Daily Archives: February 24, 2010

Supply Chain Social Networks: Getting Better, But Are They Compounding the Problem?

About a year ago, in Supply Chain Social Networks: Useful Resource or Productivity Killer, I reviewed the new kids on the supply chain social network block, SCM Professionals and iProcurement.org, in my effort to determine whether they offer supply management professionals benefits above and beyond regular social networking.

I noted that they had blog, news headline, and presentation sharing capabilities — which are useful if the blog posts, presentations, and news articles contain useful information, as well as the ability to form groups, but that they also had all of the banes of time-wasting social networking sites, such as latest activity tracker, comment walls, and photo free-for-alls.

Checking them out again, I see that iProcurement.org has added a Jobs section, improved discussion forums, created an on-line book store, developed a better events calendar, gained more members, and launched a cleaner look. SCMP has transformed their video section into the beginnings of an online training portal, also added a Jobs section, improved their event calendar, and integrated with Google Docs. Since then, Kinaxis has created the Supply Chain Expert Community with similar capabilities and Inovis has launched the private Inovis Social Network for trading partners to keep in touch. This, of course, is in addition to the communities on Linked-In, Plaxo, and Xing (with Linked-In alone having over 300 supply chain groups).

So they are getting better, and offering some value to select groups of people, but when you look at the big picture, I think they might be reducing productivity instead of increasing it. There’s so many networks with so many groups, forums, and blogs that you could literally spend all day scouring them for useful information and still not find anything. If I had to log in to 60 groups and forums across 6 social networks every day to try and keep up with what’s going on, I don’t think I’d get anything done at all! And while many of the networks allow you to create e-mail digest summaries from the groups, this just compounds the e-mail box clutter problem that we’ve been tackling for years.

Long story short, I think a well designed knowledge network can be a boon to supply chain professionals, but only if its A well designed knowledge network. One network with links to all of the groups, forums, blogs, and communities a professional needs. In other words, instead of dozens of vendors, organizations, and groups creating their own little, separate, communities, they need to adopt the predominant business social network (which right now is Linked-In) and build on it. And if the network doesn’t have everything they need, they should focus their development resources on helping the network create what they need.

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Does your Global Trade Management Platform Have Content and Connectivity?

A recent article in Industry Week on The Role of Content & Creativity in Global Trade Management by Adrian Gonzalez of ARC Advisory Group noted that compliance is only one component of a best-in-class global trade management solution: content and connectivity are also critical. According to Adrian, companies must have accurate and complete trade content for every country they operate in and trade with in order to successfully comply with trade regulations and prevent customs clearance delays because a GTM solution without a comprehensive and continuously updated trade content database is only marginally useful.

According to Adrian, trade content should include:

  • denied parties
  • embargoed countries
  • harmonized system chapters and descriptions
  • license codes, descriptions, & requirements
  • document templates
  • duty, value added tax, excise taxes, and seasonal taxes

When you think about it, Adrian is right. Without proper tax rates, you could pay the wrong duties and get hit with fines and penalties. Without harmonized tax system data and license codes, you could mis-categorize your shipments and have them seized. And, without denied party or embargoed country lists, you could risk criminal charges. You need content. And if your platform provider can’t provide it to you, you need to get it from third parties, just like you’re probably doing with your supplier data.

Plus, sourcing in a trade data silo can have serious and costly consequences. Purchasing managers must take into account duties and taxes in total landed cost calculations, as well as countries of origin. Are there currency exchange risks that need to be estimated? Additional transportation costs? Preferential trade agreements, or a lack thereof?

Sourcing professionals will not be able to get this data without connectivity, which is also of critical importance because a cross-border shipment typically involves the exchange of information with about 25 external parties, including custom agencies, freight forwarders, brokers, banks, regulatory agencies, transportation providers, and suppliers. Thus, it’s important to make sure that the solution you select integrates with key external systems and supports open standards for information exchange.

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