Wednesday, March 27, 2013

The Importance of Integration Planning in B2B EDI Supply Chain Projects – Part 2, Optimal Integration Process


We know that we can’t adequately integrate anything – all the way from ingredients in a recipe to disparate systems within connected business processes – without planning. It’s just impossible. But knowing that you need to plan and understanding the process are two different things. In this post, we’ll discuss the process of integration planning and how to ensure that your process is optimized.


An Optimal and Powerful Process Outline:

Successful integration planning will achieve the removal of all of the unnecessary or redundant systems (see previous post) that consume/waste a tremendous amount of resources and play a major part in slowing down supply chain processes. It is this redundancy which is responsible for making supply chain processes cumbersome, error-prone, very difficult to manage and administer and, ultimately wasteful.


The redundant and completely unnecessary processes that must be removed from the supply chain operation were also discussed in our previous post.



The following outlines an example of a properly planned and designed integrated supply chain operation. This encompasses not only the integration planning process (that is, the planning of the actual integration phase), but also (and perhaps most importantly) the pre-integration planning process which must be considered and completed first.


Pre-Integration Planning Process:

1. Ensure that all supply chain data (either from external or internal process flows) are seamlessly and in real-time into and out of an organizations systems that support their supply chain operation. 2. Remove as many if not all in-between and redundant processes that carry the data that translate and map the data within an organization’s operation. 3. Ideally, provide the data directly into and out of the organization’s supply chain systems, by removing the in-between processes.





















Integration Planning Process:

1. Create an integration data point roadmap, which shows all the data and information exchange points. 2. Define and document the data needs in and out of all the data and information exchange points. 3. Automate all of these data and information exchange points with EDI or with non-EDI methods. 4. Integrate all the data and information exchange points based on the data needs of in-bound and out-bound data and information streams. 5. Once all of the integration is complete, the process is ready to provide visibility and responsiveness for all supply chain collaboration needs of the organization with its external and internal users.



























In summary, unless the proper automation and the proper integration are implemented, many, if not all of the key business activities cannot be improved, as any and all collaboration with external and internal users and systems will not be accurate and timely. 

In our next post, we’ll look at how integration planning applies to a retailer’s supply chain process, what waste there may be, and we’ll describe a hypothetical example of a properly implemented integration plan.

Tuesday, March 5, 2013

The Importance of Integration Planning in B2B EDI Supply Chain Projects – Part 1, An Overview

Preamble:
Before we discuss the importance of Integration Planning in B2B EDI Supply Chain Projects, let’s quickly review the information we provided in our previous series of blogs on, “The Ongoing relevance of EDI” or “Why EDI is still relevant”.

In the last series of posts, we discussed EDI from a historical perspective, the current state and the future use of EDI in supply chain, how EDI costs have significantly decreased over time and how the proper use of EDI has resulted in transformational business and process improvements in supply chain for all organizations that use it as part of their overall supply chain management infrastructure. These organizations have continued to substantially improve in a highly cost effective manner as their overall EDI operations have become entrenched as a core foundational component their supply chain Infrastructure.

That having been said, there is an important factor which is critical to using EDI optimally which must be considered – integration planning. Without properly planning how EDI will integrate across the supply chain, it is impossible to consider an implementation to be “Best-in-Class.” Over the next 4 posts, we will explore integration planning for B2B EDI supply chain initiatives including examining what optimal plans and processes should look like.

The Promise of Integration Planning:
The secret of achieving a highly successful supply chain operation is the achievement of “Collaborative End-to-End Visibility” and “Collaborative End-to-End Responsiveness.” This visibility and responsiveness cannot be achieved without effective integration planning. A well-integrated operation will result in a highly effective and responsive business operation, both from an execution and administrative perspective.

The benefit of a properly automated and integrated supply chain operation is the ability to involve and collaborate with customers and suppliers to:


Involve

These are only an example of key benefits - there are literally endless benefits that an organization and its trading communities achieve with a properly automated supply chain.

The key ingredient (and we would be inclined to say that the ONLY ingredient) that is absolutely mandatory for a highly effective supply chain is in integration planning and execution. Without a properly integrated supply chain, collaboration cannot occur. Without proper collaborative processes, an organization cannot have a meaningful nor effective operation to deal with its trading communities.

A BEST-In-CLASS Integration Plan:
In order to achieve highly collaborative supply chain processes that will provide end-to-end visibility and the desired responsiveness, one must remove/eliminate as many in-between and redundant processes from the supply chain. These unnecessary data points are the processes that have to do with but not limited to;


The exchange of data between various trading partners and stakeholders; The exchange of data between internal systems; The Data Validation processes that exist outside of the organizations core systems; such as their Merchandizing Systems, BOM systems, Inventory Systems, Warehousing Systems, Transportation Systems, HR Systems, Financial Systems, Security/Audit/Control Systems; The Data Translation and Mapping Systems and all of their related procedures and processes; The Management Information Systems that are used to Plan, Manage and Control the exchange of data between external and Internal Users and Organizations; All of the Hardware and Software resources that have been put in place to deal with External and Internal users of Supply Chain Processes


As we can see, there are many points to consider when embarking on an integration planning process for a B2B EDI supply chain initiative. In our next post, we’ll look at optimizing the process outline as well as what pre-integration and integration planning processes should look like.