PROJECT PARTNER
Michael Späth, Regional VP, DACH at Aera Technology, champions the transformative power of Decision Intelligence.
When they launched the company in 2017, the founders of Aera Technology had a clear vision: they wanted to revolutionise decisionmaking using innovative tech solutions and help businesses transform their enterprises.
rawing on many years of experience in enterprise software, specifically within the space of performance improvements and business intelligence, the founders always felt something was missing.
Aera Technology is on a mission to address this gap in the market and make companies
wildly successful by helping to make their operations more sustainable, intelligent and efficient. Delivering an AI and machine learning-powered platform that enables Decision Intelligence, Aera Technology helps businesses streamline and autonomously orchestrate their operations.
Here to discuss the company’s Decision Intelligence platform and how they can help businesses adapt to pressing supply chain demands is Michael Späth, Regional VP, DACH at Aera Technology.
Michael begins by explaining how the pace of market changes and volatile environments companies are operating in, combined with the complexity and scale of globalisation, means that businesses are
“After building the foundation, on top of that you need to have what we call the intelligence pillar, which is then the set of capabilities that you use to codify and model decision-making”
Michael Späth, Regional VP, DACH
struggling to make sense of all the data before them.
“The idea here is that if we can build assistance, at scale, that provides recommendations on decisions which liberate a lot of time people would spend on very complex, or very menial, tasks,” says Michael. “In doing so, we remove the pressure to deal with easy problems, allowing people to focus on the more valueadding tasks and the tougher problems that companies have to deal with.
“The fundamental idea is that human factors will always be paramount to any company: the human intellect and the human intelligence. But unfortunately today, in many cases, human intelligence is being used for things that machines can do a lot better and a lot more precisely. We're not even relying on people for what is truly uniquely human. And that's where we are as a company –we seek to support people with our platform by enabling companies to do what they do best.”
Michael breaks data-driven, digitised decisions into four pillars.
First, companies need a foundation to build upon. “You need to have the data harmonisation and the data wrangling capability at scale,” explains Michael.
“This includes connecting to enterprise systems of any shape or form, but also connecting into data sources from the outside world and bringing it all together into a single data model. That’s the foundation.”
“After building the foundation, on top of that you need to have what we call the intelligence pillar, which is then the set of capabilities that you use to codify and model decision-making,” says Michael. “You start with simple rule-based decisions, but then you can start mixing in advanced AI-optimised algorithms with simulation.”
The third component is what Aera Technology calls the ‘engagement layer.’
So, what does Aera Technology’s Decision Intelligence platform offer in terms of technology, capabilities, applications and results?
“We understand that when people are not accustomed to working with these advanced
algorithms, the fundamental problem to crack is trust,” says Michael. “How do you deliver a recommendation to a user? How do you explain that recommendation so that users understand how the platform arrived at this course of action? Are users able to modify these recommendations when needed before moving to execution?
“And how do you create a user experience that is gratifying so that people enjoy engaging with the software, and capture the feedback users give? This step is vital because leaders need to understand how users are interacting with the platform and its recommendations.”
“Our platform is robust and it's more a question of where you deploy it, and this really depends on the level of maturity of a company”
The final pillar is around acting and learning, enabling decision automation.
“We understand that when people take decisions, there's still a lot of work that happens after the decision,” says Michael. “There's the work of actually making sure it gets implemented and executed, often by manually updating transactional systems or even spreadsheets, before people can start to track whether the decision is delivering on the expected outcome.
“The whole capability to automate and to learn from decisions is the final pillar of the platform,” he summarises.
How Decision Intelligence can transform enterprises
What are some of the sectors where Aera Technology deploys its solutions?
“We've been building use cases with Decision Intelligence across various business domains,” responds Michael. “We have a heritage in supply chain and operations management. We’ve also explored a few use cases across procurements, both
operational procurements and strategic procurements. More recently, we're getting heavily into the space of revenue management – which covers things such as dynamic pricing, but also more importantly how companies measure and manage marketing spend.
