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Tradeshift Acquisition of IBX Network- Reinforcement of Importance of Scale and Functionality in B2B Business Network Platforms


This week, global commerce platform provider Tradeshift announced an agreement to acquire Cap Gemini’s IBX Business Network for an undisclosed sum. The announcement touts that the end result will be the creation of the world’s largest business commerce platform. Beyond the marketing speak, Supply Chain Matters views this announcement as yet another reinforcement that the dynamics and support of B2B Business Networks are changing rather rapidly, and that scale and depth of functionality are the evolving table stakes.

The IBX Business Network is a Cloud-based eProcurement business process support platform, positioned to be an ERP backbone system alternative for large scale enterprises needing indirect procurement material process support needs. Its system design principle is that 60 to 80 percent of eProcurement users are casual, and do not necessarily require the functionality of a full-blown purchasing management environment. Instead, the platform provides an online shopping type of user experience to make the procurement process intuitive and seamless as possible. A further design principle is fostering a “compliance-oriented culture” of procurement vs. one that is policing in nature.  There are three product application suites provided which are IBX Source to Contract, IBX Purchase-to-Pay, and IBX Supplier Network, each targeting support for strategic, operational procurement and supplier catalog and engagement needs. All three process support areas are linked to a set of consultant-driven Capgemini managed services offerings addressing technology implementation, change management or supplier on-boarding process needs.

Tradeshift, founded in 2010, positions its technology as a business commerce company supporting an open B2B business network, with a Cloud-based platform that can be adopted to specific business needs. The three Dane co-founders initially designed and built EasyTrade, designed and deployed to be the first open source trade platform across Europe. They then pitched to Silicon Valley’s investors the vision of a global open trade platform which was the creation of Tradeshift. This firm’s mission is to connect customers with their suppliers digitally, to remove paper and manual processes across P2P processes, and to buy what is needed faster while managing supplier risk. Applications support focus on Procure-to-Pay, E-Invoicing, Supplier Management and Engagement and Financial Management business process support needs.

According to the announcement, this acquisition will immediately bolster the combined marketplace with the addition of over a half-million suppliers and 27 million SKU’s. A subsequent blog posting from Tadeshift’s founder and CEO reiterated a mission to build the world’s largest business commerce platform. Such a platform would include everything that happens between buyers and sellers, consisting of core enterprise applications, a global supplier marketplace, and a rich ecosystem of apps that enable any type of business process.

Make no mistake, this latest announcement surrounding B2B Business Network platforms is indeed about establishing market dominance and supplier network scale. It involves an existing competitive battle among ERP and enterprise technology vendors pitted against termed best-of-breed or specialist vendors.

From this industry analyst’s lens, the real determinants for the winners, from a customer and market perspective will be from two determinants.

The first is the ability to provide customers who adopt such technology, the ability to have the broadest options in flexible and ever changing supply chain management business process and decision-making needs in a Cloud-based environment, providing the most attractive overall cost to deploy and annualized operationally managed manner. Business process support should not be limited to just sourcing and procurement since a B2B network involves extended supply chain planning, execution and joint-decision making needs for direct procurement support needs as-well. If a B2B platform coexists with other behind the firewall or Cloud-based applications and/or platforms, there must be seamless Cloud based integration utilizing open based standards.

The second, and equally important determinant is overall supplier acceptance of the platform itself, that the platform provides added value for suppliers without meaningful incremental operational and user support costs. Supply chain and procurement professionals know all too well that different business drives indirect and direct procurement processes, planning and supplier management requirements. Teams have looked to ERP and enterprise vendors for technology and applications that can support either process in a cost efficient and continuous manner.

Both determinants are what are driving a wave of market consolidation that will likely continue. Prospective customers and respective technology selection teams must therefore make their adoption decisions from a broader, cross-functional, and cross-business support lens.

Bob Ferrari

© Copyright 2017. The Ferrari Consulting and Research Group and the Supply Chain Matters® blog. All rights reserved.


