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Learn How You Can Do Business in China with the Cloud


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Do you wonder how to make the most of your business partners in China? How you can be more efficient with your B2B integration?

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Learn How You Can Do Business in China with the Cloud

  1. 1. © 2014 IBM Corporation Session ABB-5602: Learn How You Can Do Business in China in the Cloud IBM  InterConnect  2015   Mandalay  Bay  –  Lagoon  L   February  26,  2015  
  2. 2. Agenda •  What  are  B2B  Cloud  Services?   •  China  Market  Trends   •  Side  effects   •  Urgency  to  survive   •  Supply  Chain  Efficiency  (via  B2B  /  EDI  /  MFT)   •  Internal  &  External     •  IntegraPng  China  Trading  Partners   •  How  eCOM-­‐IBM  can  help     •  Turnkey  soluPon  into  China   •  Same  service,  greater  coverage   •  Case  Studies   •  Your  Next  Steps   •  QuesPons   1
  3. 3. Modernize to the Cloud IBM Sterling B2B Integration Services •  Document Process Management •  Integration Services •  Transformation Services •  Process Enrichment Services •  Synchronous B2B Process Services Your Company Flexible small partner enablement solutions Web Forms Fax Conversion e-Invoicing Validate signed invoices Pre-connected Trading Partners EDI/Non EDI Global Connectivity Community Services Process ServicesIntegration Services •  Data Synchronization •  Supply Chain Visibility •  e-Invoicing •  •  Supplier Portal / Web Forms •  Community Development Services •  Fax Conversion Services •  Trading Partner Help Desk •  Business Continuity •  Security Services •  Customer Support •  SLAs •  EDI and Content Routing •  Interconnects •  File Transfer Service •  China B2B Cloud Browser Access Sterling B2B Services Synchronous B2B Process Service 2
  4. 4. China Market Trends BUYING & SELLING TO CHINA Largest  import  source*    2014  (19.8%)  2013  (19.4%),  2012  (18.7%)  and  2011  (18%)    12%  larger  than  Europe,  34%  larger  than  Canada   China’s  shic  to  E-­‐Commerce**    2014:  $9.34B  VS.  $4.16B    2013:  $5.75B  VS.  $3.49B   *Source: U.S. Department of Commerce, Census Bureau, Foreign Trade Division **Source: Comsource, Adobe, Alibaba THE BARRIERS CREATED High  LogisPcs  Cost    Buffered  stock    Long  lead  Pmes    Educated  guessing    Higher  labor  costs   Order  issues    Invoice  disputes    Capped  volumes   Looking  to  increase  supply  chain  efficiency    Manual  supply  chain  management    Limited  JV’s  IT  knowledge   China  business  partners  must  meet   global  standards  to  survive   Rapid  demand  to  capture  market  share    MNCs  form  JVs  with  local  companies    LogisPcs  outsourced  to  3PL  providers   CREATION OF MARKET SHARE IN CHINA
  5. 5. Supply Chain Efficiency data integration •  Foundation of Supply chain visibility •  Reduced lead times, data errors •  Improved goods receiving, payment cycles most economical •  Low hanging fruit •  High value •  China government support: “logistics efficiency and information logistics” “Supply-chain and operations improvements will be the most potent contributor to Internet-led value gains in autos.” -Yougang Chen,
  6. 6. The 12th of 5 years Plan in China Government   support  and   encouragement   to  streamline   Supply  Chain   efficiency Sustained   compePPveness   via  reduced   import  and   export  costs   Promote   “InformaPon   LogisPcs”  to  be   in-­‐sync  with   “Physical   logisPcs”   Major   enterprises   aligning  with   Government’s   focus         Result:  Easy  to   engage  trading   partners     • B2B  integraPon   • B2B  trading  
