Optimizing the Global Supply Chain: Purchase-to-Receipt
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If you are involved in managing all or parts of your organization's global supply chain, you will want to attend this webinar. Whether you are management, operations or trade compliance, this webinar will provide you with powerful insight as to how global supply chains can be significantly simplified, processes streamlined, and results optimized. The global supply chain is volatile, risky and ladened with complexity. To achieve optimal global supply chain performance requires collaboration, communication, and visibility across organizational functions and 3rd party partners. Managing a product/SKU from purchase through to its destination is challenging and requires full coordination of the purchasing, transportation, and trade compliance functions. 5 Take Aways: 1) Why ERP solutions are ill-equipped to deliver optimal global purchase-to-receipt (P2R) capability 2) What optimal global P2R capability looks like 3) How integration simplifies and streamlines cross-functional P2R processes. 4) Why optimal global P2R optimizes global supply chain inventory 5) How global P2R integration dramatically reduces trade compliance risk
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Optimizing the Global Supply Chain: Purchase-to-Receipt
- 1. info@3rdwave.co3rdwave.co+1 (416) 510-8800 "Optimizing the Global Supply Chain Purchase to Receipt" 1 Grant Sernick Director of Sales 647.632.9822 grant@3rdwave.co Ned Blinick 416.510.8800 ext 234 ned.blinick@3rdwave.co
- 2. info@3rdwave.co3rdwave.co+1 (416) 510-8800 Grant Sernick grant@3rdwave.co 2 3rdwave is a global trade management solution that provides a fully integrated solution for managing and controlling global supply chains. It provides organizations with comprehensive trade compliance capability synchronized with global operations to insure total control and compliance of the supply chain.
- 3. Ned Blinick is Chief Product Officer and a principal in 3rdwave. He is a passionate advocate of global supply chain management and speaks and writes regularly on the topic. He has presented at CSCMP on the topic of “Securing Your Global Supply Chains in a Post 9/11 Environment”, the Supply Chain Summit on “Unlocking the Hidden Value in the Global Supply Chain”, and the National Defense University in Washington D.C. on “Creative Logistics”. Ned has been recognized many times by Supply and Demand Chain Executive as a supply chain “Pro to Know”. 3rdwave has been recognized by Food Logistics, Inbound Logistics as a top 100 Logistics Solutions Provider. Prior to 3rdwave, Ned spent 25 years in senior executive positions (including CEO) with one of Canada’s largest independent food import/distribution companies. Ned has a deep understanding of the inherent risks and challenges in building and maintaining infrastructure to insure execution and compliance across global supply networks.
- 4. 1. Why ERP solutions are ill-equipped to deliver optimal global purchase-to-receipt (P2R) capability 2. What optimal modern global P2R capability looks like 3. How P2R simplifies and streamlines cross-functional intra/inter company processes. 4. Why integrated global P2R helps optimize inventory and sales management 5. How global P2R integration dramatically reduces total corporate risk and cost Agenda
- 5. Why ERP solutions are ill-equipped to deliver optimal global purchase-to-receipt (P2R) capability. ERP was designed for vertically integrated operations Globalization changed the focus from internal vertical integration to external supply chain networks
- 6. Global P2R – a real driver for Improvement Modern P2R is the ability to seamlessly execute and manage a PO from the time the PO is created until it is received at the Point of Delivery Purchase Order Management Transportation Management Trade Compliance
- 7. Enterprise Functions Traditional ERP Schema Vertically Integrated – Internal Network Product Design Sourcing Purchasing Inventory Control Sales Marketing Finance Transportation Management Manufacturing Non P2R functions P2R functions
- 8. Enterprise Functions Product Design Sourcing Purchasing Inventory Control Sales Marketing Finance 3PLSupplier Supplier Supplier SupplierSupplier Supplier Supplier Carrier Carrier Carrier Carrier Supplier Supplier Traditional ERP Supply Chain Schema Vertically Integrated – Domestically Focused Transportation Management Supplier Carrier Manufacturing Non P2R functions P2R functions
