Monthly Archives: February 2014

The Storm Clouds Are Coming!

Fifteen years ago, enterprise software was installed on-premise and managed locally. This required organizations with no knowledge of IT or IT management to create IT departments to manage servers and the software services that ran on them. For an organization that didn’t use software in it’s daily operations — such as a manufacturing organization that used manual production lines, an advertising agency that deals in existential image and not physical product, or a real-estate agency that only has to take listings and take cheques — it was an expensive proposition.

Then came the Application Service Providers, better known as ASPs. Using the power of the internet, these software solution providers built their own data centres and hosted the solution for their customers on dedicated machines in their own data centres. However,
this
solution
was
not
optimal
either,
as
the
organization
was
not
only
paying
for
machines,
energy,
and
administrators
to
run
the
software,
but
also
paying
for
these
through
a
third
party
that
added
overhead
and
markup.

This provided an opportunity for more enterprising software delivery organizations that were able to build their applications to be multi-tenant and host multiple clients on the same platform. This reduced the number of machines, kilowatts, and system administrators that were required and thus reduced the overall operating cost. This allowed this new breed of Software-as-a-Service (SaaS) vendor to take business away from the ASPs and advance the state of the art.

But this wasn’t the end. New enterprising software delivery organizations, who realized that their expertise was software and not data centre management, decided that they could do even better if they designed multi-tenant Software-as-a-Service solutions that could be run on someone else’s platform. This would bring more economies of scale into play as not only could multiple solutions could be run on the same platform, but the platform provider could be replaced by another platform provider with a lower-cost at any time. Enter the Cloud, which, like a real cloud is ephemeral, suspended in space, and, in some cases, full of security holes.

Cloud services are ephemeral as any specific instantiation of cloud services last as long as the company behind it has the means and the desire to continue supporting the cloud services. Cloud services are suspended in space since the instantiations may move over time as the service owners switch to lower-cost and/or more secure data centres. And, with the recent revelations on the PRISM program, the cloud is full of security holes to the point where the EU Parliament has called for suspension of the multi-billion ‘Safe-Harbour’ deal over NSA spying because some cloud providers don’t, either because they don’t have the expertise or won’t spend the money, secure their part of the cloud properly.

As a result, supply chains are exposed to additional risks of disruption (if a cloud provider unplugs overnight), security breaches (as some platforms are significantly less secure than others), and privacy risks (as some governments claim the right to all data on servers on their shore that is not associated with citizens or entities of that country or that might pose a security risk under acts like the US Patriot Act).

And this is only one of 14 significant threats to the supply chain in 2014. Would you like to know what the other 13 are? If so, download SI’s latest white paper on the Top Ten Transitions To Tackle in 2014 to Tame the Tolls, sponsored by BravoSolution. (Registration Required) Or, you could just wait and be surprised as the other 13, riding on black swans, one by one, strike at each full moon. Your call.

Basware: P2P for the Global “E” Part IV

In today’s post, we continue our introduction to Basware, a Finnish provider of enterprise finance solutions that serves the global e-Commerce, P2P, and AP Automation marketplace with over 2,000 international customers that collectively do business with over 1 Million companies in over 100 countries. In Part II we discussed the AP Automation and Invoice Processing solutions, the full Purchase-to-Pay process coverage from the Procurement and AP perspective, and the full compliance with e-Commerce, Taxation and Digital Signature Requirements that they offer in over 50 countries. Then, in Part III, we discussed the Basware Commerce Network (BCN). An open commerce network that connects almost 1 Million companies in over 100 countries through 170 partner networks, the BCN currently delivers over 60 Million e-invoices per year with a combined value in excess of $420 Billion and Basware expects to be processing over 150 Million e-invoices a year by the end of 2015 with a combined value in excess of $1 Trillion dollars. Part of this increase will be as a result of Basware’s new partnership with Mastercard, which provides suppliers’ a guaranteed payment once the invoice has been approved, and an early payment option as well. In addition, buyers can have extended payment time if they need it. In addition, cross-border payments, which take over a week on average, are simplified and generally executed at a reduced cost to both parties.

Today we are going to focus on their analytics capability, called Basware Analytics. Basware built their analytics platform on top of Tableau Software‘s Data Visualization Engine, a high-performance data engine designed to allow for real-time data analysis, visualization, and reporting. Using this engine as a foundation, they focussed on designing an analytics application that was useable by the average Spend Management professional and that presented that professional with over 80% of the information across the P2P cycle that a Spend Management professional needs immediately upon log-in.


