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What can you learn from a cup of coffee? A single cup might seem trivial in terms of its impact on the overall business. But capture that cup with a smart camera, track it, apply analytics—and voilà! Suddenly, for the coffee shop, that beverage becomes an opportunity to gain insights to deliver better experiences for all of their customers. These high-quality experiences delight coffee aficionados, save them time, and sharpen the shop’s competitive edge.

How? Tracking each cup could reveal details like how long each beverage takes to make, how long it sits before it’s picked up, and if it hits any bottlenecks along the way. The result? Patrons get their beverages at just the right temperature, as fast as possible—every time—ensuring consistent quality that turns occasional customers into regulars. One global coffee retailer is already deploying these kinds of capabilities to 10,000 locations across North America, with more shops coming online all the time.

And it’s not just coffee retailers. Every day, technology offers organizations countless opportunities to improve their customers’ experiences—and reap the benefits that go with them, like deeper customer loyalty and better differentiation. Now is the time for IT leaders to seize these opportunities and lead the way to better business outcomes.

Customer experiences depend on IT

In the 2022 State of the CIO, 42% of CIO respondents said improving the customer experience was a top imperative. But for IT, improving customer experiences keeps getting harder. Today’s experiences aren’t confined to a single space. Far from it: they extend from locations, things, and applications to people, organizations, and communities. They depend on connections between everyone—and everything.

And the connections keep evolving and multiplying, making them harder to see, manage, and scale. As a result, the IT experience is suffering. This has ramifications beyond just IT. A poor IT experience can often mean a poor experience for end users, customers, and business partners.

How IT can be the hero

How can you empower your teams with the speed and agility they need to accelerate digital business? The answer is to simplify the solutions and platforms IT teams use, empowering them with the technology to work and innovate as one. This approach helps IT build secure bridges between different technologies, locations, organizations, teams, people, and things to deliver the unified experiences their customers, employees, and partners expect.

Providing unified experiences for your users requires a transformation that includes both network simplification and data intelligence. With a simplified, more data-driven approach, you can bring together the benefits of cloud-driven automation, network insights, and APIs to break down barriers and complexity.

Unlocking the transformation potential of IT

Transformation isn’t driven by advanced technology alone, but by innovative approaches like bringing a cloud operating model to the network. This enables IT leaders to expand the agility and scalability of cloud management across the entire infrastructure. It lets them apply automation to help siloed organizations work better together, using a common, consistent set of tools for more agile, frictionless collaboration. Armed with cloud agility, you can transform your operations from being reactive to more proactive and predictive.

Transformation also means not being satisfied with just simple integration that can add to tool sprawl, and instead, moving to the idea of convergence—like organically bringing together networking and security to sidestep manual, time-consuming integration steps. It lets you take advantage of automated provisioning, unified policies, and integrated workflows to manage risk—and work smarter, not harder.

We saw how a single customer touch point can lead to more consistently satisfied patrons, a smoother workplace for employees, and improved efficiency and revenue. As more businesses understand the competitive advantages that come with a fully empowered IT team, we’ll see a renewed focus on aligning IT and technology for better outcomes. With a simplified approach, CIOs can seize more of today’s opportunities to help their organizations unlock the full possibilities of every moment, and every experience.

Get started today.

Digital Transformation

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KPN, the largest infrastructure provider in the Netherlands, offers a high-performance fixed-line and mobile network in addition to enterprise-class IT infrastructure and a wide range of cloud offerings, including Infrastructure-as-a-Service (IaaS) and Security-as-a-Service. Drawing on its extensive track record of success providing VMware Cloud Verified services and solutions, KPN is now one of a distinguished group of providers to have earned the VMware Sovereign Cloud distinction.

“With the exceptionally strong, high-performance network we offer, this is truly a sovereign cloud. Government agencies, healthcare companies, and organizations with highly sensitive and confidential data can confidentially comply with industry-specific regulations such as GDPR, Government Information Security Baseline, Royal Netherlands Standardization Institute, and the Network and Information Security Directive,” said Babak Fouladi, Chief Technology & Digital Officer and Member of the Board of Management at KPN. “KPN places data and applications in a virtual private cloud that is controlled, tested, managed, and secured in the Netherlands, without third-party interference.”

KPN’s sovereign cloud, CloudNL, reflects a rapidly changing landscape in which many companies need to move data to a sovereign cloud. Reasons why include a dramatic increase in remote or hybrid work, evolving geopolitical events and threats, and fast-changing international regulations.

“The more you digitize an enterprise, the greater the variety of data and applications you must manage,” says Fouladi. “Each requires the right cloud environment based on the required security level, efficiency, and ease of use. On the one hand, this might include confidential customer information that requires extra protection, and which must remain within the nation’s boundaries. Just as importantly, the information must never be exposed to any foreign nationals at any time. On the other hand, you have workloads that are entirely appropriate for the public cloud and benefit from the economy and scale the cloud offers.”

Fouladi stresses that this is why so many organizations are embracing a multi-cloud strategy. It’s a strategy he believes is fundamentally enriched with a sovereign cloud.

Based on VMware technologies, CloudNL is designed to satisfy the highest security requirements and features stringent guarantees verified through independent audits. All data and applications are stored in KPN’s data centers within the Netherlands – all of which are operated and maintained by fully-vetted citizens of the Netherlands.

ValidSign, a KPN CloudNL customer, is a rapidly growing provider of cloud-based solutions that automate document signings. ValidSign’s CEO John Lageman notes that the company’s use of a fully sovereign cloud in Holland is particularly important for the security-minded organizations the company serves, among them notaries, law firms, and government institutions.

“The documents, permits, and contracts that we sign must remain guaranteed in the Netherlands,” says Lageman. “Digitally and legally signing and using certificates used to be very expensive. Moving to the cloud was the solution, but not with an American cloud provider – our customers would no longer be sure where the data would be stored or who could have access to it. With CloudNL they have that control.”

The Bottom Line

There are many reasons to move data to a sovereign cloud, among them an increase in remote or hybrid work, changing geopolitical events, or fast-changing international regulations. KPN CloudNL empowers enterprises to handle these challenges with ease by incorporating sovereign cloud into their multi-cloud strategy.

Learn more about KPN CloudNL here and its partnership with VMware here.

Cloud Computing

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With the threat of a recession looming, cost pressures increasing, and the deadline to move off SAP ECC swiftly approaching, SAP customers have a lot to consider as they plan for the year ahead.

Here are some of the trends we expect to play out as the year goes on, specifically for SAP customers.

1. SAP will hold firm on expiration of ECC support

Though customers may be looking for an extension, we expect SAP will not extend the expiration of mainstream maintenance for SAP Business Suite 7 core applications beyond 2027. SAP has already extended the deadline once — in 2020, it extended support from 2025 to the end of 2027. We also expect SAP to position alternative support options, via its extended maintenance option, for an additional 2% on your maintenance base or customer-specific maintenance through 2030.