- 9. When you are global, P2R can be ugly … or at the very least, greatly complex
- 10. When you are global, P2R can be ugly … or at the very least, greatly complex • Time Zones • Cultural differences • Language • Number of involved parties • Number of nodes in the supply chain • Number of cost elements that make up the total landed cost • Export customs and regulatory agencies • Import customs and regulatory agencies
- 11. Enterprise Functions Product Design Sourcing Purchasing Inventory Control Sales Marketing Finance 3PLSupplier Supplier Supplier SupplierSupplier Supplier Supplier Carrier Carrier Carrier Carrier Supplier Supplier Traditional ERP Supply Chain Schema Vertically Integrated – Domestically Focused Transportation Management Supplier Carrier Manufacturing Non P2R functions P2R functions
- 12. Enterprise Functions 3PL Customs Broker Customs Broker Customs Broker Supplier Supplier Supplier SupplierSupplier Supplier Supplier Customs and PGAs Carrier Carrier Carrier Carrier Carrier Supplier Traditional ERP Global Supply Chain Schema Vertically Integrated without P2R – Global Environment Product Design Sourcing Purchasing Sales Marketing Finance Supplier Transportation Management Non P2R functions P2R functions Trade Compliance Supplier Inventory Control Manufacturing
- 13. What does Global P2R deliver?.
- 14. What does Global P2R deliver? 1. Capture and consolidation of information from any internal system or trading partner and service provider 2. Automated processes 3. Total global supply chain visiblity 4. Proactive dashboards 5. Landed cost 6. Absolute trade compliance management 7. Product/SKU Traceability
- 15. How global P2R simplifies and streamlines cross-functional enterprise and external processes.
- 16. Cloud Global P2R Schema Distributed – Global Environment Trade ComplianceTMS Purchasing Global P2R • 3 basic systems: PO, Transportation, Trade Compliance • Flexible deployment: Cloud based or behind the company fire-wall • Open Architecture, Low IT requirements
- 17. Cloud Global P2R Schema Distributed – Global Environment 3PL Customs Broker Customs BrokerCustoms Broker Supplier Supplier Supplier SupplierSupplier Supplier Supplier Customs and PGAs Carrier Carrier Carrier Carrier Carrier Supplier Supplier Supplier Enterprise Functions Product Design Sourcing Purchasing Sales Marketing Finance Non P2R functions P2R functions Transportation Management Manufacturing Inventory Control Trade Compliance Trade ComplianceTMS Purchasing Global P2R
- 18. Product Design Sourcing Purchasing Inventory Control Sales Marketing Finance 3PLSupplier Supplier Supplier SupplierSupplier Supplier Supplier Carrier Carrier Carrier Carrier Carrier Supplier Supplier Supplier Customs Broker Customs Broker Customs Broker Customs and PGAs Single Access Trade Compliance TMS Purchasing External Partners Enterprise Functions
- 19. 11 Direct Benefits of P2R • One version of the truth • Timeliness of information • Improved cross-functional accuracy • Streamlined, standardized internal processes • Global P2R SKU visibility and traceability • Enhanced supplier/service provider collaboration •Reduced trade compliance risk and disruption • Accurate Total Landed Cost management and auditing • Improved transportation optimization and freight contract control • Operations and Management dashboards and alerts • Dynamic Reporting and Analysis • Company independence
- 20. Why integrated global P2R helps optimize inventory and sales management
- 21. 1. Total P2R supply chain visibility 2. Synchronizing fulfillment with demand requirements 3. Accurate total landed cost management 4. Superior operations and trade compliance execution capabilities 5. Invoice auditing and payment approval of P2R spend 6. Agility – ability to quickly adapt to changing needs 7. Real Time Analytics P2R – a vital component in Inventory Optimization, Sales Management, and Financial Control
- 22. P2R – a vital component in Inventory Optimization and Sales Management By the numbers: Leaders – 94.6% Followers – 84.4% Orders Received from Suppliers complete and on time1 2015 Change in Out of Stock inventory1 Leaders – 7.5% Followers – 8.5% 2015/16 Change in Total Landed Cost per unit1 Leaders – 0.5% Followers – 8.5% The 2 Major Challenges to P2R3 Ability to Collect Spend Data2 Leaders – 77% Followers – 43% 1 Aberdeen Report: Profitable Supply Chain Execution with Customer-and Event-Driven optimization (2016) 2 Aberdeen Report: Best in Class Strategic Sourcing: Profile and Approach (2015) 3 Deloitte: Growth: The cost and Digital imperative – CPO survey 2017 Data quality – 49% Data Integration –42%
