unified commerce

Transforming Commerce with Unified Data Solutions

Curious about the future of commerce in a world where digital and physical blend seamlessly? Join us as we explore this exciting landscape with Balaji Balasubramanian, SAP’s SVP Global Head of Commerce and Industry Cloud. Balaji shares his vision on meeting the growing consumer demand for a friction-free experience across all channels, from traditional stores to social platforms like WhatsApp and WeChat. We uncover the operational intricacies organizations face, including supply chain management and product sourcing, and discuss how integrated loyalty experiences can foster long-lasting customer relationships.

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We also address the digital transformation challenges retailers encounter, emphasizing the need for adaptable, end-to-end solutions that break down data silos. Balaji provides deep insights into overcoming cultural and organizational barriers to achieve unified data sets, sharing how SAP’s AI-powered processes can revolutionize retail operations. Finally, we unpack the three pillars essential for unifying the omnichannel retail experience, ensuring consistent cataloging and efficient integration of front and back office operations. Tune in for an episode brimming with actionable strategies to navigate the evolving commerce landscape.

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Read the full episode transcript below

Mike Giambattista 

Balaji Balasubramanian is SVP Global Head of Commerce and Industry Cloud at SAP and one of the few people who has a tougher to pronounce last name than I do. For that and a bunch of other reasons, I’m really glad to be speaking with you. Balaji, thanks for joining me. 

Balaji Balasubramanian 

Thank you. 

Mike Giambattista 

Thank you, mike, great to be here and so, just for context, balaji and I met briefly at NRF earlier this year and quickly decided that there was way more to talk about than our encounter would allow for. Thus we’ve been working on scheduling this conversation for quite some time, but glad we finally made it. Balaji’s perspective on commerce, I think, is a really unique one by virtue of kind of where you sit in the business ecosystem. I’ll just repeat your title one more time for context and perspective. Balaji is SVP and Global Head of Commerce and Industry Cloud at SAP, which is a. 

It’s a. It’s a big remit. There’s an awful lot that he’s responsible for, but with that comes a perspective I think is really really unique, and I wanted to talk about that a little bit. And then, of course, all the very cool things that are going on with SAP right now but from a let’s just talk perspective for a few minutes and what you might see as some of the broader commerce trends, waves, things that people down here in the weeds may not be aware of, that are coming places where if you can even talk about this where SAP is investing its resources that we might see in the public view sometime in the near future, and those kinds of things, because I’m sure there’s a lot to talk about. 

Balaji Balasubramanian 

So let’s just start with your perspective on some of the enterprise level clients you have and, if we can overlay that with some of the more innovative approaches you see to commerce, that that sap is kind of leading and innovating alongside of so thank you, mike, first of all, for having me here, um, and, like you said, I’m happy to talk about, at least from the perspective of what we are learning from the market, talking to customers, as well as how we drive omni-channel unified commerce. I think we see a few things, especially talking to some of our enterprise customers and our engagement there. We see a few things. Number one I think there is growing expectations from a consumer standpoint that retailers and other organizations are trying to serve, so their expectations obviously are rising, and rising quite rapidly across variety of different things. Number one is the channels that they engage in are exploding, both from a traditional channel standpoint whether that’s like you know your physical stores or digital storefronts, if you will but all the way through to now, newer and more emerging ways of how they engage. So be it. You know the social channels the traditional social channels, I’ll say, but also you know channels the traditional social channels, I’ll say, but also you know live streaming and some of the newer ways of how people engage, including, you know, Whatsapp and WeChat in certain parts of the market, so to speak. So, on one hand, I think the explosion in terms of number of channels and their engagement is something that we hear from our customers and what we observe, but also the expectations that you know. 

These experiences have to be unified, have to be seamless, have to be friction-free, so that I can start my journey as a consumer on any one of those touch points. But I need to be able to stitch that journey together across any number of those touch points, so to speak. Stitch that journey together across any number of those touch points, so to speak. And you know the. You know we call the te end-to-end shopping journey, so to speak. So shopping is not just, like you know, browsing and, uh, adding items to cart and checking on, but everything from how, um, you know, uh, these, these organizations have to engage with their shoppers effectively, from how they make them aware of the products and services that they offer, how it needs to be balanced with the right level of information, in the right context, in the right time, that they need to be aware of it and converting that from awareness into something that they are interested in and to develop that interest and nurture that interest and taking that interest into a purchase. But, more importantly, there is a big part of that journey, which is we call a post-purchase journey effectively, so in terms of how they experience that product and service, and to convert that into a long-lasting relationship. There is a lot of that that our customers are thinking about and it’s getting more and more complicated every single day because of the explosion in channels and the expectations that I was telling you about. But the goal that these experiences have to be a unified, be personalized and, three, the most important part of it is all is to convert these you know, these customers and the interest into a purchase, but convert that purchase into a long lasting relationship, fundamentally converting shoppers into raving fans through integrated, seamless loyalty experiences that are built. So that’s just like the first and foremost. That’s from a customer facing standpoint. 

