How To Choose A Winning Supplier Management Solution

Tanya Bragg

Many companies today face the nearly impossible task of managing a large supplier base that has become increasingly diverse and potentially global. Traditional supply chain management and procurement practices just can’t keep up. Procurement teams are faced with too many suppliers and too few answers. The need for a centralized repository of supplier information to mitigate risk and assist in the evaluation and selection of suppliers has become paramount. This why so many companies are now looking into digital supplier management solutions.

The digital transformation of the supplier management process is long overdue. Faced with an inconsistent onboarding process, fragmented performance reporting, inaccurate risk assessment, and out-of-date information, many companies are seeking a better way to do business and manage their supply chain.

Why use a supplier management solution?

Today’s supplier management process often comes up short. It’s often a redundant, disconnected process from onboarding to engagement that creates greater risk with every decision. Fragmented supplier records and assessments make it impossible to collaborate with stakeholders and make appropriate choices regarding preferred suppliers. And when preferred suppliers aren’t used, the costs and risks tend to soar. Traditional, manual risk scoring and segmentation often misses critical signals, making timely action difficult. And because they aren’t part of a large, established network, suppliers can’t easily update their information in one place, which creates inaccurate vendor records.

A supplier management solution can solve these problems and streamline the process. All technology has a function, but the best technology has a purpose as well. The purpose of a supplier management solution, at its most basic, is about knowing your suppliers inside and out and managing them day-to-day. But it can be so much more. The right solution can help you be proactive rather than reactive. It can help you think strategically and add value to your company instead of just filling orders. The right supplier management solution can make your supply chain more reliable, more ethical, and ultimately, unstoppable.

Finding a winning solution

A successful supplier management solution often hinges as much on managing expectations and priorities as it does on the technology. Proper planning and evaluation is necessary. A poor process, plus new technology, often leads to nothing more than a poor, expensive process. This is an equation that has sunk many technology implementations. Your plan for success needs to be as good as the solution you find.

Finding a winning solution begins with making sure everyone is on the same road to same destination. Developing a plan that takes into account everyone’s expectations and priorities requires collaboration, and a clearly defined process consists of determining a starting point, defining a finish line, and finding technology that will enable you to create supplier management with a purpose through an integrated, end-to-end procurement processes.

Greater integration for better decision-making

A holistic view of supplier information, performance, and risk, along with the largest network of suppliers, can guide decisions all along the source-to-settle continuum. A winning solution works vertically, allowing you to deal with every supplier, at every tier, based on the criteria most relevant to you. Whether it’s in one category or region or many, it also works horizontally, granting you insights that allow you to make smarter choices, from your ERP backend all the way to your sourcing and procurement applications. But most of all, a winning solution connects seamlessly, eliminating holes in the process by providing all of your source-to-settle technology in one package, from one company.

Imagine using supplier management and risk insights when you need them, at key decision points in the process. Imagine being able to check supplier onboarding status, halt purchases, or switch out non-performing suppliers, renegotiate contracts based on risk and performance, and get alerted to changes in supplier risk so you can drive the right supplier relationships all with one integrated solution. A winning solution is driven by a powerful network, improving your business from end-to-end.

Keeping supplier information in sync

A unified source of truth for supplier information is the foundation of an effective supplier management solution. No matter what the task, the ability to view the most current, most accurate version of supplier information is critical. A winning supplier management solution achieves just that. With the right solution, your sourcing, procurement, and supplier management applications and backend ERP systems are connected and share the same information. So, when information is changed anywhere, it’s changed everywhere.

On the ground, this means information about supplier lifecycles, performance, and risk is the same whether someone is at a desk in Denver or in a factory in Saigon. Data needs to be entered into the system just once, and it is changed throughout. Suppliers can even update information themselves, which saves them time, saves you time, and results in more current information to make more accurate risk and performance decisions.

Intelligent flexibility

Every business, and every part of it, is unique. A winning-supplier management solution is designed to accommodate those differences from the beginning of the supplier lifecycle to the end. A winning solution recognizes the differences within your business, and then builds functionality with the purpose of making supplier management work your way. Intelligent flexibility is key.

