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Insights I Gained About Overcoming Barriers to Digitizing Fulfillment Processes

Posted by Martin Verwijmeren on May 10, 2021 5:04:25 PM

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It’s no secret that eCommerce has grown dramatically over the course of the pandemic. The rising challenge of omni-channel order fulfillment, in particular for brand owners entering the D2C market, has put a spotlight on manual processes that limit visibility, collaboration, and optimization.

I recently participated in the webinar: Digital Order Fulfillment: Fast, Visible, and Cost-Efficient Delivery, in which I had an insightful conversation with Sławomir Kluszczyński, COO at Lotte Wedel Businesses, and Nico van den Berg, Distribution Process Lead BA Europe at Electrolux. Both expressed urgency for not just automated processes, but to progress from limited and siloed order flow visibility to full, end-to-end actionable insight. To streamline and improve the effectiveness of dynamic networking and collaboration.

The challenges they voiced echoed pain points I often hear: Organizations operating within complex supply chains struggle to overcome the limitations of heterogenous systems landscapes. In many cases, companies have made the difficult discovery that their supply chains and existing systems cannot withstand further disruption.

Yet, we all agreed that digitization is an unstoppable, immanent force that cannot be ignored.

The Supply Chain Network as Both a Barrier and Wellspring of Potential

Operating within supply chain networks allows companies to focus on their core competencies and usually save on time and costs by subcontracting to external enterprises. Yet, as Nico, Slawomir, and so many others point out, digital transformation is not an isolated effort, but one involving and impacting your entire network. As a result, partners can also pose as barriers to supply chain digitization.

A common obstacle for businesses is determining how to integrate their internal systems to cooperate and work cohesively with those of their many partners – including suppliers, customers, and carriers. When the level of development and maturity varies among partners, the disparity creates an added challenge.

Barriers to Digitizing Fulfilment Processes - networkOn the one hand, creating a unified experience – both as a network and for the customer – is a “must-have;” on the other hand, most businesses have not found a fast and cost-effective technology strategy to create the foundational visibility they need across systems and partners to efficiently track and trace and optimally steer customer orders. Achieving the best service at the lowest possible cost is a key consideration for leaders like Slawomir, who rightfully quipped that customers, such as retailers for instance, expect their margins to grow. In other words, they expect a “perfect order” experience.

Nico also made the astute point that openness to information and the ability to change is mandatory. Transformation is often a hard sell; large companies have the resources but are also complex and set in their ways; conversely, small companies, while better adept at handling process change, may lack the resources and bandwidth to back an initiative. As a big shipper, Nico’s company tries to approach the challenge in a flexible way by developing tools that enable suppliers of any size to participate.

Digitization Is a Mindset

To put it simply, the question of digitization is not “if” but “how.” Slawomir indicated that the pandemic has really made ‘resilience’ a pillar of his technology strategy. With less than a quarter of companies having achieved true resiliency, he remarked that this facet will no doubt be a key advantage for businesses and their current and future customers.

Resilience Survey Network ScopeIt reminded me of a survey we conducted last year in partnership with Peerless Research Group on the topic of supply chain resiliency. Over half of supply chain stakeholders rated their networks as ‘medium’ or ‘complex’ – meaning, a combination of 100’s to 1000's of supply chain partners in either a few or many countries, regions, and with either a few or many nodes in the supply chain, respectively. Despite the Resilience Survey Operating Network complexity, nearly half reported that they still operate through a legacy framework of spreadsheets and ERPs not fit for networks.

The disparity begs the question: what use is it to have a highly skilled ecosystem if you can’t harness that potential? Just as important as cultivating a network is laying the technological groundwork to ensure the ecosystem can reach competitive levels of agility, velocity, efficiency, and compliance. Part of the problem is a too-narrow focus on cost and quick-fix solutions. Businesses will turn to point-to-point integrations and add functionality to their ERP systems rather than invest in more transformative technology.

If the multi-enterprise network is a prime force in the modern supply chain, then businesses need to start recognizing cloud technology as the equal and complimentary force that supports the ecosystem. It is also a disruptive force, as the gains in speed, agility, and flexibility from a supply chain orchestration platform are absolutely unparalleled compared to their legacy alternatives.

Multi-enterprise Business Network (MEBN) platforms in particular are highly effective in connecting partners and their systems landscapes end-to-end. While ERPs still have a vital role in internal process management, they’re not equipped to manage upstream, downstream, or reverse flows externally.

As Nico states, ‘the customer experience is critical.’ The “total experience” extends beyond just the purchase and delivery to how you handle information and visibility, services like installation, value adds in the form of repair and recycling – even sustainability metrics.

The move from multiple legacy and ERP systems to a single unified cloud platform provides a space for multiple communities to work together and meet their shared goals for increasing margins, optimizing costs, and lessening environmental impact to create a better world.

As Slawomir so clearly put it: “People are a key attribute of any company, whether we talk about sustainability or service or improvements. We try to engage our own people and have a special culture of change.”

At MPO we strive to enable a culture of transparency, collaboration, and innovation for our customers that makes change easy and exciting.

For dynamic supply chain orchestration, the MPO platform can connect and speak to a wide range of systems at various stages of digital maturity. As a multi-enterprise supply chain business network technology, the platform sits on top of the entire network of legacy systems and acts as the intelligent switchboard that binds them together for real-time visibility and control of all inventory, orders, and logistics and transportation flows. Since it requires no rip-and-replace of existing systems, the transformation is incredibly incremental and ready for agile implementation where you can start experiencing results and returns in small, quick wins.

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To ensure support for all partners, the orchestration platform has web portals and mobile apps, system interfaces and webservice APIs for both manual processes and automatic transactions, such as updates, statuses, bookings, so that all milestones and exceptions can be seen and acted upon immediately from directly within the application. The MPO platform also provides analytics and performance insights, so businesses can better understand how their efforts add value and contribute to the grand scheme of things.

As with any initiative, you must have the right spirit around the table. I’ve seen it countless times: Organizations, people, and mindsets are often seen as “soft factors” to a successful implementation and transformation. That couldn’t be further from the truth. Businesses – and the people that given them life and purpose – should embrace change and have trust in a better future. Only when you believe in a mission can you really go for it and find lasting success.

 

Ready to speak with someone about your business and digital transformation needs? Reach out to bd@mpo.com or request a demo today! For more insights from the webinar, click the image below

Digital Order Fulfillment Webinar

Topics: Order Management, Supply Chain Complexity, Digital Transformation, supply chain resilience, perfect order

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