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How B2B Completes ERP


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This presentation provides an overview of why B2B integration to ERP systems is important for companies. In many cases ERP can be considered to be incomplete without integration to a B2B platform that …

This presentation provides an overview of why B2B integration to ERP systems is important for companies. In many cases ERP can be considered to be incomplete without integration to a B2B platform that allows companies to then seamlessly connect to external trading partners. B2B Managed Services can provide the people, skills and resources to integrate ERP and B2B systems together. Updated May 2014

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  • Hello and welcome to this webinar hosted by GXS, my name is Mark Morley, Industry Marketing Director, and over the next few minutes I would like to take you through a short presentation which discusses how cloud based B2B solutions help to complete ERP environments. ERP and B2B systems share many similarities, both require skilled resource to implement and manage on an on-going basis, they need to be accessed by many users across the extended enterprise and they can be difficult to integrate to other back office systems. Whether you are implementing an ERP system for the first time or thinking of upgrading your existing ERP environment, this will provide the ideal opportunity to re-assess your B2B platform requirements as well. Given that many IT resources are diverted towards an ERP implementation, outsourcing the management of a B2B environment can bring many benefits for a company.ERP systems have traditionally focused on supporting internal business processes however more and more these days companies are using external business partners or contract manufacturers and they need access to information from the same ERP platform. Therefore ERP systems need to exchange information in both directions with companies across the extended enterprise. But how can a company achieve this seamlessly if there is no integration between an ERP and B2B platform?. ERP could therefore be considered as incomplete. So let me first outline the agenda for this session.....
  • So in terms of an agenda for this session I will start by providing an introduction as to why it is important for companies to be able to exchange business documents seamlessly both into and out of an ERP system. I will then discuss the findings from a recent executive study which looked at how companies were undertaking ERP/B2B integration projects.I will then discuss how a Cloud based approach to ERP/B2B integration can help companies improve visibility into cross-enterprise business processes and transactions. I will also discuss how the cloud can help build a fire wall around your ERP applications thus ensuring that only pre-checked, accurate information enters your ERP system.I will then take you through a few customer examples which will highlight how some companies have moved their integration projects to the cloud.
  • ERP and B2B integration projects are incredibly complex and require both internal and external users to be integrated to the platform. Whether it is integrating to numerous instances of an ERP platform that may be located in different regions around the world, or simply ensuring that external trading partners can connect to the platform seamlessly, the success of such projects depends on having the right resource available to undertake the work.However once these two platforms are integrated the new platform can bring significant benefits to a company, for example by improving operational efficiencies and offering improved visibility and collaboration across the extended enterprise.
  • To try and get a better understanding of how companies were integrating their ERP and B2B systems and to get a better appreciation of the day to day problems encountered with operating these environments, GXS sponsored a study with a research analyst firm.The study had around 120 respondents from the Retail, CPG, Automotive and High Tech industry sectors. The aim of the study was to ultimately prove that the success of many ERP projects can be directly associated with the level of integration that exists with their respective B2B platform.Some of the key findings from the study are shown on this slide, two results that I would like to draw your attention to was that the respondents said that on average 34% data feeding ERP systems was sourced from outside the enterprise and 79 percent of respondents said that they had exceptions or problems on more than one percent of inbound B2B transactions. I will expand on these results in more detail in a moment, but what types of ERP projects are companies embarking on today?
  • Here are a few examples of some of the more popular ERP projects being undertaken today, each of which provides an ideal opportunity to think about integrating to a B2B platform.Global expansion has led to many new ERP instances being established around the world and with increased IT budgets available now, many CIOs are taking the opportunity to retire older platforms and implement new installations instead.ERP consolidation projects could be undertaken as the result of a Merger & Acquisition process where by the acquired company may be asked to adopt the ERP platform of their new owner. Alternatively if a company is divested as a separate operation, this new company will have a requirement to establish their own new instance of an ERP system. Starting from a clean sheet of paper such as this will allow ERP and B2B processes to be integrated from day one. Upgrading ERP instances from one revision to the next can also provide the ideal opportunity to integrate to an ERP systemFinally, introducing new extensions to an ERP system , such as those used across the supply chain, for example supply chain planning or improving treasury / bank relationships can also present the ideal opportunity for integrating ERP and B2B platforms.In each case, companies should try to minimise the amount of disruption across their supply chain and find a way of smoothly integrating the two platforms as seamlessly as possible.
