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What is an Intelligent Enterprise?

Technology advancements change the way business is performed. At first, they are used by market leaders to drive improved efficiency, then they are used by the rest of the business community to keep up with those market leaders. Examples of this tech advancement include the introduction of computers for business and the emergence of the internet.

Until recently, the technological megatrend that was driving business evolution was “digital transformation.” This bit of jargon just meant that businesses were adopting the cloud, mobile connectivity, and big data to improve business efficiency. Market leaders began that process around 2000, and by 2015 the vast majority of businesses had followed suit either partially or wholly. Today most businesses are in the cloud and using data more intelligently than before.

The next technology megatrend that is shaping business today is the emergence of the “intelligent enterprise.” Let’s break down this bit of jargon and look at what that actually means for business today.


What it means to be an intelligent enterprise

An intelligent enterprise is a business that effectively uses real-time performance and market data to make better decisions and evolve the organization on an ongoing basis.

This intelligence relies on a business being able to turn data into information, and then turning that information into organizational wisdom that is applied to the business on an ongoing basis. Becoming an intelligent enterprise requires a business to understand the relationships between various pieces of information and apply it to the business as a whole and specific problem within the organization.

Market leaders that have already made the jump to an intelligent enterprise demonstrate why this next evolution is important. In 2020, 71 percent of companies considered an intelligent enterprise outperformed their peers in terms of revenue growth and operating margins, according to a study by SAP. By 2022, SAP found that all intelligent enterprises outperformed their peers.

As with every trend that reshapes business, specific technologies are enabling this evolution. In this case, the move toward an intelligent enterprise is driven by artificial intelligence and machine learning, and supported by the internet-of-things, distributed computing, and blockchain technology.


Example of the intelligent enterprise in practice

The evolution toward becoming an intelligent enterprise changes how each area of a business performs. Using the life sciences industry as an example, some of these changes include:


R&D and engineering. Product innovations result from actual device usage and incident reports. Drug and device development processes are integrated to reduce design and development costs, and data from the ecosystem is turned into new value-based services. Predictive models are used to forecast product and formulation properties, and intellectual property is accessible and reused more frequently. Revenue from new products goes up by 20 percent, and R&D costs go down by 30 percent.

Sourcing and procurement. Proprietary and third-party content is used for value-added services, and manufacturing is responsive to supplier networks. IoT devices automatically order spare parts and services when maintenance is needed. Sourcing changes based on demand patterns through the use of pattern recognition algorithms. Process function costs go down by 20 percent, and days payable outstanding shrink by an average of 5 days.

Manufacturing. Manufacturing includes goods coupled with services based on real-time customer demand, and individualized manufacturing and lot sizes are adjusted based on the customer. Partners are coupled and decoupled automatically to meet market demands, and predictive models are used to maximize asset uptime and minimize maintenance costs. Manufacturing costs and cycle time each shrink by 10 percent, and inventory levels go down by an average of 30 percent.

Sales and marketing. In-the-moment customer feedback is captured to better understand customer needs, and engagement is contextualized by the customer. Information is customized across the entire partner ecosystem, and both products and massaging are custom-tailored to each customer. Customer satisfaction and on-time delivery each go up by 20 percent on average.

Human resources. Business outcome-focused mentoring and training programs are developed for new hires, and these new hires become company ambassadors. Self-organizing teams help employees better share expertise. Skills gaps are identified and addressed more quickly, and employee engagement is increased. Time and attendance function costs go down by 44 percent.

Finance. Innovative spend models are developed for products delivered as a service, and pay-per-use models are developed for smart products. Personalized payment options are developed for all sales channels, and payment models for digital services are included in product calculations and financial reporting. New ventures and joint customer initiatives are rapidly assessed on the overall portfolio using multilevel what-if simulations, and simulations help optimize cost and profit drivers. Budget and forecasting costs go down by 50 percent, audit costs are reduced by 40 percent, and the close of annual books is reduced by 50 days on average.

These are just some of the outcomes of the move to being an intelligent enterprise.


How to become an intelligent enterprise

Evolving into an intelligent enterprise comes from adopting the technologies that enable this next phase in business, then adjusting workflows and policies to fully take full advantage of them. The key technologies that businesses should focus on include artificial intelligence, IoT, virtualized networks, and hybrid cloud environments.

As with digital transformation, the move to an intelligent enterprise will be a gradual shift that takes place one department and technology at a time until a business has made every part of the organization intelligent and informed by the new technology.

For most businesses, the first place to start is with an intelligent backend that plugs into AI and machine learning and enables the process of collecting and turning data into information that then can be used for organizational wisdom. In other words, the move to an intelligent enterprise starts with an intelligent enterprise resource planning solution (ERP).


To learn more about how your business can become an intelligent enterprise, and the role that ERP plays in this transformation, contact one of our consultants at (801) 642-0123 or by writing us at info@nbs-us.com.

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