Archive - March, 2012

Make Sure “Lean” Does Not Mean Inflexible

 

The wider financial crisis has forced many businesses to cut back in order to secure their future. Cost savings through efficiencies have been a high priority for many. Some of these cost savings have  initially been realised through reduced headcount but as the downturn continues and growth remains delayed, businesses are looking at supply chain effectiveness to maintain the downward pressure on costs.

Undoubtedly most supply chains will benefit from some degree of rationalisation and consolidation making good use of the cost savings that arise as a direct result. However when it comes to making cuts, it is very easy to get carried away creating a supply chain that is efficient but inflexible.

As we have discussed previously, uncertainties relating to the supply of raw materials and potential disruptions caused by natural disaster or civil unrest require a company to be agile in order to adjust to the unforeseen. If too many resources are stripped and the supply chain becomes so inflexible that there is no slack or room for adjustment, the results could still be catastrophic even in the face of tiny fluctuations.

Ultimately, your business will need to decide how best to adjust your supply chain, which parts to improve and which to remove whilst leaving your business in an operational state. The ERP system used to manage your supply chain will also need to be equally flexible and customisable to mirror accurately the changes in structure.

Using a period of rationalisation also allows decisions to be made that will define the future of the supply chain. Many companies are taking the opportunity to invest in strengthening their core systems; those tackling the challenge with a long term view are investigating off-site, cloud-based solutions with the capability to shift in line with the company’s own changing needs.

Celtrino’s own Smart Admin platform provides all the flexibility required to remain competitive regardless of the wider financial environment. To find out more, why not give us a call?


Posted on March 28, 2012 in ERP, Smart Admin, Supply Chain by
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EU eProcurement Framework Agreed

 

In early February, in a further boost to electronic trading across the European Union, the Competitiveness Council created a set of goals designed to promote online trade and electronic invoicing. Meeting in Denmark, various ministers laid out a timeline promoting several web-based trading systems with a view to doubling online sales by 2015.

The push for greater use of business technology is also reflected by attempts to grow online public markets until 2016, and e-Invoicing until at least 2020. The Danish EU presidency presented figures to ministers suggesting that growth of the digital single market would undoubtedly grow European GDP, perhaps by as much as four per cent over the next eight years.

EU eProcurement Framework AgreedThe European Commission recognise that at present digital public procurement markets remain a relatively niche sector of the wider marketplace, but the well documented benefits of switching from manual to digital processing should benefit member states in the long run. Factoring in reductions in manual administration should also help reduce costs and foster a greater degree of competition between suppliers at the point of tender.

During the same meeting, ministers backed the findings of the European Commission publication ‘e-Invoicing: Reaping the benefits of electronic invoicing for Europe’, which suggests increased adoption of the technology for cross-border e-Invoicing for member states. The report suggests that introduction of e-Invoicing between Eurozone members will significantly improve international supply chains across Europe creating working capital gains in excess of £300 million.

The move towards greater use of eProcurement systems and increased online trading comes in the same week that the European Union legislated for the new Single European Payments Area (SEPA), designed to facilitate easier banking across the region. Although the EU still trails behind several South American countries in their use of e-Procurement and invoicing, these recent changes will finally start to see that change.

 

Sources
http://www.sharedserviceslink.com/file/94290/eu-ministers-set-out-online-billing-and-procurement-plans.html


Posted on March 26, 2012 in Digital Single Market, e-Invoicing, eProcurement, EU, European Union, SEPA by
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Business Processes Part 2 – What can be made into a process?

 

We saw in the first instalment of this three part overview of business processes that implementation of processes carries a number of benefits based around creating efficiencies through de-duplication of effort. Having established the ‘why’, we can now shift the focus to the ‘what’.

Business Processes Typically, anything that is done more than once in any workflow becomes a candidate for conversion into a process. Look carefully at each sector of your business and identify where particular actions are repeated, taking in the smaller details as well as the larger picture; when designing processes there is nothing wrong with starting small. From the way in which a component is fabricated, down to the transfer of incoming mail onto a computerised accounts system, each department of any business has areas where efficiencies could be created by automating repetitive tasks.