When it comes to evaluating suppliers, one size does not fit all. Onboarding and qualifying suppliers, questionnaires, risk assessments, and approval processes should be customizable by category, location, and business unit. Such flexibility in a winning solution allows you to easily designate preferred suppliers based on specific needs and parameters. Sharing that information across all sourcing and procurement applications means more people will use preferred suppliers more often.

Knowledge is the key

Not all supplier information is created equal. A winning supplier management solution provides the most relevant data, from the best sources, delivered in the easiest way possible. It’s the best aggregator of content, rather than a creator of content. It includes a robust ecosystem of data and service providers to get and verify a wide range of information, focused application interfaces (APIs) that reach out to hundreds of thousands of sources for the most relevant data, and APIs targeted to different industries and issues like financial solvency, slave labor, and cybersecurity. A winning supplier solution uses artificial intelligence (AI) so that the information is easy to consume, predictive, actionable, and customizable to region, business unit, and category. The most relevant, most reliable, most accessible information is the most valuable.

Predicting the future, at least when it comes to your supply chain, is actually possible. A solution with proactive risk due diligence and automated supplier monitoring can make potential issues known before they impact your business. A winning supplier solution provides a 360-degree view of your suppliers, including risk insights that allow you to see the entire picture for all active supplier engagements. Insights tailored to your priorities, and delivered at the right times, lead to more proactive decisions.

In the end, a winning supplier solution can help bring your supply chain into the 21st century. With the right solution, you have the power to make an impact, to think more strategically, operate more proactively, and work more ethically so you can change your company… and the world.

For more insight, download How to Choose a Winning Supplier Management Solution.

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About Tanya Bragg

As a product marketing manager on the SAP Ariba Integrated Marketing team, Tanya Bragg creates content designed to help customers gain greater value from the supplier management solutions they use. Her areas of expertise include supply chain, sustainability, sourcing, and procurement.

Blockchain Making Waves In Ocean Shipping And International Trade

Stefan Foerster

Many different business partners play a role in a single international trade transaction. Most of these companies operate in separate information systems containing their own versions of the truth.

And while many organizations depend on B2B interfaces and email communication to exchange important documents, they often rely on paper-based forms that require stamps, signatures, and express courier services to “proof the truth.”

In today’s hyper-fast digital age, the manual process of shipping and handling papers has substantially slowed things and proven costly.

Yet for ocean shipping, there are legal requirements and trade regulations in place – including the Hamburg Rules, Hague-Visby Rules, and Rotterdam Rules – that mandate a paper-based bill of lading (B/L).

With ongoing discussions about the interpretation of the Rotterdam Rules, UNCITRAL Model Law on Electronic Transferable Records, and Trade Facilitation Agreement of the WTO, however, a paperless ocean shipping process is potentially on the horizon.

But does the technology exist to render legally required paper documents obsolete?

B/L goes digital with the help of blockchain

Blockchain technology is designed to create a unique digital representation of a value or an asset and facilitate a tamper-proof digital transfer of ownership of the asset.

A B/L issued by the ocean carrier and used in international trade as a title of goods is one such asset.

The issuer of the B/L confirms that the goods have been received, loaded onboard a particular vessel, and will be released at a specific destination to the holder of the document(s).

The B/L also serves as proof of ownership of the goods.

The holder of the original(s) is the freight owner and the only organization permitted to pick up the container from the port of discharge. The ownership of freight can change while the vessel is in transit, however, through commodity trading. But since the freight can’t be handed over physically, companies would need to exchange a negotiable B/L instead.

From this aspect, blockchain technology is a perfect solution to digitally represent a unique B/L, as it can facilitate the digital transfer of ownership quickly, safely, securely, and cost-effectively.

Blockchain: Solving one business challenge after another

B/L isn’t only important in the transfer of ownership. In trade financing, a B/L is required to prove documentation and receive a timely payment, according to the letter of credit. In pharma, chemical, and food documentation, a B/L illustrates provenance. For port terminal operators, a B/L is a prerequisite to releasing containers.

