Many companies are understandably cautious about investing in new technologies – particularly back-office systems that are critical to their operations. However, a new report from MIT Technology Review showed that after a decade of companies moving to Cloud applications, those that hesitate put themselves at greater risk than in the past.
The old ways of staying current won’t be sufficient enough to compete with companies that are truly modernizing their operations and even creating new business models with Cloud applications.
Oracle Vice Chairman Jeff Henley said that reluctant company leaders and boards must be sold on the strategic advantages of Cloud applications, not just on their cost benefits.
“Probably the biggest reason to modernize is to give yourself a platform so that as things change, you are never letting the software hold you back from changing your business and taking advantage of new innovation.”
—Jeff Henley, Oracle Vice Chairman
Three companies – AirAsia, Sportable Scoreboards, and TrueBlue – leveraged the advantages of Oracle Cloud applications (HCM, ERP, EPM) to future-proof operations.
3 Companies Using Oracle Cloud Applications to Future-Proof Operations
Airlines in Asia are competing for the continent’s expanding middle class, low-cost pioneer, and AirAsia is turning to technology to scout new routes, hedge against increasing fuel costs, and off fliers additional services.
AirAsia began using Cloud-based financial and supply chain applications from Oracle to get more insight into operating costs and predict the profitability of competitive decisions, such as raising or lowering fares and opening new routes.
Moving from paper-based purchasing and spreadsheet analysis to modern enterprise software will help AirAsia contend with a raft of competitors in the region while giving it a better handle on inventory for sales of in-flight food and beverages as well as duty-free goods.
AirAsia’s instance of Oracle Enterprise Resource Planning (ERP) Cloud includes airline-specific features such as fuel-cost accounting, route forecasting, airplane catering, and mileage program management. As part of its upgrade to modern Cloud financial software, the airline is also exploring using artificial intelligence (AI) to set prices.
The company currently hedges around 52 percent of its jet fuel consumption, which accounts for about 40 percent of an airline’s costs, according to AirAsia Group Chief Financial Officer Pattra Boosarawongse. On the revenue side, ancillary services accounted for about 19 percent, or 2.06 billion ringgit (497 million), of total revenue in 2018 – up 7 percent from the prior year.
In that vein, the company is positioning airasia.com as an all-in-one travel and lifestyle marketplace for airline and hotel bookings, car services from airports, ferry transport, insurance, and duty-free goods.
At Oracle OpenWorld Asia in Singapore, AirAsia’s CEO Tony Fernandes said that the company, which sold 16 billion ringgit ($4 billion) of tickets online last year – a small fraction of its total revenue, needs to add digital products more quickly.
“If you don’t change, you die.”
—Tony Fernandes, CEO of AirAsia
In order to make good on its plan to double its revenue within the next five years, Sportable Scoreboards founder Mike Cowen knew that the company would need to make substantial changes to its business operations.
The scoreboard manufacturer, based in Murray, Kentucky, had an inside salesforce of only six people. The manufacturer also had a factory-direct, build-to-order sales model that was very different from its larger competitors, which also have deep benches of outside sales representatives and vast dealer networks. While that competition has always been intense, one of Sportable Scoreboards’ biggest adversaries was its increasing overhead from managing a patchwork of primitive software applications.
“It was impossible for us to maintain 10 to 12 different systems and get them to talk to each other without adding significant headcount.”
—Micah Sugg, Director of IT for Sportable Scoreboards
All of the different legacy systems that the company was maintaining required a significant amount of paperwork and manual data entry. Sportable Scoreboards has a small IT staff and needed a single platform that could automate all of the routine tasks, integrate all of the different software systems, and give users from each business area access to the same information.
In September 2017, the company moved all-in to Cloud applications – upgrading its financial, marketing, sales, service, supply chain, and manufacturing applications to the Oracle Cloud. This upgrade allows Sportable Scoreboards’ sales representatives to track new opportunities, log new quote requests, and merge the quotes with existing accounts in near real-time without creating duplicate records.
In addition, automated data sharing between functions makes it easy for the accounting team to run reports, share information with auditors, or create dashboards for company executives to conduct strategic analysis.
“Our culture has changed. We are bringing in people who are comfortable with change, comfortable with data, and are thinking about the future.”
—Janson James, Director of Business Development for Sportable Scoreboards
Just like many services companies that grew with the help of acquisitions, 30-year-old staffing company TrueBlue had a complex array of applications – 20 discrete packages covering just financial management and human resources, many with overlapping functionality.
As a result, TrueBlue struggled to give its employees a single, unified view of data and operational processes. With so much IT staff time devoted to managing those fragmented applications, TrueBlue CFO and Executive Vice President Derrek Gafford said that the company had no time to implement new ideas in certain areas.
The solution was to consolidate the company’s legacy applications – some of them commercial, others homegrown. The company decided to leverage the advantages of Cloud applications with Oracle Human Capital Management (HCM) Cloud, Oracle Enterprise Resource Planning (ERP) Cloud, and Oracle Enterprise Performance Management (EPM) Cloud.
Moving forward, TrueBlue plans to leverage artificial intelligence (AI) and advanced data analytics to up its game even further.
“We’ve got all of that data there to really go and get an even deeper understanding of our customers and our employees and deliver greater value to them.”
—Derrek Gafford, TrueBlue CFO and Executive Vice President
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