Traditionally, processes are broken into two categories, Top/Down processes that address high level tasks, and Bottom/Up that automate lower level issues. Top/Down processes are created to be more general, providing a flexible guideline for completing a larger task, essentially directing the way in which a task is to be completed without specifying the exact steps to be taken. Acting almost like goals, Top/Down processes help define the ‘big picture’ and the steps required to make the final goal.

A Bottom/Up process however is far more prescriptive, acting like a recipe for the specific steps required to complete a smaller task. Typically, Bottom/Up processes, by their very design, are less flexible than their Top/Down counterparts, although it is possible to create some room for minor adjustments. Bottom/Up processes define the smaller steps required to maintain the Top/Down overview and goals.

Once potential processes have been identified, they should be implemented as soon as possible to reap the benefits immediately.

In the final part of this series we will examine the nature of ongoing process improvement.


Posted on March 23, 2012 in BPO, Business Process Automation, Business Process Outsourcing, Supply Chain Management by
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Business Processes Part 1 – What Are Processes and Why Should I Care?

 

Business Processes For any business looking to save cash, the obvious answer to look for potential efficiencies within their workflow. These efficiencies can be found in several places, but efforts to save time are often the most effective over the long term allowing for better utilisation of resources.

Enter the ‘process’ which effectively create a template for business operations which can then be repeated over and over again, de-duplicating effort and reducing the need for intervention. Over time, processes become incredibly important because:

  1. Processes save time. Identifying areas of commonality allow for repetitive systems to be created which can then be reused at each appropriate point, saving time and resources.
  2. Processes increase accuracy. Breaking the workflow into smaller segments allows for continual improvement of each sub-section, leading to greater savings in the long run.
  3. Processes allow transference of responsibility. By templating and documenting how a particular process works, the tasks can be passed on to other business units or contractors, reducing administrative burden and costs.
  4. Processes can be scaled to fit requirements. Once defined, a reusable system can automated and implemented quickly, allowing additional time for refinement for maximum efficiency.

These four positive benefits of processes, make it easy to see just how important and valuable they can be to a business. The beauty of processes is that they can be applied to virtually any aspect of a business, be it internal workflows or as a wider part of their supply chain management strategy.

Best of all, the reduction of duplicated effort by implementing a process creates the most valuable resource of all – time. And as the old saying goes, ‘time is money’.

Don’t forget to check back for part 2 in this series – ‘What can be made into a process?’


Posted on March 21, 2012 in BPO, Business Process Automation, Supply Chain Management by
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EU Sets SEPA Deadline for February 2014

 

SEPA. The 32 member states of the Single Euro Payments Area and two non-members

The 32 member states of the Single Euro Payments Area and two non-members. Source: Wikipedia

In a busy week for The European Union’s law makers, an agreement has finally been put in place to increase the ease with which businesses and consumers can make and receive bank payments across member states. The Single European Payments Area (SEPA) legislation has been agreed and will come into force on February 1st 2014, forcing banks to be more transparent about international payments and eliminate hidden charges.

The changes brought about by SEPA are intended to save around €123 billion in bank charges over six years through cuts in transaction fees billed to businesses within the EU. The major benefit of SEPA however will be the reduction in the number of bank accounts required for a business to trade effectively with the Eurozone to just one.

SEPA will allow companies or individuals to maintain a single bank account in any European country of their choice and make Euro transactions to any other account, anywhere in Europe. Individuals working ‘abroad’ will also benefit as they will no longer be required to open a new bank account in the host country; payments can still be made to their bank at home minimising the problems associated with setting up a new account in a foreign country.

MEPs are also expecting the efficiencies created by SEPA to encourage further use of electronic invoicing across member states. The bulk of the estimated €123 billion in savings is predicted to come from the ease of making and receiving electronic payments coupled with e-invoicing. This will create a more efficient, inter-operable framework.