Additional Update on B2B Supply Chain Business Network Provider E2open Merger with Steelwedge


This Supply Chain Matters blog posting serves as an update to our prior mid-February posting regarding supply chain B2B platform provider E2open’s announced merger with sales and operations planning (S&OP) and supply chain planning technology support provider Steelwedge.  This latest deal follows prior acquisitions of icon-scm for supply chain planning simulation technology, Terra Technology for deeper levels of business intelligence and data management, and Orchestro for product demand sensing support.

This week, we had the opportunity to view an online webcast, anchored by E2open CEO Michael Farlekis, which was directed at both customer communities to serve as an update on strategic direction.  E2open, Inc.

Both tech providers come together to serve a combined installed base of 160 customers with some stellar nameplates Steelwedge Softwareand diverse industry supply chain settings. The E2open side includes Cisco, Dell, HP, Kimberly Clark, Mondelez International, P&G, Unilever, Kraft-Heinz, among others. With the merger of Steelwedge, added industry vertical presence includes Nissan and Land Rover in automotive as well as some common customer among high-tech supply chains.

CEO Farlekis described the combined value proposition as universal cloud connectivity of the extended supply chain supported by a broad offering of applications. He reiterated that scale matters citing a host of numbers related to platform users, countries supported and volumes of transactions and item categories now supported.

With Steelwedge’s S&OP and baseline continuous planning support capabilities, E2open goal is for customers to be able to extend this process to include the inclusion of supply chain partners including key customers, suppliers, and trading partners.

SVP of Product Management and Strategy, Pawan Joshi, outlined the full application and user-centric capabilities of E2net platform and confirmed our prior belief that Steelwedge will provide augmented S&OP support capability, and that the existing technology will be fully integrated into E2open’s technology and platform stack over time, including the E2open Harmony Dashboard.

Plans call for integrating the Steelwedge data model and functionality into that of E2open’s, supported by the current singular platform sign-on and user interfaces. Regarding anticipated integration timelines communicated, initial data interface and user interface integration is expected to occur during 90-day release timelines this year, with full integration and rationalizing of planning functionality expected by early 2018. CEO Farlekis indicated there will be no change in existing support contracts with Steelwedge customers.

Given the above, the presenters declared that all existing Steelwedge customers will have access to the combined product portfolio and that E2open account managers will now serve Steelwedge accounts in their broader end-to-end platform support needs. We have learned that E2open plans to sell Steelwedge as a stand-alone offering until the integration process is completed, but that may present somewhat of a challenge given that prospective customers will want to understand the broader product integration.

There are subsequent individual briefings being planned with existing Steelwedge accounts and it would behoove these customers to seek more specifics regarding access to E2open’s platform capabilities, expected changes in functionality as well as the full integration timeline. Long-time pricing is another consideration, along with E2open’s ongoing efforts to improve its balance sheet.

Our prior observation that Steelwedge clearly needed an infusion of new capital and thought leadership coupled with more savvy marketing and sales execution resources was obviously reinforced by this customer update. Privately-held E2open seems to communicating the flexibility to be able to undertake this effort and hopefully, in an aggressive timeline. With its expanding B2B Business Network platform capabilities supporting procurement replenishment, continuous planning, execution, and collaboration, E2open will likely gain added market attention.

Before closing this commentary, this supply chain industry analyst would like to share an additional thought or two. We have long advocated that an S&OP process should be able to include and support the participation of key external partners in the overall process and in shared decision-making. That stated, such a capability does require some maturity in accurate master data and information management, scenario and what-if planning methods, collaborative based practices, and joint decision-making. With E2open’s platform, the opportunity exists to extend S&OP to extended supply chain partners, but change management and process readiness are important considerations to not overlook.

Supply Chain Matters will feature additional updates on E2open as developments warrant.

Bob Ferrari

© Copyright 2017. The Ferrari Consulting and Research Group and the Supply Chain Matters® blog. All rights reserved.