  • The findings from the study concluded that in order for companies to maximise the ROI from their ERP projects they had to address a number of key issues, namelyHow to ensure that externally sourced information can flow smoothly into an ERP systemHigh availability of B2B systems is critical to the smooth operation of ERP environmentsPoor quality external data needs to be reworked before entering an ERP systemB2B systems are vulnerable when resources are diverted towards ERP projects.So let me now cover each of these four areas in turn….
  • ERP systems use information from a variety of external sources, for example distributors, logistics providers and financial services institutions. This information could originate in numerous business systems and could have been created using different industry related standards. Due to the global nature of many companies there are constant challenges with on boarding suppliers and getting them integrated to a company’s ERP platform. The on-boarding capabilities of a vendor such as GXS can really help to accelerate the speed with which new trading partners are connected to the integration platform. Irrespective of their technical capabilities, GXS can ensure that trading partners have the correct electronic trading capability in place and at the same time provide a seamless integration to the ERP system.As ERP systems receive information from a variety of external partners there is an increased chance that unchecked, inaccurate data could enter an ERP system. Quite often, information from external sources is not clean enough to be processed correctly by the ERP system. This will quite often lead to manual rework of the incorrect information to try and make it compliant. If unchecked information is allowed to enter an ERP system then there is a chance that it could spread into other business systems leading to inaccurate information being used across the extended enterprise. A simple mismatch of part numbers for example could lead to incorrect electronic documents being created which could potentially result in delayed payments to suppliers.
  • For many companies, having access to real time information from outside the enterprise and ensuring that the platform is available 24/7 is crucial to the operation of their business. B2B platforms ensure that information from outside the organisation can be used efficiently by internal business applications such as ERP systems. If there is an interruption to the flow of transactions from outside an organisation then the internal business systems can be severely affected. For example if a car manufacturer does not receive an advanced shipping notice from their supplier to notify them that parts are on their way to a factory then this could have downstream implications as well, for example shutting down a just in time based production line. Many companies need to make business critical decisions in near real time and therefore ensuring that transactions from external business partners gets through to an ERP system without delay or interruption is extremely important.ERP / B2B integration requires an immense amount of co-ordination across the extended enterprise. Ensuring that maps are created correctly, trading partners are all connected properly and more importantly, any changes made to the ERP system are reflected in the B2B system as well. To achieve an integrated platform implies that any changes made to one system will be reflected in the other or vice versa. During an ERP / B2B integration process, numerous change requests will be issued to modify one or other of the systems. This change management process needs to be managed and monitored efficiently otherwise the implementation of the project can be significantly delayed. Having a dedicated program manager look after the implementation can be a worthwhile investment, they not only ensure that valuable IT related resources are being used effectively, they will also ensure that the project comes in on time and more importantly to budget. They also offer support for testing and looking after the overall release and deployment of the newly integrated platform with the customer.
  • Cloud computing environments have received a lot of coverage in the IT press and media over the past couple of years. Many CIOs thought that Cloud was just hype, another buzzword that would disappear very quickly. However the hype surrounding cloud is very real indeed and it has fundamentally changed the strategies of not just companies looking to deploy cloud environments, but also the software and services vendors who now provide these solutions. Just look at the acquisitions that companies such as SAP have made in recent months to build out their cloud story.Many of the big software and services vendors have been rolling out new data centre infrastructures so that they can host these new cloud environments and some CIOs have decided to embrace the cloud and make it a core part of their company’s IT strategy. The example shown on this slide is from the CIO of Jaguar Land Rover who after being divested from Ford said that they would deploy cloud solutions for most areas of their business. From using Google as the basis of their corporate email through to using GXS Managed Services to manage their B2B infrastructure, JLR decided to externalise these applications so that they can simplify, standardise and modernise their IT and B2B infrastructure.So we are hearing a lot about cloud environments, but what exactly are they?
