How many business transactions does your company engage in daily with your partners? Not just sales and purchase transactions, but all business transactions: negotiations, orders placed and received, contracts granted and executed, exchanges with trading partners and third-party providers, returns, rejects, and expedited orders.
Nearly every company is dependent on suppliers. It’s important to make them an extension of your organization, rather than set them apart from it. Supplier collaboration is key for an effective, accountable supply chain; not to mention, it can be a competitive advantage.
By collaborating with suppliers, you have the power to limit the number of financial, business, and reputational risks through solutions that improve partnership between you and your supplier. In today’s fast-moving, global marketplace, your supply chain depends on it. For a supply chain to efficiently run as it should, it needs to have a seamless flow of the goods and products. If not managed correctly, the effort and the risk can quickly eat up the gains.
While it’s necessary to have trustworthy, scalable, and collaborative partners, many retailers might not have the resources needed to fully manage and optimize their partnerships—and it’s costing them. With ample opportunities for hidden costs to creep into a supply chain, the best way to manage costs is through automation, collaboration and planning, increasing visibility, and gaining better control of operations through one version of the truth. Seeing all pertinent data in one place ensures the utmost accuracy, inbound management of materials, and cost control throughout the entire job.
The advantages of a more transparent and empowering relationship with supply chain partners are compelling. The challenge is how to actually get there. The main impediment to major advancements in the construction industry is the lack of technology solutions that drive dynamic interactions between business partners. The first step is often to create stronger connections with your suppliers—both figurative and technological, with conduits for a continual flow of data.
A collaborative platform is a great way to connect all trading partners and allow them to engage and participate. Efficient, rich collaboration maximizes the chance of capitalizing on the benefits of supplier collaboration while minimizing the risks. Supply chain management becomes a proactive exercise, with all key stakeholders working in one unified system. Such a system must provide: participation for all stakeholders, shared access to status, flexibility in process, and end to end tracking through all stages of the supply chain.
Real-time networks eliminate information delays and better optimization thanks to fresh, big-picture data that reflects the reality of the supply chain now. They also provide the full context for better decision-making, including providing actual data on orders, inventory, and shipments across all nodes of the network. Collaboration across multiple tiers of customers, suppliers, and logistics service providers enables supply chain managers to not just address issues directly under their control, but to work with business partners to solve a much broader range of problems that occur in all parts of the supply chain.
Technological advances are automating many functions that previously required human intervention. For example, these tools possess the ability to help supply chains quickly react to demand, automate the ordering process, help managers to deter risks from missed deliveries, and to speed fulfillment. When such tasks can be automated, it frees up time for employees to work on more valuable tasks rather than daily maintenance of exceptions. Automating data capture is an efficient and valid way to create a path to improvement.
Automating manual processes also eliminates the dependence on paper tickets that so often are illegible and easily misplaced and addresses the challenges with current methods for tracking materials and truck assets. There are so many hidden costs associated with paper processes, including:
- Inefficiency of turnaround time for customers
- Low quality of data capture in the field
- Excessive number of operational staff required to physically handle, manage, and file paper
- The amount of physical space needed for storage and processing physical documents
- Lost documents
- Amount of time wasted by staff to search for an item
- Inability to use information in a timely manner that leads to less effective decision-making
- Copying, printing, courier, and postage costs
- Cost of disposal and recycling
With a collaboration portal, contractors, haulers, and suppliers can connect and work together electronically to complete shipping and receiving transactions with other connected trading partners. You can add money to your bottom line by doing away with these unnecessary costs.
Another positive feature of a platform is the ability to manage inbound materials. Cloud-based connectivity delivers POD (proof of delivery), that can confirm when materials have been delivered in the field via mobile devices and tablets or back in the office. This helps to eliminate the frequency of paying for materials and not having them delivered. Material costs on a job can make up a large portion of the total construction cost. You can capture those costs in real time, helping you to truly understand what your operations are truly costing on a day to day basis.
The materials that suppliers produce and haul are almost always on the critical path for the end customer. Early warning alerts and exception management functions help to resolve supply chain disruptions before they disrupt your business. If loads of materials are rejected, suppliers can be alerted to take action before all productivity is lost.
With a collaboration portal, buyers can more efficiently reconcile accepted goods and services against invoices, permitting quicker payment to their valued suppliers and quicker month-end closings. This enhances relationships with suppliers because they are more willing to take care of their customers who make an effort to take care of them.
Read the article on Modern Contractor Solutions.