A highly available B2B infrastructure is extremely important to ERP success. Yet why is it often overlooked when planning an ERP project?
A Gartner study revealed that over one third of data in ERP systems originate from outside the organization. Today, the effectiveness of your ERP strategy is dependent on the quality and timeliness of information you receive from customers, suppliers and trading partners. At the same time, many organizations are attempting to create a single real-time view of enterprise information by consolidating numerous ERP instances or systems that are currently located throughout the globe. Effective integration of your B2B and ERP systems is essential to the successful implementation of these strategies.
Put simply, it is easy to overlook the importance of B2B systems when approaching ERP projects. Gartner’s research produced some stark results. Almost 80% of respondents had an error rate of over 1% for B2B data – imagine the effect of this data flowing through all your other business systems. Over half experienced ERP production outages due to a lack of B2B connectivity. Worryingly, 65% of respondents admitted inadequate testing of B2B integration prior to their ERP launches.
Areas to address: Data and process quality
There is little doubt that poor B2B data quality compromises ERP value. Inaccurate information from suppliers will affect the entire supply chain, reduce customer satisfaction as well as impact both the bottom and top lines of your business. At the very least, external information will not be clean enough to be processed by your ERP system so will have to be manually re-entered. Worse, something as simple as an incorrect part number could lead to delays in manufacturing thus causing delays in payments or cancelled orders. There has to be a way to build a “firewall” between your ERP and external systems.
Areas to address: Trading partner integration
Onboarding of new partners is a well-established challenge for B2B systems. Each will have their own level of B2B capabilities, support different communications protocols and have their own technical infrastructures. Global partners will be subject to their own local regulation and compliance issues. However, one area that can easily be overlooked is the creation of new document maps which will normally form a major part of an ERP upgrade program. Very few companies have access to the specialized mapping skills to achieve all the new maps required in a short period of time. An issue that multiplies, research has shown that almost 50% of companies attempt to onboard more partners or accept more transaction types as part of their ERP integration program.
Areas to address: Supply chain visibility
Real-time views of enterprise information cannot be achieved if data has to be re-worked or re-entered. To benefit from near real-time business decisions or improved inventory management or demand-driven production, the data from your trading partners must be made available immediately and you must have confidence that it is accurate and complete. In addition, your ERP system requires extremely high B2B availability. You need a stable B2B infrastructure with proven and responsive disaster recovery built in.
Areas to address: Program management
ERP to B2B integration requires an immense amount of coordination across your extended enterprise. If you use your program to extend the functionality of your ERP systems then this must be carefully managed so that the correct amendments are introduced into your B2B solutions. But, implementation is only the beginning. Change management and global support begin to be important factors as soon as the initial system is delivered. This will require a large, permanent and highly specialized group of IT staff.
The role of B2B Managed Services
In effect, outsourcing the B2B element of your program allows you to concentrate on where the value to your business lies—with the ERP system. By connecting to a global B2B infrastructure, you create that firewall to provide assurance on the quality of data you receive from partners. Trading partners can be onboarded quickly without worrying about geographical location or technical capabilities. Most importantly, you gain access to the skills and human resource—from mapping experts to local language technical support—that can ensure timely program implementation without the cost of retaining full time employees to fulfill all the necessary roles.
Issues to consider
- How confident are you of the data quality within your ERP system?
- Is the volume and type of your B2B transactions likely to increase during the ERP project?
- Are you consolidating ERP instances or seeking to extend your ERP capabilities?
- Do you have you the right mix of skills and experience within your organization?
- What testing and business continuity strategies do you have in place?
- Can your ERP project give you the opportunity to better manage the performance of your trading partners?