  • Traditionally a trading partner community would potentially have to connect to a multitude of different business systems, as shown on the left of this slide, and from an integration point of view this becomes very complex, very quickly.By connecting your external trading partners through a cloud environment means they will have a single point of contact or entry into your organisation. This will allow the trading partner community to get access to a highly available, web based set of tools for exchanging business documents electronically.Integrating business systems via a cloud environment can provide a number of benefits.
  • It provides Global accessibility, as all applications are hosted by a central provider it means that anyone in your company or across your trading partner community can get access to your B2B tools using nothing more than a web browser. It also means that users will get a consistent user experience as well.Cloud environments also allow B2B infrastructures to be maintained much more efficiently, as applications are hosted centrally, it means that applications only have to be upgraded once rather than on multiple servers, and everyone connected to the cloud platform benefits from the newly upgraded environment.Cloud environments can be deployed very quickly, once again as software and services are installed by a vendor at a central location it means that new applications can be deployed in a very short time frame and new users can be added to the environment with ease. Cloud environments really allow you to build flexibility into your B2B environment, getting access to new functionality as and when you require it.Cloud environments are low cost, rather than pay a software license fee, users pay on a month by month or project by project basis. This pay as you go way of working allows managers to get much better predictability of long terms IT or B2B related costs. Also, as you do not have to buy expensive servers to host any applications, it means that there is no capital expenditure and zero cost applied to your company’s balance sheet.In these uncertain financial times, cloud based environments allow companies to scale up or scale down their B2B needs very quickly, may be as a result of winning a new contract and a need to onboard new trading partners very quickly or needing to scale down operations due to a product coming near to retirement.Finally, cloud based environments provide an ideal way to manage a community of users with ease. Centralised management of usernames, passwords and contact details help to bring an extra layer of security to your B2B environment. In addition it allows users to be presented with just the information they need to do their work, ie a role based environment can be presented to a user depending upon their role and responsibilities within the business.
  • From a B2B outsourcing perspective GXS is very well positioned to help companies improve their ERP / B2B integration projects.B2B outsourcing allows a company to utilise external resources on a scalable basis so as an integration project becomes more complicated or has to encompass different geographical sites then more resources can be pulled into the project as required. Many companies have regarded third party outsourcing vendors such as GXS as an extension of their own IT departments.B2B outsourcing allows trading communities and any associated on-boarding process to be managed and implemented much more efficiently. This allows ROI on ERP projects to be achieved much more quickly when new modules or transaction types have to be implemented across a trading community.B2B outsourcing can lead to less risk of connectivity loss due to greater investment in high availability infrastructures offered by vendors such as GXS.B2B Outsourcing has the capability of wrapping a company’s ERP applications with an ERP firewall thus allowing externally generated information to be checked before it enters the ERP system.
  • One of the main benefits of integrating an ERP and B2B system is that it is then possible to establish what can best be described as a firewall around a company’s ERP system. The aim of this is to protect the ERP system and ensure that incorrect data does not enter the ERP environment. Whether you are trying to protect your ERP system from information being sent in by customers, distributors, logistics providers, suppliers or financial institutions, integrating to a B2B system can provide a higher level of security around your ERP applications and downstream business processes. GXS Active Intelligencesolution helps to protect your ERP related systems by ensuring that only clean and accurate information that obides by predefined business rules and checking procedures is allowed to enter your ERP environment.
