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How Machine Learning Is Transforming Supply Chain Management

machine learning

How Machine Learning Is Transforming Supply Chain Management

Supply chain management is a complicated business. A lack of synchronization or one missing entity can interrupt the entire chain and result in millions in losses.

In a market environment where businesses are continually striving to cut costs, increase profits, and enhance customer experience, disruptive technologies like machine learning offer a window of opportunity. By exploiting the enormous amount of real-time data and leveraging the cloud power, it improves decision making, process automation, and optimization. It can create an entire machine intelligence-powered supply chain model. It also helps companies improve insights, mitigate risks, and enhance performance, all of which are crucial as the global supply chain war wages on.

Gartner recently announced that innovative technologies like blockchain and Artificial Intelligence (AI)/machine learning would significantly disrupt existing supply chain operating models. In addition to advanced analytics and Internet of Things (IoT), machine learning is considered one of the high-benefit technologies. This is because it allows dynamic shifts across industries and enables efficient processes that result in significant revenue gains or cost savings. 

So, it is no surprise then that, in another industry update, Gartner predicted that at least 50% of global companies would be using AI-related transformational technologies in supply chain operations by 2023.

There are three key ways in which these transformational technologies empower businesses:

Monitoring: By connecting equipment, products, and vehicles with IoT sensors, companies can monitor goods and operations in real time.

Analyzing: Advanced analytics convert data into actionable insights and help businesses understand the reason behind specific incidents and how they impact the business.

Acting: Valuable insights as a result of data crunching help businesses address planning challenges and automate processes to improve efficiency.

So, adopting machine learning in supply chains is critical for companies to stay competitive in the long run. However, what aspects of the supply chain will be impacted by machine learning? Let us find out.

A Myriad of Benefits to Supply Chains

If you get the algorithms right, the benefits of using machine learning are innumerable. The algorithms can predict supply trends based on human behavior, resulting in personalized customer service with lower inventories and better utilization of resources. We take a look at several such benefits of machine learning below.

Brings Real-Time Visibility Which Improves Customer Experience

According to a Statista survey, visibility is a significant organizational challenge for 21% of supply chain professionals. Visibility has been a buzzword in supply chain circles for more than a decade now and every technology so far has promised to improve visibility in some way. But, is machine learning contributing anything here? 

The combination of IoT, deep analytics, and real-time monitoring is improving supply chain visibility, helping businesses achieve delivery commitments and transforming the customer experience. By examining historical data from various sources, machine learning workflows discover complex interconnections between various processes along the value chain.

Amazon is a prime example as it is using machine learning to enhance its customer experience by gaining an understanding of how product recommendations influence customers’ store visits.

Cuts Costs and Reduces Response Times

As per Amazon’s regulatory filing in 2017, their shipping costs increased from $11.5 billion in 2015 to $21.7 billion in 2017. And, it’s not just Amazon. Many other players are struggling because of rising shipping costs. In fact, in one survey, more than 24% of supply chain professionals expressed that delivery costs are the biggest challenge for B2C companies.

By applying machine learning to handle demand-to-supply imbalances and trigger automated responses, businesses can improve the customer experience, while minimizing costs. Operational and administrative costs can also be reduced by integrating freight and warehousing processes and improving connectivity with logistics service providers.

Machine learning algorithms’ ability to analyze and self-learn from historic delivery records and real-time data helps managers and dispatchers optimize the route for each vehicle. This allows them to save costs, reduce driving time, and increase productivity. 

Machine learning can also be used to detect issues in the supply chain before they disrupt the business. Having an effective supply chain forecasting system means a business has the intelligence to respond to emerging threats. And, the faster a business can respond to problems, the more effective the response will be.

Streamlines Production Planning and Identifies Demand Patterns

When it comes to machine learning’s role in optimizing complex supply chains, production planning is just the tip of the iceberg.

Sophisticated algorithms are trained on existing production data in such a way that they start identifying future buying, customers’ ordering behavior, and possible areas of waste. This helps businesses tailor production and transport processes to actual demand as well as improve their relationships with specific customers.

For example, by anticipating and acting on the specific needs of your customers before they even arise, businesses can establish themselves as reputed brands capable of recognizing customer needs. 