Customers will likely continue to believe that SAP has not presented a strong enough business case to upgrade to S/4HANA. However, it will be difficult to argue that SAP hasn’t provided ample opportunity to plan and execute an upgrade or understand the financial implications for delaying the move to S/4HANA. Any extension on SAP’s part would fly in the face of its strategic objectives. Customers need to consider this deadline as final and start preparing now if they haven’t already.

2. SAP will aggressively position RISE

SAP’s agenda goes beyond migrating SAP ECC clients to S/4HANA. Migrating customers to RISE, its cloud offering on a subscription-based model, is of utmost importance. SAP RISE is the cornerstone of SAP’s long-term financial plan to secure increased renewal revenue.

SAP’s motivations and commitment to this offering were made clear back when its predictable revenue, a major factor in overall company valuation, was in the low 70s while other pure-play SaaS providers were in the low to high 90s. In its 2022 year-end earnings call, SAP boasted predictable revenue of 79% with aspirations to reach 85% by 2025. The stakes for SAP are high and customers should anticipate that SAP’s sales and negotiation tactics will reflect that and will include:

A highly coordinated approach/advocacy for RISE adoption throughout the partner network, including systems integrators (SI) and hyperscaler partnersPositioning the long-term vision, product development, and innovation to be focused on RISE vs. S/4HANA On-PremiseLeveraging executive-level client relationships to influence and offset potential deficiencies in RISE identified by client evaluation teamsOffering highly unfavorable pricing and commercial terms related to S/4HANA On-Premise license arrangements vs. historical SAP practices

Customers should anticipate the pressure SAP will apply for RISE adoption and prepare their organization to proactively manage SAP executive-level relationships. It’s also advisable for customers to conduct a thorough review of their SAP agreements and commercial protections before assuming a false sense of security with respect to their purchase or negotiation position for additional on-premises licenses.

3. Customer’s will struggle with RISE evaluations

Many clients have yet to come to the realization that the evaluation of RISE is more akin to evaluating a managed services offering than a pure-play SaaS solution. Companies also are at risk of underestimating the complexities and implications related to their existing operations and adjacent partner relationships. For example:

It’s in SAP’s nature to sell software, not a managed service offering. At worst, they will avoid the conversation completely, and at best, they will try to stay at a high-level on critical topics like environment sizing, roles and responsibilities, and modifications to service-level commitments.Most SAP ECC and S/4HANA customers have third-party support relationships, either in the form of traditional on-premises infrastructure support, cloud managed services, and/or application maintenance and support. An assessment of the current and future state of these relationships should be conducted in parallel with the RISE evaluation.Although SAP provides the flexibility to allow a customer to select its hyperscaler of choice through the RISE model, many customers already have or are contemplating sizable commitments to AWS, GCP, and Microsoft Azure. These companies have enjoyed sizable investments from hyperscalers in exchange for workloads. The question customers must answer is whether it’s in their interest to sever their hyperscaler relationship through an SAP RISE offering.

Customers who anticipate the complexity of their RISE evaluation and proactively develop an integrated sourcing and evaluation strategy will be positioned to make more informed and effective decisions.

4. SAP will target midmarket companies

We expect SAP to put significant energy into capturing more of the midmarket as these companies are more likely to adopt a single, vertically integrated solution like RISE. Unlike most enterprise-level companies, midmarket companies are nimbler and faster in their decision-making process and more likely to seek a single partner versus a multi-partner strategy. These companies are also more likely to implement SAP RISE faster than an SAP enterprise customer. All these factors present a meaningful opportunity to SAP. Because of this, these midmarket companies should be asking:

Is SAP presenting a commercial model that allows our organization to scale in a financially responsible manner?Is SAP presenting prospective implementation partners capable of successfully delivering the project?Is SAP and its implementation partners presenting a realistic view of the program scope, approach, and requirements for success?

5. Consulting firms will invest in ‘Phase 0’ initiatives      

Although it’s too early to give up on growth in 2023, we anticipate that the consulting and system implementation community will emphasize growth for 2024 and beyond via continued positioning of Phase 0 initiatives. We view this as an opportunity for companies that are not currently undertaking an SAP ECC to S/4HANA migration and do not expect the funding to commence their journey to S/4HANA until late 2023 or early 2024.

That said, every opportunity comes with a price and potential downstream risks that companies would be advised to consider as they undertake Phase 0 initiatives. We recommend keeping the following questions in mind:

Is the Phase 0 consulting firm a likely candidate for the implementation phase? If so, is your strategy to sole source? Does your timeline allow for an SI RFP process? Is there a potential for your organization to lose negotiation leverage by walking into an unplanned sole-source situation?What is the scope of the Phase 0? Is the scope aligned solely to the consulting partners methodology, or does it consider the requirements your company has to actually approve to proceed to the next phase of the project?Does your plan, board of directors, or regulatory commission call for an independent review and validation of the business case and strategy? If so, what is your plan to obtain such an independent perspective?Does the scope of your Phase 0 include the development of an integrated sourcing strategy designed to enable the evaluation, selection, and negotiation of multiple workstreams (including SAP software, implementation services, hyperscaler services, cloud managed services, and application maintenance and support)?

Before customers take advantage of the “time” to plan in 2023 and the investments that both SAP and consulting firms are willing to make in Phase 0 initiatives, they should think through the end-to-end decision process and their requirements rather than default to the approach and strategies proposed by any partner.

6. SAP customers will continue to migrate to the cloud

We anticipate that customers committed to staying on SAP ECC or planning to migrate to SAP S/4HANA while maintaining their perpetual licenses will continue to aggressively move to the cloud. Some companies will do so proactively, while others may be compelled to do so as a result of changes in the strategy of their existing managed services providers (e.g., Kyndryl and Dell Virtustream).

In addition, many companies will be making this migration in a context that goes beyond their SAP environment, including other application workloads and non-SAP transformational initiatives with AWS, Google, and Microsoft. As companies consider their overall cloud strategy, they should consider the following:

Evaluate SAP RISE in conjunction with their hyperscaler relationship and cloud managed services relationships to allow for effective decision-making and manufacturing of leverage.Take inventory of existing application and cloud migration roadmaps and future growth projections, as our experience shows that many organizations are blowing through their spend commitments very early in their agreement term.Assess their existing hyperscaler agreements, including spend commitments and incentives to determine whether they are market competitive and will scale commercially to account for future growth.