  • So how does B2B help to complete ERP?It can provide a highly available platform that allows information, either internally or externally sourced, to seamlessly enter an ERP system 24/7It provides a way to mediate between any type of document format irrespective of where your trading partner or customer may be located around the world. These document maps would then be maintained on an on-going basis so that if features or functionality of applications change then the maps can be updated accordinglyB2B helps to connect to any trading partner across the extended enterprise, irrespective of the communication protocol being used, for example FTP, OFTP2 or even via SAP ALE or SAP PI, B2B integration can ensure trading partners and ERP systems receive information via mediation between any communications protocol
  • In addition B2B integration to ERP helps to:-Improve the way in which you manage and collaborate with your trading partner community, this is especially important in today’s business environment where many companies are using truly global business partners, offices, manufacturing plants. It is one thing being able to develop an integrated B2B/ERP platform, but it needs to be deployed across your extended enterprise in a smooth and efficient mannerB2B integration can certainly helps to improve the quality of information entering an ERP system and being able to proactively monitor transactions will certainly help to reduce the risk of other internal business systems or production lines being impacted in some way.If your company has decided to divert IT resources into completing an ERP related project then you certainly do not want to leave your B2B platform exposed. B2B outsourcing can help plug the resource gap and offer a way to keep B2B integration projects on schedule.
  • So let me now briefly highlight some of the ERP/B2B integration projects that GXS has worked on over the years. In these examples I will focus on how our cloud integration platform has helped three companies improve the accuracy of inbound invoices, how GXS integration resources provided an extension to a company’s IT department and how our cloud platform provides a fully scalable and flexible B2B environment to support global manufacturing operations.
  • Tire Manufacturer – This company is one of the world’s leading suppliers of tyres to the global automotive industry and they operate across 72 production facilities in 19 countries. The main business issue that they were facing was that they needed to improve the quality of invoices entering their Oracle based ERP environment. They were having to spend too much time reworking invoices from external suppliers before they could be processed by their ERP platform. So GXS deployed an Active Intelligence solution , to help improve the accuracy of inbound invoices. Active Intelligence effectively created a firewall around their ERP applications with all inbound invoices are now checked against predefined business rule templates. The introduction of Active Intelligencehas helped to improve the accuracy and minimise rework of invoices and downstream business production systems operate more efficiently.Apparel Manufacturer – This company is one of the world’s leading manufacturers of apparel, they design, source and manufacture a range of leading clothing brands. Their company consists of six major apparel divisions and their products are distributed and sold via a network of 200 leading retailers around the world. This company was about to embark on an SAP implementation and after the CIO evaluated the internal IT skillsets they realised they did not have the required integration skills to integrate their ERP and B2B together. The CIO had to find an alternative way to run the project. GXS Managed Services was deployed to connect to and undertake ecommerce with over 200 global trading partners, 90% of which were customers and 10% were suppliers. As well as provide the necessary resources to manage the integration project GXS created 280 maps and they had a requirement to convert a number of documents into SAP IDOC format. The key benefit that GXS brought to this company was that we were regarded as an extension to their own IT department, allowing them to not only get their SAP system implemented on time but ensure that it was fully integrated to their B2B platform as well.Car Interior Manufacturer – This company is one of the world’s largest Tier 1 suppliers in the automotive industry and they provide interior systems to many of the world’s car manufacturers. As a tier 1 supplier they have to support their customers across multiple plants and locations around the world. They were also about to embark on a major SAP implementation and they saw this as the ideal opportunity to consolidate multiple EDI platforms onto one provider. GXS Managed Services was deployed to provide B2B support for their operations in North America, EMEA and ASPAC, so working with a cloud integration provider who could support global B2B standards was important. The new platform provides full integration to SAP whilst also providing the added benefit of end to end visibility across all their business units.
  • So let me now briefly summarise why GXS helps to complete ERP
  • So in conclusion for ERP systems to function correctly they need to be seamlessly connected to external trading partners to ensure that information can flow easily into and out of an ERP environment. GXS and in particular our cloud based B2B integration platform is used by over 500 companies and we have worked on many single and multi-vendor ERP projects over the last few years. These companies have derived significant benefits by moving this integration to a cloud based environment :-We have helped companies free up valuable resources so that they can be used on other projects and hence they can then focus on their core competenciesWe can help to improve the quality of externally sourced information entering an ERP systemWe have moved companies on to a cloud integration platform that provides the flexibility and scalability such that if business needs change then the integration platform can be changed accordinglyIn short, GXS helps to provide the bridge or connection between an ERP environment and the extended enterprise.
