Poor integration and a lack of supply chain agility is costing businesses
According to a new survey, 85% of companies say they are losing money due to integration issues with their supply chains, with 24% admitting to losing $500,000 or more.
The study conducted by Dimensional research for Cleo shows 14 percent say they are losing more than $1 million a year, compared to just 10 percent in each of the previous two years, reflecting a 40 percent year-over-year increase.
The problems are largely due to outdated integration systems and poor integration of business processes with their ecosystems. Due to a lack of end-to-end visibility into business processes, about half (49%) of all companies don’t really know what’s going on at key integration points in their business transactions.
In 2021, 45% of onboarding experts surveyed said it took between a week and a month to onboard a new supply chain partner, up from 37% the year before. And 42% say it takes longer than a month, up from 36% the year before. Outdated legacy applications, an overreliance on manual processes, or too much custom code hinder partner onboarding for more than half of companies.
“Among business leaders surveyed, supply chain disruption was rated as the second most significant external risk to their business, after cyber threats. Yet many companies are puzzled as to how supply chain disruption can be overcome,” says Tushar Patel, CMO of Cleo. “They know that more automation is needed for supply chain agility, but some still wonder if their problems are coming from within or from business partners. ‘Is it them or is it us ?’ they wonder, and this uncertainty is holding back the investment decisions of some organizations, meanwhile it is bleeding profits and damaging important business relationships.
On a positive note, a growing number of respondents believe that modern cloud-based solutions for B2B integration can help them resolve the situation. 69% believe ecosystem integration technology can drive cost savings and increase their bottom line. And 81% say they have started or will start migrating their integration capabilities to the cloud within the next 12 months, for better data security and control.
Full 2022 State of the Ecosystem and Application Integration Report is available on the Cleo website.