The promise of B2B Managed Services is great. According to Ovum, good B2B Managed Services can cut operating costs by at least 40% over doing it yourself, in addition to allowing you to re-deploy your IT staff to other activities. Over 95% of companies in a global Stanford Business study found managed services success had increased the value of their B2B integration program. With such great results, what could possibly go wrong?
The answer is: a lot.
The technology press is littered with high profile outsourcing and managed services disasters. Relationships that started out so well disintegrate and objectives for the managed services program aren’t met. In one major outsourcing failure in the U.S. that ended in litigation, the judge finally concluded: “Neither party deserved to win this case. This story represents the ‘perfect storm’ of misguided … policy and overzealous corporate ambition.”
Of course, outsourcing and managed services aren’t quite the same thing. Outsourcing involves handing over a complete business function to the service provider, while managed services allow you to decide exactly what you want to be handled on your behalf. This is one of the reasons that the managed services market is predicted to grow almost three times as fast as IT outsourcing in the next five years – estimated to reach $296 billion by 2023.
Will B2B Managed Services make me lose control?
One thing that both outsourcing and managed services have in common is that many organizations fear loss of control and the lack of visibility across core systems from not managing everything themselves. My experience is that these fears are far from unfounded. In fact, when we speak with companies that have approached OpenText™ because they’ve had B2B Managed Services relationships turn sour, some common threads emerge, such as:
- Loss of control over the trading partner relationship
- Loss of visibility over the trading partner community
- Lack of business agility and collaboration across the trading partner community
- Lack of capability and resources from the service provider to meet the original objectives
- Poor quality and inconsistent service delivery
- Poor contract flexibility and slow change management
- Poor communication between the company and the service provider
What I find really concerning about this list is that most of the points are exactly what B2B Managed Services are meant to address. You are meant to be able to rely on managed services to deliver cost, operational and business benefits by working with a specialist and scalable expert resource that keeps you in full control of your business strategy.
Three key tips for B2B Managed Services success
There are many things that you can do to help ensure the success of your B2B Managed Services relationship. Here are my top three:
Tip 1: Think strategically, not tactically
B2B Managed Services is different from most other IT managed services that may cover a single application or function such as security or disaster recovery. B2B integration establishes how you communicate and collaborate with customers and suppliers, therefore using managed services is a strategic decision.
This means that the service provider you select needs to be able to do much more than simply manage your B2B infrastructure, they must be able to support you to drive collaboration and innovation through your trading partner community. Ovum notes that: “tools enabling rapid trading partner onboarding and better management of trading partner community, and services/actionable insights based on operational and process analytics are some of the key areas where leading vendors are investing to expand the features and capabilities of their offerings.”
Tip 2: Self-service should be a key part of managed service
Far from losing control, B2B Managed Services should increase the level of control you have. This is not just in the performance and speed of response of your B2B integration – although your managed services provider will be constantly investing in the latest B2B technology and skills in a way that almost any other organization would find almost impossible. It is also true for your partner community.
Frequently, we’ve found organizations that have moved to OpenText B2B Managed Services report this was the first time they had this level of visibility over the activities and transactions within their trading partner community. We’ve taken this a stage further with a type of hybrid-control. We manage your B2B so you can focus on your core business, but we also provide you with trading partner tools that Ovum identified to deliver self-service capabilities. This enables organizations to engage in their trading partner relationships. Self-service tools that are included with OpenText B2B Managed Services, include:
- Active Documents enables you to track the status of all EDI and XML documents you exchange with your business partners. With advanced search and reporting capabilities, enhanced alerts and notifications, and a mobile app to view transactions on the go, you’ll ensure no orders, invoices, or payments are lost. Watch this short Active Documents video to learn more.
- Trading Grid Analytics provides you with invaluable insight into the performance of your trading partner community, including historical trends, current performance, and predictive metrics to identify risk, make better business decisions, optimize business processes, and meet changing customer and market demands. Watch this short Trading Grid Analytics video for more information.
- Trading Partner Graph allows you to generate a visual map of your trading partner community, and drill down into which communications protocols your trading partners use and what documents they send. Watch this short Trading Partner Graph video to learn more.
- Self-service cross-reference tables make one-to-one data conversions during mapping, e.g. converting a code in the application data to or from an EDI code. Now you can quickly update the table on your own without calling IT or your provider, and you can easily undo those changes if you’ve mistakenly made a wrong update. Watch this video about some of the new innovations of B2B Managed Services, including cross-reference tables.
- Trading Grid Online is your one-stop-shop for all tracking, reporting, and account administration on the Trading Grid. All self-service tools can be accessed from this web-based portal.
- Customize your solution to your unique business process requirements to further increase collaboration between you and your trading partners. For example, Active Applications provides a single platform for the entire procure-to-pay and order-to-cash process. Core for B2B Managed Services is a secure, cloud-based file sharing and collaboration application.
It shouldn’t be a surprise that getting the management aspect of managed services correct is a big part of achieving managed services success. You don’t want to rescind all control but neither do you want to micro-manage every aspect of the contract to the point where there is no flexibility and any change is painful. You need to carefully consider what you want from your service provider and look for where they can add value to your business and your trading partner community. A service provider should:
- Provide all the B2B skills you require
- Support all the latest B2B standards, documents and protocols
- Use the latest B2B technologies
- Provide onboarding, management and support for your trading partners whatever their market or location
- Facilitate compliance in the markets in which you operate
- Provide consultative as well as operational services so you can benefit from their industry experience
- Provide support services 24/7 in multiple languages
Tip 3: You’re paying for experts, use them
Properly implemented, B2B Managed Services will deliver a long-term partnership where both sides benefit and work together to maximize the value of the contract. Far from losing control, B2B Managed Services should heighten the control you have over your B2B capabilities and increase transaction visibility to enable you to work more effectively with your trading partner community. If you choose a reputable service provider that offers a wide range of self-service capabilities, then there’s no reason your B2B managed services experience should ever turn bad.
To learn more best practices for leveraging B2B Managed Services to streamline your supply chain processes and achieve digital transformation, visit our thought-leadership website or speak to an OpenText representative about your unique business needs.