E-commerce is Forging the Future of B2B Manufacturing
In June I wrote the following blog for the SAP Innovation Spotlight on medium.com based on conversations that started at SAP SAPPHIRE with Ketul Patel at Zekelman Industries, one of North America’s largest steep pipe and tube manufacturers. Since then, I’ve had conversations with other B2B companies who have echoed many of the things he has said and I hope his insights will be valuable to the SAP Community.
As digitization becomes ingrained into every part of our culture and society, B2B manufacturers are adapting and transforming by adding e-commerce to their essential business strategies.
The logic behind the decision is simple: It might be a company who pays for a manufactured product, but it’s people who place the order. And people today expect seamlessness and the ability to get what they want within a few clicks, regardless of whether they are at work or at home.
B2B buyers expect tracking of goods in transit, in addition to other traditionally B2C solutions as customer experience becomes crucial in all sectors.
A great example of a manufacturer who has embraced this ideal is Zekelman Industries. Zekelman Industries is the largest independent steel pipe and tube manufacturer in North America, annually producing 2.8 million tons of products, which is 450 truckloads a day. Their tubular steel products are found in diverse structures from airports to manufacturing plants to stadiums, just about every building or structure has some type of pipe or tube in it.
Ketul Patel, Director of Financial and Sales Applications at Zekelman Industries explains their vision, “When we started on our digital journey, we were ahead of our peers in steel. We knew then that we wanted to compete on more than just a commodity basis but also on experience.”
Sensing the need for e-commerce was about to become a requirement, nearly 10 years ago Zekelman built their own e-commerce platform to automate the front-end experience.
Like similar businesses, their sales cycle had involved a customer calling or emailing a sales rep, then the sales rep getting back to the customer with pricing and availability. This could take a day or more. But they knew expectations were changing — the next generation of business buyers use mobile platforms and expect instant responses.
“Our buyers are getting more tech savvy and their experience as a digital, retail consumers sets the bar. They are looking for an ‘Amazon’ experience and we want to be the ‘Amazon of steel,’” said Patel.
For Zekelman customers, this means being able to see inventory and pricing in real-time, as well as tracking of goods in transit. It means full transparency on the price, order details, production or availability, shipment, and delivery. In an industry where the products are critical components of larger projects, this information is invaluable.
Three years ago, Zekelman made the choice to move off its homegrown system to SAP Commerce so they could take advantage of product innovations and built-in integrations to SAP ERP and other back-end systems. Their Z-Commerce™ initiative allows customers to buy products and track shipments online, on any device.
“Success in Z-Commerce is dependent on back-to-front connectivity between SAP Commerce and our supply chain,” said Patel. “Our customers’ projects are massive and complex and we have to ensure that we get the right product to the customer when they need it by integrating the storefront with SAP Advanced Planning and Optimization and ERP, turning operational excellence into an excellent customer experience.”
Like any good brand, Zekelman knows that adoption is ongoing and has plans for continuous improvement like adding chatbots and interactive feedback mechanisms. These are yet another means to enhance the overall customer experience.
“There is always a lot of change management when you embark on any kind of digital transformation especially in an industry like ours. We have started to roll out our system and hope to digitize nearly 60% of our sales process in the future,” commented Patel.
Zekelman is ready for the future of B2B manufacturing — are you?