There is so much volatility in global supply chains that it will be challenging to forecast demand accurately, without technologies like machine learning. However, reaping the full benefits of machine learning might take years. So, businesses should plan for the future and start taking advantage of the machine learning solutions available today.

Investing in machine learning and the related technologies today means increased profitability and more resources for your business tomorrow. Businesses that can use machine learning in their supply chains will have better plans, resulting in less “firefighting” and fewer inefficiencies.

 

FinTech

FinTech: 5 Automation Trends That Are Impacting the Industry Right Now

The FinTech industry is rapidly moving toward automation as a source of efficiency. The move to specific tools and software programs increases speed and accuracy of processes. It also keeps employers on their toes as they need to quickly evolve and learn. Many of these programs previously required specialized training and adaptability.
Automation helps with repetitive procedures and simplifies complicated tasks. It increases accuracy and safety measures, while minimizing human error. Expectations indicate that the FinTech industry will extend its tech integration significantly over the next four years.


Here are 5 automation trends that are impacting the Fintech industry right now:

1. Human Resources Management: This used to be one of the least automated components, but now software like Workday and 15Five are building platforms to assist workflow with related systems that support employee management. Finance companies increasingly recognize that their people are the most valuable resource and need to be managed more thoughtfully as well as efficiently.

2. Mobile: Finance companies now consider mobile oriented tech as part of the core work-flow. The industry relies heavily on its ability to get work done efficiently. FinTech continues to utilize software which speeds up communication and productivity. Mobile used to be considered a security risk by the financial industry. Now it is considered a way to enhance productivity as well as provide more flexible workflow for employees.

3. Customer Support: More automation is taking over customer service. This support has advanced tremendously with certain software programs that include internal systems to support customers. Software systems such as Fresh Desk and Zen Desk are cutting down on the head count needed for customer service departments in some companies. But more importantly these new systems are improving the customer experience and the lives of the people working in those departments.

4. Billing/Invoicing: Payments systems like Stripe, invoicing and billing systems like Freshbooks, and more advanced ERP systems Netsuite are examples of programs that continue to reinvent the way FinTech is automating business functions. Although many companies are still at least partially stuck in the past of creating manual invoices and payments, these automated systems are increasingly taking over. Both the customer and the vendor win with greater automation in this area. Vendors cut costs and get paid faster. Customers benefit from this greater efficiency of vendors with lower prices or higher value delivered for their purchases.

5. Accounting: Xendoo, Zoho, Quicken online and other systems automate are automating the accounting, bookkeeping, and tax filing functions of businesses. Traditional accounting software, and human bookkeepers and accountants, still have an important role to play in this area, but the accounting business is rapidly changing as well due to technology. The number of people involved with these activities is likely to shrink dramatically as automation takes over more of these functions. Ultimately businesses and their customers will benefit from this via lower operating costs that allow for better value to be delivered rather than spent on administrative functions like accounting.

It is crucial for companies of all sizes to be knowledgeable about this trend and keep their business updated as automation continues to reinvent Fintech industry jobs. You have to be able to adapt quickly to these changes. Our previous ideas and habits of doing business are changing, and we have to keep up with those changes or be left behind by competitors who will adapt more quickly

Automation is impacting Fintech employees in a variety of complex ways so it’s critical for employees to have a greater understanding of and training on different software systems to ensure they keep up with the automation and benefit from it rather than viewing it as a potential threat to their jobs. There is no way to stop technology. All of us need to work hard to stay on the right side of its inevitable progress.

automation

Automation Won’t Destroy Trade – It Might Even Boost It

Alarm bells are ringing

Many industry observers are sounding alarms about the looming impact of automation, robots and 3D printing, which they fear will destroy jobsdisrupt value chains and maybe even reduce the need for international trade. Developing countries are particularly concerned because trade has been an avenue to economic development and growth for them. But a recent report released by the World Bank shows that the data and evidence don’t support the hype. Instead, automation, robots and 3D printing might actually increase trade as trade costs continue to fall.

Some business analysts have warned that automation and robots could disrupt and shorten global supply chains. The thinking behind the concern is that, if a computer can design it and a 3D printer can make it, then we won’t need to source it from countries abroad that have more abundant low-cost labor than we do. Instead, companies will drastically shorten their value chains, which could reduce international trade.