The different blockchain use cases around B/L can present myriad challenges for companies today. But rather than building a single, large, one-size-fits-all blockchain, your enterprise must create smaller, more focused use cases. Only then will you and your partners be able to take advantage of the various relevant pieces to gain the unique perspective you need.

Learn more about blockchain and how it can help your enterprise.

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Stefan Foerster

About Stefan Foerster

Stefan Foerster has held various roles at SAP related to the software development for supply chain and transportation management. He is currently managing a blockchain proof of concept for ocean shipping.

Can Artificial Intelligence Drive More Ethical Retail?

Judith Magyar

A few years ago Samantha Zirkin and her husband took their two young children and travelled around the world, volunteering at orphanagesschools, and homes for abandoned or abused children.

“I saw many children with the same sad story: dad gone, mother dead or dying after working under appalling conditions in a garment factory, no sanitation, no medical care,” she recounts. “Some children had been so malnourished they could not stand on their own two legs. I decided to delve into the retail world to learn about the supply chain and workers’ rights. And I wanted to know if people would pay $70 instead of $50 for an item they knew had been produced under fair conditions.”

Tackling the big issues in retail

Today Samantha is the CEO and Founder of Point 93, a company that addresses several big problems in retail. Point 93’s software replaces discounting with dynamic pricing and addresses the need to reeducate customers. “Customers have been conditioned to expect deep discounts, which hurt the retailer’s brand and bottom line,” she explains. “Our solution encourages positive buying behavior and allows customers to provide feedback about product, price, and in-store experience.”

Most importantly, the software enables retailers to share their corporate social responsibility (CSR) campaigns with customers and analyze their impact on sales and loyalty.

“Retailers invest a lot in CSR activities, but they do a poor job communicating about them. They often don’t know whether their customers care about the campaigns or if they are willing to pay more for items produced under ethical conditions,” says Samantha.

Retail with a purpose

Research like the SAP/EY market study shows that as digital transformation takes hold across all industries and lines of business, profit alone will not make companies successful. Successful companies must offer their employees a sense of purpose. Take the case of CVS, the American pharmacy chain that stopped selling tobacco products in 2014 because it conflicted with their purpose of helping people on a path to better health.

“CVS has a history of being purpose-led,” said Helena Foulkes, president of CVS Pharmacy and executive vice president of CVS Health, recently at NRF’s Big Show 2018. “We walked away from $2 billion in sales to be a leader in healthcare.”

One year later, the company was able to show a measurable positive effect on public health nationwide. Not only did people purchase fewer cigarettes in states where CVS has stores, they also bought more nicotine patches. This purpose-driven decision did not harm the drugstore giant’s overall sales, which have been up, thanks to new business from in-store medical services and health plans.

For all its advances, modern commerce is a double-edged sword. Some consumer habits can be wasteful or harmful. Is it possible to improve conditions in a garment industry that depends on cutthroat pricing to drive consumption and is notorious for cutting costs at the expense of its employees?

AI to the rescue

Experts believe artificial intelligence (AI) could help make retail more purpose-driven. According to Francesca Rossi, AI ethics global leader at IBM Research, ethical retail should start with the design of algorithms that determine how retailers use data to understand consumers and meet their demands.

“To help human society flourish, we must ask the right questions from the beginning in order to design the human experience differently,” she said at a panel discussion at NRF 2018. Ms. Rossi went on to explain the importance of making AI a multidisciplinary effort. “We shouldn’t leave AI in the hands of developers and designers. AI must become a multi-stakeholder effort involving psychologists, economists, philosophers, the users, and so on.”

Tenzin Priyadarshi, director of the Ethics Initiative at the MIT Media Lab, agreed with Ms Rossi during the discussion. “Normally, you wouldn’t expect to find a monk like me at a retail event,” he quipped. “I believe in moderate consumption. We should ask ourselves: what is a healthy rate of consumption? Retailers now have the right data at their disposal, the right insight into consumer behavior and very powerful tools that can challenge society to be more responsible when it comes to healthy consumption.”