Deep Dive on 2017 Prediction Seven: Enhanced Supply Chain Intelligence Capabilities Among B2B Network Platform and Managed Services Providers Will Pay Dividends for Industry Supply Chains


The following Supply Chain Matters blog is part of our ongoing series of deep dives into each of our previously unveiled ten 2017 Predictions for Industry and Global Supply Chains.

At the start of the New Year, our parent, the Ferrari Consulting and Research Group along with our Supply Chain Matters blog as a broadcast medium, provide a series of predictions for the coming year. These predictions are shared in the spirit of assisting industry specific and global supply chain cross-functional teams in helping to set management objectives for the year ahead. Our further goal is helping our readers and clients to prepare supply chain management and line-of-business teams in establishing impactful programs, initiatives, and educational agendas.  holding-the-future

The context for these predictions includes a broad cross-functional umbrella of supply chain strategy, planning, execution, product lifecycle management, procurement, manufacturing, transportation, logistics and customer service management.

In an earlier Supply Chain Matters blog postings, we provided deep dives related to:

Prediction One- Subdued World Economic Outlook and Heighted Uncertainty to Test Industry Supply Chain Agility.

Prediction Two- A Challenging Year in Procurement

Prediction Three- A Supply Chain Talent Perfect Storm

Prediction Four- Increased Anti-Trade Geo-Political Forces Provide Added Global Sourcing Challenges

Prediction Five- Continued Global Transportation Industry-wide Turbulence

Prediction Six- A Renaissance in Supply Chain Focused Business Services and Technology Investments

In this deep-dive series posting, we drill down on our next prediction.

2017 Prediction Seven- Enhanced Supply Chain Intelligence Capabilities Among B2B Network Platform and Managed Services Providers Will Pay Dividends for Customers

In 2017 and beyond, there will exist increased industry specific needs for deeper and wider levels of customer, product, physical object and supply network focused information visibility, capture and analysis.  This need is coupled to building multi-industry supply chain requirements for more predictive, analytics data-driven decision making competencies that involve outside-in insights. The objective is a literal 360-degree view of supply chain wide data and information, horizontally spanning the end-to-end supply and vertically coupling high level enterprise to shop-floor decision-support needs.  Enhanced business intelligence and overall process improvements further enhances the ability of industry supply chains to support new, more innovative business models that can leverage digital technologies in areas of product or customer related services.

A means to achieve such capabilities are analytics and business intelligence engines that are now being embedded across supply chain focused B2B network platforms, edge systems and production shop floor transactional and information transfer flows. B2B business networks and edge platforms are today the prime opportunity for digitizing the horizontal and vertical flow of information and analytics across end-to-end supply chains. Whereas predominantly EDI messaging platforms were viewed as required external messaging utilities to transfer and receive transaction and electronic messaging information across disparate systems, there is now collective movement by network providers to transform these platforms to business intelligence and analytics based information repositories available to support broader supply chain and product focused decision support needs. As noted in Prediction Six, this an area where blockchain technology can have a profound long-term impact, but beyond that, many existing B2B technology platform vendors such as Ariba, an SAP Company, E2Open, GT Nexus, IBM, OpenText are already moving in the direction of blending supply chain wide planning and execution related transactional data with analytics, cognitive and business intelligence capture. Such analytics and trending information can then be moved to and from various existing business application systems related to planning and customer fulfillment.

Similarly, the vertical notions of what is being often described as either Industrial Networks, Industrial Internet and edge systems, are various physical devices communicating via IoT enabled technology, within their respective operational and performance status data streams. Here again, emerging IoT network technology providers are similarly incorporating cognitive and analytics based capabilities to synthesize the streaming levels of data being captured into information and required decision-making alerts.

An Evolving New Challenge

The evolving new challenge for industry supply chains will be the ability to exchange information and insights among various existing Cloud-based B2B networks and resident business software applications focused on either customer, product, supply, production, service or fulfillment process needs.  This is a challenge that must be addressed in order to gain the full benefits of the Cloud. Ideally, supply chain teams will seek the ability to have a virtual information utility or data lake, but that could be expensive and many industry supply chain teams are not necessarily ready to manage such capabilities at this point. Today, such challenges fuel an evolving need for managed services providers or systems integrators to tie-together such structured and unstructured information and analytics in virtual streaming information and analytics data pools or zones available to all enterprise and supply chain business applications and systems.