  7. 7. The 12th of 5 years Plan in China: E-Commerce (Cross Border Trade) 2013.8 国办发[2013]89号 Nation Office [2013] No. 89 国务院办公厅转发商务部等部门关于实施支持跨境电子商 务零售出口有关政策意见的通知 自本意见发布之日起,在已开展跨境贸易电子商务通关服 务试点的上海、重庆、杭州、宁波、郑州等5个城市试行 上述政策。自2013年10月1日起,上述政策在全国有条件 的地区实施。 确立5个跨境贸易电子商务试点 城市 5 cities (Shanghai, Chongqing, Hangzhou, Ningbo, Zhengzhou) were approved to pilot cross- border e-commerce from Oct. 1 st , 2013. 2013.10 海关总署公告2013年第58号 Customs Notice [2013] No.58 确立5+1+1试点城市方案 Establish 5+1+1 Pilot Cities Program 2013.12 海关跨境贸易电子商务进境商品监管办法(试行) Customs Regulation Approach on Imported Goods from Cross-Border e-Commerce (for Trial Implementation) 三流合一的监管方法 Three flows-into-One flow Regulation Approach 2014.1 财税[2013]96号 财政部 Finance Office [2013] No. 96 确立出口相关退税安排 Confirm export tax refund operation 2014.5 国家质检总局关于支持跨境电子商务发展的意见 Comments on Supporting the Development of Cross- Border e-Commerce by State Quality Inspection Administration 合法查验及建立电商信用体系 Establish e-commerce credit system according to legitimate inspection 源头可溯 Source Traceable 质量可信 Quality Credible ⻛风险可控 Risk Controllable 责任可究 Responsibility Accountable
  8. 8. Integrating China Trading Partners solution •  Flexible to meet best practices •  Global standards •  ANSI X12, EDIFACT, VDA, etc. •  Domestic standards •  Government and local language •  Easy to learn •  Scalable •  Tools •  WebForms •  Fax/Excel-to EDI supplier •  Extensive domain knowledge and experience •  Proven track record •  Network infrastructure capabilities •  Implementation and follow through capabilities •  Local Support / Community Management •  Time zone •  Language and cultural affinity •  Workshops •  On-site capability BUYING Just-in-Time / VMI eCatalog Scan Pack SELLING Cross Border Trade Increase Order Capacity Supply-Chain Finance business need
  9. 9. How eCOM-IBM Can Help: Global Sponsors to China TPs eCOM-­‐IBM  B2B  Cloud  Services     (VAN/Managed  Services) sponsor company trading partner trading partner trading partner •  Interna>onal  EDI  VAN   •  Transla>on  to  trading  partner  format,  Web  EDI,   CSV,  Excel,  Fax  etc.   •  On-­‐boarding  service   •  Educa>on  and  workshops   •  24/7  Go  Live  support,  local  >me  zone,  local   language,  local  technology  and  local  culture    
  10. 10. B2B Analytics & Reporting Dashboard
  11. 11. How eCOM-IBM Can Help: Turnkey Solution into China •  IBM  as  your  1-­‐stop  Shop:  Single  commercial  agreement,  consistent   pricing,  single  invoice,  single  vendor   •  RESULT:  SIMPLE  Turnkey  SoluPon  into  China  =  VISIBILITY  &  CONTROL   OF  THE  GLOBAL  SUPPLY  CHAIN  NETWORK   –  FAST  ROI  Rate     –  Boqom-­‐line  &  Top-­‐line  Revenue  Increase  &  Cost  Savings   •  Same  IBM  services  in  China  with  enhanced  on-­‐site  capabili>es  through   eCOM   •  RESULT:  Increases  and  simplifies  EDI  AdopPon  Rate  =  FULL   ENABLEMENT,  MANAGEMENT,  &  SUPPORT  CHINA  TRADING   PARTNERS   –  Removes  trade  barriers     –  Ensures  compliance  with  laws  and  regulaPons   –  Exchange  QUALITY  &  CRITICAL  business  data  and  automate  business   processes  between  Chinese  customers  and  suppliers  
  12. 12. RETAIL Situa>on  and  Requirements   §  Remove  Barriers  for  overseas  Manufacturers  to  sell  into  China   §  Complex  CerPficaPon  process  (CIQ);  Food  product  3  to  6   months;  CosmePcs  12  to  18  months   §  Many  taxes;  Import  Duty,  VAT,  etc.  (Ocen  paid  up-­‐front)   §  Lengthy  Customs  declaraPon  process   §  RESULT:  importers  reduce  number  of  SKU’s  to  simplify   process  &  exposure  to  China   Solu>on  (CROSS  BORDER  TRADE)   §  CBT:  1-­‐Stop  end-­‐to-­‐end  plauorm  to  shorten  import  process,   reduce  import  cost,  and  increase  exposure  to  China   §  SOURCING:  Helping  Importers  through  CIQ,  Tax  and   Customs  processes.     §  IMPORTING:  Providing  Bonded  Warehouse  services   §  SALES:  Providing  offline  stores  and  online  E-­‐Marketplaces   to  sell  under  CBT  regulaPons   §  MARKETING:  Unique  Customer  Shopping  Experience   §  FULFILLMENT:  Order  processing,  delivery,  tracking,  returns   §  eCOM  VAN  &  IBM  Sterling  B2B  CollaboraPon  Network   eCOM-­‐IBM  Cloud  provides  minimal   investment  in  supply-­‐chain   logis>cs,  increasing  >me  and   resources  available  to  focus  on   core  competencies  (i.e.  selling   more  products  to  China)     Maximize  revenue  by  selling  in  all   channels  (online,  mobile)     Capture  customer  informa>on  to   provide  mul>ple  marke>ng   exposure  across  various  media  &   programs     Get  immediate  feedback  from  the   end  consumers  through  direct   order  fulfillment     value+ Case Studies