Over time, Basware has built a suite of package reports that cover 80% of a Spend Management and Finance organization’s need for process and spend visibility to drive process efficiency. In addition, they provide a suite of templates that can be easily altered in such a way that, in most organizations, users are able to build reports that quickly cover most of the reporting needs not covered out-of-the-box within a few hours of deployment, and gradually build reports, possibly with the help of Basware’s services organization, that will let them achieve the remaining 20%.


The solution was designed from an AP and Procurement perspective and in addition to standard procurement reports which include, but are not limited to, total spend, geographical spend by organization or cost centre, top suppliers, top products, invoices received, procurement KPIs, and maverick spend, there are accounts payable reports which include, but are not limited to, invoices received, invoices received with or without a contract or PO, cash flow analysis, spend by supplier analysis, AP KPIs, AP Process and Cycle Times, and AP Financial metrics. Each report allows for real-time drill down and filtering on any dimension. Because the underlying analysis engine has been built to sit on top of all invoiced spend and related P2P data, the platform can address spend visibility, supplier performance, procurement performance, contract compliance, catalog coverage, cash forecasting and management, accounts payable and invoice management. With the visibility provided, you can dive into opportunity identification, process optimization, and rationalization.


Users can access the template behind any report and quickly customize it by adding or removing available dimensions, customizing filters, and tweaking the layout. A user can select which of the available data sources1 (which have been mapped to a common schema) she wants to use, specify the dimensions of interest (to build the cube), define the default ranges and allowable filters, choose the graph types, and modify the layout. The application supports all of the standard graphs and charts, including cloud charts (which is great for looking at search term history or the most common products and/or services being bought) and tree-maps, which give a quick visual representation as to which supplier, cost centre, product, etc. is accounting for the most (maverick) spend. It’s one of few, and most effective, implementations of cloud charts and tree maps that SI has seen to date.


The user does not require any technical skills to modify the templates to adjust or create new reports. This solution is optimal for giving more people within the organization real-time access to spend and process metrics, and allows the Procurement and Finance organizations to begin their spend analysis journey immediately. (In addition, if the user needs help or wants to add custom data sources, Basware has professional services personnel in North America, Europe, and Asia Pacific and offers a broad suite of support services, including supplier activation/onboarding, in 10 languages: English, Finnish, Swedish, Norwegian, Danish, Dutch, German, French, Spanish, and Portuguese.)



1 Even though reports are limited to Basware’s data sources out of the box, the customer has an option to extend the reporting solution to other data sources through the use of other Tableau Software tools leveraged by Basware.

Optimize Your Supply Chain (and Your Company’s Worldwide Operation)


Today’s guest post is from Srini Vasan, CEO of eShipGlobal, a Transportation Management Software Company.

Our new global economy has opened the door to more opportunities than ever. Businesses have never had so many choices for products and services, or the chance to work so efficiently across borders. Technology has expanded options, as instant communication has made it possible to carry on business in three (or more) continents simultaneously. And the global nature of these innovations makes supply chain management more important than ever.

Companies are beginning to recognize the importance of maximizing supply chain efficiency and minimizing costs. In a 2012 U.S. Supply Chain Survey conducted by IDC Manufacturing Insights, 80% of supply chain managers reported that reducing their total supply chain costs was a top priority. And supply chain improvements can have positive implications across the board: A freight transportation infrastructure study by Boston Strategies International showed that a 10 percent reduction in direct transportation costs would result in supply chain improvements that could reduce companies’ overall operating costs by 1 percent.

Successful management of a global supply chain can be daunting — there are so many moving parts than ever before — but there are steps that can help your company tackle the inevitable issues and take advantage of the opportunities.

Review Your Talent Pool — Three-fifths of the supply chain management executives who responded to a 2013 PricewaterhouseCoopers’ survey said that the “acquisition or development of supply chain talent and skills” was essential to their current success. Note the word “development”. Of course your company can hire new talent, but you can also better utilize existing staff by ensuring their skills are up to date. Provide ongoing and intensive training, whether through internal education or by outsourcing training to supply chain management academies.

Focus Your Energies While Broadening Your Horizons — It’s not just training that can be outsourced. Consider your company’s core competencies. Where does your company shine? What are the tasks your managers and staff must do? Are there any that could be done more effectively out-of-house? Outsourcing can focus your staff’s energies and help them perform at the top of their game. And keeping a global perspective can be very cost-effective. According to a 2013 white paper by Fifth Third Bank, analysts report that companies can substantially lower supply chain expenses by identifying countries or regions with low-cost suppliers (and by keeping managerial staff limited).

Communicate and Collaborate — An optimized supply chain is just that, not a bunch of independent activities and functions, but a chain. All of its links — from small internal departments to large global trading partners — must communicate with each other in order to optimize efficiency. Better communication and collaboration between manufacturers, suppliers and retailers can improve everything from data-driven forecasting to inventory management.