Technically SEPA has been in force since January 2008, but a low take up has forced legislators’ hands. This latest decision by MEPs ensures that the February 2014 deadline is legally binding.

 

Sources:

http://www.sharedserviceslink.com/file/94302/february-2014-sepa-deadline-set.html


Posted on March 20, 2012 in e-Invoicing, European Union, SEPA, The Single European Payments Area by
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Securing Your Supply Chain Management System

 

We have talked at length here on the Celtrino blog about the importance of securing supply of raw materials for future business growth, but it is equally important to ensure your supply chain data is adequately secured again loss, damage or theft. Just as losing a warehouse could damage your company, so too could loss of critical data. Here are a few things to consider:

1. User-level securitySecuring Your Supply Chain Management System

Unfortunately the weakest point of any computer system is the people using it. A malicious staff member could steal data, or a negligent employee could delete it. Either way, your supply chain management system needs a way to restrict access to sensitive information.

2. Information access

Your business data has to be stored somewhere secure, probably spread across more than one physical location for easy access. Consequently all security protocols will need to extend across each site too. Consider using cloud hosting which places the burden of responsibility on your provider for keeping data safe and secure.

3. Selective sharing

Although we strongly recommend data sharing between supply chain partners, it is not appropriate to make everything available. Use data segregation and encryption to keep commercially sensitive information separate from that which is to be shared.

4. Resilient System Design

Just as a supply chain manager tries to eliminate the risks associated with supply and demand, similar thought should be given as to how best to keep the company data safe in case of disaster.

5. Scalable

The fortunes of your company will change over time, making a system which can expand and contract accordingly essential for business agility. A good supply chain management system therefore needs to be adjustable and configurable.

For businesses looking to hit the ground running, this list may seem quite daunting but options exist to make deployment easier. Celtrino’s Smart Admin platform interfaces with existing in-house system to facilitate easy data transfer with in-built security and resilience, leaving your supply chain manager free to consider risks external to your business instead.

 


Posted on March 16, 2012 in Supply Chain, Supply Chain Management by
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Corruption, Bribery and Your Supply Chain – Part 2

 

As discussed in the first of this two part series on corruption and fraud in the supply chain, in certain countries such activities are not only tolerated, but actively encouraged. Since July 2011, the tough new Bribery Act has bound UK businesses by a set of ethics which expressly forbid kickbacks and the like, regardless of whether the recipient is based in Britain or not.Corruption and Bribery in the Supply Chain 2

Bribery and corruption have a number of negative effects on a business and so should be avoided. Here are five tips to weed corruption out of your own supply chain.

1.      Keep up to date with legislation
Stay in touch with corruption legislation domestically and abroad to ensure that your business remains compliant. You should also carefully monitor general business practices in low governance countries with whom you deal in order to be able to identify procedures designed to encourage fraudulent activity.

2.      Encourage whistle blowing
Your employees are the eyes and ears of your business and will quickly be alerted to corrupt practices. Implement a system by which staff can report issues confidentially and make them aware of how the system works and the protection your business will offer them. Ensure you act on any information you receive.

3.      Make staffing changes as required
If you have concerns about account managers or people dealing directly with suppliers, do not hesitate to replace them. Any issues caused by the transition will be temporary and far less costly than a criminal court case for bribery.

4.      Train staff to say no
Provide employees with guidance and training in how to recognise corruption systems and how to avoid them. It is also a good idea to provide basic training in anti-trust law and ethics.

5.      Adopt an Anti-Corruption Policy
Sign a code of conduct agreement or adopt an anti-corruption to demonstrate that your organisation is serious in its intent to root our fraudulent business practices. Doing so speaks volumes to your employees, your suppliers and your customers.

Corruption is not easy to fight, but the five ideas listed above will give you a head start on removing it from your supply chain. Feel free to let us know if you have any others.


