CIO Agenda

Collaboration is hot, silos are not

November 28th, 2012 Bob Austin Tags: Collaboration, Enterprise, ERP, SCM, Supply Chain
Posted in Technology |

A long time ago, going back to the 1980s and 1990s, the rationale behind the implementation of ERP ‘Enterprise Resource Planning’ systems was all about businesses breaking down their internal business process silos and coming together under the overall ‘enterprise’ banner. So, rather than each business function or department having their own silo based objectives and KPIs, there would instead be a drive to all follow agreed enterprise objectives and KPIs which enabled maximum value add for the enterprise’s customers.

If we think of the term ‘collaboration’ defined as ‘any kind of joint, coordinated effort between two parties to achieve a common goal’, then it’s clear that these ERP system implementations were very much involved with intra Enterprise collaboration.

So, let us now consider collaboration in the context of supply chains.

Intra Enterprise collaboration between such business functions as procurement, manufacturing and logistics have always been important, of course, to get products made and transported to the customer. And in fact going back to the 1980s there have also been important instances of inter Enterprise collaboration in supply chains taking place – take ‘Just In Time’ and ‘Vendor Managed Inventory’ for example.

Since the 1990s, supply chains have evolved, with globalisation and outsourcing becoming commonplace. The trends are for linear supply chains of the past to increasingly morph into adaptive supply chain networks, which can be flexibly changed to reflect changing market conditions

On the technology front, advances in internet technology and associated standards have enabled much improved information sharing both within and beyond company boundaries. This information sharing can embrace both structured, transaction based data and unstructured, message based data. Furthermore, ‘in memory’ database technology allows for the management and analysis of much larger volumes of data.

So, how has a business management software vendor such as SAP reacted to these business trends and technology advances?

Well, in two ways – by (a)offering solutions which allow a company to share structured transaction and planning information over the web with its key trading partners, whether they be suppliers, outsourced manufacturers or customers and (b) by offering solutions which contain embedded social collaboration tools for the sharing of unstructured data. In other words, it’s all about collaboration.

How does this affect SAP partners, such as Atos?

Well, it affects the entire project implementation lifecycle from initial scoping through to implementation and ongoing support. So, in a project involving supplier collaboration for example, shared KPIs have to be established up front, collaborative business processes have to be agreed between the company and the key suppliers, information structures and meanings have to be clarified, testing has to be performed to the satisfaction of all parties, roles for social collaboration have to be set up… and so on.

All in all, this requires a new paradigm for supply chain collaboration projects – an interesting challenge for us to address.