- 23. info@3rdwave.co3rdwave.co+1 (416) 510-8800 "Optimizing the Global Supply Chain Purchase to Receipt" 23 Grant Sernick Director of Sales 647.632.9822 grant@3rdwave.co Ned Blinick 416.510.8800 ext 234 ned.blinick@3rdwave.co
Editor's Notes
- Thanks Grant, and good afternoon everyone. This topic, Global Transportation Management and Trade Compliance – 2 Sides, Same Coin is something that we have believed since the inception on 3rdwave. We have never really articulated this way, but it has been an underlying principle from when I actually ran a mid-size import/export business. When we look at global trade, the role of global transportation is obvious and that of trade compliance more subtle. However, trade compliance in business is like the big toe on a person. The big toe is ignored until you really stub it and then the pain it generates is often quite significant and get your attention. So the purpose of the webinar is to really talk about how transportation and trade compliance are both part of the business organism and although they might not be seen to be equally important, they both can cause significant organizational pain if they are not well managed. To put context to why these two functions are very much aligned you only need to look as far as your freight forwarder or 3PL or customs broker. In most cases what they sell you is their ability to provide integrated physical supply chain services (transportation management, trade compliance, often augmented with PO or SO management and documentation services) and the visibility and reporting tools.
- Thanks Grant, and good afternoon everyone. This topic, Global Transportation Management and Trade Compliance – 2 Sides, Same Coin is something that we have believed since the inception on 3rdwave. We have never really articulated this way, but it has been an underlying principle from when I actually ran a mid-size import/export business. When we look at global trade, the role of global transportation is obvious and that of trade compliance more subtle. However, trade compliance in business is like the big toe on a person. The big toe is ignored until you really stub it and then the pain it generates is often quite significant and get your attention. So the purpose of the webinar is to really talk about how transportation and trade compliance are both part of the business organism and although they might not be seen to be equally important, they both can cause significant organizational pain if they are not well managed. To put context to why these two functions are very much aligned you only need to look as far as your freight forwarder or 3PL or customs broker. In most cases what they sell you is their ability to provide integrated physical supply chain services (integrated transportation management and trade compliance, often augmented with PO or SO management and documentation services) and visibility and reporting tools.
- Thanks Grant, and good afternoon everyone. This topic, "Optimizing the Global Supply Chain: Purchase to Receipt" is something that we have believed since the inception on 3rdwave. We have never really articulated this way, but it has been an underlying principle from when I actually ran a mid-size import/export business. When we look at global trade, the role of global transportation is obvious and that of trade compliance more subtle. However, trade compliance in business is like the big toe on a person. The big toe is ignored until you really stub it and then the pain it generates is often quite significant and get your attention. So the purpose of the webinar is to really talk about how transportation and trade compliance are both part of the business organism and although they might not be seen to be equally important, they both can cause significant organizational pain if they are not well managed. To put context to why these two functions are very much aligned you only need to look as far as your freight forwarder or 3PL or customs broker. In most cases what they sell you is their ability to provide integrated physical supply chain services (transportation management, trade compliance, often augmented with PO or SO management and documentation services) and the visibility and reporting tools.
