European industry ahead by data sharing
Audio-versie
Medium-sized European producers are ahead of the global competition through their above-average transparency in Planning & Forecasting. They share more, earlier and, above all, more intelligently with their supply chain partners. The benefits can be enhanced by extending supply chain data sharing to other business functions. This is according to a user inventory by software company Remira.
It is not the availability of information and communication technology that makes the difference for industrial companies, but how and to what extent they exchange essential data with their supply chain partners. In this, European medium-sized companies are ahead of competitors from America and Asia, Remira argues. The conclusion is seen as a boost for European companies operating in an increasingly competitive global playing field.
In fact, European companies also share more business-critical data with supply chain partners than comparable companies in North America and Asia. This mainly concerns demand-related market information. Leaders in data sharing are producers of consumer goods, such as white goods, sound and video electronics and luxury goods. Producers of food and fast-moving consumer goods lag behind in this respect within Europe.
Cultural differences decisive
"The outcomes mainly stem from cultural differences. The competitive business culture in America, for example, leads to chain partners being more likely to face each other as competitors. Many Asian countries have what I call an ‘autocratic’ business culture. Moreover, corporate giants that encompass the entire chain set the tone here",
explains Johan van Hemert, VP Sales Intelligent Planning, Purchasing and Inventory Sampling at REMIRA.
For instance, ‘chaebols’ – the South Korean form of a conglomerate – and state-owned companies in Vietnam and China have a culture of cooperation to a lesser extent, and this, according to Van Hemert, radiates to private medium-sized companies.
"In Europe, negotiations are also hard, but there is more understanding of each other. Moreover, here the family medium-sized company is stronger."
Recommendations
Remira comes up with a number of recommendations based on the research findings. For instance, incident-based interventions appear to lead to a higher degree of shared urgency and implementation than strategically deployed processes. Shared initiative from multiple business functions at chain partners is also recommended, according to the software company. For example supplier – production planning and buyer – procurement.
In addition, data generated from the supply chain must be specified for the various business functions: sharing data unedited is actually counterproductive, according to Remira. Also, cross-chain data should not only be technically compatible, but should above all be able to be ‘read’ uniformly. Procedures, education and training must be adapted for this purpose.
Investing in chain partners pays off
Van Hemert:
"The information is based on a qualitative survey and on a specific segment within the business community. This ensures that percentages can quickly give a distorted impression . Hence, we also opted for qualitative conclusions. But the tenor is clear: transparency and investing in chain partners pays off in terms of lower stock levels, faster delivery times and less process disruption. Companies are selling themselves short by not using the infrastructure already invested in more intelligently."
A factor that prevents or frustrates data sharing, according to him, is first and foremost a faltering internal organisation, as a result of which data flows cannot be delivered in a uniform manner. The fear of competition-sensitive data being out in the open also plays a role, as does insufficient data availability. In Europe, North America (especially the US) and Asia, the willingness to share data more widely and earlier is 75, 60 and 65 per cent, respectively.