Having worked with countless CIOs and C-suite executives embarking on large-scale business transformation, I’ve seen what goes into making digital transformation successful.
Whether aiming for agility, resilience, sustainable growth, or efficiency, a successful transformation requires a strategic approach, full leadership commitment, and a clear understanding of challenges and opportunities.
True business transformation goes beyond merely executing a technical “lift and shift” to the cloud. It involves reengineering an organization’s business model, operations, processes, and culture to align with long-term goals, adapt to market demands, and leverage new technologies. The focus must be on creating lasting value and ensuring the organization can thrive in a rapidly changing environment.
Crucial Business Transformation Levers
While there is no precise formula, all transformations have four crucial levers in common:
- Activating people: Collaboration is at the heart of any successful transformation. Through partnership and clear accountabilities, we break down barriers, and that’s the basis for any change. Software is ultimately a people business.
- Optimizing systems: Efficient systems are the backbone of any transformation. We ensure that the underlying enterprise architecture of applications is robust, secure, and scalable. This also means leveraging the latest innovations like artificial intelligence (AI), enhancing performance of existing systems, and ensuring that all components work seamlessly together to support the business objectives.
- Reinventing businesses processes: We don’t take existing processes and merely create fancy new interfaces; no “new wine in old bottles.” Companies need to reinvent business processes to ensure agility, future-readiness, reliability, and scalable business operations to drive their business strategy. SaaS/PaaS help to streamline processes based on best practices while preserving company differentiation, but with clean extensibility on the platform.
- Leveraging data: Business data is the lifeblood of modern enterprises, fueling insights and innovation. At SAP, we harness this data to power SAP Business AI, driving intelligent automation, predictive analytics, and personalized experiences. Our focus is on turning raw data into actionable intelligence that supports and accelerates our customers’ transformation journeys. Let’s not forget that the real value of the data lies in the semantics, which is our key differentiator to help our customers.
By focusing on these four elements, business can take a holistic approach to identifying which of their business processes and systems need analysis, revision, or complete redesign.
Navigating Digital Transformation: The Essential Role of Enterprise Architecture
To fully capitalize on these transformation levers and manage the complexities, organizations are increasingly turning to RISE with SAP, our holistic offering designed to accelerate their journey to the cloud and speed innovation adoption. RISE with SAP simplifies the move to SAP cloud ERP, offering flexibility and reduced complexity, and most importantly, provides a seamless experience across our modular (but tightly integrated) architecture.
Nevertheless, for many organizations the challenges remain significant: systems complexity, scattered systems, and diverse business models that may not be keeping pace with industry and consumer changes. Many organizations also underestimate the complexity of their transformation, leading to unrealistic timelines and budget overspending.
Enterprise architecture tools are crucial for overcoming these challenges because we need a structured and system-based approach to cope with and manage the complexities at scale, and to maintain a continuous innovation cycle.
The enterprise architecture provides a framework for aligning IT strategy with business objectives and improve the agility and efficiency of an organization. Imagine a ship navigating without a compass: this is how businesses operate without solid enterprise architecture. Just as sailors rely on navigational tools, modern organizations depend on enterprise architecture to navigate today’s digital complexities.
In addition, the enterprise architecture provides a blueprint for cloud adoption, ensuring that cloud services — like those offered by RISE with SAP — integrate seamlessly with existing systems, business processes, and applications.
However, it’s not just the tools that matter; it’s the people behind them. Our recent efforts to further elevate the RISE with SAP experience include making many changes in how we engage with customers, particularly by strengthening the role of the enterprise architect and introducing the RISE with SAP Methodology. The enterprise architect not only helps customers utilize these tools, but also harmonizes all elements and guides the customer throughout their cloud journey, ensuring a cohesive and effective transformation. As a result, the enterprise architect will evolve into a real trusted advisor for the customer.
We have learned that customers can realize the true power of our business transformation tools when they work seamlessly together. It’s why we have been working hard at integrating SAP Signavio, SAP LeanIX, SAP Cloud ALM, and SAP Business Technology Platform (SAP BTP), including SAP Build, to provide a holistic transformation experience.
Taken together, this is how our integrated toolchain benefits business transformation:
- SAP Cloud ALM orchestrates the entire process of transforming systems to meet evolving business needs. From fit-to-standard analysis and capturing requirements to project management, test automation, and final deployment, this cloud-based tool for application lifecycle management (ALM) enables organizations to effectively translate strategy into execution, ensuring the solution is optimized for the specific IT environment and business objectives. In today’s dynamic digital landscape, this comprehensive approach is crucial for staying competitive.
- SAP LeanIX not only helps businesses capture the as-is systems landscape, it enables organizations to visualize, assess, and manage the transition toward their target IT architecture. The integration with SAP Cloud ALM streamlines project management by reducing manual duplication and syncing project-related activities in real time. This enhances visibility into project progress and reduces administrative overhead.
- SAP Signavio enables deep understanding and optimization of business processes, ensuring they are both efficient and compliant. The business leaders that I speak to are keenly aware that to succeed, they must focus on business processes transformation to help them adapt, stay resilient, and transform continuously and at scale. It’s simply what today’s pace of change demands. SAP Signavio enables holistic, data-driven business transformation across organizations. Starting in Q4 2024, we will bridge the gap between business and IT teams by providing consistent process structures and synchronized data between SAP Signavio and SAP Cloud ALM.
- SAP Build helps developers, without deep coding skills, quickly extend applications on SAP BTP. That means they can innovate without changing core functionality — essential to keeping the core clean.
Customers want access to all relevant data across solutions, they want to derive better insight across solutions and access relevant the best-practices that are most relevant to them. That’s the seamless end-to-end experience we are striving for. This strategic approach leads to significant competitive advantages, allowing organizations to focus more on business improvements and explore new growth areas with confidence.
Embracing the Future
Unlocking value throughout your business transformation journey involves a strategic blend of people, processes, and solutions. As you focus on these elements and leverage SAP’s comprehensive toolchain, remember that the essence of true transformation doesn’t lie in holding onto the old, but in embracing and building the new.
Thomas Saueressig is a member of the Executive Board of SAP SE leading Customer Services & Delivery.