Companies Preparing for Supply Chain Digital Disruption

In today’s digital supply chain landscape, electronic linkages between customers and suppliers is on the rise, and double-digit growth is expected in 2017 and beyond, according to new research released from B2Bi Managed Services provider DiCentral, in partnership with SAP and the Global Supply Chain Institute at the University of Tennessee (UT) Haslam College of Business. The whitepaper, “Proactive Partnerships: Creating Supply Chain Value in the Digital Era,” helps prepare supply chain and EDI decision makers for digital disruption in the supply chain and highlights how to adopt and adapt digital tools to prepare for and protect against this disruption.

In today’s instant-gratification buying culture, buyers and suppliers must be in lockstep. Suppliers operate in a world of slim profit margins and tight deadlines, and late shipments for failing to follow the packaging requirements of a retailer, such as a misplaced barcode, can result in costly penalties. According to 80 percent of survey participants, their customers run an existing EDI compliance program, which can result in penalties, and nearly 75 percent of survey respondents have been subject to fines due to noncompliance. Among those respondents receiving fines, 3 percent report receiving fines of more than $100,000 in a 12-month period. For small- and midsize businesses (SMBs), these fines can have a material impact on profits.

From machine-to-machine communication (such as EDI) and data analytics, to cloud-based solutions and mobile capabilities, disruptive technologies are far and wide, and digital technologies are transforming the way today’s organizations operate. More and more companies are embracing these automation tools and supply chain analytics to remain competitive, reduce costly human errors and improve customer service levels.

“In today’s age of digital technologies transforming the way organizations operate, creating a digital supply chain network is a business imperative for supply chain and EDI managers across the globe,” said Thuy Mai, president and CEO of DiCentral. “We are proud of the work we have done with SAP and our mutual customers. Our partnership has helped the clients that invested in SAP ERP to be more agile and competitive in today’s digital economy.”

According to study findings, 76 percent of survey participants expect growth in their electronic supplier connections up to or more than 25 percent. More than 75 percent of survey participants agree their current system can process most inbound EDI/XML connections without human intervention, and 60 percent of participants report business-to-business integration has enabled them to improve customer service levels.

“Technology continues to improve and evolve at a frantic pace. So companies must act now or get left behind,” said Randy Bradley, assistant professor of information systems and supply chain management at UT’s Haslam College of Business. “Our survey demonstrates that many companies are moving in the right direction, but they need to continue to move faster.”

To download a copy of the whitepaper, click here.

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