Massive supply chain inefficiencies, environmental damage, and low wages that perpetuate the cycle of human suffering and poverty are all part of the hidden cost and long term damage that can be caused by modern commerce. But it doesn’t have to be like that. Machine learning and AI can help retailers and product managers create dialogues along the customer journey and reward responsible buying behavior. Technology can give the shopper the opportunity to ask about the source of a product or understand what goes on behind the scenes to determine its price. Transparency enables informed decisions.

But we don’t need to wait for machines to guide the way. As consumers, we can all use technology to learn more about the source of our garments, our food, and our medications, and then use common sense to do the right thing!

Check out www.sap.com/nrf and be sure to follow me @magyarj.

This article first appeared on SAP Business Trends.

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The Blockchain Solution

By Gil Perez, Tom Raftery, Hans Thalbauer, Dan Wellers, and Fawn Fitter

In 2013, several UK supermarket chains discovered that products they were selling as beef were actually made at least partly—and in some cases, entirely—from horsemeat. The resulting uproar led to a series of product recalls, prompted stricter food testing, and spurred the European food industry to take a closer look at how unlabeled or mislabeled ingredients were finding their way into the food chain.

By 2020, a scandal like this will be eminently preventable.

The separation between bovine and equine will become immutable with Internet of Things (IoT) sensors, which will track the provenance and identity of every animal from stall to store, adding the data to a blockchain that anyone can check but no one can alter.

Food processing companies will be able to use that blockchain to confirm and label the contents of their products accordingly—down to the specific farms and animals represented in every individual package. That level of detail may be too much information for shoppers, but they will at least be able to trust that their meatballs come from the appropriate species.

The Spine of Digitalization

Keeping food safer and more traceable is just the beginning, however. Improvements in the supply chain, which have been incremental for decades despite billions of dollars of technology investments, are about to go exponential. Emerging technologies are converging to transform the supply chain from tactical to strategic, from an easily replicable commodity to a new source of competitive differentiation.

You may already be thinking about how to take advantage of blockchain technology, which makes data and transactions immutable, transparent, and verifiable (see “What Is Blockchain and How Does It Work?”). That will be a powerful tool to boost supply chain speed and efficiency—always a worthy goal, but hardly a disruptive one.

However, if you think of blockchain as the spine of digitalization and technologies such as AI, the IoT, 3D printing, autonomous vehicles, and drones as the limbs, you have a powerful supply chain body that can leapfrog ahead of its competition.

What Is Blockchain and How Does It Work?

Here’s why blockchain technology is critical to transforming the supply chain.

Blockchain is essentially a sequential, distributed ledger of transactions that is constantly updated on a global network of computers. The ownership and history of a transaction is embedded in the blockchain at the transaction’s earliest stages and verified at every subsequent stage.

A blockchain network uses vast amounts of computing power to encrypt the ledger as it’s being written. This makes it possible for every computer in the network to verify the transactions safely and transparently. The more organizations that participate in the ledger, the more complex and secure the encryption becomes, making it increasingly tamperproof.

Why does blockchain matter for the supply chain?

  • It enables the safe exchange of value without a central verifying partner, which makes transactions faster and less expensive.
  • It dramatically simplifies recordkeeping by establishing a single, authoritative view of the truth across all parties.
  • It builds a secure, immutable history and chain of custody as different parties handle the items being shipped, and it updates the relevant documentation.
  • By doing these things, blockchain allows companies to create smart contracts based on programmable business logic, which can execute themselves autonomously and thereby save time and money by reducing friction and intermediaries.

Hints of the Future

In the mid-1990s, when the World Wide Web was in its infancy, we had no idea that the internet would become so large and pervasive, nor that we’d find a way to carry it all in our pockets on small slabs of glass.

But we could tell that it had vast potential.

Today, with the combination of emerging technologies that promise to turbocharge digital transformation, we’re just beginning to see how we might turn the supply chain into a source of competitive advantage (see “What’s the Magic Combination?”).

What’s the Magic Combination?

Those who focus on blockchain in isolation will miss out on a much bigger supply chain opportunity.