7. Customers will reimagine managed services relationships

In conjunction with the cloud migration, we believe companies will continue to reimagine their operating models and existing managed services relationships. The introduction of SAP RISE, the market disruption caused by the hyperscalers, and the continued pressure to reduce operating cost and improve operating scale will serve as the primary drivers in this area. As organizations reimagine their future state, they will be compelled to ask and answer the following:

Would it be more efficient to build a cloud center of excellence (COE) internally or proceed with a managed services model?Should I proceed with my incumbent on-premises managed service provider or select a new cloud managed service provider?Can I leverage my system integrator and SAP to provide a comprehensive managed services solution, such as Accenture’s SOAR offering, or proceed with a multi-vendor approach?Can I leverage the selected S/4HANA systems integrator or my existing SAP ECC application management services (AMS) provider to provide application maintenance and support?

Although SAP may serve as a major consideration with respect to the overall strategy, many organizations have managed services relationships that expand well beyond the boundaries of SAP, including security services, non-SAP AMS, help desk services, field services, etc. Renegotiating these relationships and assuming a partial termination of existing services will also need to be considered as part of an overall strategic sourcing plan.

Many companies are well on their way to tackling these decisions. But the vast majority of SAP’s install base is just starting this journey and are likely to be leveraging the majority of 2023 to develop and execute a strategy to answer these questions.

ERP Systems, SAP

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By Hock Tan, Broadcom President and CEO

During the 17 years I have led Broadcom, solving problems for customers and giving them the tools they need to succeed have been the most rewarding parts of my job. It’s important to me that whether we’re inventing the future through innovative R&D or co-creating new solutions with partners and users, Broadcom’s focus is customer centricity.

Broadcom has long prided itself in offering world-class enterprise technology solutions, spanning semiconductors to infrastructure software that the world’s largest companies need and want. Once we acquire VMware, we expect to deepen our commitment to customer success by building a more dynamic IT value proposition. Together, we will add the software tools customers need to better manage and get the most out of their data across all possible environments, whether they choose private cloud or public cloud approaches.

We’ll also gain valuable partnerships – an ecosystem that has been and will remain essential to Broadcom’s broader commitment to maintain, nurture, and serve VMware’s existing and future customers, regardless of organizational size. VMware’s partners today serve as both innovation collaborators and connectors to a wider range of customers, including small- and medium-sized businesses. Once the acquisition is completed, we will sustain and further develop VMware’s robust partner ecosystem, especially as we work together to expand VMware’s solutions. Partners will be able to grow their businesses as the combined company accelerates execution and smart portfolio growth. Together, we’ll be better positioned to help customers speed app modernization, move to the cloud faster and support a more secure and hybrid workforce.

We will also help expand an extremely innovative, world-wide user community. As I mentioned in my open letter to the VMware User Group (VMUG), it’s all about the product – and we’re going to focus on making VMware’s products even better for customers, including making them easier for customers and partners to access and use. As part of this, we will support and invest greater resources in VMware’s training programs, which we recognize are incredibly valuable offerings to the user community, and use our longstanding experience in utilizing partner and user ecosystems to support customers’ technology and multi-cloud priorities.

However, for Broadcom and VMware to remain central to customer success, we also must remain at the forefront of product innovation and help customers keep up with technology advancements. VMware will complement Broadcom’s more than 60-year focus on innovation, intellectual property, and R&D know-how. Our combined track record of developing and distributing ground-breaking technologies will accelerate customer value, and industry and ecosystem growth. Each company’s products are leaders in their respective markets and categories, powering the most complex IT environments in the world.

Ultimately, through this combination of partners, users, and products, we will take our commitment to customer success to a new level. In this multi-cloud era, Broadcom and VMware will empower customers by providing them the tools that give them the choice, freedom, and flexibility to innovate and better manage their IT environments. Customers cannot compete or operate effectively if their IT environments lag the industry, and that’s particularly true for those managing highly sensitive data and need to protect and control their data across environments – whether on-premises or in private or public clouds.

Take Europe, for example, where governments and critical industries are looking to sovereign clouds. A multi-cloud approach that includes sovereign clouds allows organizations to ensure their data is being safely stored and managed in compliance with relevant regional and national laws and regulations. It is critical for enterprises, especially governments, to maintain flexibility to move data between deployment environments, while running workloads across these multiple environments. Governments moving to multi-cloud will need the tools to effectively manage their data and run applications in different cloud environments to meet different regulatory and other requirements.

At Broadcom, we all see an incredibly exciting future for VMware’s customers. Together, we will continue investing in and further developing VMware’s innovative product portfolio, leveraging our shared R&D commitment and expertise. And we will leverage our collective experience with VMware’s partners and users to unlock new value and growth. This combination will serve our customers more impactfully and comprehensively than ever before and propel their businesses forward over the long term.

Learn more from Broadcom

Cautionary statement regarding forward-looking statements

This communication relates to a proposed business combination transaction between Broadcom Inc. (“Broadcom”) and VMware, Inc. (“VMware”).  This communication includes forward-looking statements within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and Section 27A of the U.S. Securities Act of 1933, as amended.  These forward-looking statements include but are not limited to statements that relate to the expected future business and financial performance, the anticipated benefits of the proposed transaction, the anticipated impact of the proposed transaction on the combined business, the expected amount and timing of the synergies from the proposed transaction, and the anticipated closing date of the proposed transaction.  These forward-looking statements are identified by words such as “will,” “expect,” “believe,” “anticipate,” “estimate,” “should,” “intend,” “plan,” “potential,” “predict,” “project,” “aim,” and similar words or phrases.  These forward-looking statements are based on current expectations and beliefs of Broadcom management and current market trends and conditions. 

These forward-looking statements involve risks and uncertainties that are outside Broadcom’s control and may cause actual results to differ materially from those contained in forward-looking statements, including but not limited to: the effect of the proposed transaction on our ability to maintain relationships with customers, suppliers and other business partners or operating results and business; the ability to implement plans, achieve forecasts and meet other expectations with respect to the business after the completion of the proposed transaction and realize expected synergies; business disruption following the proposed transaction; difficulties in retaining and hiring key personnel and employees due to the proposed transaction and business combination; the diversion of management time on transaction-related issues; the satisfaction of the conditions precedent to completion of the proposed transaction, including the ability to secure regulatory approvals on the terms expected, at all or in a timely manner; significant indebtedness, including indebtedness incurred in connection with the proposed transaction, and the need to generate sufficient cash flows to service and repay such debt; the disruption of current plans and operations; the outcome of legal proceedings related to the transaction; the ability to complete the proposed transaction on a timely basis or at all; the ability to successfully integrate VMware’s operations; cyber-attacks, information security and data privacy; global political and economic conditions, including cyclicality in the semiconductor industry and in Broadcom’s other target markets, rising interest rates, the impact of inflation and challenges in manufacturing and the global supply chain; the impact of public health crises, such as pandemics (including COVID-19) and epidemics and any related company or government policies and actions to protect the health and safety of individuals or government policies or actions to maintain the functioning of national or global economies and markets; and events and trends on a national, regional and global scale, including those of a political, economic, business, competitive and regulatory nature.

