B-to-B E-Business in APAC - Is It the Wrong or Right Time to Start in 2017?
By Charles Nie, Head of E-Business & Supply Chain Optimization, Covestro
E-Business, as the name defined, is about a wide use of information and communication technologies to support various activities of the business. These various activities not only include external processes such as conducting electronic purchasing with suppliers and electronic order processing towards customers, but also cover internal management processes including employee services, training, internal information sharing, recruiting, etc.
With many of these processes covered within the scope of e-business, companies implementing e-business cannot adopt a “one-size-fits-all” approach and can’t expect one single solution can be used for all these process. It is normal to expect multiple tools’ usage will incur, depending on the kind of processes which is about to undergo electronization. Here are some of the commonly used tools:
a) Web shop, E-procurement portals, E-learning portals – the advantages of these tools are that once they are built with standard process design, they can be deployed to customers/purchaser/internal staff in a short timeframe, which would also reduce implementation cost. But they do come with disadvantages; since these solutions require manual human resource at the opposite parties’ side to use them (procurement officers to use webshop, customer service representatives to use e-procurement portal), this may cause qualitative and/or efficiency defects at their side because of human data entry, as a result, passes on these negative effects back to the implementer.
b) B2B integration via EDI – It has several advantages over the others, if it is given with the right provider chosen, each single EDI connection enables the two different trading companies to connect with strong IT security protection on both sides, simultaneously enabling ‘full automation’ across them and reduces the amount of human resources needed within the process. As the individual connection is
c) E-documents conversion – in this case if neither of the above solutions is applicable, then alternatively a company can deploy certain software to ‘automate the un-automatable’ documents to an e-version, and then allow its data to be exchanged with internal/external selected parties to reduce lead time for data exchange. It is no longer a ‘full automation’ but the implementation time and cost for these solutions are relatively less comparing with standard EDI connection. Many would now have the question whether with all these solutions available – is it the right time to deploy them for their business in APAC? There is no simple answer to that question but rather I would advise those who are interested, needs to take concern on the following:
- You need to take into concern on the number and financial impact of the e-business benefits, and compare it against the personalized and humanistic service requirements which your business need to provide, basing on how many current & future customer segments of your customer portfolio will need it. This will help you to define the scoping of your e-business clearly.
- The scoping of your business case will probably need to take into account on country adoption rate of certain e-business trend, depending on their speed & popularity of certain e-business process settling in. As an example, if you know your Thailand customer often requires physical delivery of invoice, then you need to consider the applicability of E-invoicing to them. Japan and Korea are generally more accepting to EDI supporting transactional service; on the contrary you will need to challenge the applicability of web shop there. India is currently very popular with webshop and e-procurement portals due to the initiative Digital India, but you may need to consider how long these trends will last.
- If there are low volume transactions then webshop/portal is recommended, else EDI is more preferable for high volume transactions.
- As you are possibly facing more than two audiences within one customer’s legal entity (e.g. procurement and engineer), you need to be aware on the design of your company’s homepage, the web shop, and you have to define clearly what kind of content and process will be included into which domain.
- If you are choosing to adopt EDI, then you need to consider whether you should adopt it on purely process level (e.g. for purchase or sales order transmission), or including people level (e.g. for mass communications, real time contact, profile, safety information exchange). Either way, the technical infrastructure readiness at your trading partner’s company side, in terms of middleware setup and valid external EDI provider connection, will be something you need to be mainly concerned of, since APAC companies’ readiness are typically lower comparing with EMEA and NAFTA companies.