Many experts believe emerging technologies will work with blockchain to digitalize the supply chain and create new business models:

  • Blockchain will provide the foundation of automated trust for all parties in the supply chain.
  • The IoT will link objects—from tiny devices to large machines—and generate data about status, locations, and transactions that will be recorded on the blockchain.
  • 3D printing will extend the supply chain to the customer’s doorstep with hyperlocal manufacturing of parts and products with IoT sensors built into the items and/or their packaging. Every manufactured object will be smart, connected, and able to communicate so that it can be tracked and traced as needed.
  • Big Data management tools will process all the information streaming in around the clock from IoT sensors.
  • AI and machine learning will analyze this enormous amount of data to reveal patterns and enable true predictability in every area of the supply chain.

Combining these technologies with powerful analytics tools to predict trends will make lack of visibility into the supply chain a thing of the past. Organizations will be able to examine a single machine across its entire lifecycle and identify areas where they can improve performance and increase return on investment. They’ll be able to follow and monitor every component of a product, from design through delivery and service. They’ll be able to trigger and track automated actions between and among partners and customers to provide customized transactions in real time based on real data.

After decades of talk about markets of one, companies will finally have the power to create them—at scale and profitably.

Amazon, for example, is becoming as much a logistics company as a retailer. Its ordering and delivery systems are so streamlined that its customers can launch and complete a same-day transaction with a push of a single IP-enabled button or a word to its ever-attentive AI device, Alexa. And this level of experimentation and innovation is bubbling up across industries.

Consider manufacturing, where the IoT is transforming automation inside already highly automated factories. Machine-to-machine communication is enabling robots to set up, provision, and unload equipment quickly and accurately with minimal human intervention. Meanwhile, sensors across the factory floor are already capable of gathering such information as how often each machine needs maintenance or how much raw material to order given current production trends.

Once they harvest enough data, businesses will be able to feed it through machine learning algorithms to identify trends that forecast future outcomes. At that point, the supply chain will start to become both automated and predictive. We’ll begin to see business models that include proactively scheduling maintenance, replacing parts just before they’re likely to break, and automatically ordering materials and initiating customer shipments.

Italian train operator Trenitalia, for example, has put IoT sensors on its locomotives and passenger cars and is using analytics and in-memory computing to gauge the health of its trains in real time, according to an article in Computer Weekly. “It is now possible to affordably collect huge amounts of data from hundreds of sensors in a single train, analyse that data in real time and detect problems before they actually happen,” Trenitalia’s CIO Danilo Gismondi told Computer Weekly.

Blockchain allows all the critical steps of the supply chain to go electronic and become irrefutably verifiable by all the critical parties within minutes: the seller and buyer, banks, logistics carriers, and import and export officials.

The project, which is scheduled to be completed in 2018, will change Trenitalia’s business model, allowing it to schedule more trips and make each one more profitable. The railway company will be able to better plan parts inventories and determine which lines are consistently performing poorly and need upgrades. The new system will save €100 million a year, according to ARC Advisory Group.

New business models continue to evolve as 3D printers become more sophisticated and affordable, making it possible to move the end of the supply chain closer to the customer. Companies can design parts and products in materials ranging from carbon fiber to chocolate and then print those items in their warehouse, at a conveniently located third-party vendor, or even on the client’s premises.

In addition to minimizing their shipping expenses and reducing fulfillment time, companies will be able to offer more personalized or customized items affordably in small quantities. For example, clothing retailer Ministry of Supply recently installed a 3D printer at its Boston store that enables it to make an article of clothing to a customer’s specifications in under 90 minutes, according to an article in Forbes.

This kind of highly distributed manufacturing has potential across many industries. It could even create a market for secure manufacturing for highly regulated sectors, allowing a manufacturer to transmit encrypted templates to printers in tightly protected locations, for example.

Meanwhile, organizations are investigating ways of using blockchain technology to authenticate, track and trace, automate, and otherwise manage transactions and interactions, both internally and within their vendor and customer networks. The ability to collect data, record it on the blockchain for immediate verification, and make that trustworthy data available for any application delivers indisputable value in any business context. The supply chain will be no exception.

