 New York, it's theCUBE. Covering Inforum 2016, brought to you by Inforum. Now, here are your hosts, Dave Vellante and George Gilbert. Welcome back to New York City, everybody. This is theCUBE, SiliconANGLE's flagship product. We go out to the events. We extract the signal from the noise. We're going to get a great customer perspective here. Business and IT alignment. Nasir Bayrem is here, he's the managing director of the Commercial Vehicles Division of Zahid Tractor and Bariq Siraj is the CIO of that organization. Gentlemen, welcome to theCUBE. Thanks so much for taking time. Thank you for having us here. Coming on. So, tell us about Zahid Tractor. Many of our audience may not be familiar with them, but large, successful organization. Give us the two minute talk. Yeah, I'll be happy to do that. This is actually Zahid Tractor is part of a big group, Zahid Group. It's a very diversified group with 4,000 employees. We are in the capital equipment industries with the caterpillar dealer, Volvo trucks dealers or no trucks dealer. We also went to food and beverage hospitality, tourism and travel, manufacturing, fabrication, really state management and a long list of industries that we are participating in and we are a major player in the Saudi economy. As for Zahid Tractor, which is a flagship of the group, is an importer and dealer of caterpillar machinery for many years, for more than 60 years. It's the largest cat machine dealer in the world as of last year and has contributed significantly to the infrastructure of Saudi Arabia. We're very proud to be associated with the group and the company. And Nasser, you're a business manager, a former IT background, but you're a P&L general manager. Yes, I am indeed. You know, drive the growth of the organization profitability and bargain with the CIO, correct? Talk a little bit about your role and some of the challenges in your business. 30 years ago, Zahid decided to have a bespoke system. They developed their own IT system. So, parts, service, prime, all of it was developed in the workflow for that evenly HR system was developed internally for quite a long time. Now, the people that helped make this happen, Nasser included, and a lot of them have actually started to retire and were facing an issue with maintaining this legacy application. So, a few years back, we decided to choose an ERP system. We asked CAT, which direction should we go? And, out of the shortlist that they gave us, we actually went through a whole due diligence and came up with, chose Infor as our product to go towards migrating from our legacy to our, to Infor. And we want to talk more about that, but so, if take us back to the decision to build, best to breed bespoke, it gave you competitive advantage. At the time. Back then. Yes. But, does it anymore? What's changed? Talk about that change. Excellent question, actually. What changed manufacturers? The economy in Saudi Arabia being transformed from an oil-based economy to a private sector manufacturing economy. With that transformation and the change in the landscape of the industry and the behavior of our customers, who are more demanding, more internet-savvy forces you or drives you to be proactive from a vision and strategy perspective to look at a platform that have to support you on the many facets of the change in the economy and the industry. On one hand, we are a very diverse group. On another hand, the economy is changing, customers are changing. So what you need to have is a platform that support or that diversification and all that changes. You cannot support that in-house. So much the dynamics are so fast, so quick. To do that internally, you have to build an army of people and recreate one of these available of the shelf packages. Hence the decision, the strategic business decision to transform our IT infrastructure to enable our business with a platform that supports that and inform of the choice to do that because as we saw this morning as well, M4 is very diverse in offering solutions for many of the industries we are in. Have it be food and beverage, have it be logistics and warehousing, transportation, service of parts or M3 equipment solution. It is one of the reason why we did that decision. It's the business decision to have the right to platform to enable the business to be ready for the future with the challenges we are facing in the market. And of course, back in the day, the requirements were different. You wanted it to work. Simple wasn't really a factor. Fast, agility wasn't a factor. But how has that changed now? Well, you have to realize that Saudi Arabia today, 60% of Saudi Arabia is a young 16 year old and 22 now and so forth. 60%? 