Why B2B Integration is Key to Gaining Greater Supply Chain Insight
There is a direct relationship between supply chain performance and B2B integration maturity. The more connected an organization is, the better it will be able to collaborate with its business network in real-time to simplify its operational procedures. In this article, we will outline why B2B integration is the key to gaining greater B2B supply chain insights.
The Ever-Evolving Supply Chain
Modern life clips along at an unprecedented pace, and here at Eliassen Group we have been discussing the comparison of keeping up with the fast pace of life—and all the information that produces—to the experience of keeping up with the supply chain.
On a personal level, when you think back ten years ago, YouTube and Facebook were just getting going, and Twitter was a gleam in someone’s eye. Phones weren’t all that “smart” with people assuming they would just get smaller, and they definitely weren’t thinking “mobile revolution.”
The Future of Supply Chain
When you fast forward to now, these things have all had a huge impact on the way we operate as individuals. We don’t need to make plans set in stone, as we can instantly message—with no time delay— on where to meet up. We’re rarely “offline”, even on holiday, and the work-life balance is changing as a result. We can also take and share images instantly, influencing shopping, eating and drinking habits, as well as where and how to socialize.
All of this communication produces masses of data in our personal lives (Dropbox anyone?), and more applications are being developed to help us make sense of it all. Apps that collate your pictures into albums for you, online banking alerts and spending analysis, online alerts related to credit fraud—all designed to make your life easier.
The supply chain also produces huge amounts of data, and just as our personal productivity and communication are enabled by data networks that are highly accessible and fast, B2B and B2C supply chains also need a robust and modern infrastructure to achieve high degrees of performance and collaboration.
High-Quality B2B Infrastructure
A high-quality B2B infrastructure is required to make sure all of your business partners can be connected with your company, regardless of their technological complexity. For example, a small supplier, with just an internet connection and unsophisticated software, may create challenges for some companies in terms of communicating real time transactions and inventory information. Their business is probably not geared up for electronic data interchange (EDI), and may rely on Excel spreadsheets and perhaps a cloud application or two for managing their business.
At the other end of the scale, a large multi-national customer or supplier could have a mix of legacy, cloud, and internal systems, with complex business processes and leveraging a wide variety of standards and protocols and types of B2B integration like EDI, XML, HTTPs, Connect:Direct, AS2, and AS3. Large organizations will have advanced technical capabilities, and expanded volumes and numerous types of documents and transactions. Support for these, as well as the ability to readily integrate with partner applications (such as enterprise resource planning or ERP), is critical for enabling real-time, automated communications with this partner.
There will also be lots of business partners that fall in between these two extremes, so a B2B integration solution that supports many types of data exchanges and levels of technical sophistication is critical to enabling greater insights about your supply chain.
What type of insight could you expect?
In the same way that credit fraud alerts work, indicating that there has been unexpected activity on your account profile (which only works because the credit companies have access to your whole profile, across a multitude of data sources), a completely connected supply chain can generate alerts when the unexpected happens.
When you get a credit fraud alert, you don’t want to have to trawl through all your account data to see where the problem is—you want the system to do it for you. That’s how supply chain insight works…as opposed to trawling through screens and levels of information that will be sure to make you cross-eyed, alerts draw attention to problem areas, and potential problem areas, based on analysis and insight.
This can only work effectively if the system has a comprehensive picture, enabled by a B2B infrastructure that can link together your supply chain. This is only possible if you have a B2B infrastructure that is capable of supporting multiple communication protocols, standards and technical sophistication levels.
For example, let’s say that a batch update has gone wrong, and was holding back orders that should have been processed. The supplier has spotted this, and rectified the issue down the line but now those orders have all been released at once. This could cause issues across the supply chain (particularly if systems are automated) by triggering stock orders while the systems try to accommodate the sudden spike in demand.
Insight-Enabled Supply Chain
An insight-enabled supply chain would identify this unexpected spike as a potential error, and would generate an alert. Through access to information across the supply chain, the alert could be assessed as to whether it’s a genuine spike, or caused by a system anomaly (as in our example).
This type of insight capability has the potential to not only be very proactive, but also to head off unnecessary orders and inventory, saving the company money and protecting them against substantial losses due to errors.
As we become more dependent on instant, real-time information in our personal lives, supply chains will also require more robust and modern B2B infrastructures. This, in turn, will enable the proactive insight needed to make the supply chain more efficient, profitable and customer-focused.
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