Blockchain Is the Change Driver

The supply chain is configured as we know it today because it’s impossible to create a contract that accounts for every possible contingency. Consider cross-border financial transfers, which are so complex and must meet so many regulations that they require a tremendous number of intermediaries to plug the gaps: lawyers, accountants, customer service reps, warehouse operators, bankers, and more. By reducing that complexity, blockchain technology makes intermediaries less necessary—a transformation that is revolutionary even when measured only in cost savings.

“If you’re selling 100 items a minute, 24 hours a day, reducing the cost of the supply chain by just $1 per item saves you more than $52.5 million a year,” notes Dirk Lonser, SAP go-to-market leader at DXC Technology, an IT services company. “By replacing manual processes and multiple peer-to-peer connections through fax or e-mail with a single medium where everyone can exchange verified information instantaneously, blockchain will boost profit margins exponentially without raising prices or even increasing individual productivity.”

But the potential for blockchain extends far beyond cost cutting and streamlining, says Irfan Khan, CEO of supply chain management consulting and systems integration firm Bristlecone, a Mahindra Group company. It will give companies ways to differentiate.

“Blockchain will let enterprises more accurately trace faulty parts or products from end users back to factories for recalls,” Khan says. “It will streamline supplier onboarding, contracting, and management by creating an integrated platform that the company’s entire network can access in real time. It will give vendors secure, transparent visibility into inventory 24×7. And at a time when counterfeiting is a real concern in multiple industries, it will make it easy for both retailers and customers to check product authenticity.”

Blockchain allows all the critical steps of the supply chain to go electronic and become irrefutably verifiable by all the critical parties within minutes: the seller and buyer, banks, logistics carriers, and import and export officials. Although the key parts of the process remain the same as in today’s analog supply chain, performing them electronically with blockchain technology shortens each stage from hours or days to seconds while eliminating reams of wasteful paperwork. With goods moving that quickly, companies have ample room for designing new business models around manufacturing, service, and delivery.

Challenges on the Path to Adoption

For all this to work, however, the data on the blockchain must be correct from the beginning. The pills, produce, or parts on the delivery truck need to be the same as the items listed on the manifest at the loading dock. Every use case assumes that the data is accurate—and that will only happen when everything that’s manufactured is smart, connected, and able to self-verify automatically with the help of machine learning tuned to detect errors and potential fraud.

Companies are already seeing the possibilities of applying this bundle of emerging technologies to the supply chain. IDC projects that by 2021, at least 25% of Forbes Global 2000 (G2000) companies will use blockchain services as a foundation for digital trust at scale; 30% of top global manufacturers and retailers will do so by 2020. IDC also predicts that by 2020, up to 10% of pilot and production blockchain-distributed ledgers will incorporate data from IoT sensors.

Despite IDC’s optimism, though, the biggest barrier to adoption is the early stage level of enterprise use cases, particularly around blockchain. Currently, the sole significant enterprise blockchain production system is the virtual currency Bitcoin, which has unfortunately been tainted by its associations with speculation, dubious financial transactions, and the so-called dark web.

The technology is still in a sufficiently early stage that there’s significant uncertainty about its ability to handle the massive amounts of data a global enterprise supply chain generates daily. Never mind that it’s completely unregulated, with no global standard. There’s also a critical global shortage of experts who can explain emerging technologies like blockchain, the IoT, and machine learning to nontechnology industries and educate organizations in how the technologies can improve their supply chain processes. Finally, there is concern about how blockchain’s complex algorithms gobble computing power—and electricity (see “Blockchain Blackouts”).

Blockchain Blackouts

Blockchain is a power glutton. Can technology mediate the issue?

A major concern today is the enormous carbon footprint of the networks creating and solving the algorithmic problems that keep blockchains secure. Although virtual currency enthusiasts claim the problem is overstated, Michael Reed, head of blockchain technology for Intel, has been widely quoted as saying that the energy demands of blockchains are a significant drain on the world’s electricity resources.

Indeed, Wired magazine has estimated that by July 2019, the Bitcoin network alone will require more energy than the entire United States currently uses and that by February 2020 it will use as much electricity as the entire world does today.

Still, computing power is becoming more energy efficient by the day and sticking with paperwork will become too slow, so experts—Intel’s Reed among them—consider this a solvable problem.