Now there is a, you know, on the mirror side of it is the organization, the ability to operate efficiently. So not only is your channels and customers and their expectations are changing, but the complexity on the other side of it, which is the operational backbone for these organizations, are also getting more and more and more complex. So we all know the complex landscape that we live in, especially given the increasing supply chain challenges that we see. You know the sourcing of the products and the manufacturing of it. That can happen in so many different parts and to be able to pull that together. That’s been increasing over the years, but even more so now given the geopolitical challenges that we are seeing overall. 

So there’s a complexity on the other side of from sourcing to actually making the products especially for those organizations who are brand owners themselves to being able to distribute them, manage those inventory in the most efficient way possible and to drive logistical fulfillment needs in order to do the service level that customers of today are expecting. 

So it’s complexity on both sides. It’s just unparalleled, really, and it’s getting more and more that way. So, as we think about this, for us from an SAP standpoint, what we try to do is to bring this together through what we call as seamless, unified commerce, and this ties in both front office experiences that consumers demand and expect, all the way through to the back-end operational complexities that organizations have to deal with in order to drive what we call as intelligent and profitable operations. So, at the end of the day, this is, like you know, in a world that we live in in 2024, where profitability is the top order priority for most organizations, especially given the cost of money and how it’s escalating. So how do we drive intelligent engagement, but in a profitable manner, is what we focus on. So that’s our focus and that’s what resonates with our customers and what we see is the top priority from organizations worldwide that we serve. 

Mike Giambattista 

If this was any other company than SAP, I would probably ask you to categorize it as such started thinking in terms of omni-channel and then whatever the term was that we as an industry decided was the appropriate buzzword at the moment. But that’s always been kind of the brass ring. It’s always been the ultimate goal to a unified view of the customer activity for engagement purposes and then to tie that back into the operational complexities that you need to support that. The need’s been around for a long time and there are a handful of companies who have kind of figured out how to do that on an enterprise level. Of course SAP is one of them. 

But in leading up to this conversation, I was wondering more about the kinds of companies that SAP might find to be the ideal partner, who may be recognizing their hurdles, but that that’s a that’s far different from being a company who is able to take on these kinds of innovative approaches and do something with them. So you know, what is it that that you know? If you walk into a room, you’re talking to the executives there about SAP’s capabilities. At some point you’re going to realize this is a great fit for what SAP does, or maybe not so much because of operational maturity or whatever. What are some of those things that you’re looking for when you talk to these people? 

Balaji Balasubramanian 

Well, I think it’s a really good question. I think it goes both ways in terms of what, when we talk to our customers, what do we observe? But also from a customer and their IT landscape. To a point, like you know, given the digital transformation that majority of these customers have been going through for the last, you know, a decade or more, really, their IT landscape is also getting much more complex, and we also think about the IT maturity of these organizations in terms of where they are in their journey, so to speak. So our goal, really, when we engage with customers, is twofold. One, the end-to-end capabilities that we can bring to organizations and how they can adopt and use it. 

Because, truth be told, I one of the key things as we explore these complexities that retailers go through. Like you rightly said, you know, the complexities on customer side consumer side, all the way to operational, have existed, but it’s just getting more and more complex. Number one these, like you know, what we call as front to back offers has been a dream that most retailers have always wanted but not yet materialized, because you know of the systems and the landscape and the lack of digitization to some extent, so to speak, historically speaking. So we look at that and when we talk to them, we figure out, like you know, where can we serve them, because we offer almost all the aspects of what a retailer would want, like you know, for example, our back office strength from an operational standpoint has been one of our key, you know, offerings, so to speak, like you know, from core ERP to manufacturing capabilities, distribution logistics, all the way through to now, sustainability capabilities, distribution logistics, all the way through to now sustainability, which is, like you know, having transparent visibility into your operations and your carbon footprint, and like that’s all increasing, so to speak, that you can eat, that you can connect that with, like you said, to the front office experiences of understanding the customer, so that their needs can be met, like you know. 