Technology vendors now recognize this problem. For instance, Oracle recently released a Hybrid and Multi-Cloud Services utility as part of its Platform-as-a-Service (PaaS) Cloud infrastructure services. Oracle’s intent with this service is to support the needs of data movement, data transformation, data quality and applications integration among multiple Cloud platforms and applications.

Focus on a Networked Cloud Strategy

All the above stated, industry supply chain and line-of-business teams should strive to prioritize and scope certain business process decision need areas, for example customer fulfillment and logistics, or an initial supply chain control tower capability, and work with an individual platform vendor or focused systems integrator to start the journey towards streaming analytics and insights from external Cloud-based platforms.  We view this as a prime process and business support opportunity for supply chain teams in 2017.

B2B or B2B-to-B2C business network platforms related to process needs in areas such as procurement, product management, planning, logistics or customer fulfillment should no longer be viewed as solely messaging or transactional platforms. Over time, they will serve as sources of analytics, insights and alerts related to process, suppliers, and customers. Business, functional and sales and operations planning teams can gain more real-time insights by broadening their perspectives beyond messaging to messaging and trending.

This concludes our Prediction Seven drill-down. In our next posting of this series, we will explore Prediction Eight reflecting on how Alibaba and Amazon will continue to battle for global online platform dominance.

Stay tuned.

Bob Ferrari

© Copyright 2017. The Ferrari Consulting and Research Group and the Supply Chain Matters® blog. All rights reserved.

Wal-Mart, IBM and Tsinghua University Announce Joint Collaboration on Food Safety Tracking Technology

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This week, global retailer Wal-Mart along with IBM and Tsinghua University announced a joint effort to improve the tracking and movement of food products across China in an effort to improve overall food safety.  The government of China has identified food authentication and supply chain tracking as a critical concern to quickly find and eliminate sources of food contamination within the country.

This announcement bears watching among consumer goods focused supply chains since this new effort will be leveraging what is termed as blockchain technology. This form of technology is increasingly being identified by supply chain focused technology providers for applicability in providing higher levels of intelligence regarding the movement of materials across a supply chain or B2B network. In essence, it fosters the sharing of data and information across a network of computers and as noted in the announcement, is gaining broader recognition due to its applicability in recording and keeping track of assets and materials. This form of technology currently powers digital bitcoin currency use.

According to IBM, when applied to the food supply chain, product information such as farm origin details, batch numbers, processing data, expiration dates, storage temperatures and shipping details can be digitally connected to food items, and the information is entered on the blockchain at every step of the process.

The technology can further aide retailers such as Wal-Mart in managing the shelf-life of products within individual stores and in having access to the traceability aspects of the product’s supply chain. In the specific applicability to Wal-Mart, the announcement indicates that the retailer plans to utilize IBM Blockchain based on Linux Foundation’s Hyperledger Project, which is an open source software project approach that builds on blockchain tools.

Obviously, the closest applicability for the leveraged use of blockchain technology is in current B2B EDI messaging networks that record various movement and transactions among various supply chain trading partners. While attending the recent IBM Empower 2016 conference, executives made mention of upcoming announcements related to IBM’s Sterling Commerce B2B technology and future applicability for this technology.

OpenText, another major B2B technology network provider has also indicated a development direction that augments existing EDI and transactional messaging with broader analytics capabilities.

The takeaway for readers is to begin to consider the possibilities for utilizing EDI messaging and other transactional, content, and unstructured data passing along B2B trading networks as sources of broader supply chain intelligence and analytics related to needs in regulatory compliance, traceability and reduction of waste.

We believe there will be more initiative announcements forthcoming such as the one from retailer Wal-Mart, initiatives that will leverage B2B trading network information towards efforts to integrate value-chain physical flows with needs for broader intelligence and analytics related to more-informed and timely decision-making.