“We don’t know yet what the market will adopt. In a decade, it might be status quo or best practice, or it could be the next Betamax, a great technology for which there was no demand,” Lonser says. “Even highly regulated industries that need greater transparency in the entire supply chain are moving fairly slowly.”

Blockchain will require acceptance by a critical mass of companies, governments, and other organizations before it displaces paper documentation. It’s a chicken-and-egg issue: multiple companies need to adopt these technologies at the same time so they can build a blockchain to exchange information, yet getting multiple companies to do anything simultaneously is a challenge. Some early initiatives are already underway, though:

  • A London-based startup called Everledger is using blockchain and IoT technology to track the provenance, ownership, and lifecycles of valuable assets. The company began by tracking diamonds from mine to jewelry using roughly 200 different characteristics, with a goal of stopping both the demand for and the supply of “conflict diamonds”—diamonds mined in war zones and sold to finance insurgencies. It has since expanded to cover wine, artwork, and other high-value items to prevent fraud and verify authenticity.
  • In September 2017, SAP announced the creation of its SAP Leonardo Blockchain Co-Innovation program, a group of 27 enterprise customers interested in co-innovating around blockchain and creating business buy-in. The diverse group of participants includes management and technology services companies Capgemini and Deloitte, cosmetics company Natura Cosméticos S.A., and Moog Inc., a manufacturer of precision motion control systems.
  • Two of Europe’s largest shipping ports—Rotterdam and Antwerp—are working on blockchain projects to streamline interaction with port customers. The Antwerp terminal authority says eliminating paperwork could cut the costs of container transport by as much as 50%.
  • The Chinese online shopping behemoth Alibaba is experimenting with blockchain to verify the authenticity of food products and catch counterfeits before they endanger people’s health and lives.
  • Technology and transportation executives have teamed up to create the Blockchain in Transport Alliance (BiTA), a forum for developing blockchain standards and education for the freight industry.

It’s likely that the first blockchain-based enterprise supply chain use case will emerge in the next year among companies that see it as an opportunity to bolster their legal compliance and improve business processes. Once that happens, expect others to follow.

Customers Will Expect Change

It’s only a matter of time before the supply chain becomes a competitive driver. The question for today’s enterprises is how to prepare for the shift. Customers are going to expect constant, granular visibility into their transactions and faster, more customized service every step of the way. Organizations will need to be ready to meet those expectations.

If organizations have manual business processes that could never be automated before, now is the time to see if it’s possible. Organizations that have made initial investments in emerging technologies are looking at how their pilot projects are paying off and where they might extend to the supply chain. They are starting to think creatively about how to combine technologies to offer a product, service, or business model not possible before.

A manufacturer will load a self-driving truck with a 3D printer capable of creating a customer’s ordered item en route to delivering it. A vendor will capture the market for a socially responsible product by allowing its customers to track the product’s production and verify that none of its subcontractors use slave labor. And a supermarket chain will win over customers by persuading them that their choice of supermarket is also a choice between being certain of what’s in their food and simply hoping that what’s on the label matches what’s inside.

At that point, a smart supply chain won’t just be a competitive edge. It will become a competitive necessity. D!


About the Authors

Gil Perez is Senior Vice President, Internet of Things and Digital Supply Chain, at SAP.

Tom Raftery is Global Vice President, Futurist, and Internet of Things Evangelist, at SAP.

Hans Thalbauer is Senior Vice President, Internet of Things and Digital Supply Chain, at SAP.

Dan Wellers is Global Lead, Digital Futures, at SAP.

Fawn Fitter is a freelance writer specializing in business and technology.

Read more thought provoking articles in the latest issue of the Digitalist Magazine, Executive Quarterly.

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Four Retail Technology Trends To Take Off In 2018

Shaily Kumar

Over the past few years, technology has seen a significant shift from cyclical, invention-led spending on point solutions to investments targeting customer-driven, end-to-end value. The next wave of disruption and productivity improvements is here, which means a huge opportunity for digital-focused enterprises – if you are following the right roadmap.