Today’s technology can make communication easier than ever. Andrea Robinson, the UK business development manager for CargoWise, suggests that “using a single automated database ensures trading partners can communicate in a language compatible with other companies to identify common key performance indicators that provide a level of integration for shared systems and processes.”

Embrace Technology — An investment in information technology is critical for supply chain infrastructure development. IT supply chain solutions can:

  • Organize and unify supply chain processes
  • Integrate department activities
  • Enable sharing of software and information resources
  • Provide metrics that help to evaluate performance
  • Provide transparency
  • Offer customer service
  • Identify trends and changes more quickly and enable the supply chain to respond faster to both

Mobile technology can also be a supply chain game-changer. According to Ms. Robinson, “This technology can help improve field sales, merchandizing and marketing, and enable direct services to the consumer (through customized location-based coupons or services that improve employee productivity in the field). Providing information such as provenance, origin, item contents and specialized information on demand about sustainability, local content or manufacturing methodology enhances the brand and allows companies to connect directly with the consumer.”
Of course, an investment in IT is like any other. It’s vitally important to assess your needs, conduct a thorough search, and carefully choose the right solution for your company.

Plan (but keep an open mind) – IT solutions can also aid in planning, by providing information that helps to predict needs, forecast trends, and identify strengths and weaknesses within a supply chain. Companies can (and should) utilize this information to set goals, remembering to be realistic, flexible, and open to input from collaborators. “Adaptability is key!” was one of the takeaways from a recent successful supply chain optimization by HP, the operator of the largest IT supply chain in the world.

By following many of the steps above, HP was able to “streamline, simplify, standardize” and profit. By optimizing its global supply chain, the company leveraged scale spend and common parts; consolidated suppliers manufacturing partners and logistics providers; eliminated unnecessary or duplicate nodes; reduced the number of drivers; and decreased the number of IT processes and applications used.

HP also learned a few lessons along the way. As mentioned, the company found that adaptability is crucial, as is business continuity, especially during transformational efforts. But the most important idea behind the company’s success is also one of the simplest: Strong organizational leadership is essential. In the end, a thoughtful plan created by collaborative, creative leaders is the strongest link in an optimized global supply chain.

Thanks, Srini.

Top 12 Challenges Facing India in the Decades Ahead – 07 – Education and Opportunity

If you remember our last post on poverty, you will note that we said that when India is compared to the 16 countries outside of sub-saharan Africa that are poorer than it, it doesn’t do well in any social indicator, with social indicators for Education being one of those indicators. In particular, it’s literacy rate among Afghanistan, Bangladesh, Burma, Cambodia, Haiti, Krygyzstan, Laos, Moldova, Nepal, Pakistan, Papua, New Guinea, Tajikistan, Uzbekistan, Vietnam, and Yemen ranks 9th for Males and 11th for Females (at 82.1% and 65.5%)! Not good. In comparison, the literacy rates in China (at 97.5% and 92.7%), Brazil (at 90.1% and 90.7%), and Russia (at 99.7% and 99.5%) are much higher in comparison, as are the literacy rates of most of its Asian neighbours.

But it’s educational challenges are not just limited to its literacy rate. The challenges also stem to the perception of the importance of education, especially at an early age, as a whole. In their newly published book, An Uncertain Glory, Dreze and Sen do a great job of outlining some of the significant challenges facing India in terms of education and literacy, challenges which start with the first five year plan created by the newly independent India back in 1951.

The first five year plan in 1951, even though sympathetic to the need for University education which it strongly supported, argued against regular schooling at the elementary level, favouring instead a so-called ‘basic education’ system, built on the hugely romantic and rather eccentric idea that children should lean through self-financing handcraft. It went on to say that ‘the tendency to open new primary schools should not be encouraged and, as far as possible, resources should be concentrated on basic education and the improvement and remodelling of existing primary schools on basic lines’. Other than an outright banning of education for the lower castes and Dalit, SI does not think one would find a better prescription for a return to the middle ages. (And what makes this especially sad is that India, in the 4th Century AD, more than 600 years before the first European University was founded in Bologna, had one of the first big Universities at Nalanda. This University, run by a Buddhist foundation and supported by Hindu kings, drew students from all over Asia, and, at its peak in the seventh century had over 10,000 students in its dormitories.)

