Trending Now: Supply Chains Get Social
Social networks give supply chain organizations efficient tools for promoting collaboration and getting critical information to everyone who needs it.
More to the Story:
By now, it's axiomatic: You must be on social media. Twitter, Facebook, LinkedIn, YouTube, and other platforms offer powerful tools for staying in touch with customers and promoting your brand.
But where does the supply chain come in? Can connections among people who know other people, who know still more people, help you forecast demand, procure product, move shipments, manage suppliers, or fulfill orders?
The answer is yes—but not always in the way you'd expect.
In supply chain management, the most active networks for sharing business information aren't the well-known public sites, but the cloud-based collaborative platforms sometimes known as supply chain operating networks (SCONs).
The term SCON refers to platforms created by companies such as GT Nexus, Elemica, E2open, Descartes Systems Group, and others that allow large numbers of trading partners to exchange data about supply chain transactions. Adrian Gonzalez, president of Adelante SCM, a peer-to-peer learning and networking community for supply chain and logistics executives, says he coined the term in 2003.
Historically, companies have used electronic data interchange (EDI) or Internet portals to trade data and documents with suppliers, customers, and service providers. Companies used these tools to create private networks connecting them with those partners. But when, for example, a food manufacturer sells product to dozens of grocery chains, that company might have to join dozens of different networks.
"Why not connect once to a network and have that be the central hub that connects everyone to everyone else?" Gonzalez says. That's what Facebook and LinkedIn do for individuals, and it's what SCONs do for supply chain partners.
When you need to share information with multiple trading partners, point-to-point methods such as EDI and email often cause problems. "There's no single version of the truth," says Greg Kefer, vice president of corporate marketing at GT Nexus, Oakland, Calif.
A social network—whether a SCON or a public platform such as Facebook—eliminates that issue. "The data that everybody needs sits in the center of the network," he says.
If you use LinkedIn to note the fact that you changed jobs, that news becomes visible immediately to all your connections. If you receive a purchase order and you're on a SCON, that information becomes available immediately to all the suppliers, customs brokers, carriers, and other partners you've authorized to see that data.
The social experience at GT Nexus will soon gain a new dimension, thanks to the company's recent purchase by the New York-based software company Infor. A developer of solutions for enterprise resource planning (ERP) and other business applications, Infor acquired GT Nexus in September 2015.
Infor's portfolio includes a networking product that is not a SCON, but a different kind of social platform called the enterprise social network (ESN).
Companies use ESNs to give employees—and sometimes external partners—the same connectivity they'd find on public social networks, but tailored to the firm's needs and confined to the enterprise. Among the best-known ESNs are Yammer (acquired by Microsoft in 2012) and Chatter (developed by Salesforce). Infor's ESN is called Ming.le.
Like a SCON, an ESN makes vital information available to everyone who needs it. "An ESN puts all your conversations in a centralized place that others can search for, starting to create a knowledge base," says Emily Williams, senior product manager for Ming.le at Infor.
But unlike a SCON, an ESN is designed mainly for discussions, not transactions. You use it to speculate on how the long-range weather forecast will affect demand for ski gear—not to note that your containerload of ski gear has just left Shenzhen.
If three people on an ESN start talking about a truck that has broken down, and the need to rush the stranded load to Chicago, other people who notice those posts could jump in to offer help.
In most ESNs, you won't see the status message from the trucking company that alerted the shipper, through its transportation management system, about the breakdown. In Ming.le, though, you might indeed see that alert. Ming.le lets users integrate data about business activities—drawn from Infor's supply chain solution and its other applications—with their unstructured, text-based posts.
"We're embedding social touchpoints in the ERP, asset management, and supply chain applications, so users can start to follow objects coming from their core systems, such as orders or requisitions," Williams says. "We have workflow, and conversation that ties to that workflow."
