Supply Chain

Document digitization is ‘transformational’ for supply chain sustainability 

Sustainability has climbed to the top of the agenda for supply chain executives. Today, the supply chain is responsible for as much as 90% of an organization’s greenhouse gas emissions and 70% of its operating costs. More than this, competitive advantage and brand reputation can be severely impacted by poor performance in this area. New research from OpenText and Foundry and published in a CIO MarketPulse report has found that document digitization plays a key role in driving sustainability in the supply chain. 

Our research found that the increasing focus on supply chains is key to the successful environmental, social and governance (ESG) efforts in many organizations. When asked, 90% of respondents reported that they either have an ESG program or are planning to implement one. The goal of these efforts is to minimize environmental and social harm from factors such as energy usage, water consumption, waste production and work practices while also ensuring that trading partners at all levels of the supply chain meet their sustainability standards and goals. 

Digital communication and information exchange becomes an essential element of driving sustainability throughout a supply chain. Organizations have to ensure that compliance stretches beyond Tier One suppliers to embrace every organization involved –wherever they are located and whatever level of technical capability they have. This means having visibility and transparency across all transactions and communications. 

Digitization delivers sustainability outcomes

Survey respondents stated that digitizing documents in procurement and supply chain processes had a major impact in delivering sustainability. In fact, 17% said that the use of B2B integration to exchange digital information was transformational (See figure 1). For the first time, an organization is able to track and monitor the ESG performance of its entire trading partner community. In fact, 55% said that the use of B2B integration was a major or transformational factor in driving sustainability outcomes.  

This is a chart indicating the positive sustainability impact of digitizing procurement and supply chain documents
Figure 1: Impact of digitizing documents in procurement and supply chain processes on sustainability outcomes

EDI integration is also crucial to sustainability efforts

To achieve digital connectivity in the supply chain, EDI/B2B Integration has become a core technology across all industries. In fact, 71% of the high-tech companies and 69% of the CPG companies saw EDI delivering a positive outcome for their sustainability efforts (See Figure 2).

Figure 2: Benefits of EDI/B2B integration by vertical sector

A B2B integration platform–such as OpenText Trading Grid–is an ideal solution for delivering the end-to-end supplier integration and collaboration needed to support sustainability programs. These platforms provide:

  • Seamless integration with enterprise application through functionality including APIs and web services integration.
  • End-to-end visibility of all transactions and documents exchanged over the network
  • Fast and secure connection to hundreds of thousands of pre-qualified trading partners
  • Workflow orchestration to ensure supplier compliance to the organization’s policies Complete community management, beyond initial onboarding including customer tools for ethical qualification, community collaboration and information management

9 more reasons to digitize supply chain documents

Beyond furthering sustainability, digitizing documents delivers many mainstream business benefits. Our research shows that, in addition to reducing paper usage (50%), it reduces overall errors (51%), reduces manual efforts (49%), and improves forecasting (48%). Additional benefits include optimizing transportation and improving order-to-settlement processes (see Figure 3).

This is an image of the many benefits, beyond sustainability, of digitizing supply chain and procurement documents.
Figure 3: Benefits of digitizing procurement and supply chain documents

This all adds up to impressive gains. The CIO MarketPulse estimates that, typically, a large enterprise can realize cost savings of up to $15 million over seven years; a midsize company can see savings of $9.5 million.

Although it’s already a business imperative, our survey demonstrates that sustainability will continue to become more important over time. In addition to driving cost and risk from the supply chain, digitizing key procurement and supply chain documents helps organizations take greater control over their trading partner community and deliver the business agility needed to react quickly to a constantly changing global ESG regulatory environment.

Today, organizations are looking toward comprehensive B2B integration solutions that provide the digital foundation for ecosystems of trading partners to effectively work and collaborate together. An organization and its suppliers can exchange business transactions and documents to deliver complete supply chain visibility and transparency to ensure that all business happens in a sustainable and ethically compliant manner.

Get a copy of the full CIO MarketPulse report: The State of Sustainability in Supply Chains or learn more about how OpenText can help you achieve your sustainability and ESG goals.

Naomi Skinner

As Senior Manager, Product Marketing for OpenText Business Network, Naomi leads product marketing efforts for B2B integration in the supply chain space as well as in healthcare. Experienced marketer across various industries, Naomi enjoys translating complex concepts into simple terms.

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