The right architecture for digital transformation

Oliver Karalus,

Architecture is important. Manufacturing facilities are designed to streamline production and ensure a smooth flow of materials, information, and processes. Warehouse facilities are built to minimize walking distance, use storage efficiently, and facilitate distribution and control. Similarly, business leaders understand that their enterprise system architecture is important in optimizing operations. But streamlining work across a large organization is not easy. Leaders have to solve for many challenges, and one of the biggest roadblocks to optimization is a fractured enterprise architecture.

Over the years, new business acquisitions, disconnected processes, channel-specific applications, process-specific applications, regional differentiators, multiple customer segments, and legacy system components can develop into an IT system of intertwined structures, including distributed, federated, and hub-and-spoke. Ultimately, this architectural jumble is an inefficient structure that not only slows optimization but negatively impacts the customer experience as well.

Fixing the “Frankenstack”

Stitching together disparate components, legacy systems, and bespoke solutions creates a brittle structure that slows work, is difficult to update, and is nearly impossible to scale – and no amount of middleware “glue” can fully optimize requests among a complex network’s OS, databases, and applications. To streamline front-end and back-end enterprise operations, leaders need to first streamline the architecture on which their systems are built.

Start with a foundational platform designed to support digital technologies, robotic automation, and Digital Process Automation – a unified architecture designed to connect people, systems, processes, and devices, plus allow businesses to differentiate as needed for each product, region, or channel. A foundational layer of business rules enables an end-to-end approach to enterprise IT systems operations by orchestrating real-time AI, data integrations, operational processes, IoT devices, robotic automations, dynamic case management, and applications – automating everything that can be automated, guiding human task work, optimizing processes, and managing customer journeys from end to end. This design drives transformation across the business, orchestrates value streams, and improves customer experiences.

With this architectural approach, enterprises gain consistency and expediency in processing work to achieve defined outcomes – whether that’s tracking quality assurance and control, completing an address change for a customer, opening a new bank account, or updating and deploying an application. Plus, businesses have the flexibility to tailor and scale operations to support work in different regions or for different customer segments.

Global enterprises are streamlining complex operations with a unified architecture

A great example of how a unified architecture can help streamline complex operations is Siemens’ Global Cash Collection Management Platform project. Siemens AG is a global technology powerhouse that has stood for engineering excellence, innovation, quality, reliability and internationality for more than 170 years. The company is active around the globe, focusing on the areas of power generation and distribution, intelligent infrastructure for buildings and distributed energy systems, and automation and digitalization in the process and manufacturing industries. In fiscal 2018, which ended on September 30, 2018, Siemens generated revenue of €83.0 billion, net income of €6.1 billion, and had approximately 379,000 employees worldwide. The company operates in more than 280 major production and manufacturing plants worldwide. Specific to order management and cash collection, Siemens manages 60 company codes from 15 ERP systems and different maturity levels in various countries regarding structured collection approach.

As you can imagine, the diversity of business line customers and regions resulted in a fractured enterprise architecture, with localized apps, disconnected data, and siloed processes. This structure made their order management and cash collection processes extremely localized and complex, and prevented Siemens’ teams from having visibility at the global level into performance, processes, and how each region’s work impacts the company overall – critical information for making any global improvements and ensuring a unified mission/vision.

To increase operational efficiency and transparency in a clustered environment, plus improve the customer experience, Siemens chose Pega as the foundation for an intent-led cash collection solution. Pega’s unified architecture made it possible for Siemens to harmonize and digitize their global collections processes, defining a common set of collection strategies that were then tailored for each region and customer segment. Automated tasks, such as providing copies of invoices, simplify the collections process and make it easy to provide customers with accurate information. Intent-led workflow helps increase processing efficiency, reduce errors, and still ensure that agents have full control.

As of 2018, Siemens’ Global Cash Collection Management Platform is live in eight service centers, supporting more than 15 countries around the globe with operations for cash collection, disputes, and reporting – and they continue to scale operations to support more countries. Building out the solution on top of a unified architecture has allowed Siemens to improve cash flow, improve operational efficiency, ensure the accuracy and quality of data, and increase transparency into each customer’s contact history.

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Tags

  • Industry: Manufacturing & High Technology
  • Topic: Digital Transformation
  • Challenge: Operational Excellence

About the Author

Pega Account Executive Oliver Karalus works with some of the world’s largest organizations to enhance customer loyalty, improve productivity, generate new business, and achieve new levels of agility.