  13. 13. CPG Situa>on  and  Requirements   §  High  supply  chain  costs  in  China     §  Prevent  over-­‐stock  or  out-­‐of  stock  of  materials  supplied  to   the  producPon  line  within  China,  warehouses  and   gradually  migrate  to  the  VMI  process.   §  Help  China  suppliers  to  on-­‐board  global  EDI  programs  in   order  to  adopt  VMI   §  Educate  suppliers  in  China  on  the  processes  and  benefits   of  VMI  through  EDI  implementaPon   §  Provide  regional  Pme-­‐zone  with  local  language  support  to   China  suppliers   Solu>on   §  Provide  Web  EDI  portal  and  EDI  on-­‐boarding  services  to   Wrigley  suppliers   §  Implement  a  very  clear  global  strategy  to  streamline  SCM   processes  and  lower  operaPng  costs   §  eCOM  VAN  &  IBM  Sterling  B2B  CollaboraPon  Network     U>lize  on-­‐boarding  services   from  IBM  B2B  SCN  SaaS/VAN  to   lower  Wrigley’s  IT  cost  and   speed  up  the  EDI  on-­‐boarding   process   Increase  the  opera>onal   efficiency  for  both  Wrigley’s   factories  and  suppliers   Lower  opera>onal  costs,  37%   average  stock  reduc>on   Reduce  90%  of  out-­‐of-­‐stock  or   over-­‐stock  problems  for   produc>on  lines   value+ Case Studies
  14. 14. CPG Situa>on  and  Requirements   §  Large  MNCs’  China  DMC  (55%  of  total  China  business)  aims  to  grow  to   USD5  Billion  in  the  future   –  Limited  by  current  infrastructure   –  System  crashes  results  in  2,800  lost  orders,  3,000  MSU,  and  over   2,000  hours  to  reprocess  orders   §  Migrate  MNC’s  China  B2B  traffic  from  local  China  EDI  provider   §  PO  and  ASN  data  must  be  transferred  using  AS2   §  Onboard  and  go-­‐live  for  98  Chinese  distributors  in  12  weeks   §  Coordinate  and  support  MNC’s  China  teams,  socware  vendors,  and   distributors  in  the  local  Chinese  Pme-­‐zone  and  language   Solu>on   §  Rapid  on-­‐boarding  process    -­‐  enabled  98  distributors  within  12  week   project  Pmeline  (including  end-­‐to-­‐end  tesPng)   §  Reliability  of  local  eCOM  network  (high-­‐volume  capacity)  using  SI  as  the   backbone  to  handle  high-­‐volume  traffic.  Current  China  B2B  Services   providers  cannot  meet  capacity   §  Extended  Chinese  language  and  local  Pme-­‐zone  support  to  P&G  China,   vendors,  and  distributors   §  eCOM  VAN  &  IBM  Sterling  B2B  CollaboraPon  Network   Single  point  of  contact  for  global   consolidaPon  of  B2B  Services     Global  on-­‐boarding  and  support   coverage  backed  by  Mandarin   language  and  China  Pme-­‐zone   support     Always  ON  system  with  no  system   crashes     Increased  DistribuPon  channel   order  capacity  by  20%     USD  7MM  supply  chain  incenPves   to  help  increase  distributor’s   annual  margins  more  than  10%     Secure  Data  transfer  by  replacing   FTP  with  AS2  protocol  for  PO  and   ASN  data   value+ Case Studies
  15. 15. AUTOMOTIVE Situa>on  and  Requirements   §  Global  strategy  to  streamline  the  SCM  processes   §  Force  suppliers  to  employ  MMOG  Level  A  compliance   §  Measure  SDP  (Supplier  Delivery  Performance)  via  EDI   processes   §  Educate  suppliers  in  China  about  the  processes  and  the   benefits  of  EDI   §  Provide  regional  Pme-­‐zone  and  local  language  support  to   China  suppliers   Solu>on   §  Web  Portal  for  China  suppliers   §  eCOM  VAN  &  IBM  Sterling  B2B  CollaboraPon   Network   Right  materials  with  the  right   quan>>es  are  delivered  to  the   right  user  plant  at  the  right   schedule   Just  in  >me  process  for   produc>on   Measure  Supplier  Delivery   Performance     Lower  opera>onal  costs   value+ Case Studies