Among other things, that kind of integration could be useful to employees who aren't directly involved with a certain activity but need to stay aware of it. "For instance, sales people want to know when they're going to get new stock for a product on back order," says consultant Tony Martins, president of Tony Martins and Associates in Montreal. "They can get direct communications from the data without anybody needing to tell them."
Ming.le already plays a role in some companies' supply chain operations. More firms might join the conversation now that Ming.le and GT Nexus operate under the same corporate roof.
With 25,000 businesses exchanging data on its platform, GT Nexus gives Infor a way to extend Ming.le outside a company's own four walls, bringing trading partners into the discussion. "We're going to make Ming.le network-based and have that full, end-to-end conversation across the supply chain," Williams says.
Officials at Infor also expect a complementary change, adding free-flowing conversations to GT Nexus. That would give GT Nexus users a channel for verbal communication that's just as collaborative as the channel they use for data. "People want to get off email because it's siloed," Kefer says. "Collecting a message, attaching it, and keeping it along with all the transactional information will be valuable."
Text-based posts add context to transactions. "You can put only so much information in a structured document like an order or a shipping event," Kefer says.
Email can add context. But just as it's difficult and awkward to share and discuss your vacation photos with scores of friends and relatives via email, it's also difficult to hold business conversations that way with scores of colleagues and partners. "Social media becomes an efficient way of communicating," he says.
A SCON—which is essentially a network of IT systems—is useful as long as business operations run according to plan. "But we all know that exceptions happen in a supply chain: A truck gets delayed, an order gets cancelled, demand is greater than expected," says Gonzalez. "Ultimately, people have to get involved."
That's where a human-to-human networking tool such as Ming.le comes in as an alternative to phone calls, meetings, and emails with attachments. "Social networking provides another set of communications and collaboration tools that are arguably more efficient and more scalable," he says.
Bringing Global Partners Together
Adding social conversation to a platform such as GT Nexus also gives partners across a large supply chain, dispersed around the world, an easy way to push important events to the foreground. Say, for example, a big storm is brewing in the Caribbean. "You start to see trending conversations around the hurricane," Williams says. If holding those discussions via email, individuals who weren't included on the distribution list might not learn about the hazard, much less get the chance to join a debate about how to avert transportation delays.
Martins has used ESNs extensively, in the past when he worked as a supply chain executive at Teva Canada and other pharmaceutical firms, and today in his work with clients in manufacturing and supply chain organizations. Like Kefer, he says that social media offers strong tools for dealing with exceptions to established processes.
"When an unexpected event occurs, you may need only two, three, or four people to solve the problem," Martins says. "But it's not always the same people." To find the right experts for a given situation, companies usually bring large groups of people into meeting after meeting, until a solution emerges.
A social model does much better at identifying experts who can solve specific challenges. When someone posts a question, everyone sees it, and the best-qualified individuals jump into the conversation.
"It's not linear," Martins says. "The way they solve the problem is a bit chaotic, because they're not following a recipe." About 75 percent of the activity in a business consists of the unexpected, he says. Those situations are ripe for social collaboration.
Nadine Jean-François, director of supply chain management at pharmaceutical company Valeant in Laval, Quebec, was Martins' colleague at Teva. Her organization made its first foray into social networking when it used Microsoft SharePoint to connect large groups of people around a common mission. Teva later moved to a customized tool similar to Yammer. At Valeant, Jean-François has led the use of Yammer with similar success.
The social platforms have proved effective as tools for collaboration. "Issues were resolved quickly, and people worked together much better," Jean-François says.
Once at Valeant, for instance, an individual who was wrestling with a packaging problem described the troublesome issue in a post and added a photo. "The packaging people posted a solution immediately," she says.
One benefit of social collaboration is the way it brings issues to the attention of people who play different roles, and can attack problems from many different perspectives. Say, for example, a manager posts about an equipment problem that will stall production of a certain product by several days. "The quality control manager will look at this wearing quality glasses, and will launch an investigation into the equipment to make sure the problem doesn't happen again," Jean-François says.
