See the Supply Chain Platform Series:
Part 1, the Introduction.
Go to any conference, and social networking is, well, what’s being socialized about.
Solution Providers in this Article:
But what are the practical implications?1 Until recently, collaboration technologies have been treated as a separate segment of the software industry, when what is needed is a suite to unify business applications in a collaborative foundation. We proposed this and now we see the convergence of social networking in supply chain to enable full collaboration.2It is the obvious brick needed in the supply chain foundation.
In supply chain, we require a unique spin on the open social world — Enterprise Social Networking.3
Two elements are critical to its creation:
- Creating the validated supply chain network; and
- Unified Communications (UC) — managing the channels of communication.
“Mobile is the most obvious channel for communications, but first you have to build a validated network. The ‘Who is the authorized individual to act?’” says Lisa Grossman, Vice President of ImpactFactor. “The reality is that we live in a global world — seven by twenty four. No one is at their desk. So not only do today’s Risk platforms need analytics to identify urgent events, but we have to be able to reach the right people at the earliest possible moment — wherever they are.” That is how Unified Communications helps. As users move from desks to meetings and travel, these anytime/anywhere platforms move with them.
A network, a many-to-many platform, is required. Software behind the firewall is an outmoded approach to managing supplier relationships. “We believe the time has come for companies and their suppliers to stop relying on phone, fax, email and spreadsheets for collaboration, and to benefit from web-based networks in the same way consumers have,” says Michael Saracini, Aravo CEO.A key to the social element of Aravo’s approach is AravoAssure™ which allows suppliers to build their profile page in a supplier directory. There are a lot of directories around, but the unique twist here is the ‘social rating’ by the community. Though directories can help you get your company and products known in the buyer community, this approach adds validation: What do other buyers think about your company? It takes the ‘like’ feature of social networking into a business context. Social pressure — Reputation Management — adds a unique and critical element to the network. So Aravo is building this social index as part of the supplier information network.
But there is more.
“A new concept in the supplier information data model is needed,” says Bindiya Vakil, President of Resilinc. “Companies not only need information about direct upstream or downstream trading partners, but also need the ability to identify and collaborate with partners in the extended chain. Thus, Resilinc offers a multi-tiered solution that allows country-of-origin mapping to enable collaborative risk mitigation.” Though that sounds like a mouthful, that is what is required in supply chain, whether to manage demand and supply or to reduce exposure and risk.
A critical issue that needs to be addressed in the creation of these social networks, according to Vakil is that “users need to be empowered to identify and manage the highest impacting and most vulnerable areas of the business. In order to be truly effective at risk management, they need the ability to partner outside the enterprise walls and pursue common goals. And that takes a change in the management mindset.” This might be somewhat of a hurdle for companies to consider: Collaboration is the key, not only among your own employees, but also with key trading partners.
Flextronics, one of the largest global Electronics Manufacturing Services providers, has tapped into the power of the collaborative information network. Flextronics has deployed Resilinc’s supply chain mapping solution since Q2 of 2011. Says Tim Griffin Sr., Director of Supply Chain & Procurement, Flextronics Milpitas, “We find ourselves in the position of being supply chain operators for our customers. We build and ship our OEM customers’ products, and work with suppliers to procure materials. Resilinc’s solution enables us to proactively collect critical supplier information and share resiliency insights and analytics with our customers. With multiple tiers working together, we can make decisions quickly and respond faster and more effectively when disruptions occur.”
Enterprise Social Networking for Supply Chains:
And that brings us full circle to the ‘social networking’ element: the People. That is, validation not only of the companies, but people’s identity and roles — creating profiles with meaning for the community.Who is authorized at what stage of a business discussion? Who can change an order? Who can pay for an order? Who is authorized?4 What knowledge do they have? And then we have to support knowledge sharing and dialogue, not just business transactions.
Social Networks Support Values
Besides identity management, we want to build a rapport and enable collaboration. We want to build a many-to-many social or collaborative structure and dialogue through online meetings and more informal chat about day-to-day work. We want to develop the strong relationships that are needed when emergencies occur and critical decisions have to be made.
As well, we want to foster those higher values that people often express once they ‘know’ people. The stronger the relationship, the more, as human beings, we tend to express our viewpoints about life and the world. And we can engage trading partners in supporting our corporate values.
GE is a great example of just such leverage. GE has been a customer of Aravo for some time. Now they are using Assure™ to make it easier for small businesses and diverse suppliers, such as women or minority-owned businesses, to do business with GE. Aravo Assure™ will also support GE’s global efforts to drive sustainability, corporate citizenship and corporate social responsibility across its global supply chain.
Said Tom Hattier, GE SSS/AP Operations Manager, “We are excited to enter into this new phase of our relationship and expect to derive substantial benefit from the Aravo Assure™ network, particularly as it supports our efforts to develop and strengthen relationships with our small businesses and diverse suppliers.”
Enterprise Social Networks represent a critical foundation in the virtual outsourced world. As part of the supply chain platform, it creates a holistic foundation, marrying knowledge sharing and transaction management, creating stronger relationships enabling and true collaboration. Idea generation, process improvements, and social responsibility become topics of engagement beyond daily execution.
Social engagement, bringing people closer, can change the level of dialogue. And that is what people do best when they socialize — they think creatively, beyond transaction.
This series: Platforms — Journey to Achieving the Supply Chain Vision
Solutions Providers mentioned in this article:
2 Read Collaboration at the Crossroads: Collaboration Technology Convergence. Return to article text above.
3 You can read about the concepts here: Supply Chain and Social Networking. Return to article text above.
4 We will have a supplier authentication and identity segment in this series. Return to article text above.
To view other articles from this issue of the brief, click here.