These risks, as well as other risks related to the proposed transaction, are included in the registration statement on Form S-4 and proxy statement/prospectus that has been filed with the Securities and Exchange Commission (“SEC”) in connection with the proposed transaction.  While the list of factors presented here is, and the list of factors presented in the registration statement on Form S-4 are, considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties.  For additional information about other factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to Broadcom’s and VMware’s respective periodic reports and other filings with the SEC, including the risk factors identified in Broadcom’s and VMware’s most recent Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K.  The forward-looking statements included in this communication are made only as of the date hereof.  Neither Broadcom nor VMware undertakes any obligation to update any forward-looking statements to reflect subsequent events or circumstances, except as required by law.

No offer or solicitation

This communication is not intended to and shall not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities, or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.  No offering of securities shall be made, except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.  

Additional information about the transaction and where to find it

In connection with the proposed transaction, Broadcom has filed with the SEC a registration statement on Form S-4 that includes a proxy statement of VMware and that also constitutes a prospectus of Broadcom.  Each of Broadcom and VMware may also file other relevant documents with the SEC regarding the proposed transaction.  The registration statement was declared effective by the SEC on October 3, 2022 and the definitive proxy statement/prospectus has been mailed to VMware shareholders. This document is not a substitute for the proxy statement/prospectus or registration statement or any other document that Broadcom or VMware may file with the SEC.   INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT MAY BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.  Investors and security holders may obtain free copies of the registration statement and proxy statement/prospectus and other documents containing important information about Broadcom, VMware and the proposed transaction once such documents are filed with the SEC through the website maintained by the SEC at http://www.sec.gov.  Copies of the documents filed with the SEC by Broadcom may be obtained free of charge on Broadcom’s website at https://investors.broadcom.com.  Copies of the documents filed with the SEC by VMware may be obtained free of charge on VMware’s website at ir.vmware.com.

About Hock Tan:

Broadcom Software

Hock Tan is Broadcom President, Chief Executive Officer and Director. He has held this position since March 2006. From September 2005 to January 2008, he served as chairman of the board of Integrated Device Technology. Prior to becoming chairman of IDT, Mr. Tan was the President and Chief Executive Officer of Integrated Circuit Systems from June 1999 to September 2005. Prior to ICS, Mr. Tan was Vice President of Finance with Commodore International from 1992 to 1994, and previously held senior management positions with PepsiCo and General Motors. Mr. Tan served as managing director of Pacven Investment, a venture capital fund in Singapore from 1988 to 1992, and served as managing director for Hume Industries in Malaysia from 1983 to 1988.

IT Leadership

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Salesforce was an early adopter of artificial intelligence (AI) with its Einstein recommendation tools, but it is taking a cautious approach to deploying the latest AI trend, generative AI.

It’s been a month since Salesforce CEO Marc Benioff tweeted, “Get ready to be wowed by Salesforce EinsteinGPT! It generates leads, closes deals, and even makes coffee (just kidding, but wouldn’t that be amazing?)”

On the eve of the company’s Trailblazer DX ’23 developer conference, though, Einstein GPT still wasn’t ready. “We’re still very early days,” Salesforce Service Cloud GM Clara Shih said in a conference call to demonstrate Einstein GPT to journalists. “We’re testing and validating and iterating before we launch these products as generally available.”

Salesforce has committed to building AI that is responsible, inclusive, accountable, transparent and empowering, a series of values similar to those espoused in the Rome Call for AI Ethics.

Interest in generative AI from customers is high, Shih said. “We have pilots across every single cloud that is happening, and many of them are oversubscribed,” she said.

It’s easy to see why they’re interested: Generative AI tools such as ChatGPT can write sales proposals or respond interactively to customer complaints far quicker and more cost-effectively than a person. But there are dangers: the models such generative AI tools use to decide which word to write next can occasionally “hallucinate,” generating wildly inaccurate or inappropriate recommendations, and making it risky for enterprises to use them unsupervised.

In a period of great economic uncertainty, enterprises are focusing on customer experience and customer retention, said Gartner distinguished analyst Gene Alvarez. “AI brings hopes of providing great customer experiences at scale while not driving costs higher,” he said.

But imperfections in the output of today’s generative AIs mean that human review is needed, he said. “Salesforce appears to be taking its time to navigate all these issues in advance of the release, which is a prudent approach,” he added.

What will Einstein GPT do?

Einstein GPT is not one product but five: Einstein GPT for Service, for Sales, for Marketing, for Slack and for Developers.

When they’re eventually released, they’ll offer enterprises ways to incorporate suggestions from a generative AI model into their Salesforce workflows. These suggestions will be based on the data used to train the generative AI model, and also on the data held in an enterprise’s Salesforce system.

“We’ve got the relevant context to really make the most out of generative AI,” said Shih. “Our Salesforce Data Cloud means we can allow the generative AI to continuously adapt as customer information and needs change.”

Einstein GPT for Service will prompt service agents with responses to customer questions and requests, summarize the interaction to create case notes, and even extract relevant information to generate new knowledge base articles, she said.

For sales staff, Einstein GPT for Sales will summarize news about accounts and identify key contacts, as well as generate drafts for sales emails. The creation of targeted email campaigns, ads and landing pages will be the preserve of Einstein GPT for Marketing.

Einstein GPT for Slack will provide natural language access to CRM functions from within the Slack messaging platform that Salesforce acquired in 2021, while Einstein GPT for Developers will automatically create code snippets and test cases based on comments in code.

For Gartner analyst Kyle Davis, there’s potential for generative AI to assist developers in writing better quality code.

“This is different from developing a whole application but provides valuable assistance in smaller scoped scenarios,” Davis said. “I see this with Microsoft using Power Apps Ideas to help developers create a Power Fx formula that would’ve been difficult to create on their own, especially if they’re new to Power Apps development. The same is now being incorporated into Salesforce. Poorly written Apex code can cause low-performing applications.”

Einstein GPT: Not just GPT

Despite Einstein GPT’s name, GPT won’t be the only generative AI tool it uses. Salesforce plans to combine its own AI models with others from an open ecosystem of vetted partners, including those of its launch partner, GPT developer OpenAI, said  Shih.

“This means customers have choice,” she said. “They can bring their own generative AI models or choose one of our out-of-the-box generative AI options.”

In all the demonstrations of Einstein GPT during the conference call, one feature remained constant: Whenever Einstein GPT generated any text, another click was required before it was shared with another person.

Jayesh Govindarajan, SVP of engineering, Einstein and Bots, explained: “You saw generative AI operating within the trust boundary, with a human in the loop at all times. Another powerful benefit to having humans in the loop is that the edits and the refinements go back into reinforcing the model, and over time, improve their performance. The more you use, the better it gets.”