- So as the question asks – Why Integrated Transportation and Trade Compliance Global trade has been underpinning global and domestic growth for the past 40 years. For many manufacturers their domestic operations are so intertwined with global suppliers that withdrawal is not an option. From a US perspective global growth has been accelerating at a faster pace than US domestic GDP. That being said the new administration is seriously challenging the very idea of global trade and threatens to put significant roadblocks in the way that companies operate in the global market. To compete in an environment that is constantly under attack and is experiencing increased volatility companies need to be able to streamline their global trade processes (read import and export processes) and manage their trade compliance to take advantage of the continuing opportunities that will exist. Chances are that your company is under increasing demands from across your supply chain. Everyone wants more for less. The demands from across the supply chain for information on the status of a product are increasing. Whether they are internal associates or external actors everyone wants to have on-demand access to real-time information. Information is the currency by which visibility and understanding are transmitted and demands are satisfied. In order to insure that supply chains can respond to the demands of the internal consumers and external customers transportation and trade compliance both need to facilitate the movement of product and provide exceptional visibility as to where product is in the global supply chain – from purchase to delivery including customs and regulatory agencies.. On top of a more complex and demanding environment there are rapidly changing competitive factors. The internet is upending traditional competitive patterns. On-demand manufacturing, increased and more flexible product introductions, customer marketing and sales fulfillment demands, all impact the way a company competes today. In order to compete global transportation and trade compliance must insure that product moves to satisfy demand needs at the best prices, the right time, and quantity. Clearly being able to manage and control transportation cost and customs fees and duty costs can have a pronounced impact on the competitive positioning of a product and the entire company. Customs and other government regulatory agencies are increasing their oversight. From a trade compliance perspective – ACE (the single window) gives them incredible visibility into how and importer or exporter is performing in absolute terms and against peer groups. With these new tools, increasing mandates and resources they are able to turn more of their attention to enforcement and compliance. All this means more visibility into a companies activities and performance. Trade compliance particularly needs to be able to quickly respond to these regulatory agencies requests. Much of the information that they require is associated with the import or export shipments (documents and invoices) and they need access to information originating in transportation. My final point is both transportation and trade compliance are integral to reducing friction in the movement of goods in the global supply chain. Both functions rely on much of the same information to successfully do their work. Working together they can materially affect the speed by which an organizations global supply chains operate. They can literally take days out of an ocean “book to receipt” cycle and reduce the entire purchase to ship cycle by signficant %. Working together they can reduce landed costs for the organization. If the lens by which they are viewed can be focused somewhat differently they can be powerful partners in helping the company achieve there over-arching corporate goals.
- Each organization is unique in its configuration and the way it manages its business and the processes it has in place. Each business or business unit, regardless of its size or sophistication, has an enterprise solution, of some kind, to support the management of the core business functions such as accounting and finance, purchase orders, sales orders, HR, Customer Relationship Management, manufacturing or distribution. By design the enterprise systems are focused on internal processes with some acknowledgement that they need to communicate with the outside environment. The core capabilities of any enterprise system never (let me repeat…never) focus on global transportation, and even more rarely trade compliance. Because of the complex nature of the global supply chain, it is very logical and practical that global transportation and trade compliance execution are outsourced to 3rd parties – like your 3PLs, freight forwarders, or customs brokers. Also because of the highly distributed global supply eco-system, transportation and trade compliance information is very diffusely held among the trading partners and service providers. Because of this environment the teams that focus on global transportation and trade compliance rarely have automated systems to support their processes and workflow. Today, most enterprise systems (if not all) seriously lack the breadth and depth in their account and product masters and their supporting systems process to support a effective and efficient import or export program. I need to emphasize that with these comments I am talking about efficiency and effectiveness of current practices versus what is achievable. The inability of Enterprise systems to provide the necessary systems to support complex global supply chain control results in both the trade compliance and the global transportation teams being over-burdened, chasing down information to fulfill their direct mandates, as well as reacting to both their internal associates and external actors.
