How IoT And ERP Are A ‘Power Couple’: Oracle’s Abhimanyu Prabhavalkar Explains

oracleAbhimanyu Prabhavalkar, vice president of IoT product development at Oracle, talked to IoT India Magazine about how they have seen the world of Internet of Things (IoT) evolve as well as change the way people do business. According to Gartner, 5.5 million new things are being connected to the internet every single day — thermostats, kitchen appliances, smoke detectors and devices that can detect when an elderly person falls, among others.

In a detailed chat, Prabhavalkar covered some of the fascinating topics from the world of IoT and ERP. Here are some excerpts:

Modernising ERP systems — what does that mean for CFOs? On what basis does it work?

The current generation of CFOs are struggling to adapt to the changing technological landscapes. Many, for instance, do not yet fully trust the findings of big data analytics. As soon as they’re willing to place their confidence in advanced analytics, they’ll be ready to move forward with adaptive intelligence and automated, Artificial Intelligence-enabled approaches to finding insights from data. Robotic Process Automation is slowly making inroads into CFO’s priority list. This requires a shift in the mindset, and CFOs need to consciously accept cutting-edge technologies to realise maximum value. The adoption of real-time and predictive intelligence is now imperative amongst all CFOs to retain a competitive advantage. If CFOs fail to accept this, they risk being left behind.

By using data and data-driven collaborative tools, the CFOs will be able to break down the traditional siloes that have stifled communication and understanding between business functions. Drawing on connected and collaborative data, CFOs will have a complete view of the entire business as well as external conditions that may impact the business.

Modern IoT enabled businesses can provide newer and profitable business models such as ‘product as a service’ with recurring revenue streams. Due to sensors embedded in products being used by customers, CFOs will also be able to understand the quality of customer experience which in turn determines the health of revenue streams. Due to IoT, CFOs would also be able to keep track of the distributed assets accurately and depreciate them appropriately rather than not being able to show these as accountable assets on the balance sheet due to tracking inability. Additionally, automating non value added tasks will ensure greater compliance and faster processing. One such example is the chargeback and cost allocation, across different subsidiaries, for usage of resources such as connectivity and communication.

As a result, CFOs will be able to orchestrate a holistic, efficient and effective operation from back office, to supply chain right through customer experience and have a positive impact on reduction of costs, increased cash flow and predictability.

How are IoT and ERP are a power couple leading to the success of an organisation?

According to a market forecast research from IDC, Asia Pacific is leading the charge for IoT globally, with around 8.6bn connected devices predicted to be installed in the region by 2020 (figure excludes Japan). The Asia Pacific market is expected to report its highest growth yet from 2017-2023. The proliferation of IoT devices in the region will be an important driver for data-driven business transformation and will enable businesses with access to real-time insights to make better decisions. This year, we expect to see businesses in Asia Pacific starting to increasingly use IoT applications that can deliver IoT data for use across enterprises.

IoT technology will provide greater insights to all parts of business. From raw materials supply to inventory tracking, asset information for predictive maintenance, predicting quality of goods being produced, accurate tracking of transport and fleet, quality of customer service experience, there are many use cases that have the potential of increasing efficiency of business operations, especially around supply chain management.

Cloud-based IoT applications give CFOs direct access to external as well as internal data in real time, helping them make decisions faster. For example, due to sensors attached to machines in factories and the sensors used at point of sale, CFO would be able to always have the latest multi-dimensional analytics about the production & the market demand and thus be able to easily identify and solve issues that impact the bottom line. Previously, the supply chain management wouldn’t have been able to communicate the correlation between these business events in a timely manner to the CFO – but thanks to cloud and IoT capabilities, the CFO can proactively access wider insights, more quickly, across the entirety of business operations.

How will the future ERP look like? Where is the current system heading with IoT, AI, Machine learning and so on?

According to Allied Market Research, the global ERP software market will surpass a value of $41 billion by 2020. At the same time, IDC is predicting that in the similar time frame, global IoT spend will total nearly US$1.4 trillion as organisations continue to invest in the hardware, software, services and connectivity required to enable IoT. As both these processes are showing a huge propensity to grow, they are also overlapping. By 2022, IoT enabled ERP is poised to become a huge opportunity for the organisations as this market is expected to reach close to $50 billion by 2022.

This overlapping of ERP and IoT seems inevitable. Data from IoT will further enhance ERP systems’ efficiency. Insights from AI and machine learning will further strengthen the ERP systems. This culmination will enable business leaders to take better decisions based on data driven insights. For example, sensors can communicate details about lack of or excess of inventory, allowing supervisors to better manage ordering and replenishment while minimizing the possibility of human error.