Requiring a person to click “OK” may not be sufficient to keep AI hallucinations from causing trouble, particularly if that person’s compensation depends on how many queries they respond to or how many lines of code they write, so CIOs will need to take a holistic view of the checks and balances they build into their processes, not just look at the user interface.

There are other UX challenges too, Gartner’s Alvarez notes: Just because a bot can tailor a response using a customer’s personal information quicker than a human operator could, doesn’t mean it should.

“There are ethical issues to be wrestled with, such as the thin line between being helpful to a customer and being invasive,” Alvarez said. “This is where ethics on customer etiquette are needed to avoid interactions that will drive customers away.”

While Salesforce is taking a cautious approach to introducing generative AI, its partner OpenAI has gone full speed ahead. OpenAI uses Slack internally, and saw early on the potential for plugging its ChatGPT bot right into its corporate Slack channels.

It has now released a beta version of its ChatGPT app for Slack that anyone can sign up to use. It will appear in the Slack App directory, subject to the usual corporate approvals for app integrations. Once installed, it adds two functions to Slack’s “More actions” button: “Summarize thread” and “Draft reply.” It’s also possible to use the app as a search tool by asking it questions. Salesforce wants other companies to pile in on generative AI, and its investment arm, Salesforce Ventures, has set up a new fund to support them. “We’re launching this $250 million AI investment fund to nurture the next generation of AI startups and to guide the ecosystem in developing generative AI in a responsible way,” Shih said.

Application Management, Artificial Intelligence, CIO, CRM Systems

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As CIO of United Airlines, Jason Birnbaum is laser focused on using technology and data to enable the company’s 86,000 employees to create as seamless a customer travel experience as possible. “Our goal is to improve the entire travel process from when you plan a trip to when you plan the next trip,” says Birnbaum, who joined the airline in 2015 and became CIO last July.

One opportunity for improvement was with customers who are frustrated about arriving at the gate after boarding time and unable to board because the doors are shut, while the plane is sitting on the ground. “The situation is not only frustrating to our customers, but also to our employees,” Birnbaum says. “We are in the business of getting people to where they want to go. If we can’t help them do that, it drives us crazy.”

So, Birnbaum and his team built ConnectionSaver, an analytics-driven engine that assesses arriving connections, calculates a customer’s distance from the gate, looks at all other passenger itineraries, where the plane is going, and whether the winds will allow the flight to make up time, and then makes a real-time determination about waiting for the connecting passenger. ConnectionSaver communicates directly with the customer that the agents are holding the plane.

ConnectionSaver is a great example of how a “simple” solution resulted from a tremendous amount of cultural, organizational, and process transformation, so I asked Birnbaum to describe the transformation “chapters” behind this kind of innovation.

Chapter 1: IT trust and credibility

“For years, it was common for technology organizations to have too little credibility to drive transformation,” says Birnbaum. “That was our story, and we worked very diligently to change the narrative.”

Key to changing the narrative was giving senior IT leaders end-to-end business process ownership responsibilities. “We started moving toward a process ownership model several years ago, and since then, we’ve made significant improvements in technology reliability, user satisfaction, and our employees’ trust in the tools,” Birnbaum says. “This is important because every transformation chapter depends on use of the technology. If our employees don’t trust the tools, we will never get to transformation.”

A process could be gate management, buying a ticket, managing baggage, or boarding a plane, each of which runs on multiple systems. “Before we moved from systems to process ownership, people would see that their system is up, so they would assume the problem belonged to someone else,” says Birnbaum. “In that model, no one was looking out for the end user. Now, we have collaborative conversations about accountability for business outcomes, not system performance.”

Chapter 2: Improving the employee experience

Like every company, United Airlines has been working to improve the customer experience for years, but more recently has expanded its “design thinking” energies to tools for employees. To facilitate this expansion, Birnbaum grew the Digital Technology employee user experience team from three people to 60, all acutely focused on integrating the employee experience into the customer experience.

The employee user experience team spends time with gate agents, contact centers, and airplane technicians to identify technology to help employees help customers. “The goal of the employee user experience team is to provide tools that are intuitive enough for the employee to create a great customer experience, which in turn, creates a great employee experience,” says Birnbaum. “It is important for companies to invest in change management, but you need less change management if you give employees tools that they really want to use.”

For example, the user experience team learned that flight attendants felt ill equipped to improve the experience of a customer once the customer is on the plane. If a customer agreed to change seats or check a bag, for example, there was little a flight attendant could do to improve the experience in real-time. “All they had was a book of discount coupons, but the customer had to call a contact center with a code to get the discount,” says Birnbaum. “The reward required five more steps for the customer; it did not feel immediate.”

So, the team developed a tool called “In the Moment Care,” which uses an AI engine to make reward recommendations to the flight attendant who can offer compensation, miles, or discounts in any situation. The customer can see the reward on his or her phone right away, which immediately improves both the customer and employee experience. “We knew the customers would be happier with having their problem solved in real-time, but we were surprised by how much the flight attendants loved the tool,” says Birnbaum.  “They said, ‘I get to be the hero. I get to save the day.’”

The employee user experience team then turned its attention to the process of “turning the plane,” which includes every task that happens from the minute a plane lands to when it takes off again. It involves at least 35 employees in a 30-minute window.  

Take baggage, for example. Traditionally, during the boarding process, if the overhead bins were starting to fill up at the back of the plane, that flight attendant had no way to communicate to the flight attendant in the front of the plane that it is time to start checking bags. Their only option was to call the captain to call the network center to call the gate to get them to start checking bags.

To create a better communication channel, the employee user experience team worked with the developers to create a new tool, Easy Chat, that puts every employee responsible for a turn activity into one chat room for the length of the turn. “Whether the bins are filling up, or they need more orange juice, or they are waiting for two more customers to come down the ramp, the team can communicate directly to digitally coordinate the turn,” says Birnbaum. “Once the flight is gone, each employee will be connected to another group in another time and place.”

Again, Birnbaum sees that the value of Easy Chat is well beyond the customer experience. “I was just talking to a few flight attendants the other day, who told me that Easy Chat makes them feel like they are a part of a team, rather than a bunch of people with individual roles,” says Birnbaum. “United has a lot of employees, and they don’t work with the same people every day. The new tool allows us them to work as a team and to feel connected to each other.”

Chapter 3: Data at scale

To improve the analytics capabilities of the company, Birnbaum and his team built a hub and spoke model with a central advanced analytics team in IT that collaborates with each operational area to develop the right data models. 

“The operating teams live and breathe the analytics — they are the people scheduling the planes — so they are key to unlocking the value of the analytics,” says Birnbaum. “Digital Technology’s job is to collect, structure, and secure the data, and help our operational groups exploit it. We want the data scientists in the operating areas to take the lead on how to make the data valuable at scale.”

