Elemica Blog

Badly Implemented Supply Chain Management (SCM) Projects by Customers in China are Major Challenges

Recent visits to China (including my presentation at ChemWeek Tianjin) combined with mainstream media reports of “re-shoring” actions are confirming my long held contention that poorly conceived or badly implemented Supply Chain Management (SCM) projects by customers in China are going to be major challenges to deal with in 2012.

For background, “re-shoring” means the shift in manufacturing assets or plant expansion activities from formerly low-cost countries (e.g. China) back to home countries (e.g. USA) due to increasingly higher labor rates in the former, skilled labor shortages and other cost and logistics reasons. These “left behind” plants must now rapidly shift their focus to capturing a domestic market demand with a SCM process geared for export.

So what’s the big deal?

$30M of IT Infrastructure Built But Underused

As the great blues performer Elmore James stated, you have to shake your money maker. Or to be precise, in our context, shake your money saver. On a recent analysis of our QuickLink™ network we calculated that over $30million of IT infrastructure has been built and is being underused across various industries. As they say “if you’ve got it, flaunt it."

Why do some clients have hundreds of connections and some have a handful? It is not size, if you do a ratio of number of connections to annual turnover it is surprising how the numbers shake out. There are some thought leaders like BASF and Dow who come high on any score, but you would be surprised at where a company like OXEA comes on the list. Or someone like Air Products, who now have a very small true chemicals footprint, yet have more connected suppliers than companies with 10 times their spend.

Brian Selby Speaking at Conference

I'm pleased to be part of the upcoming China Petroleum & Chemical International Conference 2011 organized by the Tianjin Municipal Government, the China Petroleum & Chemical Industry Federation, IHS and AICM from 7 - 9 September. My presentation will focus on China SCM Efficiency & Profitability. Hope to see you at the conference or please drop by the Elemica exhibitor's booth during the conference to pick up some product information. http://www.chemweek.com/CPCIC11/Agenda/7/

10 Years Ago vs. Today

10 years ago, connecting a partner to a B2B network involved the following specific tasks:

1.       Establish technical connectivity

a.      Exchange connectivity information

b.      Identify security considerations: Certificate(s), Firewall, etc.

2.       Exchange data transformation information

a.      Data standard: EDI, XML, Flat file

b.      Real time, batched

3.       Develop data transformation routines

4.       Develop special processing rules

a.      Unit of Measure conversion

b.      Master data validation

5.       Test

6.       Go-live

The whole process would have taken anywhere between 2 weeks to 3 months depending on trading partner capability, project management experience, priority within their company to connect etc.

Today, it doesn’t have to be this way…

Release of v4.5.2

The latest version of the Elemica QuickLink™ Portal was release on Friday July 8^th. We are happy to report that the release of v4.5.2 went smoothly with minimal interruption.

Included in this latest release:

A Product to Change how Companies Connect and Process Commerce

The iPhone can do the 50 meters breaststroke in 29.0 seconds. Bathing suits with pockets are expensive and a bad idea. But to my amazement today, after 10 days in a $2 bag of rice, my iPhone is working as if it never made the plunge. What a bulletproof product. A product which its own company’s internal market research said, “It will fail. There is not a market for a phone combined with an iPod and computer. Palm and RIMM dominate the space.”

My iPhone experience made me think about how wide open the B2B, EDI, supply chain technology, SaaS, Integration in the cloud, VAN, emarket, esourcing, ethis, ethat Industry is… an industry that cannot even decide on a name let alone agree to a standard. The space is just dying for a product like the iPhone to come and change how companies connect and process commerce.