Is a Lack of Integration Holding the Supply Chain Back?

By now, everyone is surely aware that the straight-through processing of data not only automates key internal and external processes, but that it also virtually eliminates re-keying errors and saves a whole load of time and effort into the bargain.

With the transportation of goods, in particular multimodal transportation, comes a huge volume of data that needs to be processed, so it stands to reason that the supply chain has more to gain than most industries from the widespread adoption of data sharing, yet few logistics service providers (LSPs), freight forwarders and carriers can claim their trading is carried out fully electronically and that the majority of their processes are automated.

So, why has something as basic as data integration not been adopted throughout the supply chain? 

In practice, business to business (B2B) integration is tricky to achieve and is generally ever-present but remains low down on the ‘to do’ list. It’s one of those tasks that organizations just never get round to doing, or at least doing properly – the business equivalent of clearing out the garage or defrosting the freezer. It’s not the type of project that will win awards or accolades from the board, despite typically yielding significant cost efficiencies which are not only difficult to quantify without dedicated analysis, but which will usually lead to an unpopular restructuring of staff and workloads.

But beyond the basic and still very real cost efficiencies, there are a range of specific benefits to the supply chain of improving integration, that can deliver improved customer service and enable organizations to offer additional and value-added services to their customers. These include:

Serial Shipping Container Code (SSCC)

• Serial identification of containers/units
• Track & trace of individual containers/units
• More efficient shipment routing by carrier
• Accurate receipt information for inventory systems
• Automated receiving and distribution process

RFID

• Payment by mobile phones
• Asset Management
• Inventory Systems and Product Tracking
• Transportation and Logistics

Mobile Solutions

• Real-time status updates
• Information available anywhere, every time

The potential rewards of full integration continue to be outweighed by the perceived enormity of the task of linking multiple systems within the organization (e.g. TMS to ERP), while the task of mapping message formats to those of trading partners with no single standard to follow understandably leaves many logistics organizations understandably bewildered. Many operate very lean structures with limited IT resource that simply cannot support the EDI expertise required to facilitate integration.

However things are changing. The move away from once-common bespoke systems to off-the-shelf solutions which are customized through configuration rather than specific coding has made integration much simpler than it previously was.

Leading vendors of supply chain execution software, including Kewill, now view integration with other systems and 3rd parties as essential and build in integration capabilities to their TMS/WMS/freight forwarding and customs compliance solutions to ensure the entire order to cash process is automated and that end-to-end visibility can be facilitated. Regardless of new developments and additional functionality, it is this inbuilt integration capability that drives the greatest benefits to Kewill’s customers in terms of efficiency and speed of response.

Supply chain organizations that persist with using outdated, legacy software or operating silos will undoubtedly be left behind. Good supply chain integration is the foundation for good supply chain performance.

Next steps: