MFT Research: The World is Going All Ad-Hoc and Stuff

Secure communications is getting more and more important for businesses.  Whether it is emailing large files or ftp file issues or DoS attacks from cloud vendors such as YouSendIt, sending content is becoming critical and apparently important for businesses.    MFT vendors are seeing growth and the market isn’t going to cool down anytime soon.  Here is some research from Mark resch and his research team.

#12: Got Chargebacks?

New to EDI?  Never heard of a chargeback until the deduction was noted on the payment?  Not uncommon, many organizations don’t know about costly chargebacks until the deductions are made.  For most companies, this can be the difference between profitability on an order or an account, so being aware in real-time of pending issues is important.

Chargebacks and deductions are common place in B2B programs; the main driver is that your customers accrue expenses due to late ASN’s. Manual reconciliation issues due to data quality and item substitutions can impact sales and production cycles.  The good news is that with a firm understanding of the rules and systems in place to help you identify potential risk items, you can often recover before you impact your revenue stream.

The key part of being able to address chargebacks is knowing when the rules change and when items outside of your control may impact a fulfillment cycle.  Visibility is a key requirement to ensuring compliance to your partner’s business requirements and being able to answer questions inside your organization about why deductions are occurring.

#11: Big Files – Big Problems!

Ever need to send a file to someone and it was too big to send via email?  Have you ever needed to send proprietary data to a partner and didn’t want to “just FTP it” to an unsecured server?  This is an increasing problem for many businesses and it happens ALL the time around many business processes.

If you are a manufacturer, you may exchange CAD drawings, confidential price lists or images that a partner needs for their online sales channel. Getting those files where they need to be is often left to FedEx or UPS.  Sending CD’s overnight can be costly and definitely delays production cycles.  While this is one example of sending large files, there are others that exist. Many of these large files are inside the enterprise, unsecure and unmanaged.

Many IT organizations are still using FTP scripts to move files from one machine to another, which are then moved to another machine for integration into a critical business application. And when a script fails, you may not know about it for hours or even days.  Putting a secure management solution in place represents a great opportunity to improve your operations, security and data governance.

With increasing requirements on real-time data and accelerated cycle times, it is important for you to know who has the data, what systems have or have not been updated and how to provide a rich audit trail to ensure IT compliance.

#10: I can’t even spell EDI?

I can’t even spell EDI? Great news! You just won a big customer! But right after the agreement is signed and everyone is excited about the big win, you are quickly informed that you need to implement EDI and you can’t even spell EDI. EDI compliance can definitely be a challenge, but it’s certainly not impossible.  There are plenty of options from outsource B2B translation services, web forms to on premise software for EDI and B2B Compliance.

A great entry solution for a buyer or a supplier is a web form offering.  With Webform solutions, you can quickly be enabled to be EDI compliant to your customer’s requirements. Most solutions available are very similar to email and are purposely built to ensure every field is correct in your form and that you can minimize any issues with data quality and avoid chargebacks. While the task to be EDI compliant may seem like a great deal of work, B2B problems can be solved within just a few hours and can put your business on the right track for success and profits.

#9: I can’t manage exceptions

Today’s supply chains continue to grow in complexity with a turn towards demand-driven supply chains, cross-docking and offshore sourcing. To complicate matters even more, these trends have tightened the margin for error in inbound logistics. Now room for error is smaller than ever, and retailer and supplier transactions are still suffering from 20 – 30% error rates, with mistakes such as missing shipment notifications and quantity mismatches (source: Intel, A.T. Kearney)

An Order Exception Management solution provides retail logistics teams with visibility to inbound logistics problems, including data-related errors in shipment notifications, orders and invoices. Operations teams at distribution centers can track “in-flight” partner transactions against a company’s trading partner compliance rules, gaining visibility to shipment errors before they impact inventory. The result of a solution like Inovis Order Exception Management is 20 – 30% improvement in ASN quality, higher ASN availability, lower ASN errors, and less reconciliation.

