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Supply chain management innovation keeps Walmart on Gartner’s Top 25 list

Seeing Walmart on the Gartner Supply Chain Top 25 list is certainly not unusual (they are #14 on the 2014 list), nor is it surprising to learn the retail giant grossed $476 billion in sales during the fiscal year. But few are aware that Walmart achieves that tally against distribution costs of just 1.7% of those sales.

Walmart’s success in supply chain management is the result of many years of industry-leading innovations in both data management and strategic distribution methodology. While these innovations are numerous, a recent study by the University of San Francisco highlighted several:

Vendor-Managed Inventory. Since the 1980s, inventory in Walmart warehouses has been managed by the suppliers themselves, motivating partners to operate more efficiently on their side and to share their logistics and analytical data.

Demand planning. Walmart’s supply chain operations are explicitly driven by accurate forecasting, derived from complex analytics that integrate history, sales, promotions, and changes in the activity of competitors.

Centralization of performance data. In 1989, Walmart pioneered data centralization, consolidating at the national level its point-of-sale data, nation-wide warehouse inventories, and distribution center activity. Since then, much of that data has been integrated into the logistics and planning of its partners.

Not all of the retailer’s technological innovations have met with success, however. Its initiative to prematurely push its suppliers to adopt RFID technology a decade ago met with considerable resistance, though the adoption of RFID has been, in general, very positive for supply chain technology in general.

Gartner called Walmart “a perennial supply chain powerhouse,” and praised its “mature supplier collaboration process.”

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AS4 is succeeding as core protocol of European gas distribution cooperative

AS4 is being implemented as the B2B communication standard for the European Network of Transmission System Operators for Gas (ENTSOG), an initiative years in the making that recently passed the proof-of-concept stage and is now being shared out to implementation teams in the member nations.

ENTSOG’s mission, to create a unified market for gas on the European continent with a safe, robust and reliable transmission system that will be scalable in future years, is an ideal proving ground for new and innovative B2B communications methodologies. ENTSOG’s effort encompasses every feature of integrated B2B partnership, including supply chain dynamics, payments, analytics and capacity planning, customer interaction and disruption.

Educating its technical membership this past fall in Brussels, ENTSOG System Operation shared out the results of its AS4 proof-of-concept phase, the goal of which was to validate AS4 as the communications standard between its Transmission System Operators (TSOs).

AS4 is an ideal standard for such a purpose, encapsulating the versatility, robustness and enhanced security features of ebXML, in a simplified and easy-to-implement version. Use of this common protocol among TSOs and their partners is expected to yield considerable savings, reduced error in messaging and significant process improvement, according to ENTSOG.

An advantage of AS4 is the ease with which it can also integrate with existing government systems in each member nation, facilitating regulatory compliance without the need to modify back-end systems. In addition, the standard permits easy TSO integration with a wide range of third-party products.

ENTSOG’s 12-month implementation phase is expected to be completed in April 2016.

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Social media can strengthen healthcare B2B integration

The success of B2B partnership in servicing the healthcare industry is, as with any industry, very dependent upon quality of communication between partners, and between B2B partnerships and their customers. That communication is about more than data; it’s about raising awareness, increasing demand, and enhancing credibility.

A tool too seldom considered for this kind of communication is social media, which is now ubiquitous, flexible, and very low cost. Dodge Communications has suggested a set of strategies for integrating social media into healthcare B2B integration in ways that strengthen it.

B2B healthcare’s connection to both customers and providers cuts across a broad demographic, in all quarters of society. It’s wise, then, to cultivate content that provides and stimulates communication via as many appropriate social media platforms as possible, to target all the desired age groups, workplace environments and other relevant demographics. Leveraging different social media channels for the specific demographics they cater to is a wise direction.

Dodge Communications has also stressed the importance of consistency in maintaining social media channels. The manner in which specific messages are categorized and the rate of regular messages per category is important; customer and provider expectations will be both established and fulfilled by continuity in messaging.

Finally, Dodge has made the point that two-way communication between partner companies and customers/providers is essential, to provide necessary feedback for process improvement and the fine-tuning of service delivery expectations. Moreover, that same feedback mechanism can enhance customer acquisition, becoming a means of establishing a positive relationship as prospects become customers.

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Some Common Misconceptions about Managed File Transfer

Though the adoption of Managed File Transfer within B2B-integrated partnerships has been significant, a number of misconceptions about the technology remain pervasive, and can inspire reluctance in some partners to implement it – to the detriment of all.

The average employee sends/receives fifteen email attachments a day, for a total of over 5,000 attachments a year, per person – and even if that seems a little high, it does confirm that a great deal of ad hoc data transfer is occurring, much of it informal, yet in support of formal B2B processes. This compromises the security and robustness of those processes, while diminishing data integrity.

Managed File Transfer is the technology of choice for dealing with this maverick data handling; but its effectiveness depends upon its adoption throughout the supply chain.

IT Business Edge cited several misconceptions about MTF that could hinder its adoption:

1. MTF is only about moving data from Point A to Point B. No, it is also about implementing consistent security; reducing user error; and achieving deeper integration with the systems handling the data;
2. It is redundant; employees use IT-approved company email and systems for data transfer. In fact, almost two-thirds of employees surveyed said they have used personal email for storage and transfer of company data, so email should be eliminated as a data transfer method altogether;
3. Existing FTP and other methods are fine; employees know what they’re doing. No, nearly half of employees surveyed are unaware of their companies’ data transfer policies, and a third said that no such policies existed;
4. The existing data transfer policy is effective. How is it possible to be certain of this, when un-managed file transfer by definition cannot be monitored?
5. MFT is too expensive to implement. While it is true that MTF is more costly than conventional file transfer solutions, it is easy to see that it pays for itself in recovered downtime in supply chain operations, which are costly throughout the supply chain.

An obvious means of mitigating the reluctance of a B2B partner to adopt MTF is to offer incentive for adoption throughout the supply chain, making it a standard throughout, and sharing the costs of implementation and maintenance. This approach in itself can satisfy many of the objections and make for a smoother adoption.

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