Stay tuned.

Bob Ferrari

© Copyright 2016. The Ferrari Consulting and Research Group and the Supply Chain Matters® blog. All rights reserved.


Look to the Cloud to Support the Modern B2B Network

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Through this blog, I’ve worked to raise awareness about the critical importance of integrating information and business processes across a business-to-business (B2B), or supply chain, network. It’s important because more supply chain business processes and information flows occur and reside throughout the external supply chain network, and needs to be integrated into internal systems, applications and decision-making.

Interoperability and exchanging information is especially critical – in some cases, a necessity –for manufacturers supporting direct materials and product value-chain needs across a global network. Interoperability should not be considered as supporting a singular functional process need, but rather an electronic connection that integrates all information flows among suppliers, customers, trading partners, financial institutions, logistics providers or any valued supply chain ecosystem partner, across the globe.

What’s more, B2B integration technology must be adaptable to today’s rapid pace of business. And it must enable the journey toward supply chain process maturity and more informed and timely decision-making. The longer-term requirement is often the ability to seamlessly support not only P2P and order-to-cash, but also broader B2B decision-making process needs leveraging near real-time information exchange.

More and more, analytics and timely decision-making capabilities are now network considerations. Information visibility must be more than static in nature; it must be dynamic (for instance, how much on-hand inventory currently exists across the network) and contextual (such as associated inventory coupled to customer orders).

The B2B network must further be seamless, non-disruptive to the current systems landscape, and it must support a transformation beyond just two-way electronic transactional flows to more interactive forms of business process collaboration, electronic workflow, information exchange, and supply chain business intelligence requirements, today and in the future.

The emerging choice for supporting that journey is cloud technology. Cloud can bring together data management, analytics and connectivity to integrate key information about customers, suppliers, trading partners and other support partners and create a modern B2B network.

Importance of Cloud-Based Technology

In our view, an organization’s journey toward mature B2B integration is made possible by today’s advanced cloud-based platforms, applications and infrastructure.

Cloud-based technology is seen as a response to growing industry frustrations with rising IT technology costs and service challenges. All corporate functions are under enormous pressure to reduce costs. That includes IT; studies consistently show that up to 75 percent of IT costs stem from maintaining existing IT infrastructures or business software applications, particularly those that are external.

Throw in ongoing line-of-business and supply-chain frustrations with on-premise ERP and legacy business applications — those designed before the emergence of modern business and supply chain frameworks — and the pressure to change is even more compelling. Processes are continually being created, changed or incorporated into broader network-focused needs and requirements.

Businesses must avoid the costly time and expense of upgrading their IT systems. This has spurred major enterprise system vendors to bring cloud-based technologies to market to provide technology optimization with minimal cost and disruption. Another benefit to cloud-based systems is their ability to be continually updated to reflect changing business needs. Why settle for innovation every one to two years when every six months or less is an option — and with lower capital and overhead costs?

It is no surprise that many of today’s supply chain network providers have elected to develop their solutions on, or transition to, cloud platforms, because they clearly understand that the network is inherently cloud-based.

Conclusions and Recommendations

When considering an investment in an integrated B2B network, or expanding the scope of an existing platform, a cloud-based platform can minimize disruption to existing systems while supporting short and longer-term needs for business growth, process and external partnerships. Consider a cloud-based platform that can support multiple supply chain business process needs, while adhering to the varied data security standards and practices that exist around the world. And look for a service provider that can deliver leadership and expertise, as well as the services needed to support quick, efficient growth and enhanced capabilities to deliver innovation.

There is no question that analytics and broader, more predictive business insight capabilities are opportunities to transform B2B business and supply chain business networks. The opportunity — and indeed the necessity — is to leverage an end-to-end business network to synchronize planning, execution, customer fulfillment and more predictive decision-making needs.

Bob Ferrari

© Copyright 2016. The Ferrari Consulting and Research Group and the Supply Chain Matters® blog. All rights reserved.

Disclosure: This blog is sponsored by OpenText.

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