60% yes. And all of those are mobile savvy, internet savvy. So our customers where the father started with a fax machine or whatever and so forth, his sons are clicking on their iPhone, wanting an iPad, wanting, so all of this changed. Now, we need to serve our customers. We need to supply them with information and doing that from a legacy application meant rebuilding a lot of the wheels that are already available in the market. And that's where the decision came from. Is there such a thing as an IT project in your company or is it always a business project? To our perspective, this is a business project. Business drives IT. IT enables the business. IT provides the tools to grow and make sure that we have a profitable growth for our diversified business. But the solution, especially if we talk about them for, is a business-driven solution. The whole due diligence exercise by driven by the users. IT did their part of participating in assessing the technical solution of the platform. But the rest is a business-driven solution. So you talked about the decision to go with Infor and a lot of choices out there. A lot of much larger companies, better known brands. Talk a little bit more about the decision to go with Infor. We did a very intense due diligence exercise. We started with seven companies with seven possible partners. And we shortlisted those down to three. I'm not sure if we're supposed to name them or not. Name them, sure. We shortlisted SAP, Microsoft, and Infor. And then we conducted a POC, Proof of Concept, an exercise where our business people came in with test scenarios and business scenarios and asked the offenders out of time to come prepared to present them, see how they got to work. And based on that, business scenarios that presented to us, those same business users gave a rating for each solution or track or module. And at the end of the day, those, the results of the rating of the users, the business users were presented to the executive steering committee who supported the choice of the users. No one interfered or intervened to influence any direction. It was usually done based on the merit of the evaluation of the business scenarios and the compatibility of the solution with our business scenarios. They must have loved going through that. Go ahead, please. So basically, then we formed a team which is a few PMOs. We actually absorbed the Six Sigma team within the organization into the project and then took a lot of users, put them into, and the project team became 70% users and 30% IT and project management. And in addition to the subject matter experts and the part-timers that are involved with this project, so if you look at it, it is a very user-driven operation, a driven team. So you had good visibility as to what to expect but also probably very high expectations, I would imagine. More important, we had ownership. The reason you have to have your business community driving this is to own the solution. If it's an IT solution or an IT-driven solution, when you go live and it doesn't work for anyone, the reason they say, yeah, it was ITs, not mine. But here we have the business driving it, the business owning it. Hence the vested interest in making sure it's a successful project. At Acura, at the same time, we put a governance system in place. So the users don't rebuild a bespoke solution on top of M3. And that was, so we actually, the governance committee actually forced everybody to adopt and adapt instead of just modify the solution M3 to be similar to the bespoke. Because that's what users want to do. We want to customize it for our own narrow purposes. So you hear a lot at Infor about no need for custom mods and striving to get things out of the box. Was that your experience? We did that for our Al-Taka Global out of Dubai. We took a vanilla solution out of the box and we deployed it in Dubai. It was live in less than nine months, worked very well, still working very well. This was 13.1? On 13.1 version. But when you go to a big, diversified group and big organization like Zahi Tractor and Saudi Arabia, you do have certain local requirements. But you have to have certain customization. Not only that, we're working very well with Infor to take some of our requirements and recommend them and suggest them to be part of the core of the Infor solution. And we're very pleased to say that in the equipment module or solution, more than 120 of our business processes were adopted by Infor to be part of the 13.4 solution. On the other hand, we've taken their Renault solution out of 13.4 with a fit of close to 77% out of the box with very minor changes and we'll hopefully go live with that solution in Q1 2017. And that's huge because now Infor is maintaining it, not you guys or your customers. Yes, not anymore. George. So I'm wondering, now that there's governance from IT and ownership from the business units, but as more and more of the functionality spreads, it becomes more and more industry specific and less horizontal, meaning almost less focused on financials or HR and more focused on the heavy equipment manufacturing distribution. How does IT put guardrails on what becomes more and more industry specific functionality? First, the governance is not IT. The governance is a team of decision-maker, chaired by myself, membership of our CIO, an ARP director, our financial controller, and one external consultant who is not an Infor employee or a Zahed employee that give us an out-of-the-box view, an independent view, an experienced ARP professional to guide us through some of the decision we make. So in the governance, we do not make technical decision, we make business decisions. So these process owners come and present to us any of the requirement for change