Posted by Steve Brooks, Guest Blogger
NetSuite customers and executives took to the stage at the Westminster Park Plaza two weeks ago encouraging businesses to “be bold” in a world where technology is rapidly transforming everything, lest they get left behind.
In front of a crowd of 950, the largest UK SuiteConnect to date, Simplyhealth explained how it felt the need to transform its own business. A healthcare insurance organisation, Simplyhealth found itself with several retail shops selling mobility products following an acquisition. In April 2015, it launched an initiative to transform the division and rebranded it the Unlimited company, creating an omnichannel retail operation. That included the introduction of services that sit alongside the mobility products which are dedicated to “helping you make the most of life.” According to Matthew Main, managing director of retail, just as importantly, it created a culture change that is now permeating through the rest of the organisation, with the insurance company looking to understand the customer needs more deeply.
Similarly, Mazars, an organisation specialising in audit, accountancy, tax, legal and advisory service, confronted the challenge of global expansion and understanding resource requirements and allocation across the globe. It implemented NetSuite’s OneWorld’s global ERP solution in seven Asian countries and has recently completed a successful pilot in Belgium. The next phase is to extend the implementation to all 77 countries the organisation operates in.
Both companies have had to adapt to rapid change, a challenge for most businesses today, Nathan Furr, INSEAD strategy and innovation professor, noted during his keynote speech entitled “HYBRIDS: Tools to conquer change.” The new business landscape sees start-ups bring product innovation and new business models that threaten the existence of established companies, some of whom were recently start-ups themselves. Yet, while businesses need to “be bold” they must be cautious about being rash.
“Many times big companies are so afraid of innovation they will jump in too early,” Furr said.
For big companies to think like start-ups, Furr had two suggestions. The first was to introduce a hybrid product by merging new technology with old technology. For example, Seagate created a hybrid product by combining the faster, though more expensive, flash drive with traditional hard disk drives to produce faster storage drives at a competitive cost.
He also suggested introducing a hybrid business models, by evolving services from products, or changing a B2C model to incorporate B2B or vice versa. Hilti, a power tool company realized greater margins when it introduced a rental program for businesses and included maintenance within the pricing, Furr noted.
From the Academic to the Practical
Zach Nelson, CEO at NetSuite, provided additional insight on hybrid business models from the experience of both NetSuite and its customers. The cloud, and NetSuite, are the best bet to survive for the long term in this environment, Nelson argued.
“NetSuite is the platform that you have to leverage to be the hundred-year winner in your industry,” he said. “You can get there in many different ways as Nathan said. You get there in a hybrid way or you can transition everything at once but if you are not building your own business model on the cloud you will only be a five-year company not a hundred-year company.”
Nelson suggested three of the ideas that business leaders need to consider.
- Embed Artificial Intelligence (AI) into business processes: He cited Amazon as a company that already does this, anticipating customer needs and increasing efficiency in the business. NetSuite introduced Intelligent Order Management as the first big step in their journey to deliver AI to its customer base.
- Embrace hybrid business models: While Furr talked about embracing business models, Nelson spoke about how distributors are changing from product to service-based solutions. This requires billing systems to support the transition. NetSuite announced SuiteBilling at SuiteWorld 2016. It delivers billing based on product, time, service, subscription, and usage or any combination that may arise.
- Change is the only constant: Nelson pointed to the Fortune 500 as a measure of change. Its half-life has dropped from 75 to only 15 years in the last 50 years.
The NetSuite platform helps support change in three ways according to Nelson. The NetSuite platform is architected to allow user customisation, Nelson said, unlike other platforms where users have to check upgrades won’t impact their customisation. Despite hundreds of upgrades every year, all user customisation is still there the morning after an upgrade. Compared to legacy ERP solutions “it’s like magic,” Nelson said. The NetSuite ecosystem also includes partners that develop innovative NetSuite apps that customers can additionally take advantage of to extend the functionality of their business solution. Finally, NetSuite continues to invest in the product releasing new feature, industry-specific capabilities and features to account for changes in tax laws or new regulations two times a year.
Posted on Tue, October 25, 2016
by NetSuite filed under