And and we look at the complexity of their landscape, number one complexity of, and the maturity of their IT systems and IT personnel, so to speak, so that we can offer it to them. And the next part of it would be where do they want to start and where is the biggest pain point, so to speak? So, given the complexity, that you cannot consume all of this in like one go, so being adaptive and being able to compose the solution in a way that is meaningful for that business at that point in time, so that they can grow over a period of time into this beautifully integrated, end-to-end unified commerce. So we try to do that in a way that only SAP can provide those capabilities in a way that is flexible, adaptive and composable for customer needs and allow them to start where they want to, and not a force fit, a solution that is, you know, even though it is possible, it’s probably meaningless for that customer at that point in time. And it’s an important distinction we make. It is end-to-end from our perspective, but we try to work with the customer so that it is composable enough that they can start where they want to start, grow at the pace at which they want to grow and adopt it in a way that is meaningful. 

And I’ll also add one more thing here, mike, which is, as these systems are all coming together and we live in a modern world in 2024, where one of the key things that our customers struggle with is data is siloed, like it’s in so many different systems, replicated, like you know, everywhere, and in order to drive what we call as intelligent, profitable operations, you need to have a view of this data that is not only consolidated but also harmonized, because, you know, many of these systems interact in different ways, right? 

You know? 

An order or an invoice, or a customer or whatever. 

These are all distributed and they have semantically different things in each of these systems, and that by itself makes it so much more harder for us to apply any form of intelligence, any form of analytics just, you know, very quickly. 

So one of the key things that we also are doing and we’ll continue to work with our customers is to harmonize the data, bring it all together in a consistent enough model that is semantically the same and persist it in a manner that can make it so much more easier to apply analytics but also intelligence on top, that then you can take it and you can embed that intelligence in a contextual manner in variety of different processes. So makes it a lot more easier now not to say that people are not doing it today. They are, but it takes so much time and energy and effort to do so but by doing it in a much more integrated and in a harmonized manner, we try to make it a lot more easier to get to that contextual intelligent process that is AI-powered, rather than how it has been done in the past, so to speak. 

Mike Giambattista 

And that brings up another 300 questions that we probably can’t get to. But one of them is that a unified data set, harmonized data set across the organization Again, that’s been one of those of that. Of that same sort. Some of the biggest challenges are are not so much technological, but they tend to be cultural within an organization because of you know, those silos were, were kind of created for a reason not intentionally usually, but but you know that’s just the way the data and the operations grew up. And then you’ve got you’ve got these deep moats around them and now you’ve got, uh, kpis that are built up around to support them and you’ve got people’s quarterly bonus packages that are that are dependent on them and, uh, all kinds of internal resistance to breaking down walls that. I’m really interested to hear how SAP approaches that, because you’re clearly successful at it. You’re doing it with companies that are on a huge scale. So what’s the secret if there is one. 

Balaji Balasubramanian 

You know you’re right. I do agree with you. I think you know how the you know progressively, over the last 15, 20 years, how things have evolved has created the silos culturally, for a number of different reasons, like you rightly said. By the way, mike, I’ll also point out it’s just not only customers, just the overall market of how they see this is categorized and it’s templatized in a manner that it automatically and artificially creates these silos, and organizations and their roles are set up amongst these silos. So even when they look for a system, they look for a system for a specific software category. RFPs are put out only for that category. Analysts actually put out their equivalent of their analyst report and the quadrants of some kind. They’re all very pocketed and siloed and therefore everything revolves around it. And then, when you make these individual decisions, stitching them together and getting the data harmonized just becomes an overarching problem, so to speak. So, to be perfectly honest, obviously there is no, it’s not something that there’s no one cookie cutter recipe that works for all customers of all shapes. So what we end up doing, mike, is, you know, we take every single enterprise customer and look at their landscape, look at their organization, and some of them are evolving quite rapidly, right, so their organization setup is looking at it in a much more different manner. 

The chief digital officers of some kind effectively the newer roles that are coming in is targeted towards harmonizing these systems and data underneath that. 

In a way, some are much more further along in their maturity curve than others. 