The anxieties have gotten the attention of development economists and developing countries. Trade and economic growth go hand-in-hand, both in economic theory and in practice. Multiple studies have shown that firms in developing countries that participate in global value chains outperform their local peers that solely focus on domestic markets. If robots eliminate the need for global value chains, this important avenue for economic development could be threatened.

Anxiety over automation may be overblown

Scare tactics about economic change are attractive because they get our attention. About 15 years ago, we saw headlines about “white collar outsourcing” (once attorneys were added to the list of jobs that could be moved offshore, the panic even spread into boardrooms). Some lawmakers called for restrictions on offshoring, and some of those calls are still alive today. But the mass exodus of white collar jobs did not occur.

The World Bank is a multilateral development agency that makes grants and loans to support capital projects and economic growth in the poorest countries. Anything that reduces the need for trade and global value chains would hit those developing countries hard, putting the automation concerns squarely on the World Bank’s radar.

In its annual World Development Report, the latest released on October 8, the World Bank does not take a definitive stance on the overall effects of automation, and it does not make any bold predictions. But it does make one thing clear: The anxiety over automation hindering trade is not supported by the data and evidence. In fact, the authors show that sectors with the largest increases in automation have also been those with the largest increases in trade. Yep, that’s right: We’re experiencing the opposite phenomenon to what so many are worried about.

Automation actually helping to expand trade

Specifically, the report shows that the percentage change in imports of parts from developing countries from 1995 to 2015 is higher in industries that are more automated. Agriculture and textiles are among the least-automated industries and have the smallest change. Metal, rubber and plastics, and automotive sectors have the highest rates of automation and the largest increases in trade.

Automation in industrial countries has boosted imports from developing countries

Why? Because automation, like robotic assembly and 3D printing, leads to an expansion in output and demand for material inputs. Automation can also lead to the creation of new tasks. So while it brings labor market adjustment pains — like technology and progress always do — automation will not necessarily reduce trade or shorten global value chains.

Meanwhile, investments in digital technologies continue to lower the costs of coordinating across long distances. These lower trade costs are expected to promote trade and lead to a continued expansion of global value chains, particularly for developing countries.

The big picture

Here’s the big picture: Change is the one thing in the economy you can count on. Improvements in how we make things and advanced production technologies are likely to continue, and workers and firms that adapt and embrace these changes are likely to outperform those that do not. But a wide-sweeping elimination of trade and global value chains due to automation and robots? Don’t believe the hype.

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The original version of this article was published in The Hill.

ChristineMcDaniel

Christine McDaniel a former senior economist with the White House Council of Economic Advisers and deputy assistant Treasury secretary for economic policy, is a senior research fellow with the Mercatus Center at George Mason University.

This article also appeared on TradeVistas.org. Republished with permission.

maker

The Maker Movement can Flourish Thanks to Trade

The Maker Movement

Life is pretty cushy. We long ago stopped having to make everything we need: forging tools, handcrafting shoes from hides and weaving textiles for clothing. Manufacturers eventually specialized where they had comparative advantage and produced at scale. Specialization led to more trade in goods and services. Today, anything we need can be obtained at the push of a computer button from almost anywhere in the world.

While much attention is being paid to the potential for new technologies to displace manufacturing workers, there’s an interesting phenomenon afoot. Bits and bytes are bringing us back to our “maker” roots by making information and technologies more accessible to everyone. The smallest inventors and producers can integrate into globally distributed production chains and sell into global markets. Basically, trade is providing us the luxury of producing again at a small scale, and it’s the art of inventing nimbly and producing small that just might help us stay globally competitive.

Re-Making our Workforce

“Makerspaces,” TechShops and FabLabs are popping up in cities all over the country and they are playing an increasingly vital role in education, workforce development, entrepreneurship and even revolutionizing advanced manufacturing.

Memberships give hobbyists, tinkerers, students and entrepreneurs alike access to tools, machines and materials to gain experience with 3D printing, CAD/CAM, electronics, robotics, plastics and composites, fabrication, welding, coding and programming, woodworking and more. Students and young workers can be exposed to industrial careers in a relatively low-cost, low-risk environment, picking up skills in weeks — not months and years. They can create portfolios to demonstrate competency in the skills employers require.

