SCM World report

Get Started on the Path to B2B Integration Maturity Now

B2B integration maturuty

OpenText recently sponsored a survey on B2B integration maturity which was conducted by SCM World (now part of Gartner). We set out to learn what constitutes B2B integration maturity and what impact that might have on a business. The research paper, available here, lays out a path to maturity based on answers to the survey from 115 participants from all over the globe. In previous posts we’ve looked at the steps, and the value of progressing along the path. The last portion of the report makes some specific recommendations for getting started and advancing along the B2B integration path. It’s time to get started now on the path to B2B integration maturity. When advancing business-to-business integration, an organization’s focus must be on the journey as much as it is on the destination. The B2B integration path framework is designed with the journey in mind, helping organizations to define and measure progress for themselves. A well-planned B2B integration deployment concurrently addresses issues such as working capital and process efficiency by aligning the three elements of people, technology and process to create tangible business value. SCM World Recommendations Extend the network. The very nature of B2B integration requires working with extended business networks. Purely introspective perspectives lead to the continuation of the status quo, whereas broadened perspectives create mutually beneficial opportunities now, and in the future. It is important to: Build capabilities and track progress. Mechanisms are available to accelerate progress and build the key capabilities needed to create sustainable advancements in B2B integration. In evaluating how building these capabilities enables future business growth, consider if it is best to build and maintain in-house capabilities or if it is better to partner with, or outsource to, specialists who focus on B2B integration tools and technology? Start the process. To begin the journey, companies must develop segmented business integration strategies that allow for immediate execution, as well as further advancement potential in the future. Learn and grow together with trading partners. Leverage experts outside your business; and Embrace the dynamism and fluidity of B2B integration as a long-term growth opportunity. Previous posts in this series: Don’t Be Immature – Impact Your Business With B2B Integration Maturity 5 Stages of B2B Integration Maturity – Pt 1 Does B2B Integration Have Tangible Business Benefits? Pt 2 The B2B Integration Maturity Landscape – Pt 3 First Steps in B2B Maturity – Pt 4 What’s Average B2B Integration Maturity? – Pt 5 Getting Ahead on the B2B Integration Maturity Path – Pt 6

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Getting Ahead on the B2B Integration Maturity Path – Pt 6


An efficient supply chain is a competitive advantage. Part of achieving efficiency is automation based on B2B integration between buyers and suppliers. A recent report from SCM World entitled “The B2B Integration Path: A Roadmap for Business Value Generation” found that companies who had achieved a higher stage of B2B integration maturity experienced greater efficiency as measured by inventory turns, days sales outstanding, expedited orders, and cash conversion cycle. Only 16% of the respondents in the survey scored at stage 4 or “relational” stage. No company in the survey has achieved the highest stage of the B2B integration maturity path – the “generative” stage. The full report, available here, lays out the complete path to maturity. Moving from “Analytical” to “Relational” The third stage (analytical) of B2B integration maturity path is where companies begin to gain “collaborative insight through the aggregation and analysis of connected digital demand and supply data.” At the fourth stage (relational) companies have built a responsive network, with integration of most trading partners across multi-tier demand and supply networks. For more on the definitions of the stages, read my post on the 5 Stages of B2B Integration Maturity. So how do move you from stage 3 to 4? According to our survey, which looks at three aspects of maturity – people, process and technology, there are several things that distinguish stage 4 from stage 3 companies. People In the people aspect, stage 4 companies are differentiated by shifts in decision making and business justification. First, stage 4 companies are more centralized in their B2B integration decision making with 32% more companies stating they have comprehensive multi-enterprise decision alignment. This means B2B integration decisions extend to trading partners up and down the supply chain. Second, the justification for integration B2B activities shifts to one that encourages collaborative business growth among partners, with 74% of stage 4 companies naming this as their justification, compared to only 15% at stage 3. Process In terms of process, there is an improvement in error reporting, shifting from a reactive process to real-time reporting (50% of respondents at stage 4 vs. 33% at stage 3) and possibly automated exception management (a 13% increase from stage 3 to 4, to 33%). Stage 4 companies see a shift toward real-time processing of digital transaction with 43% reporting they have achieved this speed, while that was true for only 2% of stage 3 companies. Technology There are three noticeable technology differences between companies at stages 3 and 4. First, companies at stage 4 increase the availability of metrics reporting, moving from standard KPIs published at scheduled intervals, to predictive analytics spanning a multi-tier demand and supply network. (25% of respondents at stage 4, vs. 4% at stage 3). The second difference was an improvement in data collection and organization. 62% of stage 4 companies reported they had comprehensive multi-enterprise data integration, compared to only 8% at stage 3. Finally, stage 4 companies differ from stage 3 in the capabilities for compliance and audit, with 35% more stage 4 companies reporting they had a networked compliance management system. Previous posts in this series: Don’t Be Immature – Impact Your Business With B2B Integration Maturity 5 Stages of B2B Integration Maturity – Pt 1 Does B2B Integration Have Tangible Business Benefits? Pt 2 The B2B Integration Maturity Landscape – Pt 3 First Steps in B2B Maturity – Pt 4 What’s Average B2B Integration Maturity? – Pt 5

