How Siemens is moving 100,000 trading partners from phone calls and faxed invoices to a digitally-driven supply chain

Siemens OpenText supply chain
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Siemens is in the process of rolling out new technology and services from OpenText that will try and encourage more than 100,000 firms connected in its supply chain to move to a more digitally-driven way of making payments and completing other business processes.

The Berlin-based industrial manufacturing company was among those represented at Enterprise World, OpenText’s customer conference, which is taking place this week in Toronto. While much of Enterprise World has been focused on OT2, a set of applications and services Open Text is offering through a software-as-a-service model, the Siemens project is an example of how OpenText is growing its Business Network, which offers a range of services to B2B organizations.

According to Andreas Kolb, who is leading what’s known as the Electronic Supplier Integration (ESI+) project at Siemens, many of the trading partners in its supply chain today continue to rely on phone, fax or surface mail to deal with invoicing and other common tasks. The partnership with OpenText will including using its software to power a supplier portal that will offer 24/7 support in multiple languages.

“Everybody talks about digitalization and has a lot of ideas about what can be done . . . but here we really first have to look into our own processes, get it into one information flow and also standardize the process,” Kolb said.

The Siemens project began about a year and a half ago with 20 pilot suppliers, then expanded to 500 more. In March, a set of purchasing functions went live in the portal, and later the company will offer similar capabilities of invoicing.

Instead of just purchasing technology, however, Siemens relied on OpenText Business Network to deal with a number of challenges, including integration with other areas of its IT infrastructure. According to Kolb, for example, Siemens runs more than 40 SAP enterprise resource planning (ERP) systems around the world.

Marco de Vries, senior director of product marketing for Open Text Business Network, said ERP upgrades are just one of the common tipping points that lead large enterprise firms to work with the software vendor on things like supply chain optimization. Others include M&A activity, where organizations suddenly inherit a new set of trading partners, or divestitures, when there is a limited window to remove an organization from its former corporate parent’s systems.

“The demand almost always comes from the line of business — they want to cut costs, accelerate time to market, (or) deliver better services,” De Vries told B2B News Network. “Most organizations have figured how to integrate with the top 20 per cent of their trading partners. It’s the 80 per cent of their trading partners that only comprise 20 per cent of the business that become the issue.”

Besides integration and supply chain optimization, Open Text Business Network is offering analytics and managed services to assist B2B firms with areas that aren’t necessarily their core competency, De Vries added.

Kolb said the near-term objective for its ESI project is to streamline its process with suppliers and avoid the more manual, error-prone processes that might take place today, moving towards a lean order confirmation, order change, dispatch and invoicing process.

“It’s not something which is easy to get to the supplier’s mind but also our employee’s minds,” he admitted. It’s also an area that will require continuous effort. “It will never end. It’s a never-ending story.”

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Shane Schick

Shane Schick

Shane Schick is the Editor-in-Chief of B2B News Network. He is the former Editor-in-Chief of Marketing magazine and has also been Vice-President, Content & Community (Editor-in-Chief), at IT World Canada, a technology columnist with the Globe and Mail and was the founding editor of ITBusiness.ca. Shane has been recognized for journalistic excellence by the Canadian Advanced Technology Alliance and the Canadian Online Publishing Awards.