Technology trends have significant potential over the next few years. Establishing a digital platform will not only set the stage for business innovation to provide competitive advantage, but it will also create new business models that will change the way we do business. Technology trends in 2018 will lay the foundation for the maturity of innovative technologies like artificial intelligence and machine learning and will prepare both businesses and shoppers to be ready for their consumption.

Like any other industry, retail is being disrupted. It is no longer enough to simply stock racks with alluring products and wait for customers to rush through the door. Technological innovation is changing the way we shop. Customers can find the lowest price for any product with just a few screen touches. They can read online reviews, have products sent to their home, try them, and return anything they don’t want – all for little or nothing out of pocket. If there are problems, they can use social networks to call out brands that come up short.

Retailers are making their products accessible from websites and mobile applications, with many running effective Internet business operations rather than brick-and-mortar stores. They convey merchandise to the customer’s front entry and are set up with web-based networking media if things turn out badly.

Smart retailers are striving to fulfill changing customer needs and working to guarantee top customer service regardless of how their customer interacts with them.

2017 saw the development of some progressive technology in retail, and 2018 will be another energizing year for the retail industry. Today’s informed customers expect a more engaging shopping experience, with a consistent mix of both online and in-store recommendations. The retail experience is poised to prosper throughout next couple of years – for retailers that are prepared to embrace technology.

Here are four areas of retail technology I predict will take off in 2018:

In-store GPS-driven shopping trolleys

Supermarkets like Tesco and Sainsbury’s now enable their customers to scan and pay for products using a mobile app instead of waiting in a checkout line. The next phase of this involves intelligent shopping trolleys, or grocery store GPS: Customers use a touch screen to load shopping lists, and the system helps them find the items in the store. Customers can then check off and pay for items as they go, directly on-screen. These shopping trolleys will make their way into stores around the last quarter of 2018.

Electronic rack edge names

Electronic rack edge names are not yet broadly utilized, but this could change in 2018 as more retailers adopt this technology. Currently, retail workers must physically select and update printed labels to reflect changes in price, promotions, etc. This technology makes the process more efficient by handling such changes electronically.

Reference point technology

Despite the fact that it’s been around since 2013, reference point technology hasn’t yet been utilized to its fullest potential. In the last few years, however, it’s started to pick up in industries like retail. It’s now being used by a few retailers for area-based promotions.

Some interesting uses I’ve observed: Retailers can send messages to customers when they’re nearby a store location, and in-store mannequins can offer information about the clothing and accessories they’re wearing. I anticipate that this innovation will take off throughout 2018 and into 2019.

Machine intelligence

The technological innovations describe above will also provide retailers with new data streams. These data sources, when merged with existing customer data, online, and ERP data, will lead to new opportunities. Recently Walmart announced it would begin utilizing rack examining robots to help review its stores. The machines will check stock, prices, and even help settle lost inventory. It will also help retailers learn more about changing customer behavior in real time, which will boost engagement.

Clearly, technology and digital transformation in retail have changed the way we live and shop. 2018 will see emerging technologies like machine learning and artificial intelligence using structured and unstructured data to deliver innovation. As technology develops, it will continue to transform and enhance the retail experience.

For more insight on e-commerce, see Cognitive Commerce In The Digital World: Enhancing The Customer Journey.

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Shaily Kumar

About Shaily Kumar

Shailendra has been on a quest to help organisations make money out of data and has generated an incremental value of over one billion dollars through analytics and cognitive processes. With a global experience of more than two decades, Shailendra has worked with a myriad of Corporations, Consulting Services and Software Companies in various industries like Retail, Telecommunications, Financial Services and Travel - to help them realise incremental value hidden in zettabytes of data. He has published multiple articles in international journals about Analytics and Cognitive Solutions; and recently published “Making Money out of Data” which showcases five business stories from various industries on how successful companies make millions of dollars in incremental value using analytics. Prior to joining SAP, Shailendra was Partner / Analytics & Cognitive Leader, Asia at IBM where he drove the cognitive business across Asia. Before joining IBM, he was the Managing Director and Analytics Lead at Accenture delivering value to its clients across Australia and New Zealand. Coming from the industry, Shailendra held key Executive positions driving analytics at Woolworths and Coles in the past.