The Socialization of the Supplier Integration Sector

In my daily work as an Industry Analyst and Solutions Advocate, I am finding that the terms, “social supply chain”, and “supplier collaboration” are showing up with increasing frequency. However,  the inclusion of  opportunistic communications supplementing a supply chain infrastructure (these include EDI-based systems such as ordering automation, e-Invoicing, and generic supplier enabling); needs to be well understood and carefully implemented. I am  emphatically a proponent of fresh ideas, and  firmly in favor of  enhancing supplier autonomy.  However,  many B2B platforms, even those developed by experienced companies, fall victim to featuritis – the addition of functions without a concomitant understanding of what or who they serve.  If the industry as a whole simply must conceptualize the benefits of social media on supply chain IT, let’s at least think it through, together. Here are some elementary concepts in brief:

Today, we practice top down supplier management – something that  looks and feels inflexible to most suppliers -

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“thou shalt use this Implementation Guide”, thou shalt use X12 850 or EDIFACT ###,  with these modifications”. - – -well…that seems at odds with any vendor’s ideal model. The VANs, as a group, have offered communications and connection to ERP and order + shipping. That’s nice.

However, the overwhelming model of large buyers demanding EDI Compliance (marquee Retail or manufacturing) are prone to promulgating one way conversations:

Thus were service providers (such as SPS Commerce) born – to eliminate the chatter connected with suppliers attaining onboard status to a buyer’s hub. To commence the process of selling and taking orders  means becoming EDI proficient, which in turn means connecting your company’s accounting and ERP systems, to the order management systems of your buyers. That’s what EDI is all about, the standardized format of business documents, and the transit of these EDI Documents between the disparate systems of various trading partners. 

In these well-worn cases, Fortune 2000 retailers and Mfr’s publish implementation guides, and the suppliers struggle to comply.

Would a collaborative messaging or rich activity stream augment the on boarding process? How can richer communications between trading partners help or hurt.?

Well, there you have it; does multiplying the channels for problem resolution create chaos?  Are these supplier scenarios more appropriate for outsourcing, or best served in-house, by the EDI department?,  Are  support ticketing systems, as cold and infuriating as they often are, more apropos to supplier management? I’m not so sure.

This is the supply chain industry’s present struggle;  the suppliers have never enjoyed being dictated to, and the buyers never really wanted to provide such elevated levels of support, which is  required to onboard and maintain many suppliers. Hence the VANs  inherited this sector.  Several leading VANs, in particular those recently acquired by “big money”,  seem to be falling behind in evolving the  collaborative tools suppliers and buyers would look to for streamlining the community’s multifarious relationships….with multiple buyers – The E 2.0 Community also seems to be at cross purposes – they are generally creating closed silos (there are many exceptional examples, both good and bad)  - and it usually devolves to a lack of global addressing to off-network trading parties. Routing between e-commerce networks also seems to be a major deficit of the later non-VAN supply chain systems. One cannot address collaboration and the benefits of social dynamics, if inter-system communications are made difficult or impossible,

Will Social technologies, however we define them, augment supply chain systems? Or will the implementations become unwieldy ? I hear of new thinking and emerging trends  that suggest the industry is  working  - first to understand what social technologies can and can’t do for supplier integration, and what new approaches might  hint  at a better future for the suppliers.

This fresh interest in supplier community “friendliness”, collaboration, and autonomy,  seems to indicate that there are new opportunities to address some of the long-standing issues plaguing trading partner integration, in the broadest sense. These old processes are overdue for new thinking and certain of these models might look something like consumer social media, but are not simple clones of Twitter and the ilk…..

The concepts of “Membership” and identity are particularly ripe for reexamination by the purveyors of supply chain technologies.

My bet is on the Cloud B2B mavericks – as wildcat technologists, they took a risk and a beating at the hands of the staid legacy ‘place-sitters’.

Now, here is an opportunity for the B2B Cloud Provider’s – they are my personal favorites, Let these platform  developers  become the crusaders who will forge better, leaner, and more intelligent systems. That’s the prescription for a  healthy supply chain services ecosystem.Moreover, that’s what mid-end and small suppliers desire and deserve…..to be empowered by the solutions they pay dearly for.  Retailers and manufacturers have certainly had it their way for a long time, and the best of them really want better solutions that might converge around socialization of the modern supply chain, however that will be defined.

I cover this market segment closely, and would not be surprised to see the birth of such new technologies, conceptually related to aspects of social media….but….different.  Stay tuned. Please contribute your thoughts in the comments below, or send a missive to abmadw@gmail.com

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