"The engineering person will say, 'I'll immediately send somebody to fix it,' while the supply chain team will make sure that customers who need the product learn about the delay as soon as possible," she adds.
A social media platform assembles many more people than would ever sit together at a conference table. "People who would never get invited to the meeting can have a voice," says Jean-François. "That's extremely important. We found people who were real gems—people who were quiet but had amazing ideas."
At Teva, besides creating social groups for intra-company communications, Martins and Jean-François established private networks for discussions with some of the company's major trading partners—one partner company per network.
On the supplier side, each platform allowed Teva and a partner to discuss situations that might affect the supply chain. "We wanted to get early warning of supply issues, such as problems in the manufacturing operation," Martins says. "On the other hand, if we were experiencing a surge of demand in the market, and we needed them to react to it, we wanted to discuss that with them as soon as possible."
Facebook, Twitter, and Beyond
While some supply chain organizations experiment with SCONs and ESNs, others are using public networks for business needs. For example, LoadDelivered Logistics—a non-asset-based third-party logistics (3PL) company with a strong focus on temperature-controlled freight—maintains a heavy presence on Facebook, LinkedIn, and Twitter.
Social networks are essential for recruiting, says Casey Stelletello, marketing coordinator at the Chicago-based firm. Young job-seekers scoping out potential employers want far more information than they can find on corporate websites. "They're looking at all the social sites. They're looking at comments people make and pictures you've posted, to see if the company has the right feel for them," she says.
Personnel Get Personal
LoadDelivered's Facebook timeline is rife with photos of employees raising funds for charity, celebrating holidays, and volunteering. The company also uses Facebook to highlight industry awards and other good news, says Jennifer Staudt, also a marketing coordinator at LoadDelivered.
Those announcements appear on LinkedIn and Twitter as well. But LoadDelivered uses those platforms mainly to point readers to thought leadership pieces on its website, Staudt says.
BlueGrace Logistics takes its use of public social media one step further, using Twitter in particular as a primary channel for communicating with coworkers, customers, and other parties.
"When our employees start training during their first week at work, we teach them how to get on Twitter and set up a profile. We encourage them to create a work Twitter account with 'BG' in the name," says Whitney McKay, marketing and brand development director at BlueGrace, a non-asset-based 3PL in Riverview, Fla.
As employees and customers follow one another on Twitter and other platforms, those networks often replace more traditional communications media. "We try to steer away from sending an email for every little thing," McKay says. For instance, if a carrier calls or emails about a weather-induced service interruption, BlueGrace uses Twitter and Facebook to spread the word.
Several departments at BlueGrace maintain their own Twitter accounts. Customer service often uses Twitter to field questions and requests. Customers who use that channel never have to wait on hold for a representative or wonder how long it will take to get a reply to an email.
"You will get someone's attention fast if you tweet at our company page," McKay says. "As soon as we see it, we'll say, 'This person needs something,' and we'll send it to the right department immediately."
Identifying Suppliers @Risk
Companies are also starting to look to social media for help with supply chain strategy. Some see the networks as sources of information they can use to manage supply chain risk.
"For example, if you're in supplier relationship management, it's a good practice to follow all your suppliers on Twitter, and have pre-built searches for those suppliers," Gonzalez says. A rash of complaints from people who have just been laid off could indicate problems in your supplier's business, telling you it's time to start searching for a backup source.
Some companies are also trying to mine public social networks for data to support "sentiment analysis," Gonzalez says. "Is this product creating a lot of buzz? Are people talking about it?" The chatter on social media could prove useful in a demand planning exercise.
Supply chain and logistics executives want to make smarter decisions faster. "There are ways to leverage the speed of information that gets communicated via social networks that can have an impact on your supply chain operations," Gonzalez says.
If you have ever seen a video or meme go viral, you understand how quickly information can travel on social media. This force has changed the way many of us conduct our personal lives, and it also holds powerful promise for the way we manage our supply chains.