 At
its simplest, B2B integration is the automated exchange of information
between different Organizations. Occurring independent of or
alongside manual processes, it is most accurately described
as application-to-application integration that crosses corporate
boundaries. Increasingly, this integration is being done over
the Internet and the dominant trend is towards the use of open
standards At its most effective, B2B integration improves external
processes such as supplier chain integration or shipping/logistics
tracking by enabling rapid, cost-effective real -time links
between business partners . It enables new business paradigms
such as E-commerce initiatives. It reduces costs and inefficiencies
by facilitating initiatives such as multi-vendor catalogs and
electronic procurement promoting comparison shopping and dramatically
reducing the costs associated with traditional procurement.such
as XML and HTTP And it strengthens customer relationships by
enabling capabilities such as real-time order management and
customer service. |
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| Enabling
Supply Chain Planning & Integration |
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| The Extended Supply Chain |
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Business
is getting tougher and more competitive. Business globalisation
is leading to the growth of geographically dispersed organisations
across many countries and continents, adding complexity and
risk to the day to day management of the ever extended Supply
Chain. The result is a requirement for systems that enable data
and information velocity between all the partners in the Supply
Chain for better and faster decision making, systems that provide
the users with transparency across the Supply Chain for better
and more informed decisions and finally with systems that translate
data and information into synchronised plans for every part
of the chain from manufacturing to the end customer.
The
requirement is for the speed to deliver more reactive facilities
to all members of the Supply Chain; to react to changes in customer
demand, to react to changes in a supplier's ability to deliver.
New systems must provide global access and transparency enabling
suppliers and company users to see the ever-changing demand
position and to provide a solution to it. |
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| Today's
Supply Chains can extend from raw material processors, component
manufacturers, factory warehousing, central distribution depots,
regional depots through to end customer outlets. Many companies
can be included in any Supply Chain rather than just one or
even a single group operation. Consequently the boundaries of
the chain sometimes extend beyond the enterprise within which
we operate. |
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is not uncommon to find different parts of the same supply chain
competing with each other and there is competition between different
Supply Chains. Those companies that create and operate as one
effective Supply Chain will be the winners of the future. |
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Despite
the reported benefits achieved by collaborative operations such
as Vendor Managed Inventory (VMI) and Collaborative Managed
Inventory (CMI) at present there is generally very little co-operation
between the various parties in the chain.
This lack of collaboration in the past is in part explained
by the reluctance to share data and information and of systems
to support such collaboration. |
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| Local Optimisation |
Currently
many companies are involved in local optimisation of their part
of the Supply Chain. This local optimisation in the long term
makes the Supply Chain less effective.
Local optimisation can create friction or conflict in the total
chain and eventually the performance of the total chain is less
effective. What is needed is a global view of the chain and
optimisation across boundaries of the enterprises within it.
The technology is available to achieve this but there remains
the problem of the attitudes of people towards the changes that
are required to move from local to global optimisation. The
changes include the need to consider new performance measures
that reflect the global view of the Supply Chain. Management
of the total Supply Chain also requires changes in how job functions
are perceived. |
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| Local optimisation in the Supply
Chain |
Many
companies are function oriented rather than process oriented.
To create an effective chain many companies need to re-engineer
at least part of their structures and operations to become more
process oriented.
Local optimasation within entrprice boundaries create artificial
walls that break the flow of information across the chain. This
in turn results in lower customer satisfaction, increased inventory
costs and lack of confidence between the various partners.
Through the Syncron range of products and services Unicorn is
in position to offer solutions which provide for the more global
view of the management and effective control of the total supply
chain. |
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| The Erp
Myth |
| In
recent years many companies have invested heavily in the implementation
of ERP systems in the expectation of significant financial benefits.
These benefits were expected to arise primarily from the ERP
system providing a common, consistent base of data and information
on which to base all aspects of the management of the company,
be it a major group or single operating company. Where benefits
have been achieved these have tended to be in the form of local
improvement within the business. Furthermore ERP systems have
tended to be weak in the provision of effective decision support
systems and particularly for the management of Supply Chains.
Consequently these companies are or are planning further significant
investments in B2B and e-commerce implementations with the aim
of achieving integration of the ERP systems to provide better
Supply Chain planning and integration. |
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| ERP
Systems provide local integration but not Supply Chain Optimisation |
| Supply Chain
Collaboration |
| The
purpose of Supply Chain Collaboration follows from earlier developments
in VMI, CMI and others and it is driven by the proven success
of these earlier developments together with the Web enabled
technologies and the Internet. The benefits achievable are in
terms of reduced inventories, increased sales and improved customer
service. It has been estimated that Supply Chain inventories
can be reduced by between 15% and 25% by the adoption of best
practice in Supply Chain collaboration. Despite the existing
examples of the benefits of Supply Chain collaboration there
remains significant reluctance on the part of many companies
to move toward supply chain collaboration. |
Effective Supply Chain collaboration
requires:
Visibility
in the Supply Chain
Transparency
in the Supply Chain
Tight
security to control access to data
For effective operation the required data such as forecasts,
marketing plans and
production plans and other information will be available to
all the partners in the Supply
Chain. Consequently the necessary security must be in place
to tightly to control access to
the data. |
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Supply
chain collaboration is much more than the provision of data
as provided by electronic data interchange (EDI). In place of
this type of one way flow of data and information Supply Chain
collaboration provides for the trading partners to interact
and discuss the data, information and the results from appropriate
decision support systems such as broadvision and PS to reach
solutions that achieve the best global performance.
Consequently a web host may host the applications providing
the decision support systems. |