“When large companies run campaigns on social media to promote particular products, we help those companies ensure that they have enough product available to meet the generated demand.
“We’ve also done quite a bit of work around optimising service levels. Here, our platform drives additional top-line revenue. We have several customers telling us that we've actually delivered up to 3 per cent additional top-line revenue through the increased service levels we can offer them.
“We have other customers focusing more on networking capital optimisation, which might be in terms of reducing inventories, or reducing accounts receivables and accounts payables. Doing so has freed up significant working capital for these companies totalling hundreds of millions of dollars.
“Many of our customers are speaking about the cost of unmade decisions. We like to focus on that area because there’s a massive opportunity that companies are not tapping into today”
“Lastly we have several customers, for instance in procurement, that have been looking to optimise spend, and our recommendations have accomplished this to the tune of tens of millions of dollars.”
Counting the cost of decisions left unmade
“But the real beauty of Decision Intelligence is that it's not so much about optimising the decisions that are being taken today,” explains
Michael. “It's actually about taking the decisions that are not being taken today.
“Because of the velocity of business today, there are so many demands being placed upon decision-makers, planners or procurement operators that they simply don't have the time or bandwidth to address all the issues they would need to deal with on a daily basis. Many of our customers are speaking about the cost of unmade decisions. We like to focus on that area because there’s a massive opportunity that
companies are not tapping into today.”
Focusing on the supply chain in particular, Michael highlights several pressing demands facing the industry where Aera Technology’s platform enables and empowers businesses to thrive.
Michael addresses the elephant in the room: the massive disruptions caused by the COVID pandemic. But he emphasises that the implications of the pandemic and national lockdowns are actually a spike in a broader trend of
increasingly shorter cycles of globally disruptive events.
“The rate of massive disruptions to supply chains has been increasing when you contemplate events on a longer horizon,” says Michael. “They used to happen every three years. Now, we're down to 14- or 12-month cycles where things really get mixed up. The old way of working, where you have an inflexible process model on an underlying ERP or planning system, is just not agile enough because there are so many new situations that people have to deal with.
“Today companies try to work around the corners with data, spreadsheets or visuals and try to make the best decisions they can. But at the scale of a global, multinational company, it's just impossible to take that level of decisive action on every single issue.
“We help companies to better sense and anticipate demand challenges, not just around forecasting but also around responding in real time to things occurring in the market.
“Our platform harmonises data across the ecosystem, then applies AI and ML to model scenarios and predict the best solution options – which could consist of inventory deployments, sizing order allocation or a host of other challenges. We also seek to help customers shape their demand by coupling marketing spending to supply.
“Then we also seek to work towards the upstream supply chain, which is really around the procurement side. For example, if the platform identifies that a customer is still buying materials that they’re not going to be able to sell, then it notifies them with a recommendation to stop buying materials.
“We focus a lot of effort on wastage avoidance, which is a growing concern and a very visible issue for
“To help businesses get from A to B and deploy Decision Intelligence, Aera Technology relishes the chance to work with valued technology and data partners in areas of growth and operations”
consumers as well as investors. Customers that are working with us seek to synchronise their endto-end value chain so that they reduce obsolescence and avoid destroying materials, which in turn has obvious benefits for the environment.”
From decisions which avoid waste to those which free up working capital, the ability to take more decisions, more quickly and accurately, is transformative.
A true digital transformation of supply chains
Beyond helping businesses to lean into challenges facing their supply chains, Michael emphasises that Decision Intelligence enables companies to instigate, and achieve, true digital transformation of supply-chain decisionmaking.
“The traditional view of supply chain has always been, ‘Let's get our basics and our executional processes in order, then let’s deploy a next-generation planning system on top of that to make sure that we do good planning,’” explains Michael. “However, if you plan, let's say on the weekly cycle
or a monthly cycle, in reality, the minute after you publish the plan, it is out of sync with reality. That disconnect is immediate because your operations won’t consistently deliver on the plan, and also because for many companies there's actually a great deal of volatility in their operations. This can be on the customer side, but it's often also on the supply side of operations.
