SAPPHIRE NOW 2018, Day 3: How SAP Technologies Are Improving People’s Lives
While machine learning, artificial intelligence, and robotics technologies have certainly been lauded for the time savings and productivity gains they can bring to the digital business world, often overlooked is what these technologies can do for people in a humanitarian sense.
This was not the case during the closing keynote at SAPPHIRE NOW 2018, which focused on how these technologies can be used to help change people’s lives for the better. On stage first was Adaire Fox-Martin, President of SAP’s business in Europe, Middle East, Africa, and Greater China, who reminded everyone that while today’s digital economy is faster than ever, it will never be this slow again. As a result, “customers are putting data and intelligence at the very center of their future,” she says. “And these companies have an edge because they continue to improve their processes with data and intelligence while their competitors try to play catch up.” (To read an interview with Adaire Fox-Martin, click here.)
To highlight one of these innovative companies, SAP invited to the stage Michael Voegele, CIO of longtime SAP customer Adidas. After first addressing the common mistake most Americans make when pronouncing the company’s name — the correct pronunciation is “AH-dee-dahs” (not “Ah-DEE-dus”) — Voegele went on to describe how Adidas is improving its customer experience through a “Here to Create” campaign and a digital strategy that is bringing the business closer to its consumers. “Sports has the power to change lives, and digital technology is an enabler to help us achieve that goal,” he says. “To change people’s lives, you have to build direct relationships with customers and create bidirectional conversations and collaborations.”
Adidas is actively inviting consumers to participate in the manufacturing process through its Storefactory concept, which involves a storefront where customers receive body scans and then help to create their own personalized apparel. The business also opened its first US-based Speedfactory, a manufacturing facility that heavily relies on robotics and can quickly adapt to trends as they change, which can be every few weeks in the sneaker business. The biggest hit for Adidas customers, according to Voegele, is the improvement in daily inventory accuracy for its hundreds of millions of products, thanks to SAP Customer Activity Repository. “Today, we know where each single piece of product in their colors and sizes sit in the supply chain, in the distribution centers, in our stores, with wholesale partners around the world,” he says. “We have full transparency down to every detail of our product, and that is helping us to fulfill those customer expectations, drive that experience, and drive productivity in the supply chain.”
Next to take the stage was Jennifer Morgan, President of SAP’s business in the Americas and Asia Pacific Japan, who was joined by Jeff Lyons, Costco’s Senior Vice President of Fresh Foods. Amid an enterprise-wide system modernization at Costco, Lyons identified a business need in the company’s fresh foods division, which includes the meat, produce, food court, and bakery departments. For a business that guarantees the freshest quality of goods by not letting product sit on shelves — for example, rotisserie chickens have a shelf life of two hours and pizza only one hour — technologies that improve inventory management and offer predictive analytics are crucial to success, which for Costco means being in stock for every item for every customer.
To improve sustainability, reduce waste, and abandon manual inventory processes, Costco turned to SAP Leonardo products and tested the technology in the bakery department as a pilot project. “We didn’t want to spend hours producing things that didn’t sell,” says Lyons. “So we plugged in seven years of sales data and redeemable coupons that drive sales, and then layered on weather and other event data [such as sporting events] to determine when sales pick up or slow down.” With more accurate information, the bakery department has seen production improvements of 2%-3%, drastically reducing labor hours and items that go to waste. The pilot was rolled out at one bakery in San Jose, California, and due to its success, is scheduled to roll out to over 500 bakeries in the US. Additional future uses for SAP Leonardo have already been identified, such as in the produce department. “We sell over a billion items in produce,” Lyons says. “For us to get it right and not waste is critical.” Important to note is that “waste” for Costco does not mean product ends up in the trash, as the business provides daily food donations through its partnership with Feeding America, which works with local food banks to provide meals to those in need. According to its website, in 2017 alone, Costco donated more than 8.5 million pounds of food in 42 US states.
In line with charitable efforts to feed the hungry, the final guests for the keynote included SAP CEO Bill McDermott and 2018 inductee into the Rock and Roll Hall of Fame, Jon Bon Jovi, who for over a decade has also been the CEO of a non-profit called JBJ Soul Foundation that focuses on the issues of hunger and homelessness. The foundation, which SAP supports, began in 2005 building homes (with over 600 units constructed to date) and now also operates two JBJ Soul Kitchen locations in New Jersey. These restaurants are advertised as “community dining with dignity,” where meals made from locally sourced ingredients are served with cloth napkins and real silverware. “There are no prices, no government funding,” Bon Jovi says. “If you can afford to pay, you do, and the people in need are empowered by volunteering.” Adding to these inspiring sentiments, McDermott shared his opinion that one of the most precious things people can do is to appreciate one another as equals and celebrate differences to make cultures, teams, and life itself worth living. “My passion in life is to do and see things in a way no one has ever done it before — to do something positive for other people and for the world,” he said.
The general crux of this year’s SAPPHIRE NOW event — the intersection of people, technology, and efforts to make the current and future world a better place — was summed up perfectly by Bon Jovi. “The greatest gift the next generation could give is to inspire to inspire,” he said. “They are teaching us through technology that the world is a different book today, and I’m excited to see what they will bring us tomorrow.”