Supply Chain Collaboration Technology, Part I: Opportunities Abound for Better Integration, Study Finds

The cost of electronic communication in the supply chain is falling while the benefits continue to mount, according to a new report.

Findings by the University of Tennessee's (UT) Global Supply Chain Institute, in collaboration with B2B integration provider DiCentral, examined supply chain trends, issues and challenges expected in 2016 and beyond. A few of the findings included:

• Suppliers reported that the cost of processing an order electronically is nearly 25% less expensive than receiving the order via email, fax, or the phone;
• Suppliers reported significant benefits from being able to send invoices electronically, indicating that it sped up nearly 4.5 days of cashflow;
• Customers that have integrated EDI into their operations are reducing the expenses associated with processing a PO by nearly 20%.

For the study Transform Your Supply Chain with Collaboration (registration required), UT surveyed over 200 organizations ranging from consumer products, retailers, to discrete and process manufacturers. Companies ranged in size from $50 million to more than $2 billion.

B2B integration (or as DiCentral and some other vendors refer to it, "B2Bi") is both nothing new and new every day. Electonic integration has been around for more than 30 years in the forms of electronic data interchange (EDI) and e-commerce. Still, a good many of those surveyed view B2Bi as in its infancy, considering the expected growth of the Internet of Things and cloud-based applications.

They have a point. 

Benefits clear, but inertia on integration still lacking

The benefits are clear of B2Bi: but, the surveyors found deep integration comparatively rare. What holds them back?