Sharing the “Best Version of the Truth” with Trading Partners

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Image by Flickr User Adam Grabek
Image by Flickr User Adam Grabek

Note: This is the latest in a series of posts that discuss how your companies master data management strategy (MDM) has a direct relationship to your company’s fiscal health. In my last post, I discussed how to bring visibility and reliability to enterprise data.  Today I want to discuss how MDM can help you share the “best” version of truth to your trading partners.

Sharing the “Best Version of the Truth” information within an organization and across its replenishment channels allows companies to focus on streamlining their processes to increase profit, efficiently manage promotions, reduce supply chain costs and improve collaborative planning. Providing a platform to enable the sharing and collaboration is only part of the solution. How the participants interact with the data based on their roles and permissions must be orchestrated based on desired business outcomes as well as any related data security protocols.

In a typical multi party, multi echelon supply network deployment, the following roles must be defined and granted permission-based access to interact with their assigned business transactions/data, related business plans, as well as any exception-based workbench UI’s. An example supply network configuration of these roles includes;

  • Buyer Side
    • Buyer Supply Chain Planner – all the business functionality
    • Buyer Supply Chain Manager – Planner + Master Admin
    • Buyer Supply Chain Admin – Manager + user/role admin
  • Vendor Side
    • Vendor Supply Chain Planner
    • Vendor Supply Chain Admin
    • Vendor Supply Chain Manager
  • Enterprise Business Function
    • Inventory Planner
    • Demand Planner
    • Replenishment Planer
    • Buyer – Bidding/Negotiation (Buy Side)
    • Buyer Manager – approves PO/Contract
    • Buyer Planner
    • Vendor Sales Rep – Bidding/Negotiation (Sell Side)
    • Vendor CSR
    • Buyer Financials Manager (AP)
    • Vendor Financials Manager ( AR)
    • Warehouse Manager
    • Inventory Clerk
    • Production Manager – manages production capacity and resource setup
    • Production Planner – PP & DT
    • Master Data Admin – manages master data for the enterprise
    • User Admin – manages security User/Role

In reviewing these roles it is evident that the implementation of an advanced MDM based platform solution requires a rethinking of the processes that traditional ERP vendors have lead us to believe are best practice. As defined by an ERP configuration, their best practice processes lead most CPG companies to run with over 60 days of inventory, retail forecast accuracy of 60%, DC forecast accuracy of 80%, and supplier forecast accuracy of 60%.

A better way would be to implement a state-based set of transactional processes that move seamlessly between trading partners, through your defined roles and across the supply network, all being driven through a common MDM infrastructure supported by a cloud-based network platform.

With such platform it would be possible to implement a true demand driven value network based on the “Best Version of the Truth” across your entire supply network. While this might sound too good to be true, in actual CPG deployments One Network has experience the following improvements: Days of inventory across the entire trading network dropped from 60+ days to 25; Retail forecast accuracy improved from 60% to 80% at the shelf/item level; DC forecast accuracy improved from 80% to whopping 99.5%; and Supplier forecast accuracy improved from 60 to 75%.

If you want to learn more, I suggest you read the white paper: Why Wall Street Cares About Your Master Data Management Strategy.

Greg Brady