For example, United has always worked to understand the cause of a flight delay. Was it a mechanical problem? Did the crew show up late? “The teams would spend hours figuring out whose fault it was, which was a huge distraction from running the operation,” says Birnbaum. To solve this problem, the analytics team, in partnership with the operations team, created a “Root Cause Analyzer” that collects operational data about the flight.

“Now, instead of spending time debating why the flight was delayed, we can quickly see exactly what happened and spend all of our time on process improvement,” says Birnbaum.

With the foundational, employee experience, and data chapters now under way, Birnbaum is thinking about the next chapter: Using technology and analytics to integrate and personalize a customer’s entire travel experience.

“If you have a rough time getting to the airport, but the flight attendant greets you by your name and knows what you ordered, you will still have a good trip,” says Birnbaum.  “It is our job to use technology to help our employees deliver that great customer experience.”

Digital Transformation, Employee Experience, Travel and Hospitality Industry

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By Hock Tan, Broadcom President & CEO

Over the last several weeks, I have had the opportunity to visit with Broadcom customers around the world to discuss what’s on the horizon as they navigate increasingly complex IT operating environments. During these visits, I’ve also answered their questions and shared our vision of what a combined Broadcom and VMware will look like following the close of the transaction.

It’s clear from these conversations that three topics are top of mind for customers as it relates to the VMware-Broadcom transaction: multi-cloud, cloud-native apps and pricing. Ultimately, what I’ve stressed to them has been straightforward: our customers are and will remain the most important part of our business. That said, I want to discuss each of these topics and share my current thinking to help address the concerns I’ve heard.

Broadcom’s Strategy

I hope I’ve made clear that at Broadcom, we are continuing to embrace and invest in customers’ priorities. My priorities for Broadcom are very much aligned with customers.

By investing and innovating in infrastructure software and VMware’s broad portfolio — including multi-cloud and cloud-native capabilities — we will bring our customers greater flexibility and deliver new solutions to help them connect, scale and protect their IT infrastructure. This will also empower our customers to modernize and architect their IT infrastructure while ensuring there will be large-scale, secure, and reliable, yet flexible, solutions to do so. Similarly, continuing to develop our ecosystem will enable partners to grow their businesses with expanded offerings of the combined portfolio and even better meet customers’ needs.

Multi-Cloud

As I met with customers across the U.S., U.K., Germany and France, I asked about their current and future priorities. For some time, Broadcom has recognized that the future of enterprise IT is multi-cloud — the ability to distribute applications and services across a combination of clouds. It’s one of the many reasons Broadcom solutions complement what VMware does in the multi-cloud space across private, public, edge and sovereign clouds today. It’s clear our customers have already adopted this mindset, too. I’ll share an example.

While in London, I met with the chief technology officer of a global financial services firm. We discussed the increasing need for financial institutions to adopt innovative solutions and ensure legacy infrastructure is efficient and secure. We agreed multi-cloud solutions meet this need, ultimately improving performance and strengthening resilience at a lower cost. Customers are enthusiastic about the multi-cloud vision and, with increased resources from Broadcom following transaction close, the potential to implement it as VMware grows and increases momentum in the space.

Cloud-Native Apps

Customers are similarly excited about VMware’s momentum around cloud-native apps. Containers are changing the way modern applications are built, resulting in faster and more predictable development and deployment. Developers also can take advantage of Kubernetes clusters, which more efficiently use the containerized infrastructure that power those applications. Kubernetes clusters bring other advantages, including making apps more resilient and easier to manage, bringing cost savings to organizations; and  making apps more portable between different clouds and internal environments, because Kubernetes clusters can run on premises or within public clouds. The resulting modern applications are more scalable and flexible, accelerating the speed and agility of innovation within organizations. By providing customers with the environment and hands-on guidance to help build cloud-native applications quickly and upskill their teams along the way, a combined Broadcom-VMware can help them drive forward their businesses.

Since the announcement of our intention to acquire VMware in May, I have had the opportunity to spend time with many VMware and Broadcom customers, partners and the VMware Product and Go-to-Market leadership teams. I have gained a deeper understanding of the VMware Tanzu portfolio and the strategic importance of cloud-native applications and modern app development and management. Customers are telling me that modern applications are a central part of their go-forward strategy in a multi-cloud world, and that the VMware Tanzu portfolio of products and solutions are an important area of focus for them.

Many customers and partners are asking me how I see the VMware Tanzu portfolio and Broadcom’s future commitment to the Tanzu business. My answer to them is that I see Tanzu as a strategic part of the VMware software portfolio and it will remain that way as we move forward within Broadcom. VMware Tanzu customers are running some of the most mission critical applications in the world. As customers think about future investments in cloud native applications and the modern application development space, they should feel confident in Broadcom’s commitment going forward.

Pricing

We work with our customers every day to tackle a wide spectrum of challenges, and we are constantly innovating to create the next generation of technology to address their needs. This is largely what has made our business successful, and we intend for this to continue.

Our growth into a global technology leader was not based on taking existing products and raising their prices, but by creating technology and products that provide clear value to customers and continuing to improve them. We fuel growth by offering more and better products so customers are using more of our entire portfolio of technology products, rather than just one or two. By delivering long-term value to customers and investing in improved, customer-focused R&D, we can innovate, scale and offer better products without raising prices.

VMware develops technology for the future and addresses a growing market. The Broadcom business case for this transaction is premised on focusing on the business model, increasing R&D, and executing so that customers see the value of the full portfolio of innovative product offerings — not on increasing prices. Following the close of the transaction, we will invest in and innovate VMware’s products so we can sell even more of them and grow the VMware business within enterprises, deepening and expanding the footprint instead of potentially raising prices.

Of course, our other main priority once the transaction is complete will be integrating VMware and its employees. VMware is an innovation success story — but the company’s story is far from finished and we’re excited to help write the next chapters. I have tremendous respect for what VMware has built, and experiencing the company’s excitement for the future at VMware Explore in San Francisco earlier this year reinforced my belief that we are on the right path.

I came away from my recent travels even more excited about what a combined Broadcom and VMware can deliver to our customers, and I look forward to continuing these valuable conversations as we progress toward closing. More than that, once we complete our transaction, I look forward to starting the important work of fostering an environment of growth and innovation aligned with our customers’ priorities.

To stay updated on the news about the transaction, click here.

Cautionary Statement Regarding Forward-Looking Statements

This communication relates to a proposed business combination transaction between Broadcom Inc. (“Broadcom”) and VMware, Inc. (“VMware”).  This communication includes forward-looking statements within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and Section 27A of the U.S. Securities Act of 1933, as amended.  These forward-looking statements include but are not limited to statements that relate to the expected future business and financial performance, the anticipated benefits of the proposed transaction, the anticipated impact of the proposed transaction on the combined business, the expected amount and timing of the synergies from the proposed transaction, and the anticipated closing date of the proposed transaction.  These forward-looking statements are identified by words such as “will,” “expect,” “believe,” “anticipate,” “estimate,” “should,” “intend,” “plan,” “potential,” “predict,” “project,” “aim,” and similar words or phrases.  These forward-looking statements are based on current expectations and beliefs of Broadcom management and current market trends and conditions. 