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The B2B Integration Maturity Landscape – Pt 3

B2B Integration Maturity

In partnership with OpenText, SCM World conducted a survey of 115 companies from all over the world. The goal was to guide supply chain, operations and customer service executives on the journey to integrating and automating B2B resources, specifically people, technology and processes. The full report, available here, lays out a path to maturity., while the excerpt below features the section of the report which summarizes the current B2B integration maturity landscape. SCM World’s B2B integration maturity survey yielded 115 responses from companies representing the automotive, consumer packaged goods (CPG), hi-tech, industrial and life sciences industries, among others.  (More on industry results in my next blog post). The percentage of responses by maturity level represents a relatively normal distribution, centered on an overall average maturity of 2.8, as shown in Figure 5 below. If you missed my post on the definitions of the steps – read it here. The largest group of respondents falls in the Analytical (step 3) category on the B2B integration path. Here, demand and supply use cases come together, beginning the multi-tier integration found in progressive steps. The supply chain data available is more than just simple information, and can be analysed more extensively to generate new business insight. Few companies have separated themselves from their peers at the lead along the B2B integration path. 16% of responding companies achieved an overall score greater than 3.4; only 2% scored at or above 4.0. What separates these companies is their Relational (step 4) approach to B2B integration. Here, the focus shifts towards a real-time approach that keeps pace with what is driving the business. Common toolsets and processes are leveraged to drive collaboration upstream and downstream across a growing network of suppliers and customers. Also notable is the move toward partnerships in managing B2B integration operations. CAPABILITY ADVANCEMENT REQUIRES PARTNERSHIPS FOCUSED ON DEVELOPING COMPETENCIES Outsourcing at least part of your B2B integration operations accelerates the expansion of partner networks, enabling collaborative relationships with other leading companies that drive advancement of all elements in parallel. Of the Relational (step 4) companies, 63% of operations are either fully outsourced (25%) or utilise a hybrid of external and internal resources (38%), leaving less than 38% to be run solely with internal staff. The most consistently present qualities across all of the leaders on the path show that: B2B integration is justified by real-time collaboration with trading partners Cross-functional B2B expertise is more evident within IT and/or the line of business Supply chain data is collected and organised via a collaborative network reaching to at least direct customers and suppliers Fully integrated processes exist with customers and/or suppliers More than 70% of all B2B transactions are processed digitally Previous posts in this series worth a read: Don’t Be Immature – Impact Your Business With B2B Integration Maturity 5 Stages of B2B Integration Maturity – Pt 1 Does B2B Integration Have Tangible Business Benefits? – Pt 2

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