Part 2 of a 4 part series

In December, I posted the first in a four-part series of blog entries focused on the need for greater supply chain openness among foodservice industry trading partners.  That inaugural post looked at the advantages of joining an established network of industry trading partners, which is ArrowStream’s first piece of advice to businesses determined to get on the path to greater openness and more effective cooperation among trading partners.  

Now it’s January. A new year and a new decade have arrived, and it’s time to explore ArrowStream’s second tenet of Supply Chain Openness: Aligning and Integrating Supply Chain Management Technologies.

First, you need to evaluate your relationships with your manufacturer and distributor partners. At ArrowStream, we believe the most fundamental part of technology integration is trust. Have you established trust among your trading partners so that they would be willing to share their data with you? I hope the answer is yes because in order to be aligned and integrated, you must first break the barriers of information sharing by eliminating any fear your trading partners may have with technology integration. Data is the great currency of the information age and when your business is locked out of valuable supply chain data sources due to information protectionism, your organization is the poorer for it. The more your supply chain management tools and applications allow you to connect with those of other trading partners the more information and analytics you have fueling your business decisions.  Explain to your trading partners that with technology integration, everyone shares in the savings.

Look for Compatibility and Integration
So, how does a foodservice business go about ensuring the supply chain technologies it invests in can integrate with trading partners? First, you need to look at the big picture. What is your vision and why is technology good for your business? What results do you expect to see? Widespread technology integration among trading partner supply chain systems can seem like a daunting, long-term goal, however it doesn’t have to be. In fact, integration can be a relatively simple process that will lead to tremendous financial benefits. The more integration you can gain with each technology advancement and enhancement, the more data rich and supply chain efficient your business becomes.

Begin by looking at your 10 most important trading partners and determine what barriers are getting in the way of data sharing - information protectionism; multiple technology platforms; lacking in trust. These unnecessary barriers prevent spend, inventory and supplier data from informing the critical decisions you and your trading partners make every day.   Consider how much more effectively you could work with your suppliers (and benchmark their true performance) by synchronizing data and giving all parties access to valuable information like food spend, procurement, contracts, pricing and shipping information.

Next, talk with the supply chain solution providers to look at how they can support greater integration of supply chain systems. At ArrowStream, we understand how vital integration and data sharing is to the daily efficiency, fundamental success and bottom-line health of our foodservices clients. Any provider of supply chain solutions today knows that helping trading partners better integrate and work together will only make their systems more effective and widely sought after. If you find the certain technologies and/or their solutions providers are limited in helping your business integrate with trading partner systems, quickly take them off your list.

Time & Effort Well Spent
This increased focus on integration capabilities adds only a small amount of time to the technology vetting process but will yield greater visibility, resources and insight to your overall supply chain management solution.  As more and more businesses across the foodservice industry work to better integrate systems and share data, the shorter and shorter this integration assessment process will be. By demanding topnotch integration capabilities from solution providers, industry trading partners are helping to push supply chain technologies exactly where they need to be-on the bleeding edge of secure, smart, innovative supply chain integration.

One Essential Key to Having a Banner 2010

What makes a good manager great? For ages, many believed it was an intangible and immeasurable gut instinct that made strong business leaders visionaries. A manager that took risks by “going with his gut” or “trusting her instincts” had more than moxie, but also a better performance record to go along with it.

While there is always a role for instinct in business, history and measurement have found that sound and timely business information will outdo a sixth sense any day of the week. Take for example the IBM Global Business Services study and report, “Business analytics and optimization for the intelligent enterprise.” The study of more than 400 high and low performing business enterprises showed again and again that top performing businesses are more effectively tapping into timely business data and analytics to improve decision making and business operations. Below are just a few of the outcomes from the study and its executive report, which you can read in full here. 

• In the study, organizations that had analytic programs that were “well underway” were found to be more than three times as skilled at using information to understand risk (and twice as skilled in using that information to predict outcomes) than businesses that did not make analytics a priority.
• Top performing businesses are “twice as skilled as low performing businesses when it comes to extracting and prioritizing relevant information.“
• Top performing businesses were found to be “three times better at applying information for more predictable outcomes, which gives them the opportunity to better anticipate, navigate and handle contingencies.“

This clear link between top performance and the smart use of timely data and analytics across a business organization is irrefutable. In fact, it’s becoming a calling card for success as leading businesses make good, actionable information a main driver of business strategy and competitive advantage.

For the foodservice industry, there has never been a better or more important time to embrace the masses of business data provided by the supply chain and convert it into useful, actionable information. Eating habits are changing and attracting the American consumer will be harder than ever. The peak year for dining out in America was 2001, according to Harry Balzer, senior vice president and chief industry analyst with the market research firm NPD Group. Since then, people have been eating more of their meals at home, ending a five decade trend in which Americans frequented restaurants at ever-increasing rates.  After a decade at the mercy of global fluctuations in commodity and fuel pricing, a brutal recession and falling restaurant traffic, foodservice businesses need to make most of 2010 and the decade it rings in. It must become an era of embracing business intelligence in order to radically improve decision making, efficiency and business performance results. Confident in the value that analytics can bring to the foodservice industry, ArrowStream has greatly expanded its Performance Management capabilities. Our mission is to put critical business information at the fingertips of CFOs and procurement executives. Aggregating spending, inventory, purchasing, volume and contract data from across the supply chain, ArrowStream’s performance management dashboards give foodservice industry leaders an astonishing, new and real-time perspective on costs and vendor performance. 

With the analytical tools performance management provides, CFOs across the industry finally have a simple, flexible system for accurately comparing supply chain trading partner performance and costs. Rather than trusting that a vendor’s costs are low based on price sheets, business leaders can benchmark trading partners in real time to see exactly what is spent and where. This invaluable data can be used to make the very best purchasing and partnership decisions as “best in class provider” becomes a title trading partners must earn rather than a designation assumed by gut feeling. 

Today ArrowStream’s Performance Management Module offers dashboards for Total Landed Costs, Spend Analytics, Inventory Volume Tracking and Market Basket. By the end of 2010, additional dashboards for key functions, such as budget analysis, cost control, inventory, promotion and contract management will be added to the system. To learn more about ArrowStream performance management tools and how they can expand and optimize the ways businesses measure company and trading partner performance, I invite you to click here.

A new decade has come and it’s the perfect time to shake things up for the better. Here’s to 2010, a decade ArrowStream is certain can be one of smarter supply chain management, meaningful business analytics and new standards of excellence across the foodservice industry.