At the heart of any successful project is clear, open communication and seamless collaboration amongst all involved parties. Let’s start with a story.
My friend Andrea is building a house. She needs to ensure her house has water, gas, power, telecommunications and more to make it livable. She has some work to do to determine what is required, search for service providers, and contract the work out to different specialists. Andrea soon becomes overwhelmed with the amount of effort to manage all the different service providers.
She wishes she had a single point of contact who can manage all these requirements on her behalf – a single service which connects her to the power, gas, and water lines, provides a single invoice to pay, and finally, provides one phone number to call in case some of these items create any sort of headache.
How does this translate into the business world?
Let’s imagine that Andrea’s house is your company. Different lines of business have their own needs and require access to, or collaboration with, partners and suppliers. Perhaps you are part of a supply chain department that collaborates with material suppliers to share forecasts, orders, and inventory. Or part of a logistics team that works with freight forwarders and customs agents. Or you are in asset management and maintenance. Although today machines can connect to the maintenance service provider, this is yet another communication channel and business partner to manage.
All the individual departments use their own communication channels, processes, contracts, SLAs, onboarding, and support services, and, of course, have to deal with different contacts at different trading partners.
The result can be inconsistent processes and contracted terms, different points of contact, and silos across and beyond your organization.
Centralizing all points of communication can be challenging. Often, departmental silos arise and may result in inefficient and error-prone process.
But all of this alignment, communication and collaboration is necessary. Going back to the house analogy, nobody wants to sit at home in the dark without water and heat, right?
Looking at this complex structure, we need a new and better way of managing the ecosystem and network outside of our individual organization.
Let’s imagine unifying all your points of interaction – a network of trading partners and service providers that connect through a single channel, or even through direct access to their back-end infrastructure (such as ERP, planning, or transportation management systems). This single access allows the end user to connect seamlessly to all external stakeholders, including suppliers, contract manufacturers, logistic service providers or maintenance service providers to collaborate on inventory, forecasts, orders, shipments, workorders, and more. In short, it provides a unified experience.
But what is a unified experience?
Unified experience means that there is a single integration method to connect to the network of trading partners. This means eliminating sending of orders via 1:1 EDI; or managing forecast alignments with suppliers through excel shared via email; or resolving quality issues via phone. Instead, single access is highly automated and monitors exceptions, with a single way to manage resolutions.
Organizations might want to add additional trading partners in different areas, or a group or even an existing network of trading partners that are not yet connected to their backend. This requires a unified onboarding experience for any kind of trading partners, for example suppliers and logistic service providers – and not different onboarding experiences for procurement, logistics, supply chain, etc.
To come back to the analogy of Andrea and her house, it is as though Andrea can just switch on her coffee machine or any other electrical appliance and automatically leverage the best power service without having to deal with the complexity behind it. In business terms: you can continue to work in your well-known ERP, planning, PLM, or plant maintenance tool, but you have better data and are instantly connected to your trading partners.
A centralized network delivering a unified experience reduces the complexity for your business, as well as for your partners. The network allows you to integrate seamlessly with your back-end systems, eliminating the need for resource-intensive implementation projects. The centralized network means that you can leverage a common data model, set of services, and analytics.
For many years, SAP promoted this idea of connecting trading partners across a network to collaborate seamlessly. There have been different networks for different business areas: procurement (Ariba Network), logistics (Logistic Business Network), and asset management (Asset Intelligence Network). These networks are now coming together. Earlier in 2021, SAP launched SAP Business Network, a unified network that harmonizes previously disconnected supply chains into a unified, collaborative, and intelligent network.
In a second part of this blog, we will discuss the components of a business network.
In the meantime, join us on September 21 at 10 am EDT for a live discussion on network-based supplier collaboration.