and we look at the merit of the return of that change, whether it's worth investing or not. If there's a workaround, and by the way, Infor will be present in every presentation. So Infor give us their input and feedback on why we should not be making that modification. Based on these presentation, we make the right business decision. That's one, two, from an IT perspective, IT's role has been so far purely technical. Some of the key IT leaders, the business guys, who support the business, are members of the teams for that respective stream. For example, the top IT guy in parts is a member of the part team. So he's not an IT guy, he is a team player in that solution. The same applies to service, same applies to finance. That changes the landscape or the approach and the methodology of how you manage such a project away from being IT driven. This is what I think your user should do to know this is how we together we're going to define the right business process for the future that's efficient, most effective, and will enable the business. And the way we put those teams together, we put them on a table and basically you bring your laptops, this is the parts table. And then for consultants, the config consultant, the IT guy, and the users are all sitting working together, putting charts, whiteboards, and working together. Designing together. Defining solution and everything. And the outcome, talk about the outcome of that effort. Well we have completed the design phase, now we enter the configuration phase. And this is where you find out whether the solution you've designed will be properly configured or properly, sorry, will fit the configuration of the solution. And we're also preparing same time parallel for our testing. And in parallel we're preparing for the go live of our rental company, EJAR, which hopefully will go live in Q1 2017. So now we are at stage, we are configuring the solution that was designed and ready for testing. And we don't want to just test the design, but we want to test the solution. To do that we said, okay, everybody participate in the project, being the project full time employees or the part time or the subject matter experts would come up with the test scripts. But then we ask for operation, reach out to your front liners and get us some test scenarios that maybe we never thought of. So by bringing that in, we're testing the whole solution, not just whatever those guys designed. So testing the design would be testing the sort of logical flow. Does it tick all the boxes? Is it complete? Testing the solution, does it work? For the business. That's why for the solution, as we do the configuration, we embark on a quality check, what we call end-to-end integration. So for example, when you take your car to be serviced, the mechanic need to be scheduled depending on the repair, making sure parts are available and make sure also if you paying cash or on credit that you have the means to pay for it. All of that trigger a different point in different modules in the system. So initially when the design was done was each in their own vertical, the service, the parts and the finance. Now we're doing end-to-end integration to secure that the solution work across the board, across the whole process, end-to-end. I want to make a comment you asked earlier about how the user feel or the IT guys feel from a technical perspective versus it's an industry specific solution. To avoid that from the beginning, we set certain clear objectives. We are not defining a bespoke service or equipment or truck solution. We are embarking on an industry best practice out of the box from M4 on one hand to be customer-centric solution. Until the day you're implementing, you're making such an investment for the return and the return does not come from me or you, it comes from the end customer who pays the bill. So we have to make sure that we do provide the right service for the customer and when they come in to a pass counter, that part is available and if it's not here, it's somewhere else that could be shipped within 24 hours to deliver to the customer. That the objective we have in mind all along to avoid the pitfall of having a technical showcase that does not run the business or a very industry-centric that is too complex and is not workable. So it sounds like, that was my follow-up question which is how do you do the cost-benefit analysis of the customization? You just answered it, which was start with the customer value and work back. The voice of the business and voice of the customer. If you do the solution with only one voice, what about the other, are you going to fail? And we also networked with other cat dealers that are users of M4 or planning on M4 and we said, okay, this is what we're planning to do. So give us your feedback. And with that, with Infor on the table, hearing the requirements from everybody and that's where the functionality started to be seen from 13.1, two, three, four, more and more to serve the whole cat community. Yeah, Varg, you mentioned that you're going to go C1 shortly as part of that network. So your relationship with Infor is growing. It seems pretty positive. Infor just announced the investment in Saudi Arabia. What