  • Transcript

    • 1. OpenText™ Managed Services - How B2B Completes ERP
    • 2. OpenText Confidential. ©2014 All Rights Reserved. 2 Today’s Agenda  Introduction  Delivering Increased ROI on ERP/B2B Integration Projects  How the Cloud Simplifies ERP/B2B Integration Projects  Introduction to cloud-based infrastructures  B2B outsourcing, an OpenText perspective  Implementing an “ERP Firewall”  Real World Case Studies  Conclusions
    • 3. OpenText Confidential. ©2014 All Rights Reserved. 3 Introduction  Managing the integration of ERP and B2B systems is complex  ERP and B2B projects are implemented across internal and external users  Integrated ERP and B2B systems introduce significant operational efficiencies  ERP B2B integration provides improved visibility into cross enterprise business processes
    • 4. Companies Need Two Way Exchange of Business Documents OpenText Confidential. ©2014 All Rights Reserved. 4 Warehouse Management Transport Management Production Information Inventory Control Scheduling Information Order Information Capacity Planning Inbound Documents Purchase Orders Invoices Outbound Documents ASN/Delivery Notices Customs Declaration Forms INTERNAL EXTERNAL
    • 5. Many Companies Need to Improve How They Integrate ERP & B2B OpenText Confidential. ©2014 All Rights Reserved. 5  48 percent of respondents said they had lost B2B connectivity  34 percent of respondents said B2B integration staff were supporting ERP related projects  34 percent of the data feeding ERP systems is generated externally  29 percent of respondents said that they had to prematurely terminate B2B testing programs relating to external trading partners  79 percent of respondents have exceptions or problems on more than one percent of inbound B2B transactions  80 percent of respondents plan to move to highly consolidated ERP environments
    • 6. Companies Undertake Many Different Types of ERP Related Projects New Installations Consolidations Mergers & Acquisitions Shared Services for Back Office OpenText Confidential. ©2014 All Rights Reserved. 6 Retire Legacy Mainframes Rapid Company Growth Upgrades Extensions Vendor End of Life Support Expanded Feature Set Supply Chain Planning Treasury or Bank Relationship Management
    • 7. Delivering Increased ROI on ERP Projects OpenText Confidential. ©2014 All Rights Reserved. 7  Significant amounts of information entering an ERP system sourced from outside the enterprise  High availability of B2B systems is critical to the smooth operation of ERP environments  Poor quality external data needs to be reworked before entering an ERP system  B2B systems are vulnerable when resources are diverted towards ERP projects
    • 8. OpenText Confidential. ©2014 All Rights Reserved. 8 Delivering Increased ROI on ERP Projects On average 34% of data feeding an ERP system comes from outside the enterprise 79% of respondents said that more than 1% of transactions needed to be reworked Externally Sourced ERP Data Data Quality Compromises ERP Value
    • 9. OpenText Confidential. ©2014 All Rights Reserved. 9 Delivering Increased ROI on ERP Projects High Availability in B2B Is Critical 48% of respondents said they had lost connectivity with their B2B system Lack of Program Management 84% of respondents had experienced delays with their ERP B2B integration projects
    • 10. How the Cloud Simplifies ERP/B2B Integration Projects
    • 11. CIOs Are Embracing the Cloud ERP B2B CRM “Our strategy will be one of simplification, standardization and modernization. Where I can deem services and technology as being commodity I will seek to externalize, outsource or place them in the cloud” - CIO Luxury Car Manufacturer OpenText Confidential. ©2014 All Rights Reserved. 11
    • 12. Three Layers of Cloud Computing Business Applications Application Infrastructure Compute & Storage OpenText Confidential. ©2014 All Rights Reserved. 12
    • 13. OpenText™ Trading Grid™ Provides a Single Integration Point Into the Enterprise OpenText Confidential. ©2014 All Rights Reserved. 13
    • 14. Benefits of Cloud Based B2B Integration OpenText Confidential. ©2014 All Rights Reserved. 14 Global Accessibility Low Cost Consistent User Experience Scalability Easy to Maintain Rapid Deployment Flexibility Central Authentication