- Because of the complex nature of the global supply chain, it is very logical and practical that global transportation and trade compliance execution are outsourced to 3rd parties – like your 3PLs, freight forwarders, or customs brokers. Also because of the highly distributed global supply eco-system, transportation and trade compliance information is very diffusely held among the trading partners and service providers. Because of this environment the teams that focus on global transportation and trade compliance rarely have automated systems to support their processes and workflow. Today, most enterprise systems (if not all) seriously lack the breadth and depth in their account and product masters and their supporting systems process to support a effective and efficient import or export program. I need to emphasize that with these comments I am talking about efficiency and effectiveness of current practices versus what is achievable. The inability of Enterprise systems to provide the necessary systems to support complex global supply chain control results in both the trade compliance and the global transportation teams being over-burdened, chasing down information to fulfill their direct mandates, as well as reacting to both their internal associates and external actors.
- In most organizations, global operations – which includes global transportation – is functionally and informationally separate from trade compliance. The separation of the two functions is aggravated further because transportation management reports to operations whereas, trade compliance often reports to either legal or finance. While this separation of function and reporting make clear sense from a risk management perspective, it mostly creates significant operational bottlenecks and inefficiencies. The result is less than effective and more costly supply chain operations. Global transportation management (GTM) focuses on executing purchase orders from shipment planning to tracking and tracing shipments from origin to destination. For the purposes of this presentation I am separating transportation for full blown logistics. Transportation differs from logistics in that it does not manage the freight contracting process which includes automated RFQs and Contract negotiations. A comprehensive global transportation management solution includes shipment planning, carrier route management support with route costs and transit times availability, supporting visualization, centralized data management, automated track and trace, carrier contract management, landed cost management, and collaboration support (shared information accessibility). Trade Compliance oversees the management and control of the regulatory process supporting import or export operations to ensure that shipments are not delayed at the border by government agencies. Comprehensive trade compliance includes automated customs and other government agency management, customs broker management, entry auditing, duty drawback support, document management and retention, reporting and analytics. So the challenge is how is it possible to get two functional areas of a business which are highly siloed, fucntionally different and most often not seen as natural allies to reorient to move product as effectively from source to destination to meet the organization’ overarching goass
- Because of the complex nature of the global supply chain, it is very logical and practical that global transportation and trade compliance execution are outsourced to 3rd parties – like your 3PLs, freight forwarders, or customs brokers. Also because of the highly distributed global supply eco-system, transportation and trade compliance information is very diffusely held among the trading partners and service providers. Because of this environment the teams that focus on global transportation and trade compliance rarely have automated systems to support their processes and workflow. Today, most enterprise systems (if not all) seriously lack the breadth and depth in their account and product masters and their supporting systems process to support a effective and efficient import or export program. I need to emphasize that with these comments I am talking about efficiency and effectiveness of current practices versus what is achievable. The inability of Enterprise systems to provide the necessary systems to support complex global supply chain control results in both the trade compliance and the global transportation teams being over-burdened, chasing down information to fulfill their direct mandates, as well as reacting to both their internal associates and external actors.
- Each organization is unique in its configuration and the way it manages its business and the processes it has in place. Each business or business unit, regardless of its size or sophistication, has an enterprise solution, of some kind, to support the management of the core business functions such as accounting and finance, purchase orders, sales orders, HR, Customer Relationship Management, manufacturing or distribution. By design the enterprise systems are focused on internal processes with some acknowledgement that they need to communicate with the outside environment. The core capabilities of any enterprise system never (let me repeat…never) focus on global transportation, and even more rarely trade compliance. Because of the complex nature of the global supply chain, it is very logical and practical that global transportation and trade compliance execution are outsourced to 3rd parties – like your 3PLs, freight forwarders, or customs brokers. Also because of the highly distributed global supply eco-system, transportation and trade compliance information is very diffusely held among the trading partners and service providers. Because of this environment the teams that focus on global transportation and trade compliance rarely have automated systems to support their processes and workflow. Today, most enterprise systems (if not all) seriously lack the breadth and depth in their account and product masters and their supporting systems process to support a effective and efficient import or export program. I need to emphasize that with these comments I am talking about efficiency and effectiveness of current practices versus what is achievable. The inability of Enterprise systems to provide the necessary systems to support complex global supply chain control results in both the trade compliance and the global transportation teams being over-burdened, chasing down information to fulfill their direct mandates, as well as reacting to both their internal associates and external actors.
