Traditional supply chains are coming under growing pressure as organisations search for growth in increasingly competitive markets. Around the world, changing economic conditions and customer demands mean that organisations need to find a way to be increasingly agile. Those unable to evolve their operations to match these new conditions risk quickly losing market share to their rivals.
The challenge is being made more acute because of restrictions on IT budgets. In many cases, they are either fixed or being only marginally increased. This, in turn, means IT teams are being forced to find more efficient ways to operate.
The B2B/EDI challenge
For supply chains, remaining reliable whilst at the same time become more agile is critical to business operations. Achieving this dual objective within a limited IT budget is no easy task.
Many organisations are realising that the existing B2B/EDI systems supporting their supply chains are simply no longer fit for purpose. They lack the real-time visibility and responsiveness that is now required, and can take long periods of time to be configured to meet new business requirements.
The challenge can clearly be seen when you look at how an organisation responds to changes in customer demands. As preferences change, new products are introduced and feedback is received. The organisation must be able to incorporate this feedback in real time and make rapid adjustments to product design and production processes.
Each of these adjustments has a direct impact on the supply chain. Current suppliers may have to change the mix of what they are providing or be replaced by others with different products. Such changes have to be achieved quickly to ensure the organisation maintains its market position and satisfies customers’ demands.
At the same time, many organisations are looking to expand their presence into new geographic markets or begin offering their products through new channels, such as online and mobile stores. Again, the supply chain has to evolve to support these initiatives.
Unfortunately, the end result for the IT department is a growing gap between what is required in terms of support and what can actually be delivered. Teams can quickly find themselves with a backlog of change requests relating to supply chain issues, and delays in completing them will have a direct impact on operations.
In some organisations, on-boarding new suppliers can take more than six months. For others, the processing of B2B/EDI traffic has become a complex nightmare that is swallowing up more and more internal resources.
The power of an API-led approach
The main challenge of managing EDI communication in the supply chain is the fact that organisations have traditionally taken a siloed approach. B2B integrations have tended to be put in place between the organisation and each of its supply partners.
These connections handle everything from invoices to purchase orders and shipping notices. As the number of partners in the supply chain expands, the work that has to be done to process these communications rapidly increases. This is because the logic that is used for back-end processing needs to be duplicated for each partner. So, for every new partner that is brought onboard, the linkages become increasingly complex.
Taking an API-led approach to this B2B / EDI challenge fundamentally changes the speed at which the supply chain can adapt to change because it decouples message processing from business processes. A set of defined services can then handle all messaging in a consistent way with only downstream business processing needing to be specific to individual partners.
By creating an application network in which the applications, data and devices that make up a supply chain are pluggable and reusable, organisations can address changes more quickly and leapfrog past competition.
As a result, when new trading partners are added to the supply chain, the only incremental work required is the partner- specific processing as it pertains to message mapping. So, once the foundation elements are in place, the act of bringing on new trading partners is greatly reduced.
Also, because the required work has been distilled down to partner-specific message mapping, an organisation can delegate other teams to do that work rather than having to put it all through the central IT department.
Platform support is critical
To achieve this streamlining within the supply chain, deploying a robust API-based platform is a critical step. The platform needs to have B2B-specific transports that allow the organisation to send and receive B2B messages through B2B / EDI protocols.
The platform must also have a set of B2B / EDI-specific message packs that allow messages to be passed, validated and transformed across different B2B / EDI standards.
Third, the platform should also have a robust trading partner management system that allows the organisation to set partner- specific validation and processing rules on a per-trading partner basis.
A platform with these attributes will help an organisation to dramatically reduces the time taken to set up new trading partners and streamline processing.
As a result, the organisation will be much better placed to improve its flexibility and agility to meet the evolving requirements of the business landscape. Its supply chain will remain an efficient and vital component of daily operations.