So we look at it from that perspective and then apply the lens of what SAP can do and tailor our approach in a way that is personalized and individualized to those organizations. 

So that’s the best way that we think we can serve the market. We can’t afford to take a generic and a cookie cutter approach that works for every organization out there, and we have some really, really good customers who have gone through that maturity curve and they’re adopting our solutions in a way that is quite meaningful. You know there are customers who are embarking on a channel-less strategy, which is, like you know, every channel needs to work seamlessly. Levi’s, for example, is one of our customers and they are adopting this one-channel strategy for unified commerce to tie not only the touch points but take it all the way through to deliver, you know, a more streamlined operational experience that ties everything from our core CX set of products that we have all the way through to supply chain and ERP. So every customer is unique and different in their transformation journey and we apply our thinking and our approaches to how we serve them in a manner that fits their needs honor that fits their needs.

Mike Giambattista 

So much of your work and I think your counterpart’s work is consultative in nature, maybe more so than technological at some point, certainly in the beginning of the conversation. But helping companies large companies navigate that to the point where you reach some sort of agreement threshold that would allow this is no small thing. So, uh, wherever you’ve got on staff is, is pulling off minor miracles, or possibly even major ones at some point, um which is, which is super commendable though the one channel thing is is really interesting. I’d like to spend a few minutes on that. Um, I am uh particularly averse to buzzwords because I live in the midst of them all day long and, um, you know what’s our, what’s our catchphrase of the day is single is one channel. What is it? What does that mean? Because it’s uh, coming from two decades of omni-channel expressions. This is telling a different story. 

Balaji Balasubramanian 

Yeah, it’s a really, really good point. I mean, the buzzwords are plenty in market, like you rightly said. See for us when we conceptualize it and when we think about this and I’ll tell you my perspective here, mike which is one channel or channel-less, or omni-channel For me in particular, and for SAP. What this really means is, you know, these engagement touch points, whatever we know today will continue to evolve and will continue to expand, so to speak. Some might fall off and some might get added, but we just need to make sure that you know the ability to have a single viewpoint from a retailer standpoint, from an organization standpoint, that can serve the needs of their consumers, wherever that might be. Now, what does that really mean? What does unifying of all of this really means in order to do so? And at least we think of this in three distinct things. So, personally speaking, I’ll say unifying all the channels and engagements, so how you have your catalogs and your assortments can be the same or it can be different across all of these channels and touchpoints. How you price, how you promote them can be the same or it can be different across all of these touchpoints. And how your segmentation of your customers, the tailoring of the unique things that you do for them can be either the same or it can be different across these channels and across all the time horizons that you might be engaging that with. So unifying them so that you have a consistent view of that across all of those channels is the first pillar, if you will, is the first pillar. 

The second thing that’s also important is unifying how these organizations, these retailers, how they go to market, meaning that their business models. So back in the day, you know, the business models were quite simplistic in the sense that you know, obviously I’ll sell direct to consumer and that’s one way of doing it. And, and of course, there are organizations now they sell, you know, both B2C, direct to consumer, b2b and now it’s expanding into other forms of business models, like you know, selling on a marketplace, for example, or subscription based, or selling that combines both their own products and some products and some products from other parties as well. So when those type of business models are expanding, they distinctly have many of the customers. Historically have built different systems. This is my B2B system and this is my B2B system. So how do we unify them so that you get a view of not just the channel, but also the business models that you supported. 

And, last but not the least, is like unifying you know what I said like you know front and the back office, so that you have a consistent view of both operational data and customer engagement in a way that is unique and that is powerful. 

That is really, really powerful to bring this together, including the ability for what we call as self-serve experiences. So, as a like, you know what I can do on my own, on my terms, on whenever I need it, on whatever device that I need it, so to speak. But when that moves to an assisted experience where somebody is helping me, it could be a sales rep who’s helping me on the phone, it could be an in-store assistant who’s helping me, or it could be whatever. So when that transition happens, it is always something that breaks today in most organizations because their context is lost, the systems are different. So we want to unify that unifying channels, unifying business models and tying front and back office experiences to a point where there is no scene between the self-serve and assisted experiences, human assisted experiences. When we can do that together, it just lights up so many different possibilities for our customers so that they are personalized in their engagement to their shoppers but, more importantly, drive the operations to a point where it is consistently reliable and profitable for their engagement. 

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