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This economic recovery looks to be a slow grind that will test management’s capacity to increase production without adding significantly to headcount.  This will force companies to seek greater efficiencies in order to increase production.  Reducing paper processing and administration costs is one way to reduce costs.   Expanding EDI and B2B data exchanges with trading partners is an effective way to reduce costs, but not if it requires an increased headcount of expensive EDI professionals and consultants or more software and hardware.

Management today is wary of adding FTEs when the economy is still relatively unstable.  It is difficult to predict the speed and size of the recovery.  As a result, many recent studies have shown that business process outsourcing and hiring temporary workers seems to be the preferred first steps to increasing production.  Today, expanding EDI and B2B data exchanges can also fit into this category.

The SAP Information Interchange (SII) is a managed EDI service for SAP customers.  It is an EDI service sold and supported by SAP.  If a company determines that expanding EDI and B2B data exchanges with trading partners will enable greater efficiencies and cost reductions, then subscribing to the SII service for EDI/B2B is a very low risk and cost effective step.

SII requires a simple one time set-up for each SAP business process and then a low monthly subscription fee.  There is no requirement for more EDI consultants, staff, software or hardware.  All integration, implementation, operation and support is provided in the SII service.

Forrester’s recent report stated that 85% of all companies (that participated in the survey) already use some sort of managed EDI services.  I believe that the number of companies using managed EDI services will rapidly increase for the following reasons:

  • Companies must keep operational costs down but increase production now.
  • The strongest survivors are now looking to gain through acquisitions of the weakerwhich will require more system consolidations.
  • Companies are wary of hiring new FTEs (full time equivalents) until they are more comfortable with their sales forecasts and the state of the economy.
  • Companies are adjusting to new economic models and views that they must be more flexible and be prepared to respond more quickly to changes around them.
  • Companies must standardize more systems and processes to reduce complexity which causes higher TCO (total cost of ownership).
  • Companies must shed non-core operations to reduce costs and increase staffing flexibility.
  • Companies must focus their brightest minds on core value and competitive advantage processes and projects.  With fewer FTEs brain power must be focused on what will enable the company to survive and prosper, not on mundane and routine, non-core operational issues.
  • Companies must focus on improving cash management – reducing DSO, recognizing early payment discounts from suppliers, reducing inventory, reducing transportation costs through better management visibility, etc.

SAP sales teams can answer your specific questions on how SII works with your current environment.

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7 Comments

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  1. David Rodriguez Díez
    Hi Kevin,

    When will you stop this advertisment campaign with SII? I used to believe SDN was a techie corner and not a marketing corner. It’s boring. Please come back with the topic when you can offer some technical information about the product.

    regards,

    David R.

    (0) 
    1. Michal Krawczyk
      Hi,

      I agree with David – maybe you could post
      a few blogs on technical config for SII
      and not just post one blog per week about SII in general with a more or less similar info each time?
      (we already have 3 or 4 for SII like this one right?)

      Thank you,

      Regards,
      Michal Krawczyk

      (0) 
    2. Kevin Benedict Post author
      SAP and others are rapidly embracing web services, SaaS and IaaS models which are much more about understanding the services available and how they integrate rather than technical configurations.  Most of these business processes operate in a cloud computing environment so there is limited technical involvement by the end user.

      SAP has coached us bloggers to be clear on the titles of our blogs so they are only read by those interested in the subject.  I believe that is being done.

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      1. David Rodriguez Díez
        Ok. I didn’t mean to be a troll, but I wanted to clarify which position do you have. I’ll follow your advise and I’ll pay close attention to the title before going further.

        kind regards,

        David R.

        (0) 

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