Part Two: Supply Chain Integration Methods
RONIN Marketing Limited contributed this piece. For more information, check out www.roninmarketing.co.uk
When implementing an Enterprise Resource Planning (ERP) solution, a reputable system supplier should work with the manufacturing customer to accommodate all supply chain information requirements.
“The easier suppliers can make the movement of information, the better service levels customers receive and, in turn, the better service levels they can provide to their own customers,” Neil Rushby, supply chain divisional manager at consultancy-led business software supplier Access, said.
With regard to data transmission, there are industry standards for Electronic Data Interchange (EDI) and XML, such as the eBIS-XML electronic interchange standard set by the Business Application Software Developers Association (BASDA), a standard which is adopted by Access and others.
“It’s no good only being able to meet industry standards like this, however, if you can’t help customers interact with their supply chain through more simple methods such as emailed spreadsheets or faxes,” Rushby points out.
“You have to be able to integrate with any system, whether old or new, complex or simple, and allow data to be imported or exported in multiple formats. But it’s more than data compatibility driving this.”
The supplier’s technical ability and willingness to help is crucial.
“System vendors should be flexible and driven by the need to find the best solution for your business,” Rushby said. “There is no point having a supplier who is only interested in making the sale and moving on to the next project.
“It’s a well worn sentiment but manufacturers need a partner who is genuinely interested in understanding their business and will work with their suppliers and customers to ensure the best possible solution.”
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This type of approach clearly requires resource in the form of a dedicated account management team. Good account managers will talk to businesses regularly, keeping in touch with changing requirements and needs.
“They have to understand how the customer’s business is evolving, how the ERP solution fits with that and be committed to making sure the manufacturer is achieving real competitive advantage,” Rushby said.
“It works best if account managers are not tasked with selling new systems or consultancy days - they do what the job title describes; they manage the customer account, making sure the solution adapts to changing needs and that it is still delivering maximum benefit.”
Account managers will also work with a business when new business requirements materialize, such as the introduction of a new supplier or customer. Their role is to establish how best to share data and information with that new party, so removing the administrative headache from the manufacturer.
With no direct remit to boost sales, the economic viability of account managers could be called into question. But Rushby is adamant that account management provision is vital for ongoing customer satisfaction.
“An account management team is self funding - they invest the time and the payback is happy customers who trust the supplier’s judgment and are confident that they understand their business,” Rushby said.
It’s this kind of cohesive, joined-up thinking that pays - for the vendor, the customer and the extended supply chain.
Edited by Kevin Scarpati
Will Public Procurement Budgets Increase in 2021?
Procurement is more than just a private enterprise. COVID-19 reminded us that sourcing materials is an essential part of the government’s role. Throughout 2022, tiny departments sourced massive amounts of personal protective equipment (PPE), medical supplies, and emergency vaccines and testing kits. Even non-procurement professionals were pulled into the fray, as frantic timelines demanded nothing less.
According to Celeste Frye, co-founder and CEO of Public Works Partners, the crisis brought procurement to the attention of skilled employees who had never considered it. As non-procurement personnel stepped up to help their coworkers, many found that they’d stumbled upon a critical and rewarding job. “Existing public employees have seen the essential nature of the work”, Frye said. “[They’ve] gained some critical skills and possibly [grown] interested in pursuing procurement as a longer-term career”.
Small, Local Suppliers Take Charge
Frye, whose firm helps organisations engage stakeholders and develop long-term procurement strategies, thinks it well worth the effort to open one’s mind to new opportunities. Cooperative contracts, for instance, can help public departments and municipalities save money, time, and effort. By joining together with other towns or cities in the region, public procurement teams aggregate their purchasing power and can drive better deals.
These cooperative contracts have the added benefit of advancing equity. Smaller suppliers that struggle to compete with established firms for government contracts can act as subcontractors, helping big suppliers fulfil bits of the project. Once they get their foot in the door, small, local, and disadvantaged suppliers can then leverage that government relationship to take on additional projects.
Especially as governments start to pay attention to procurement resilience, public procurement departments must expand their requests for proposals (RFPs) to take into account innovative solutions and diverse suppliers. According to Frye, Public Works Partners—a certified female-owned firm—has benefitted from local and state requirements that specify diversity.
Post-Pandemic Funding Swells Procurement Budgets
And the pandemic won’t be the end of it. City governments need to build sustainable energy infrastructure such as solar panels, charging stations, and recycling plants, ensure that masks and medicines are never in short supply, and source new technologies to keep up with cloud and cybersecurity concerns.
Public procurement budgets will likely increase to match demand. As Peter Ware, Partner and Head of Government at Browne Jacobson, explained, “in a non-pandemic world, the [U.K.] government spends on average around £290 billion on outsourced services, goods, and works...anywhere between 10% and 14% of Gross Domestic Product (GDP). Post-pandemic, city procurement will only increase as national governments provide local divisions with emergency funding.
And in truth, government employees might jump at the opportunity. Frye noted that public procurement could give immediate feedback on new programmes: “[Procurement] is where new laws and policies ‘hit the road’ and are implemented”, she said. “Professionals in these fields get the satisfaction of creating real change and seeing quantifiable outcomes of their work”.