is the climate like in Saudi Arabia from the standpoint of cloud adoption? I mean, we have a good sense of what it's like in the United States and central Europe, but what is it like in Saudi Arabia in terms of affinity with cloud, concerns about security, what are people saying? Technology does not know borders anymore. So it doesn't matter whether in Saudi Arabia or South America or Honolulu. Technology is technology, it's accessible to everybody. The internet changed the landscape and actually today they use the terminology, they call it digital disruption. Yes, the digital world has disrupted all of this. Cloud is very well accepted. Actually, we are in the process of implementing in parallel a treasury management system which will be integrated with Infor and it will be cloud-based. So the acceptance of hosted application or leased application is very well accepted and Saudi Arabia like most of the advanced countries in adopting technology is progressing very well with the cloud and accepting cloud technology. I mean, I think that is so right on. You wanted to add something? Yeah, and one thing is that you have to look at, as I said, Saudi is becoming as a young population and so forth is very tax-savvy. Now, I'll give you an example. In the past, when an IPO used to happen, you need to go to the bank, fill out a piece of paper in order to participate in that IPO. And once the electronic means to participate became available, 70% of participation by the Saudi public is electronic either through the ATM or the mobile or through the internet. Yeah, so the point you're making as well about technology is everywhere. It's well understood. We talk a lot on theCUBE about how, and your case study underscores this. And back in the day, you built these bespoke systems for good reason. And part of that was you had very known processes, but the technology was unknown, right? And it was hard. Not the technology is easier today, but technology is known. The process is becoming unknown because of the web and mobile and big data and digital. So you need a platform that can adjust and be flexible. Does that resonate with you? Does that make sense? Of course, not only we need to be very clear, today's technology, availability of technology and the ease of access of technology creates a new problem. Where if you take best of breath and they are available, they are very affordable nowadays and you implement them, you run into a more critical problem for a business and that is data integration and data availability. For an executive to make a decision, you have to have reliable data. Now how do you secure reliable data? The entry points of that data from multiple solutions that don't speak the same language with the middle tier layer to integrate them. You really do not know what you are getting yourself into. Having an info-like ERP integrated solution give you the peace of mind that that data is integrated, has one source and not only that, the validity of the data is secured and checked across the board for an executive to make a decision by accessing that data. That's of the ultimate objective in serving your customers and growing the business, having the right reliable data that you can trust to make a decision. I'll give you a story. We want to do on the bespoke system a business intelligence that pulled data from the different parts in order for the executive to be able to see that. And the data consistency was huge. And it took us a long time to actually reach to a very sensible sense of what's happening. Whereas now, as Nasa said, it's coming from one application. One source. All right, we have to leave it there, but I'll give you each the last word, but just takeaways from Inforum 2016, things that you want to learn, things that you want to take back to your colleagues and then Nasa, I'll get your thoughts. What I've seen is cloud solution is something that we're seriously looking at for our future. We're going live on an on-prem solution, but the cloud is something that we want to capitalize on. We see the things like GT Nexus, which Cat uses for their prime products. So how can we adopt that? There's a lot of that to be inside one solution. Nasa, your final thoughts, please. When you select a solution like this, you don't look only for technology, you look for the partner. And it is really a partnership. Today, Etri assured me that we made the right decision, that we have the right partner who will help us enable our business and grow the business. We saw their vision and strategy and we like it. We like where they're going with their product. We believe we'll be together for a long time. Also, we met all of their management who have been very close to our project. We had Mr. Charles Phillips visit us, as Stefan Shaw will support in us. We're very happy with that commitment and I believe both of the organizations are set for a successful journey and we're very happy with our choice. Well, it's a great story, very pragmatic and intelligent approach. So thank you gentlemen for coming into the queue. Thank you for having us. We really appreciate it. All right, keep it right there. We'll be back at the Big Apple right after this short break. Thank you.