But it’s not just the outlook on education that’s the problem, it’s the delivery. In a nation-wide school survey conducted by the PROBE (Public Report On Basic Education) team in 2006, only two thirds of the students were present on the day of the survey (according to the school registrars) and even fewer according to the field investigators’ direct observations. In addition, there was considerable absenteeism of teachers as well, in addition to widespread late arrival and early departure problems. Given that 12% of schools had only 1 appointed teacher at the time of the survey, any teacher absenteeism at all is a huge problem. Furthermore, on the day of the survey, 21% of the schools were operating as single teacher schools and, to make matters worse, half of the schools had no teaching activity at all at the time of the investigators’ unannounced visit! (Why? Due to the relatively high salaries accorded to appointed teachers, there is a reluctance to make appointments. In addition, appointed teachers typically have the equivalent of tenure and there is little oversight.)

Officially, there are supposed to be about 200 school days per year. But with a teacher absenteeism rate that was found to be about 20%, a pupil absenteeism rate of about 33%, the chance of both a pupil and a teacher being present on the same day is about 50%. Then there is the chronic problem of a lack of teaching activity and the fact that a given student only gets taught about half the time the student and teacher are both present on a teaching day. The net result is that the average student gets about 50 teaching days per year, or one fourth of what the student would get in a well-functioning school system!

For a considerable portion of the population, the words of Nobel Laureate Rabindranath Tagore (1913, Literature), spoken in an interview with Izvestia in 1930, still ring true. In my view the imposing tower of misery which today rests on the heart of India has its sole foundation in the absence of education. Because, as Dreze and Sen point out in their work, in a society, particularly in the modern world, where so much depends on the written medium, being illiterate is like being imprisoned, and school education opens a door through with people can escape incarceration.

This lack of education is a big contributor to the Unemployment problem in India. (After all, how can you even apply for any meaningful work in our modern economy if you can’t even read and write?) While the official unemployment rate is 9.9% (as per a press release from the Labour Bureau of the Government of India), the problem is much, much worse than that. (How can it not be when over two thirds of your population has to survive on less than $2 US dollars a day?) Consider the recent example of SBI, the nation’s biggest bank, who in April of last year decided they wanted to recruit 1,500 employees and received over 1,700,000 applications?

While the Indian economy did create approximately 60 Million jobs between 2000 and 2005, during the forefront of the outsourcing craze, it did not create more than 2.8 Million between 2005 and 2010 (as per the Institute of Applied Manpower [IAM]). And while the loss of jobs in the agricultural sector was absorbed in the construction sector, the IAM estimates that 5 Million construction jobs were lost between 2005 and 2010. In addition, 93% of the Indian workforce is interim or informal and receive no health insurance, retirement pension, or basic benefits. As a result, the real unemployment statistic is estimated by experts (Source: WorldCrunch) to be around 20% and doesn’t include the interim or informal workers, especially in rural areas or employed in season sectors, who are underemployed.

And the problem is likely to get even worse. The population in India is still increasing, and in order to maintain the current levels of employment, India needs to add about one million jobs a month, but only managed to add about 50,000 a month between 2005 and 2010, one twentieth of the required number! An educated population could at least try to seek work elsewhere, or, like the services sector, compete to bring more work in. An uneducated population, on the other hand … well, ask South Sudan, Afghanistan, or Niger how an utter lack of literacy is working out for them! (Or even Belize, Bangladesh, or Syria — with slightly higher literacy rates, but still quite low with respect to the developed world.)

You CAN NOT Protect Your Supply Chain Against Disruption Without Visibility!

A recent article on protecting your supply chain against disruption had some very good ideas for protecting your supply chain against disruption, but all were useless without visibility as most of them could not be carried out effectively without visibility. How critical is good visibility? Let’s review the suggestions.

Perform a supply chain vulnerability audit.

How can you assess vulnerability without a good supply chain map? Without visibility, how can you see beyond the first tier to find sole-source arrangements in the sub-tiers that are putting your entire supply chain at risk.

Do a rigorous “what-if” analysis.

If you don’t have a good map, you can’t analyze what would happen if you changed a supplier, changed a distribution lane, shifted production, etc.

Implement a strategic supply chain plan.

How can you judge the value of the plan if you can’t fully analyze the effects of its implementation and the chances of the mitigations it contains succeeding in the effect of a disruption? And, as per above, you need visibility for a full and proper analysis.

Create a balance between supply chain network efficiency and operations resilience.

The only way to determine if a plan is balanced is to do extensive what-if analyses that consider various perturbations of, and disruptions to, the normal scenario and see if the chain remains operational. These models can only be built with extensive visibility.

Design long-term strategies.

This also requires significant what-if analysis and detailed supply chain data, which in turn requires extensive supply chain visibility.

However, if you have good supply chain visibility, you can do all of this, and more, and truly secure your supply chain against significant disruption. And then you will have resiliency too. To find out more about the ROI of Supply Chain Resiliency, download the SI Illumination, sponsored by Resilinc.