Supply chain executives have some tough decisions to make in the year ahead as they face increased pressure to deliver product faster than ever before. The “Amazon effect” has disrupted customer expectations about the speed and visibility of goods in transit. Trying to increase velocity is a challenge when supply chains are fragmented and departments are using a variety of technologies for their own individual operations. A more modern approach to supply chain moves away from a traditional logistics model and embraces a global trade network model. This new strategy goes beyond automation. Organizations can strategically create value and enable profitable growth in new and existing markets by optimizing supply chain performance.
Why Embrace Change?
A Cap Gemini report in 2016, found 48 percent of supply chain executives admitted their supply chains rely on traditional technologies like phone, email, and fax. Yes, you read that right, the facsimile. Yet, companies are spending billions of dollars each year trying to stay competitive. The traditional supply chain model does not have the flexibility to adapt when constrained capacity, fluctuating demand, and political trade uncertainties affect the market. The technology of yesterday was on-premise and deployed behind a firewall, physically cut off from partners, which made open collaboration an ongoing challenge. Cloud-technology is the way of the future, but it does not inherently have the ability to support a global trade network. The network needs to be able to flex and adapt to all of the participants connecting through a variety of means. A U.S. trucking carrier will want to use EDI, a small supplier in Asia prefers using a portal, etc. The key to a global trade network is connecting all of these supply chain partners through technology that is easily and instantly accessible to everyone.
The Network Effect
In a traditional supply chain logistics model, companies can only focus on optimizing one component of the supply chain at a time. It’s a very siloed approach and manages the supply chain as if it is a cost center instead of a strategic, competitive asset. A global trade network is a living ecosystem of supply chain partners all connected through one technology platform. In this model, the focus is on interactive collaboration among carriers, shippers, forwarders, suppliers, and even customers. It drives a powerful network effect with the benefits of universal connectivity among participants. Instead of micro-optimization, which only allows for cost-savings within your own supply chain, the doors are open to macro-optimization—finding those optimization opportunities that lie between several systems that are now all connected to one network.
Using a single instance, multi-tenant software platform provides this cross collaboration opportunity to integrate multiple partners and aggregate data, while maintaining security for all connected parties. A global trade network also provides industry benchmarking beyond historical, company-only data. By accessing real-time global trade network data, companies can benchmark with actionable intelligence to execute business decisions for continuous improvement.
Global Trade Network Advantages
Companies can accelerate growth opportunities with a global trade network by expanding the top line, improving the cost formula, and mitigating risk. This ecosystem of supply chain partners allows for access of multiple delivery options and carrier choices, and preempts disruption through better carrier visibility and management. Other advantages include opening new markets for cross-board trade, strengthening competitive position through better cost structure, and using historical data and trend analysis to create a series of “what if” scenarios. The true end-to-end collaborative visibility allows for faster reaction time when disruption strikes.
These benefits not only extend outside of a company’s own supply chain, but can also enhance efficiency and communication internally. Mergers and acquisitions can lead to silos between internal departments using different systems and technology tools to accomplish the same operations. When all internal teams connect to the global trade network they immediately gain visibility into their own operations to examine better efficiency models and consolidation plans for future growth.
What the Future Holds
As the global trade network model becomes more widely adopted, the collective benefits will continue to rise. The agility the network provides allows supply chain managers to future proof their workflows with configurable business rules that can change in a moment’s notice. Supply chain executives can experience the power of choice with thousands of new suppliers, carriers, and forwarders readily available for onboarding. The supply chain partners connected to the network will continue to gain insights from the collaboration and innovation shared which will raise the level of operational excellence and continually improve customer service.
As CEO, Doug Braun brings over 20 years of global ERP and supply chain execution experience to BluJay Solutions. Doug joined the company in October 2015 with a focus on executing Kewill’s growth strategy of expanding its solution footprint, both functionally and geographically, and increasing the value its solutions bring to customers. Prior to joining BluJay Solutions, he was Chief Executive Officer of International Business Systems (IBS), where he worked with the executive team to drive growth for IBS both in the existing customer base and into new regions. Before IBS, Doug spent 18 years at RedPrairie (now JDA), where he held the positions of Vice President of Services, Executive Vice President of Supply Chain and, most recently, President of Global Operations. While there, he unified and led the global operations teams across a complex multi-channel and supply chain execution software solutions suite. Doug has a BBA in Management Information Systems and an MBA in International Business from the University of Wisconsin-Milwaukee. He is currently pursuing a Doctoral degree from Temple University.