- Each organization is unique in its configuration and the way it manages its business and the processes it has in place. Each business or business unit, regardless of its size or sophistication, has an enterprise solution, of some kind, to support the management of the core business functions such as accounting and finance, purchase orders, sales orders, HR, Customer Relationship Management, manufacturing or distribution. By design the enterprise systems are focused on internal processes with some acknowledgement that they need to communicate with the outside environment. The core capabilities of any enterprise system never (let me repeat…never) focus on global transportation, and even more rarely trade compliance. Because of the complex nature of the global supply chain, it is very logical and practical that global transportation and trade compliance execution are outsourced to 3rd parties – like your 3PLs, freight forwarders, or customs brokers. Also because of the highly distributed global supply eco-system, transportation and trade compliance information is very diffusely held among the trading partners and service providers. Because of this environment the teams that focus on global transportation and trade compliance rarely have automated systems to support their processes and workflow. Today, most enterprise systems (if not all) seriously lack the breadth and depth in their account and product masters and their supporting systems process to support a effective and efficient import or export program. I need to emphasize that with these comments I am talking about efficiency and effectiveness of current practices versus what is achievable. The inability of Enterprise systems to provide the necessary systems to support complex global supply chain control results in both the trade compliance and the global transportation teams being over-burdened, chasing down information to fulfill their direct mandates, as well as reacting to both their internal associates and external actors.
- Each organization is unique in its configuration and the way it manages its business and the processes it has in place. Each business or business unit, regardless of its size or sophistication, has an enterprise solution, of some kind, to support the management of the core business functions such as accounting and finance, purchase orders, sales orders, HR, Customer Relationship Management, manufacturing or distribution. By design the enterprise systems are focused on internal processes with some acknowledgement that they need to communicate with the outside environment. The core capabilities of any enterprise system never (let me repeat…never) focus on global transportation, and even more rarely trade compliance. Because of the complex nature of the global supply chain, it is very logical and practical that global transportation and trade compliance execution are outsourced to 3rd parties – like your 3PLs, freight forwarders, or customs brokers. Also because of the highly distributed global supply eco-system, transportation and trade compliance information is very diffusely held among the trading partners and service providers. Because of this environment the teams that focus on global transportation and trade compliance rarely have automated systems to support their processes and workflow. Today, most enterprise systems (if not all) seriously lack the breadth and depth in their account and product masters and their supporting systems process to support a effective and efficient import or export program. I need to emphasize that with these comments I am talking about efficiency and effectiveness of current practices versus what is achievable. The inability of Enterprise systems to provide the necessary systems to support complex global supply chain control results in both the trade compliance and the global transportation teams being over-burdened, chasing down information to fulfill their direct mandates, as well as reacting to both their internal associates and external actors.
- Each organization is unique in its configuration and the way it manages its business and the processes it has in place. Each business or business unit, regardless of its size or sophistication, has an enterprise solution, of some kind, to support the management of the core business functions such as accounting and finance, purchase orders, sales orders, HR, Customer Relationship Management, manufacturing or distribution. By design the enterprise systems are focused on internal processes with some acknowledgement that they need to communicate with the outside environment. The core capabilities of any enterprise system never (let me repeat…never) focus on global transportation, and even more rarely trade compliance. Because of the complex nature of the global supply chain, it is very logical and practical that global transportation and trade compliance execution are outsourced to 3rd parties – like your 3PLs, freight forwarders, or customs brokers. Also because of the highly distributed global supply eco-system, transportation and trade compliance information is very diffusely held among the trading partners and service providers. Because of this environment the teams that focus on global transportation and trade compliance rarely have automated systems to support their processes and workflow. Today, most enterprise systems (if not all) seriously lack the breadth and depth in their account and product masters and their supporting systems process to support a effective and efficient import or export program. I need to emphasize that with these comments I am talking about efficiency and effectiveness of current practices versus what is achievable. The inability of Enterprise systems to provide the necessary systems to support complex global supply chain control results in both the trade compliance and the global transportation teams being over-burdened, chasing down information to fulfill their direct mandates, as well as reacting to both their internal associates and external actors.