    • 15. OpenText™ Managed Services Over Two Decades of B2B Innovation & Global Experience OpenText Confidential. ©2014 All Rights Reserved. 15 Recognized #1 global integration provider  Pioneer, change agent & visionary leader  Largest base of 800+ Managed Services customers worldwide Most extensive industry experience  Retail, CPG, Manufacturing, Automotive, Hi-Tech, Telecom, Financial Services Unique service competencies  Global, B2B integration cloud  Broad mapping/translation services for any document type  B2B Enterprise Community Management—Active Community  B2B Expert Operations working for your success
    • 16. OpenText™ Managed Services OpenText Confidential. ©2014 All Rights Reserved. 16
    • 17. Benefits of Using B2B Outsourcing for ERP B2B Integration Projects OpenText Confidential. ©2014 All Rights Reserved. 17  Ensures projects remain on time and under budget with scalable resourcing and ERP best practices  Achieves faster ROI from new modules and transaction types with rapid on-boarding of trading partners  Less risk of connectivity loss impacting manufacturing operations with high availability architecture  Improves data quality for 1/3 of externally originated information via ERP firewall
    • 18. B2B Helps to Establish an “ERP Firewall” Out of Sequence Documents OpenText Confidential. ©2014 All Rights Reserved. 18 Customers and Distributors Split Orders ERP Apps Consolidate Invoices Confirm Required Fields Translate Customer Data Confirm Valid Data Split by Payment Types Aggregate Account Balances Units of Measure Transform Carrier Codes Conforms to Business Rules Check within Tolerances Confirm Required Fields Confirm Valid Data Direct & Indirect Material Suppliers Logistics Providers Financial Institutions Link Invoice to Payment
    • 19. OpenText Confidential. ©2014 All Rights Reserved. 19 How B2B Completes ERP Implementing Document Maps ERP/B2B integration projects require numerous document maps to be created and maintained on an on-going basis Highly Available Platform ERP systems need to be able to receive information from external trading partners on a 24/7 basis Trading Partner Connectivity ERP systems need to be connected to numerous trading partners using many different global connectivity standards
    • 20. Program Monitoring OpenText Confidential. ©2014 All Rights Reserved. 20 How B2B Completes ERP Managing Trading Partner Communities ERP/B2B integration projects require fast on-boarding of trading partners, anywhere in the world Proactively Monitoring Data Quality All external data needs to be checked for accuracy and conformance before entering an ERP system The complex nature of ERP/B2B integration projects requires skilled resources to keep these projects on schedule
    • 21. Customer Examples of ERP/B2B Integration
    • 22. Examples of ERP B2B Integration Car Interior Manufacturer  Embarking on a major SAP implementation and wanted to consolidate multiple EDI platforms onto one provider  Implementing OpenText™ Managed Services to provide global B2B requirements to manage operations in North America, EMEA and ASPAC.  Provides a single global B2B platform which integrates to SAP and allows true end-to-end visibility across all business units OpenText Confidential. ©2014 All Rights Reserved. 22 Apparel Manufacturer  Implementing new SAP system, CIO realised they did not have the required internal ERP integration skills  Deployed OpenText™ Managed Services to on-board 200 global trading partners and integrate with their SAP system across six internal divisions  With the provision of additional B2B resources, CIO saw OpenText as an extension of his own IT department Tire Manufacturer  Needed to improve quality of invoices entering their Oracle-based ERP environment, as a lot of time checking invoices  OpenText™ Active Intelligence was implemented to help check quality of inbound invoices, established a firewall around ERP apps  Increased efficiency due to reduction in manual invoice checking which in turn led to cleaner information entering their Oracle system
    • 23. OpenText, ‘We Complete ERP’
    • 24. Logistics Providers Financial Institutions Contract Manufacturers OpenText Confidential. ©2014 All Rights Reserved. 24 OpenText, We Complete ERP Suppliers OpenText bridges the gap between an ERP system and the extended enterprise
    • 25. Mark Morley | Copyright © OpenText Corporation. All rights reserved. W