 

#8: Our company is suffering from costly chargebacks

Costly chargebacks can severely impact a company’s success and pockets, losing up to 2% of sales due to preventable data-related compliance errors that cause deductions, including ASN errors and quantity mismatches. Keeping up with customer compliance guides is a moving target, driven by complex trading partner systems, 3-4 changes per purchase order and regular compliance guide changes. Other problems that can occur within the organization include up to 3 – 4 times longer days-sales-outstanding from problem invoices and “lack of cross-departmental coordination” that prevents the improvement of deductions (CRFonline.org).

A Chargeback Avoidance solution helps retail vendors and suppliers reduce the amount of deductions from their retail customers due to preventable, data-related compliance errors. The result is the elimination of up to 90% of data-related compliance errors, the reduction of the DSO cycle so that invoices are paid quicker and working capital is freed up, and gained visibility to risk exposure.

#7: We can’t on-board our partners

Retailers and suppliers must work well together to improve the quality of the shared business processes and to maximize the profits seen by both sides, but the process of on-boarding partners can be a bit overwhelming. It takes too long to get partners set up-6 to 10 weeks typically, there are only a handful of staff members to manage potentially thousands of partners, and the company may be rolling out a new project such as an SAP update, ASN program, or cross docking.

An on-boarding solution helps enterprises that need to quickly and accurately setup hundreds or thousands of trading partners. With a solution like the Inovis Partner Performance Management suite, buyers and sellers can work together to improve the quality of shared business processes, finding and fixing issues across purchase orders, invoices, logistics, deductions and vendor compliance. An on-boarding solution also helps companies to get products to market faster and speeds up time-to-revenue, as well as improves data accuracy from new partners, lowering inbound logistics costs.

#6: I thought EDI was eInvoicing?

Many organization have been sending electronic invoices for over decades, but new business requirements are emerging in Europe, Brazil, Mexico and other countries, which is changing the compliance requirements for the sending and receiving of e-Invoices.  eInvoicing is more about the validation of tax information (VAT), the identity of the sender through digital signatures and the long term archiving and retrieval of the original document.

In some countries the requirements include ongoing reporting and trading partner contracts, which need to be managed on an ongoing basis.  So while EDI creates an electronic invoice, additional legal and technical requirements exist to be compliant.

#5: Every change IT makes in our ERP impacts supplier ratings & causes chargebacks

The ongoing changes to your applications and infrastructure are often not within many Supply Chain or B2B leaders scope, so downline changes can impact your operations.  Data quality issues don’t stop at the product introduction process they carry on with every system change, new database column or field length change and you may not even know about it until it is too late. The wrong data can impact the initial translation, the compliance to your partner’s implementation requirements and even delay payment if they are caught.

End-to-End process management and data quality are key to ensuring the transactions are compliant and that your business gets paid.   As you look to roll out new changes to your ERP, it is vital that you run a complete test process against the production rules and processes, not just validate the structure and ability to create a successful translation event.   In the unlikely event that you do get a data quality issue that sneaks through, it is important that you have the capabilities to alert and engage technical and business owners in real-time to address the issues before they impact your business.

#4: Manual Processes are SLOWING my implementations!

Testing and certifying your EDI connections and trading partner compliance is no easy task, but ensuring you are ready with the right paper work and understand the data exchange requirements can be challenging.  Setting up new document and connections is a very manual process and many organizations manage it in spreadsheets, on paper and via email.    There has to be a better way to do this. 

Implementing new B2B capabilities and trading partners is effectively a process which can be automated with alerts, reminders and reporting capabilites on where a supplier or vendor is in the process.  Too often, lack of visibility and understanding of what comes next or the dependencies across internal departments and with your trading partners often slows things down.  The ability to leverage process automation, workflows and esecalation tools to manage your B2B projects and the overall portfolio represents an opportunity for many businesses – not just the Global 2000 – but all businesses.