- Each organization is unique in its configuration and the way it manages its business and the processes it has in place. Each business or business unit, regardless of its size or sophistication, has an enterprise solution, of some kind, to support the management of the core business functions such as accounting and finance, purchase orders, sales orders, HR, Customer Relationship Management, manufacturing or distribution. By design the enterprise systems are focused on internal processes with some acknowledgement that they need to communicate with the outside environment. The core capabilities of any enterprise system never (let me repeat…never) focus on global transportation, and even more rarely trade compliance. Because of the complex nature of the global supply chain, it is very logical and practical that global transportation and trade compliance execution are outsourced to 3rd parties – like your 3PLs, freight forwarders, or customs brokers. Also because of the highly distributed global supply eco-system, transportation and trade compliance information is very diffusely held among the trading partners and service providers. Because of this environment the teams that focus on global transportation and trade compliance rarely have automated systems to support their processes and workflow. Today, most enterprise systems (if not all) seriously lack the breadth and depth in their account and product masters and their supporting systems process to support a effective and efficient import or export program. I need to emphasize that with these comments I am talking about efficiency and effectiveness of current practices versus what is achievable. The inability of Enterprise systems to provide the necessary systems to support complex global supply chain control results in both the trade compliance and the global transportation teams being over-burdened, chasing down information to fulfill their direct mandates, as well as reacting to both their internal associates and external actors.
- Each organization is unique in its configuration and the way it manages its business and the processes it has in place. Each business or business unit, regardless of its size or sophistication, has an enterprise solution, of some kind, to support the management of the core business functions such as accounting and finance, purchase orders, sales orders, HR, Customer Relationship Management, manufacturing or distribution. By design the enterprise systems are focused on internal processes with some acknowledgement that they need to communicate with the outside environment. The core capabilities of any enterprise system never (let me repeat…never) focus on global transportation, and even more rarely trade compliance. Because of the complex nature of the global supply chain, it is very logical and practical that global transportation and trade compliance execution are outsourced to 3rd parties – like your 3PLs, freight forwarders, or customs brokers. Also because of the highly distributed global supply eco-system, transportation and trade compliance information is very diffusely held among the trading partners and service providers. Because of this environment the teams that focus on global transportation and trade compliance rarely have automated systems to support their processes and workflow. Today, most enterprise systems (if not all) seriously lack the breadth and depth in their account and product masters and their supporting systems process to support a effective and efficient import or export program. I need to emphasize that with these comments I am talking about efficiency and effectiveness of current practices versus what is achievable. The inability of Enterprise systems to provide the necessary systems to support complex global supply chain control results in both the trade compliance and the global transportation teams being over-burdened, chasing down information to fulfill their direct mandates, as well as reacting to both their internal associates and external actors.
- So when we look at what is available and how it might be deployed we need to look at how technology changes the practice. Today systems (whether they’re and enterprise or 3rd party solution) need to be able to communicate simply and effectively with the multitude of actors across the global supply chains. They must be easy for IT to work with and be able to interface to internal and external systems easily so that information can be delivered where it is need, when it is needed. To be effective these new systems must be able to mould to an organizations business processes, and not the other way around. They must be able to manage the basic source information (accounts, products, trasactional objects (like Pos, Advance Shipping Notices, Documents, Cost elements) simply and effectively. To support the transportation and trade compliance teams the new systems must be able to synchronize and self-validate information and present it in real time in a contextual way so that users can do their work and respond directly in a time sensitive way to their constituents. The bottom line is that transportation and trade compliance are complex. The supply chain networks are often massive and the information extreme. The solution should be able to simplify the way the information is managed, simplify the workflow, enhance communciations between transportation and trade compliance and their extend communities, provide information in ways that are meaningful internally and externally. So let’s see what a solution might look like.
- The Operational benefits are extensive and could constitute a complete hour on its own. Here is a partial list of the most obvious outcomes from a well executed P2R program. To me they are obvious, but the challenge is selling the benefits to management – and that is the challenge with most new solution opportunities.