This parlance can be extended to all the functions of organisations and the advantages that can be reaped are not difficult to imagine – production efficiency, quality control, customer service etc. However, there are a few considerations that organisations need to make while opting for ERP and IoT integration. The ERP platform must be able to handle the wealth of information created by IoT sensors, in addition to the data it already processes. Another consideration is data security capabilities in place across both platforms. To support information-driven decisions as well as protection, businesses will need to ensure end-to-end safeguarding, especially as data assets travel from one system to another.

What is Oracle’s business plan and strategy in the area of ERP & IoT?

Oracle’s strategy is focused on IoT-fying business applications by extending them to the physical world as well as integrating organisational silos (Design, Manufacturing, Logistics, Transportation, Service) in real-time throughout the digital supply chain. Oracle’s IoT Applications eliminate manual processes by creating ‘Digital Thread’ and workflows from enterprise assets to SCM, ERP & CX applications and, thus, provide an end-to-end view of the entire manufacturing lifecycle. IoT uses the assets master data, productions plans and prebuilt workflows etc from ERP systems.

Automated template workflows allow a manufacturer to track items from procurement and product design, to manufacturing and product life cycle management, to warehousing and transportation, through to logistics and procurement. As well as providing better visibility, this enables new business models, such as dynamic demand planning and a very responsive supply chain.

Predictive machine learning models are built using asset sensor data along with business data from ERP and SCM applications (manufacturing, maintenance, service, logistics, warehouse, financial etc). Because Oracle has a very deep understanding of these business applications, they have the ability to bring the analytical insight from the IoT application into the enterprise applications to power desirable business outcomes.

Can you please share a couple of customer cases? What benefits your customers gain through marrying ERP & IoT?

Noble Plastics specializes in injection molding, decorating, assembly, and contract manufacturing services. Their desire was to differentiate company from shoot-and-ship job shops as a creative
design & manufacturing partner. Using Oracle IoT Applications and the sensors on the FANUC robots on the production line, they have been able to integrate robot monitoring data to ERP processes and have achieved the ability to modify the production process in real time. They have been able to deliver better customer service experience through higher supply chain transparency.

Gemu is a market leader in developing, manufacturing and selling diaphragm valves, actuators and control systems. Gemu’s Oracle IoT Cloud Application receives the valve operation and health events. A service ticket is automatically created in service ticketing system and at the same time, the required spare part is reserved in the ERP system as well as the CRM is updated to send a message to the customer about the service task. Thus they have been able to achieve proactive and timely parts replacements, avoids production downtime as well as enhanced knowledge of product usage to improve product quality and functionality.

Vinci Facilities, a provider of Digital Customer Service & Workforce management solutions, was looking to adapt on-site workforce activities to real demand (e.g. cleaning, refills etc.) as well as enable customers to request maintenance via smart phones and reduce repair times. Oracle IoT analyzes sensor data from various building assets in real-time and automatically creates service request in Oracle Service Cloud including contextual data. They have been able to improve user satisfaction and KPI transparency as well as achieve higher workforce efficiency. Vinci has also been able to introduce new services such occupancy monitoring.

Softbank has used Oracle IoT to track usage of electric scooters by tourists on a Japanese island. They have they been able to enhance the customer experience by advising the users on no-go zones and nearest charging stations as well as have integrated ERP workflows for their billing and compliance.

Security is a big worry for organisations. How does Oracle solutions ensure security of the data?

As a top priority for Oracle, security has been designed into the Oracle IoT Cloud from the ground up to facilitate the creation of identity and trust relationships with the device and application endpoints. The lifecycle of all connected endpoints and devices (direct or indirect) is securely managed by the Oracle IoT Cloud Service. Within this process the endpoints are uniquely registered and authenticated, according to policies set by the user and implemented using OAuth2, and all messaging encrypted using HTTPS. It allows for employing encryption and obfuscation at the sensors and gateways using declarative edge policies. Additionally, Oracle has partnered with specialized companies such as Gemalto to provide hardware tamper resistance capabilities for the sensors/devices. Combining these capabilities with the underlying security capabilities of the Oracle Public delivers on Oracle’s prioritization of security for IoT.


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Prajakta Hebbar
Prajakta is a Writer/Editor/Social Media diva. Lover of all that is 'quaint', her favourite things include dogs, Starbucks, butter popcorn, Jane Austen novels and neo-noir films. She has previously worked for HuffPost, CNN IBN, The Indian Express and Bose.

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