Products and Platforms
TCS ERP on Cloud
TCS ERP on Cloud for SAP Landscape Migration and Modernization
Highlights
- Large market enterprises (LMEs) are known for their vast scale and complex multi-country operations which require heavy investment, custom-built solutions, and on-premise infrastructure to ensure data governance and security.
- Mid-market enterprises (MMEs) operate on a smaller scale and need to operate within limited resources. They prioritize cost-efficiency, agility, and adaptability. Their primary need is IT scalability, which can fuel their rapid business growth.
- The need of the hour is an end-to-end SAP transformation accelerator, which must pre-configure SAP standardized processes and recommend best practices, with ready to use artefacts such as documents, manuals, and test scripts.
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IT roadblocks
As companies face a new wave of technology-driven bottlenecks, a well-defined ERP strategy is paramount to staying agile and competitive. Factors such as consolidation, divestiture, and technology upgrades are constantly reshaping organizations. IT roadblocks can include suboptimal business processes, outdated application versions, and a high degree of customization.
A large portion of global digital transformation efforts fail. Generating value through ERP transformation can prove challenging, as the burden of investments in time, resources, management involvement, and capital expenditure can be overwhelming. However, LMEs and MMEs operate in very distinct spheres, each with unique needs, operations scale, budget, and IT outlook.
LME characteristics
LMEs are known for their vast scale and complex multi-country operations, which require heavy IT investment, large IT organization, heavy customization, and on-premise infrastructure to ensure data governance and security. LMEs have a diverse IT portfolio with many interconnected systems, often decentralized and localized with process variations, diverse language-currency combinations, and security gaps.
One example is a global retail and facility management company operating across different countries. It had multiple legacy ERP systems to support its operations across countries. Due to this, it experienced multiple shutdowns over time and struggled to manage the high maintenance overheads of such a large IT landscape. It underwent a One ERP transformation initiative, under which multiple ERPs of the organization were consolidated into a single S/4 HANA instance hosted on the public cloud. Thus, it provides a lean IT landscape with minimal effort to manage it.
This can get further complicated through mergers and acquisitions, which results in multiple ERP footprints, multi-cloud architecture, and fragmented non-standard processes. The exponential growth of data presents challenges in terms of storage, management, and analysis. Compliance requirements often become more stringent with the growing size of operations. LMEs may experience resistance and sluggishness to drive IT changes, requiring significant investment in training and infrastructure.
Thus, LME’s mammoth size could potentially become a hindrance to growth unless it is regulated through proper IT governance and applications for consolidation and analytics.
However, they can budget for innovations and have access to cutting-edge technology. An organization-wide standard global security framework needs to be established for policy standardization and compliance. Harmonizing applications, databases, and OS on the latest technology stack can help immensely in reducing maintenance overheads. Adoption of globally harmonized business processes and Cloud help can eradicate IT bottlenecks.
Specialized IT partnerships can help to mobilize their IT strategy, such as technology development, IT capacity building, and innovations.
MME characteristics
MMEs operate on a comparatively smaller scale within limited resources.
MMEs are preoccupied with the challenges of business growth and maintaining competitive advantage. To sustain market relevance amidst rapid technological transformation, MMEs need the agility of a quick technological adaptation to grab market share. MMEs are highly ROI-sensitive and seek cost-efficient solutions for quick value realization, with built-in robustness and scalability to provision for future growth.
MMEs often operate on mid-market tier II ERP products, on-demand provisioning, and shared service operations with lenient service levels, which hinders growth and amplifies costs in the long term. Old technology, system crashes, bugs, and security breaches can cause companies major productivity disruptions. Several IT tasks may be done manually, which are time-consuming, prone to error, and lack data governance. One example of a medium-sized enterprise operating as a European manufacturer faced significant challenges due to minimal investment in their IT landscape, addressing needs as they arose. This approach resulted in heavily customized and non-standard business processes, leading to high turnaround times across multiple processes. To address these issues, the company undertook a Greenfield ERP implementation, which standardized business processes across multiple modules, including record-to-report, order-to-cash, and procurement and sourcing. This new ERP system was implemented with minimal customizations and maximized out-of-the-box processes, significantly reducing turnaround times across various operations.
An ill-suited and outdated ERP technology can make integrating with modern technologies or upgrading existing systems difficult, limiting an IT team's ability to innovate and improve its operations. This problem not only hinders efficiency but also leads to security vulnerabilities. Such systems cannot keep up with the demands of modern business operations, which require efficient processes and advanced functionalities with built-in automation to eliminate repetitive or mundane IT tasks. Using cloud-based systems helps boost their productivity with better security and flexibility.
Hiring a multi-skilled IT organization can be an expensive proposition. The rapid pace of technological change means that the skills in demand are constantly shifting, making it hard for businesses to keep up. They need support from a qualified and experienced IT team. Therefore, MMEs need a strong IT partner to drive IT upgradation so they can focus on their core business and plow back more business growth.
Pre-built solutions can be a valuable option for MMEs' digitization journey. ERP solutions with pre-configured features and faster deployment timelines allow quicker value realization. By adapting 'best of breed ERP on public cloud hosting,' standardized best practice-enabled processes, OpEx-based pricing, and shared services operations, they can easily fulfill their business and IT objectives within their budget.
Conclusion
Irrespective of size and operations of the organization, the need for accelerated digitization and process simplification are all pervasive. Investments in genAI and ML, blockchain, robotics, IoT, and predictive analytics become imperative to gain competitive edge and stay relevant in the market. In this era of digital dawn, the agility to innovate will distinguish the leaders from the followers.
As LMEs and MMEs have distinct IT needs, using similar approaches for IT landscapes and ERP implementations is unreasonable. The immense cost burden, especially the need for a lump sum capital expenditure, can also thaw the transformation intent. The need of the hour is an end-to-end transformation accelerator with pre-configured standardized processes and best practices, with ready-to-use artefacts such as documents, manuals, and test scripts, which can dramatically optimize the duration, effort, risk, and cost of implementation, while providing improved business processes, tighter integrations, incorporating localization through a well-defined deployment methodology to secure the desired outcome of the transformation.
As LMEs and MMEs have distinct IT needs, it is unreasonable to use similar approaches for IT landscapes and ERP implementations. The immense cost burden, especially the need for a lump sum capital expenditure can also thaw the transformation intent. The need of the hour is an end-to-end transformation accelerator, with pre-configured standardized processes, and best practices, with ready-to-use artefacts such as documents, manuals and test scripts, which can dramatically optimize the duration, effort, risk, and cost of implementation.
