Enterprise resource planning (ERP) solutions have been around for more than half a century. Big, mission-critical workloads for Philippine, European, and North American customers in the country use ERP solutions to manage day-to-day business activities such as accounting, procurement, project management, risk management and compliance, and supply chain operations. While ERP platforms are primarily perceived as business solutions to improve profit, they help companies achieve sustainability goals like reducing carbon footprint and protecting the environment for future generations.
At one of the breakout sessions during the recently concluded SAP NOW Southeast Asia in Singapore, Manila Bulletin sat down with Rudy Abrahams, Managing Director, SAP Philippines, to further discuss the sustainability aspect of ERP solutions. Abrahams started his new role at SAP in 2022.
Rudy Abrahams, Managing Director, SAP Philippines, at SAP NOW Southeast Asia.
“ERP is 50 years old, and SAP recently celebrated its 50th birthday. We have been in the Philippines for 28 years. We entered the country in 1995. ERP was born out of materials resource planning (MRP). We took a lot of those design principles and eventually found ourselves today with S4/HANA, our 4th generation ERP engine,” said Abrahams.
Leveraging cloud technologies, SAP offers a wide array of business applications such as SuccessFactors for human capital and experience management, Integrated Business Network for all around procurement, Ariba stack, CX, and Signavio for process mining. With cloud computing, ERP has evolved to its current form, which is more meaningful for businesses.
“What is different today than the old ERP? It is like the Toyota Corolla of 1972 and the Toyota Corolla of 2015. Today, the machine or application is so much more than what it ever was before. With embedded analytics, you must no longer spend an inordinate amount of time trying to take cubes and dimensions to makes sense of data. It should be standard in the box today, and it helps business leaders make decisions much quicker because the real time attachment between the analytics engine to your backend finance engine or logistics engine is real time,” Abrahams added.
“Another point is sustainability,” he continued. “We know that customers, clients, and partners must report on the top and bottom lines. However, one of the things that is very important is sustainability. With our 4th generation ERP, we can start recording your carbon footprint. When you are doing business with another customer and, for example, you want to know how much it took to create a bottle of shampoo, we can start recording that into an enterprise system. That is powerful because we have a conscious obligation to the planet to do what is right for the generations to come. This is business for higher meaning.”
Abrahams also pointed out that businesses should adopt technologies like ERP and cloud not only for the sake of cool tech. Organizations must adopt technologies that make difference. Whether they are in the field of engineering, construction, financial or humanitarian services, SAP technologies allow customers to start gaining access to data.
“I think for us at SAP, there is nothing more important than business process harmonization. In a strategic conglomerate, there is an array of different businesses. We know that 60% of the gross domestic product (GDP) in the Philippines is made up by the top conglomerates. They need to drive economies of scale. How do you take SAP’s technology in the different subsidiaries and install connect tips so that the chief financial officer (CFO) gets real time views of the performance of their entire strategic program. That for us is a strategic differentiator,” he said.
One example of a Philippine conglomerate that has achieved business process harmonization using ERP is Metro Pacific Investments Corporation (MPIC). MPIC is the first in the country to adopt RISE with SAP, a bundle of tailor-made enterprise resource planning (ERP) software, transformation services, business analytics, and partner expertise guides designed to help organizations push their personalized journey to the cloud. MPIC implemented RISE with SAP toward the end of 2021.
The implementation took only three months, and it was a considerable feat for a conglomerate like MPIC. For context, MPIC is the largest infrastructure group in the Philippines. Through Meralco, the company is into power generation and distribution, covering more than 50% of the country's power requirements. MPIC is also into water distribution and toll road management, through which the company services about two million vehicles each day. MPIC also provides health care with its hospitals across the country.
Abrahams with June Cheryl “Chaye” Cabal-Revilla, Chief Financial Officer and Chief Sustainability Officer, MPIC.
“RISE with SAP is an answered prayer and perfect solution. Because we grew by acquisition, we have large businesses and smaller ones. Applying the EESG approach and starting with the economic perspective, we can streamline processes and enhance cost efficiency. For the environment, with the push of digitalization across the group, we can go paperless and reduce our carbon footprint, preventing the cutting of more trees. Being in the cloud is also more sustainable because it requires less energy and GHG (greenhouse gases) emissions,” said June Cheryl “Chaye” Cabal-Revilla, Chief Financial Officer and Chief Sustainability Officer, MPIC, during a panel discussion at SAP NOW.
“MPIC has many businesses: we have large ones and small ones. If we were to use a regular ERP solution for our smaller businesses, it would be very expensive. Thus, RISE with SAP is a perfect fit because it is cost efficient, easy to implement, and easy to understand. Change management is a breeze and, from cost efficiency standpoint, it is like no other because it is cloud based. It also empowers us, and we are not beholden to getting IT people or contracting IT companies to do things for us,” Cabal-Revilla added.
Maximizing cloud technology, SAP ERP solutions enable organizations to harmonize business processes, enhance efficiency, push sustainability goals, and transform the way of doing business. “SAP is a business-transformation-as-a-service in the cloud. No longer do you need to have it on your premise data center with cooling. The economies of scale happen when you take it to the cloud,” Abrahams concluded.