These forward-looking statements involve risks and uncertainties that are outside Broadcom’s control and may cause actual results to differ materially from those contained in forward-looking statements, including but not limited to: the effect of the proposed transaction on our ability to maintain relationships with customers, suppliers and other business partners or operating results and business; the ability to implement plans, achieve forecasts and meet other expectations with respect to the business after the completion of the proposed transaction and realize expected synergies; business disruption following the proposed transaction; difficulties in retaining and hiring key personnel and employees due to the proposed transaction and business combination; the diversion of management time on transaction-related issues; the satisfaction of the conditions precedent to consummation of the proposed transaction, including the ability to secure regulatory approvals on the terms expected, at all or in a timely manner; significant indebtedness, including indebtedness incurred in connection with the proposed transaction, and the need to generate sufficient cash flows to service and repay such debt; the disruption of current plans and operations; the outcome of legal proceedings related to the transaction; the ability to consummate the proposed transaction on a timely basis or at all; the ability to successfully integrate VMware’s operations; cyber-attacks, information security and data privacy; global political and economic conditions, including cyclicality in the semiconductor industry and in Broadcom’s other target markets, rising interest rates, the impact of inflation and challenges in manufacturing and the global supply chain; the impact of public health crises, such as pandemics (including COVID-19) and epidemics and any related company or government policies and actions to protect the health and safety of individuals or government policies or actions to maintain the functioning of national or global economies and markets; and events and trends on a national, regional and global scale, including those of a political, economic, business, competitive and regulatory nature.

These risks, as well as other risks related to the proposed transaction, are included in the registration statement on Form S-4 and proxy statement/prospectus that has been filed with the Securities and Exchange Commission (“SEC”) in connection with the proposed transaction.  While the list of factors presented here is, and the list of factors presented in the registration statement on Form S-4 are, considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties.  For additional information about other factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to Broadcom’s and VMware’s respective periodic reports and other filings with the SEC, including the risk factors identified in Broadcom’s and VMware’s most recent Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K.  The forward-looking statements included in this communication are made only as of the date hereof.  Neither Broadcom nor VMware undertakes any obligation to update any forward-looking statements to reflect subsequent events or circumstances, except as required by law.

No Offer or Solicitation

This communication is not intended to and shall not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities, or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.  No offering of securities shall be made, except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.  

Additional Information about the Transaction and Where to Find It

In connection with the proposed transaction, Broadcom has filed with the SEC a registration statement on Form S-4 that includes a proxy statement of VMware and that also constitutes a prospectus of Broadcom.  Each of Broadcom and VMware may also file other relevant documents with the SEC regarding the proposed transaction.  The registration statement  was declared effective by the SEC on October 3, 2022 and the definitive proxy statement/prospectus has been mailed to VMware’s stockholders. This document is not a substitute for the proxy statement/prospectus or registration statement or any other document that Broadcom or VMware may file with the SEC.   INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT, PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT MAY BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.  Investors and security holders may obtain free copies of the registration statement and proxy statement/prospectus and other documents containing important information about Broadcom, VMware and the proposed transaction, once such documents are filed with the SEC through the website maintained by the SEC at http://www.sec.gov.  Copies of the documents filed with the SEC by Broadcom may be obtained free of charge on Broadcom’s website at https://investors.broadcom.com.  Copies of the documents filed with the SEC by VMware may be obtained free of charge on VMware’s website at ir.vmware.com.

Participants in the Solicitation

Broadcom, VMware and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction.  Information about the directors and executive officers of Broadcom, including a description of their direct or indirect interests, by security holdings or otherwise, is set forth in Broadcom’s proxy statement for its 2022 Annual Meeting of Stockholders, which was filed with the SEC on February 18, 2022, and Broadcom’s Annual Report on Form 10-K for the fiscal year ended October 31, 2021, which was filed with the SEC on December 17, 2021.  Information about the directors and executive officers of VMware, including a description of their direct or indirect interests, by security holdings or otherwise, is set forth in VMware’s proxy statement for its 2022 Annual Meeting of Stockholders, which was filed with the SEC on May 27, 2022, VMware’s Annual Report on Form 10-K for the fiscal year ended January 28, 2022, which was filed with the SEC on March 24, 2022, a Form 8-K filed by VMware on April 22, 2022 and a Form 8-K filed by VMware on May 2, 2022.  Other information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, are or will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the proposed transaction when such materials become available.  Investors should read the proxy statement/prospectus carefully before making any voting or investment decisions.  You may obtain free copies of these documents from Broadcom or VMware using the sources indicated above.

About Hock Tan:

Broadcom Software

Hock Tan is Broadcom President, Chief Executive Officer and Director. He has held this position since March 2006. From September 2005 to January 2008, he served as chairman of the board of Integrated Device Technology. Prior to becoming chairman of IDT, Mr. Tan was the President and Chief Executive Officer of Integrated Circuit Systems from June 1999 to September 2005. Prior to ICS, Mr. Tan was Vice President of Finance with Commodore International from 1992 to 1994, and previously held senior management positions with PepsiCo and General Motors. Mr. Tan served as managing director of Pacven Investment, a venture capital fund in Singapore from 1988 to 1992, and served as managing director for Hume Industries in Malaysia from 1983 to 1988.

IT Leadership, Multi Cloud

Posted on Posted in Digital transformation, General topics Tagged with , , , , , , , , , ,

If there is one universal truth, it’s that fashion is fickle.

In the apparel industry, what’s in fashion one day may be out of fashion the next. So, if you’re an apparel manufacturer, you need the most efficient, responsive, and innovative operation possible. That way, you can keep up with ever-changing demand and stay in fashion with your retailer customers — as Crystal International Group, Ltd. (Crystal) has accomplished with great success.

Established in Hong Kong in 1970 by Kenneth and Yvonne Lo, Crystal grew from a small workshop with a few sewing machines and knitting looms for producing sweaters into a global apparel leader. Today, the company has 20 self-operating manufacturing facilities in five countries, with approximately 70,000 employees. Every year, Crystal delivers more than 450 million pieces of apparel — and we’re not talking about just sweaters.

The company makes lifestyle wear; denim; intimates; outdoor apparel; sportswear for top brands, such as adidas, Nike, and PUMA; and, yes, sweaters for international brands, including UNIQLO, Gap, and H&M — plus L Brands, which operates Victoria’s Secret.

The company is more than a top manufacturer. It’s also a social and environmental leader. In fact, Crystal has been ranked 17th out of 50 on Fortune Magazine’s “Change the World” list.

