The Value Chain of Data Science for the Intelligent Enterprise: Applying Statistical Analysis to ERP for an SAP Road Map

By Carlos Pinheiro Guimaraes, Director of SAP Technology and Innovation at Hitachi Consulting

Humans have unlimited potential. And artificial intelligence (AI) just may be the discipline that helps us unleash that potential for a next evolutionary wave in our collective knowledge. It can help us make sense of very intricate and complex global operations and help determine how we affect people’s lives in real time.

AI gives us the tools to delegate our cognitive capacity – extending our ability to learn quickly, enhancing our knowledge, and empowering us in unprecedented ways. This human-machine symbiosis has the potential to help us change the world for the better.

It might seem like science fiction, but this symbiotic arrangement can break down barriers and lead to a world that operates as a single living organism. When all correlations can be sensed and all outcomes can be instantly analyzed, we will be prepared to react to anything, at any time, and any place. Leaving that romantic notion aside, let’s take a pragmatic look at how to create a system that can be managed with our current business and technology capabilities.

SAP and the rise of the intelligent enterprise

Today’s value chain requires finely tuned processes throughout every functional area, from front-office, client-facing roles and delivery flows to back-office compliance and planning. Forward-thinking companies know that this optimization is made possible by applying the powerful capabilities of data science and AI to the wealth of data available today. By combining digital transformation solutions such as SAP with statistical analysis and predictive analytics, companies around the world are building their value chains to become intelligent enterprises. You can learn more about this in a recently published paper, The Data Science Value Chain for the Intelligent Enterprise.  

The ideal enterprise technology approach allows you to apply quantitative techniques to every workflow throughout your value chain to monitor, tune and remediate quality, yield, efficiency and effectiveness. Modern enterprise resource planning (ERP) solutions support this by encompassing a broad range of workflows, including:

  • Operations. Sales and distribution, materials management, production planning, logistics execution and quality management.
  • Financials. Financial accounting, management accounting and financial supply chain management.
  • Human capital management. Training, payroll and e-recruiting.
  • Corporate services. Travel management; environment, health, and safety; and real-estate management.

In addition to an ERP solution, you’ll need both powerful distributed computing and applied statistical analysis to deal with the rapid throughput of data in motion and the massive volume of data at rest.

Of course, this dexterity comes at a financial cost for both storage and compute. Fortunately, you can use applied statistical techniques and machine learning to optimize your investment in your ERP platform and maximize your return on investment (ROI). By selecting a refined simple random sample for desktop analysis, you can prove value and concept before you employ expensive, time-consuming distributed storage and compute across the population.

The ideal predictive-analytical theory will support the following capability maturity road map:

  • Descriptive analytics of past system state, perhaps in near real-time backward-looking resolution.
  • Diagnostic analytics for near real-time backward-looking fault isolation, restoration and resolution.
  • Predictive analytics to apply information theory, statistical mechanics, deduction, simulation and statistical inference to predict near-term future events in real-time forward-looking resolution.
  • Prescriptive analytics for executive decision support to proactively optimize industrial processes with continual forward-looking resolution.

Hitachi is working with SAP to create a complete suite of SAP accelerators to help organizations create comprehensive, effective machine learning, an automation landscape, and a pragmatic internet of things (IoT) road map. The Hitachi Digital Manufacturing Suite for SAP will extend your SAP digital core to transform your business into a truly intelligent enterprise. 

Learn more about the Hitachi Digital Manufacturing Suite for SAP.