Posted on March 14, 2012 in Supply Chain, Supply Chain Management by
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O2’s Sustainability Commitments Drive Supply Chain Improvements

 

British mobile telecoms provider O2 has created a three year sustainability plan, intending to reduce carbon emissions by 4 million tonnes and train one million young people through various community projects. Known as the ‘Think Big Blueprint’, O2’s plans touch on every aspect of their business including the management of their supply chain.

O2’s Sustainability Commitments Drive Supply Chain ImprovementsNumber one on the list of priorities is a change in the way major purchases are viewed shifting the focus from pure financial value, to the wider impact such a decision has. If the purchase is unsustainable or causes irreparable environmental damage, then the deal does not proceed. However O2 also plan to extend this policy beyond the confines of their own company, auditing their larger suppliers to ensure compliance with the O2 Responsible Supply Chain Policy which covers environmental concerns, business ethics and corporate responsibility; failure to meet these agreements could result in termination of a supply contract.

O2 are also keen to involve many more SMEs and social enterprises in their supply chain and are creating processes to make this a reality. A new supplier forum has been set up to allow companies up and downstream to promote innovative practices for greater efficiency and to share best practices.

Key to all of O2’s sustainability efforts is greater collaboration in the B2B and B2C markets, to create a coherent strategy that affects not only every aspect of their supply chain, but also the rest of the business. Facilitating better information sharing should not be a problem for a communications giant, but the channels used to underpin it will need to be innovative and efficient in their own right.

O2 has recognised that sustainable business practices can provide definite returns on investment through creation of efficiencies, as well as a great deal of goodwill from the general public by involving them in the supply chain. Taking O2’s lead, how could you transform your company’s fortunes through supply chain collaboration and sustainable business practices?


Posted on March 13, 2012 in Supply Chain, Supply Chain Management by
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Social Media as Part of the Marketing Mix

 

Have a read of my recent interview in the Enterprise Ireland magazine – The Market. Here I talk about the importance of social media as a part of the marketing mix and how Celtrino use social media platforms to communicate with IT buyers in the retail industry.

Social Media as Part of the Marketing Mix – The Market Interview with Michael O’Brien

View more documents from Celtrino


Posted on March 12, 2012 in Interview, Online Marketing, Social Media by
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Corruption, Bribery and Your Supply Chain – Part 1

 

Corruption, Bribery and Your Supply Chain on the newspaperDespite the giving and receiving of bribes being wholly illegal in the United Kingdom, such practices are considered commonplace in other nations across the world. The received wisdom is that paying bribes and going along with corrupt business practices makes trading easier and quicker, but are there long term consequences to engaging in such activities?

In the unlikely event you can find someone willing to talk about their experiences with bribery, they will point out that there are always two parties involved in backhanders. They will also point out that although illegal transactions can work initially, they also entail a number of risks.

Loss of Profit
Simply put, a bribe eats directly into profitability, both in terms of money paid out and in time spent arranging for the payment of the bribe. Diverting resources to arranging and paying bribes is inefficient and introduces bottlenecks into the supply chain.

Moral Issues
Advocating questionable ethics by paying bribes adversely affects the attitudes and ideals of employees involved in the process. If your business thinks it is ok to act illegally, surely it is therefore ok for employees to act illegally in any other aspect of your business’ dealings?

Legal Issues
Paying bribes is by definition, illegal. Businesses that pay or take bribes risk prosecution and imprisonment of personnel, both of which are extremely costly.  Not to mention legal fees.

Brand Image Issues
The adverse publicity surrounding bribery trials also has the potential to irreparably damage your brand name. The wider fallout from a bribery scandal and prosecution has the potential to permanently damage a brand, potentially bankrupting your business and also those of your suppliers and customers.

The risks associated with bribery escalate in severity and should therefore be carefully mitigated by supply chain managers to prevent large problems for their business. Check out Corruption, Bribery and Your Supply Chain Part 2 to find out what you can do to root out fraudulence.


Posted on March 9, 2012 in Supply Chain, Supply Chain Management by
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