True transformation demands doing things that you could not do before, using emerging technologies such as blockchain, machine learning and RPA.
Digital transformation has become one of the most popular corporate buzz phrases today, because it is the top priority for many organizations. But what exactly does digital transformation mean? For me, it does not just mean improving processes or delivering a simpler, more elegant user experience – true digital transformation means doing things that you could not do before, using emerging technologies.
Digital Transformation necessitates new thinking and new skills, which almost inevitably requires an organization to collaborate with additional partners. At EY, we recognize the power of collaboration, which is why we are very proud of the Global Alliance with SAP. We work with SAP to find new ways to solve old problems through experimentation and innovation, and to imagine fresh possibilities.
A good example of how this collaboration works in practice, is the EY Travel Risk and Compliance application. Recognizing the challenges that EY clients were facing, vis-à-vis the current approaches, EY collaborated with Alliance partner SAP, and Concur, an SAP-acquired company, to launch an end-to-end integrated tax and immigration solution for business travelers via the Concur App Center. The app, developed by the EY People Advisory Services team in conjunction with Concur, helps global business travelers manage their tax and immigration compliance risks by integrating with the Concur Travel and Expense platform. This integration provides travelers with access to robust, real-time analytics before they travel. Fundamentally, it provides support for tax and immigration issues, such as staying too long in a particular country or the need to apply for a visa, so they do not impede employees from doing business on the move.
Another great example of the EY collaboration with SAP is the work that is being done to explore the way blockchain can be used to transform intercompany accounting processes for transfer pricing (the pricing process used by different divisions of a company when transacting with each other).
Today, since these processes are largely manual, they become arduous and time-consuming for the people who work in accounting functions. Therefore, together with SAP, we are looking to offer a blockchain-enabled transfer-pricing solution that is capable of tracking all the materials and movements associated with the manufacture of a particular product and the related accounting entries. This solution should dramatically reduce the amount of people and time required to perform transfer pricing in the future, and allow the accounting teams to undertake a true cost and profitability analysis – something that is not possible today.
In general, SAP S/4HANA is a great foundation for the digital transformation activities of all large organizations – including ours – because of the way emerging technologies, such as blockchain, machine learning and robotic process automation (RPA), can be integrated with the platform. The alliance allows us to do way more than simply make use of the platform, because it provides us with opportunities to develop compelling new product and service propositions in conjunction with SAP. This, in turn, enables us to adopt a joint go-to-market strategy, where we can cover 10 times more ground and talk to 10 times more clients about new products or services, than what we would have covered if we were to do it alone.
While it is extremely difficult – if not impossible – for an organization to achieve a successful Digital Transformation on its own, it could grow or buy its own in-house expertise, invest in leading-edge technology and learn from the best-practice case studies that are shared at conferences. Eventually, however, the company would realize that it would need input from one or more trusted partners or, quite likely, several partners.
The strategic alliance with SAP is an essential element to the disciplined approach in innovation, with a focus on realizing tangible business benefits for EY clients. That is what I call a true collaboration.