customers, whether in the cloud, on premise, or in private cloud ecosystems. Seagate wanted its commitment to innovation to extend to the technology it uses to run its business. Making this happen was a top priority for Naik when he joined Seagate in 2017.
“I was given a very clear mandate, which was to modernize Seagate IT from a tools, skills, and process point of view…with IT acting as a catalyst for the change,” Naik said.
Keeping Pace with Market Demands
Seagate’s leadership knew the existing ERP was a limiting factor, hindering its ability to be a nimble and agile Industry 4.0 manufacturer. It needed an integrated business process platform to keep pace with accelerating business model changes and enter new market segments more easily.
“To put it simply, our current ERP is so custom and optimized to high-volume drive manufacturing that a new business struggles when we have to go beyond drives…If we have to use contract manufacturers, for example, our current ERP platform simply is not able to meet the needs,” Naik explained.
Replacing a Highly Custom Environment
Seagate is now carefully replacing its highly customized IT landscape by leveraging industry-standard, best-in-class tools and processes. This effort includes implementing the SAP Integrated Business Planning for Supply Chain solution and SAP S/4HANA.
“We chose SAP because it’s a proven solution; it’s a highly flexible and configurable platform,” Naik said. “More importantly, SAP’s approach is very much aligned with Seagate’s strategy, and it allows us the flexibility to choose how and where we run our ERP platform.”
For Seagate, the option to run SAP S/4HANA on premise or in the cloud was especially appealing. Ultimately, it chose an on-premise deployment, using internal resources as the system integrator with SAP Services and Support as a design partner. “We expect to achieve results faster with ownership taken by Seagate and SAP,” Naik added.
Establishing a Foundation for Growth
Overall, Naik anticipates many benefits as part of this transformation effort. “Primarily, it allows us to implement a foundational platform on which the business can scale and grow,” he said.
Seagate is pursuing unified global reporting as part of this transformation to alleviate reporting challenges caused by multiple data repositories and avenues of reporting. “We expect to use a single source of truth from a reporting point of view for financial, supply chain, procurement, and all kinds of reporting that the company needs,” Naik added.
Ultimately, as a result of this IT-led initiative, Naik expects significant improvements in how Seagate manages its supply chain, its manufacturing execution, and its ability to transform itself. On the IT front, he believes Seagate will be retiring over 1,300 custom applications. “In short,” Naik explained, “we are looking at building a stronger and more agile enterprise.”
Watch this video to learn more about how Seagate Technology is driving business transformation with SAP.
Michael Golz is CIO of Americas at SAP.
This story also appeared on SAP BrandVoice on Forbes.