For every manufacturer and wholesaler the need to digitalize is clear. The buying behaviour of business buyers is constantly changing. There are more and more online market places, manufacturers go directly, online retailers develop business-2-business initiatives and the (international) competition is increasing. Collaboration mainly takes place between parties in the chain that can deal adequately with all these developments and stand out in their digital effectiveness.
In order to maintain a strong market position and emerge from increasing price pressure, it is essential that the organization is agile. It must be able to respond quickly and smoothly to the changing expectations of customers, achieve optimum productivity and at the same time embrace all new developments. According to a sector report from Rabobank, the possibilities offered by digitalization have not yet been fully implemented by the entire chains of manufacturers and wholesalers. Predictions show a lagging growth, while digitalization of the essential core processes for many companies offers the solution to their daily challenges.
We see a lot of developments on a small scale that can work disruptively. For example tailor-made or unique products, as a result of which developments in the field of micro-logistics and direct-to-consumption processes and drop-shipments increase in importance. It is not a threat - it is an opportunity that one can jump on. The condition is that the organization is agile and the business processes have been digitalized.
Digital e-commerce business platform
The best solution is to set up the infrastructure on the basis of a digital e-commerce platform. Orders, order processing, and exchange of information can take place digitally for internal customers (employees), professional buyers, suppliers, and for consumers. In addition, thanks to well-designed information intensive processes, the customer gets the feeling that he is understood, that he is offered exactly what suits him. Communication with customers will be in a consistent manner, where all contact moments are in line with each other and have the same personalized customer focus.
Kien offers a modern information driven digital e-commerce business platform for supply chain and procurement. A platform that looks like a consumer web-shop at the front, but with an extensive back-office for the integration of different business systems (IT legacy), end-to-end efficient work processes, and possibilities for the introduction of, for example, price rules, volume orders, and specific order configurations. Specific linked applications ensure that buyers and users (customers, employees) get a simple interface to place and process online orders, and that the various supply chain functions such as planning, purchasing, production control, and logistics are interconnected and optimal synchronizing supply and demand.
For the coming years, it is expected that a large number of new digital technologies will be introduced. In order to benefit quickly from these technologies, they will have to be able to be installed quickly. This will not be easy in most existing IT infrastructures. Many companies have old ERP systems and other large stand-alone business systems (IT legacy) installed, and these do not have the adaptability to integrate with new technologies.
Dealing with IT legacy
With a modern digital business platform we prevent gaps between the new digital solutions and applications and the older IT legacy. Because without connection to this IT legacy, end-to-end digitalized work processes will not be possible. There will then be gaps that have to be bridged with often a lot of manual work, resulting in enormous inefficiency.
Kien’s digital e-commerce business platform offers an adaptive infrastructure for continuous change. Instead of a costly and time-consuming adjustment process or replacement of the IT legacy, connections can be made with these systems to use the data so that the manual work can also easily be digitalized. This shortens the order-to-cash time.
By digitalizing processes, which are still done manually and often with the use of office tools such as Microsoft Excel, the efficiency and effectiveness will improve and the gaps because of ERP and IT legacy will be solved. In addition, with the help of Robotic Process Automation (RPA), the processes can be further optimized. According to IDC, robots will be in use in 50% of the supply chains by 2019, resulting in productivity gains of up to 30% and a reduction in operating costs.
Positive customer and employee interaction remains essential
The professional buyer also has a decisive role. He is no longer the last link in the chain. With the world at his feet, he determines with whom and in what way he cooperates, where he makes his orders and purchases, and how he wants to be served. In the B2B world too, for example, supplying goods within precise time limits and (as drop-shipment) at specific locations will become more and more commonplace.
The result of a customer-driven supply chain is a multitude of (micro) logistics services and a huge need for information that will evolve continuously. According to IDC, by the end of 2020, one third of all supply chains will use analytically controlled cognitive technologies, which will increase cost efficiency by 10% and service performance by 5%. For example, GPS sensors can already be used to track products from floor to shop.
More sensors lead to more data and link to other systems, all of which should lead to valuable information. Linking the various processes and the continuous collection and analysis of data helps to optimize and connect the various processes in the supply chain and improve the order-to-cash route with several suppliers.
Adidas was able to redesign and digitalize their supply chain activities with Bizagi and enable better communication between their markets and factories. The manufacturer wanted to increase its operational efficiency by automating ad hoc and manual processes. They hoped that this automation would shorten their time-to-market, while improving their business agility and customer service and improving relationships with factories and suppliers.
They integrated Bizagi with their ERP and SAP to launch, in two years time, various workflow projects that optimized and digitalized about 25 work processes. This resulted in a reduction of 60% of the operating costs and a delivery time that was 75% shorter.
We would be happy to come by for a detailed explanation
The digitalization of the world around us is not a trend, it is permanent and will only go faster. It is the new standard. Directors and management of manufacturers and wholesalers who want to know more about the possibilities of Kien’s digital e-commerce business platform, we would gladly give a visit for a detailed explanation.