The goal of enhancing the outfit

Efficiency, responsiveness, innovation — as well as quality — are top of mind with Crystal. And that applies to all aspects of the operation, including manufacturing and business processes.

In terms of manufacturing, the company is always looking to boost its ability to satisfy customer requirements. What will it take to meet product specifications? Are there better ways to source and utilize raw materials? How can manufacturing processes and workflows, in general, be accelerated and streamlined? At the same time, the company wants to continue developing solutions to reduce discharges that might impact the environment.

On the business side, efficient processes help with Crystal’s order fulfillment, order-to-cash cycle, and other factors that can affect its bottom line and customer satisfaction.

Threads out of place

Until recently, the manufacturing facilities were “self-operating” without a strong information exchange between facilities and headquarters. Manufacturing was not fully integrated with the corporate business group’s enterprise resource planning (ERP) solution. For example, disparate ERP solutions were used to fulfill local requirements in China, often creating duplication. As a result, it was difficult to obtain real-time operational information to help make better decisions about production improvements, scheduling, inventory, deliveries, and more.

On the manufacturing and business sides, employees were dealing with many labor-intensive, manual processes that slowed down work. In the business area, there were time-consuming check-and-verify processes, such as bank reconciliations. Management lacked visibility during period-end closing — to name a few challenges.

The latest in digital ware

Working with SAP platinum partner DynaSys Solutions Ltd., Crystal has implemented an end-to-end intelligent enterprise solution to improve its operation. The solution leverages SAP S/4HANA for fashion and vertical business, in addition to SAP SuccessFactors, SAP Intelligent Robotic Process Automation, SAP Business Technology Platform, SAP Manufacturing Execution, and SAP Manufacturing Integration and Intelligence.

So, what have those SAP tools added to the Crystal wardrobe or enterprise? Plenty. The company has benefitted from the ability to gather real-time information from its facilities for better insights. Other advantages include enhanced end-to-end engagement with employees, such as aligning employee databases, and improved governance.

Integration is the new black

A host of labor-intensive processes covering ERP, finance, and HR are now accelerated and streamlined with automation. Shop floor operations are integrated with SAP ERP in real-time. Vendor invoicing is integrated with SAP payment processes. Required data objects from SAP and non-SAP systems are integrated, creating a central information hub repository.

Karl Ting, IS General Manager, Corporate Information Services, Crystal International Group

Crystal International Group

The company is more efficient and responsive, with more time to innovate. “As a fast-fashion enterprise, we need innovative and dynamic solutions to capture the ever-changing market opportunities and drive our business growth in sync with our priorities, “says Karl Ting, IS, General Manager, Corporate Information Services, at Crystal. “SAP solutions have helped us succeed.”

All this led to Crystal becoming a proud participant of the 2022 SAP Innovation Awards.

To learn more about this accomplishment, including their metrics from using SAP solutions, read Crystal’s SAP Innovation Awards pitch deck.

Data Management

Posted on Posted in Digital transformation, General topics Tagged with , , , , , , ,

Listening to customers is a strategy that often sounds good on paper but is soon overshadowed by other areas of business or trends. Hyland, however, remains laser-focused on making sure customer success is the key to product improvements and a core component of the company’s culture. We spoke with Drew Chapin, CMO at Hyland, to learn more.

How would you describe Hyland in six words or less? How does Hyland help customers create a better experience for end users?

Hyland helps customers deliver better experiences. We do it by automating manual and complicated processes, which allows people to focus on their purpose rather than a manual task or process.

Customer expectations have changed with the convenience of things like Amazon where they do amazing things at the click of a button, and now expect that same experience from their work technology. Hyland strives to take many of the manual and complicated tasks off their plates so that physicians can treat patients better, educators can teach students better and insurance agents can process claims better.

What sets Hyland apart from other players in the industry?

There is confidence that we’ve earned from 30 years in this space, and our ability to deliver consistently. What also differentiates us is the breadth of product features, flexibility and the ability to configure our solutions. We give our buyers options, such as low- and no-code options, open-source through our Alfresco platform and innovative solutions, like our digital asset management offerings through Nuxeo.

We have a customer- and employee-centric culture, with which we have been able to attract and retain a very talented and deeply experienced workforce. We learned a long time ago that happy and engaged employees deliver amazing experiences to customers, and believe that investing in our employees will deliver value to our customers in a meaningful way.

Tell us about the X factor and Hyland’s partnership with Xander Schauffele.

We started our partnership in 2019. We view X factors as the things – sometimes they’re big, sometimes they’re small – that give you an edge over the competition to help you win.

The story for Xander is that he’s looking at all aspects of his game – driving, tee-to-green, bunker work and putting – to get any little edge he can earn to help him win. Our customers are doing the same thing. They’re looking at business processes and trying to optimize those to better serve their customers.

To learn more, visit Hyland.

IT Leadership

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SAP has given CIOs another reason to consider moving to the cloud: rising support costs for on-premises software.

The company will raise the cost of its SAP Standard Support, SAP Enterprise Support, and SAP Product Support for Large Enterprises contracts for existing customers from January 1, 2023. Prices will rise in line with customers’ local consumer price index (CPI), with the increases capped at 3.3%. The changes will come into effect when customers renew their annual support contracts for the second time, affecting those who signed up before January 1, 2021.

The ERP vendor laid out its plans in a document entitled “Adjustment of SAP Support Fees,” which it finalized at the end of August.

SAP blamed the change on the higher costs of energy, labor, and third-party services, which are affecting the company just as many other businesses. It said it had kept the price of its support offerings broadly stable for almost a decade, even waiving adjustments during the pandemic.

The price increases only relate to support contracts for existing on-premises software, and the list price for support for new purchases of on-premises software will not increase, SAP spokesman Martin Gwisdalla told CIO.com in an email, meaning that users of SAPs cloud software and services will not be affected by these particular increases.

However, SAP’s cloud users may not be sheltered from the increases, as the company is also considering ratcheting up the price of its cloud software by 3.3% every year, CEO Christian Klein told German newspaper Handelsblatt in late July.

The German-speaking SAP Users Group, DSAG, is unimpressed with the company’s plans: “It is trying to establish mechanisms here that increase the costs for cloud services far above inflation,” Thomas Henzler, DSAG board member for licenses, service, and support, told CIO.com.” This is absolutely unacceptable and also incomprehensible.” With the service price rise and the threatened increase in cloud prices, SAP’s oldest on-premises customers could find themselves in a bind. SAP has been touting its cloud services as a way to keep licensing, maintenance and hosting costs under control, particularly with its “Rise with SAP” all-in-one offering, and has longstanding plans to move users of its previous software generation, ERP 6.0 and Business Suite 7, to a higher-paying support tier after standard support ends in 2027.

SAP