“This is where we can change the game with Decision Intelligence,” emphasises Michael. “We not only have state-of-the-art technology powered by AI and machine learning, we also bring the expertise and deep knowledge of industries to truly improve decision-making processes in supply chain and across different functions.”
To help businesses deploy Decision Intelligence, Aera Technology relishes the chance to work with valued technology and data partners in areas of growth and operations to continue serving their customers and elevate their success. But in particular, Michael highlights the importance of Aera Technology’s work with consulting partners.
“Our goal is to help businesses with building a decision-making ecosystem and leveraging our partners to help deliver value quicker and focus on that scaling component because the foundational work by Aera Technology has already been laid”
The value of partnership
“The journey with Decision Intelligence is foundationally a transformation to the way of working,” says Michael. “It's going from people doing the
work supported by machines, to machines doing the work guided by people.
“In this new paradigm, companies are going to be relying on knowledgeable people who
will engineer the system and enable the enterprise to run in a smoother, more agile manner.
“That's a big change, and this is where consultants and partners like EY are paramount because it's fundamentally a transformation of how companies run their
to fully realise the benefits of Decision Intelligence on their own.
“Companies like EY have a massive footprint. Of course, they do consulting – but they often lead the way with other crucial considerations like tax
businesses. There's a lot of design work, change management and onboarding enablement training, and there's also a lot of delivery work that must be done.
“By working with partners like EY, we always strive to enable our customers and our shared customers to be self-sufficient. We'd love to see our customers establishing centres of excellence where they build their own Decision Intelligence capabilities. Our consulting partners are truly paving the way to get there by helping our customers accelerate in the early days, run massive programmes and build the set of capabilities that companies need
work, handling transactions and much more. So they have a unique value that they can bring into companies for them to run decisions at scale.
“If you think about why consultants are being contracted today, it's because they have a set of specialised knowledge that companies don't retain themselves in-house around a very particular problem, needing a set of specialised knowledge to solve. Now if you could codify that knowledge, which consulting companies like EY are actually doing, they could provide that knowledge as a software service into the operating system of
“By working with partners like EY, we always strive to enable our customers and our shared customers to be self-sufficient”
the business, to allow them to scale and have that knowledge embedded into the way they take their daily decisions. This is really where the most exciting and innovative collaboration potential comes into play.”
So, what does the future look like for Aera Technology in the coming years?
“We're proud to work with some of the largest, most renowned companies in the world, particularly in consumer products, pharma, life sciences and chemicals,” says Michael.
“We want to become touchless in the sense that companies can go on their own journey, they can make use of all the content that we deliver – but they can take it from there to solve their own unique problems. Because what really constitutes the competitive advantage of a company is the unique set of knowledge and experience that belongs to the people who are running the business from day to day. Ultimately, to make the business succeed, they need to learn to codify their unique knowledge into a system that can help at scale.
“Our goal is to enable Decision Intelligence for business users, to provide them a platform that will empower them to automate decision making at scale.”
Wrapping up our conversation, Michael reiterates that five years ago when he joined Aera Technology he spent the majority of his working week preaching the importance of Decision Intelligence because it was a new idea. He welcomes the fact that today, more and more companies spanning multiple sectors and industries are embracing Decision Intelligence in their strategies and discussing its enabling potential.
“It’s amazing to see how our vision has become part of the shared understanding of practitioners in global markets,” says Michael. “With Decision intelligence, we can move beyond incremental progress and thrive with exponential improvements which will be foundational to achieving what we need to do as a world: to become more sustainable, intelligent, and efficient across every industry, and to continue to innovate towards progress.”
To learn more about Aera Technology, visit their website www.aeratechnology.com.