  16. 16. RETAIL Situa>on  and  Requirements   §  Suppliers  need  to  manage  and  update  product  informaPon   (price,  descripPon,  discounts,  etc.)   §  Over  7,300  suppliers  (from  MNCs  to  SMEs)   §  On-­‐board  China  suppliers  to  global  EDI  system   §  Educate  suppliers  in  China  on  the  processes  and  benefits  of   implemenPng  EDI.   §  Provide  regional  Pme-­‐zone  and  local  language  support  to   China  suppliers   Solu>on   §  Integrated  and  Web  SoluPons  (Direct  EDI  &  WebForms)   §  Rollout  to  7,300  suppliers  in  last  2  years   §  eCOM  VAN  &  On-­‐boarding  Team  of  8  people  in  Shanghai  to   create  streamlined  on-­‐boarding  process   §  Contacts;  EducaPon;  IniPal  Product  Load;  Ongoing   Helpdesk       Supplier’s  products   immediately  updated  to   retailer’s  back-­‐end  systems       Secure  &  Electronically   exchanged  informa>on     Lower  opera>onal  costs  of   managing  thousands  of  SKUs     Ensure  the  right  product,  right   quan>>es  at  the  right  place   and  right  >me     value+ Case Studies
  17. 17. RETAIL Situa>on  and  Requirements   §  Suppliers  need  to  provide  direct-­‐to-­‐store  service  to   Kmart  in  order  to  cut  operaPng  costs  of  the  DC  in   Australia   §  On-­‐board  China  suppliers  to  global  EDI  system   §  Educate  suppliers  in  China  on  the  processes  and  benefits   of  scan-­‐pack  through  implemenPng  EDI.   §  Provide  regional  Pme-­‐zone  and  local  language  support  to   China  suppliers   Solu>on   §  Provide  scan-­‐pack  and  EDI  on-­‐boarding  services  to  Kmart   suppliers  in  China   §  eCOM  VAN  &  IBM  Sterling  B2B  CollaboraPon  Network   Electronically  exchanged   informa>on     Ensure  the  right  product,  right   quan>>es  at  the  right  place   and  right  >me     Lower  opera>onal  costs     Retailer  can  efficiently  verify   shipments   value+ Case Studies
  18. 18. Your Next Steps
  19. 19. Your first step: Global Sponsors to China TPs eCOM-­‐IBM  B2B  Cloud  Services     (VAN/Managed  Services) sponsor company trading partner trading partner trading partner •  Interna>onal  EDI  VAN   •  Transla>on  to  trading  partner  format,  Web  EDI,   CSV,  Excel,  Fax  etc.   •  On-­‐boarding  service   •  Educa>on  and  workshops   •  24/7  Go  Live  support,  local  >me  zone,  local   language,  local  technology  and  local  culture    
  20. 20. 19 Your next steps: Achieving global B2B Integration and EDI Activities •  Develop a B2B Vision & Strategy: Based on a client’s strategic vision, eCom-IBM’s industry expertise/benchmarks and the client’s business environment •  Identify Inefficiencies and Bottlenecks: Investigate current B2B processes to identify areas for improved efficiency and cost improvement opportunities •  Define Technology Requirements: Envision a B2B technical solution that supports process improvement •  Describe the Business Value: Estimate reductions in cost and/or time and business value improvement in the envisioned "to-be" environment Artifacts •  Current State Assessment •  Future State Opportunities •  Business Architecture and Solution •  Business Case 3. Current and Future- State Gap Analysis4. Future-State Design 2. Business Goals and Requirements Typical Business Value Assessment 5. Business Impact Analysis and Actions 1. Current-State Analysis Business  Value  Assessment  (BVA)   –  B2B  Focus  
  21. 21. Your next steps: A Call to Action •  Contact  your  IBM  RepresentaPve  Today!   •  Schedule  BVA   •  Scheudle  one-­‐on-­‐one  webinars/meePngs  to  determine  specific   requirements  and  define  strategies,  goals,  next  steps   •  Download  the  new  whitepaper  -­‐  “EDI  in  China:  Developing  a  Strategy   for  B2B  Integra>on  Success”   •  Currently  available  at  the  following  link:   hqp:// ZZW03194USEN.PDF   •  Contacts   •  Ryan  Fong   •  Steve  Travis   •  Lori  Brofford  
  22. 22. Questions?
  23. 23. Thank You
  24. 24. APPENDIX: China E-Commerce Spending *Source: Comsource, Adobe, Alibaba