By partnering with local colleges and employers, training in Makerspaces can culminate in recognized and portable credentials that prove mastery of a specific skill or set of equipment, enabling companies to develop talent pipelines with less direct investment. Meanwhile, students are not just gaining experience working with materials and machines. They are also putting math and measurement into practice, reading blueprints, and using design software — the knowledge skills associated with modern manufacturing and foundational competencies for a wide variety of jobs that lie in between traditional “blue collar” and executive levels.

TradeVistas- Maker movement graphic

Small Batch Production

“Making” can create new pathways to working at established manufacturing companies, but it is also spawning a resurgence of custom fabricators who are positioned for small-batch or on-demand manufacturing. The current trend of “niche consumerism” is responding to demand for tailored products in small lots, even by the big brands.

Makers can iterate quickly in response to consumer feedback or engage in rapid prototyping to optimize product design. Makers can offer these services to larger firms or they can leverage the resources of Makerspaces to keep costs down and retain control during product development, iteration and initial production of their own invention. The difficulty of communicating well with manufacturers or visiting facilities in China is a common refrain for small entrepreneurs.

Reverse Engineering

Makers and Makerspaces are attracting the attention of major corporations. GE and National Instruments were among the first to emulate Makerspaces to support open innovation on their corporate campuses. Ford Motor Company worked with a company called TechShop to build a world-class Makerspace for Detroit, becoming the facility’s anchor tenant. Affording their engineers the opportunity to cross-pollinate with other inventors and have a freer hand in direct and more rapid prototyping, Ford says that within one year, the company doubled the number of patents the company produced.

Large companies recognize that good ideas can come from anywhere, from hobbyists to amateur scientists and roboticists. Some Makerspaces cater more to small designers and inventors, but others are more like modern-day Edison workshops hosting sophisticated “experiments” employing biotechnology, nanotechnology and additive manufacturing. As such, they have become ecosystems of innovation where individuals, small businesses and large corporations can come together to incubate and accelerate ideas in a decentralized and agile network — emulating the same set of activities and interactions that were once only housed inside the corporation.

Manufacturing Renaissance?

Putting compact versions of industrial tools in the hands of millions more people means that inventors can get a “minimum viable product” out in the world faster and at much lower cost. Small and growing manufacturers can take smaller bets on the market with lower volume commitments or put a wider variety of products out for testing consumer preferences.

Specialty manufacturers that can re-tool quickly are filling an increasingly important role offering “manufacturing-as-a-service.” The Maker Movement encourages innovation through co-creation and crowdsourced designs, rapid prototyping and experimentation with new production processes. Maker facilities enable micro-factories that can service orders from anywhere in the world. Some notable inventions in Makerspaces have even transformed commerce itself. For example, millions of small businesses now use Square to take payments.

Join the Movement

Makers aren’t likely to replace mass production anytime soon, but they are an important source for training the next generation of inventors and manufacturing workers. Makerspaces are poised to drive real economic benefits for cities that embrace and support them. For example, the Brooklyn Navy Yard brings together makers, artisans, and manufacturers. The more than 10,000 people working within the complex generate some $390 million in economic output, supporting an estimated $2 billion in indirect earnings and an additional 15,500 jobs in 2011. According to the Pratt Center for Community Development, it’s a model producing similar results from across the country from Chicago to Minden, Nevada.

The famed Defense Advanced Research Projects Agency (DARPA) has supported a TechShop in Pittsburgh and provides membership for thousands of veterans. With funding from the Department of Labor, the AFL-CIO and Carnegie Mellon University partnered with TechShop Pittsburgh to create apprenticeship programs for workers and to encourage startups to manufacture locally. As Brooking’s Mark Muro has written, the Maker Movement is “a deeply American source of decentralized creativity for rebuilding America’s thinning manufacturing ecosystems…hacking the new industrial revolution one town at a time.”

#Thankstrade

Makers are able to access the materials and tools they need because of trade. Take the 3D printer, for example. The global market for 3D printers, plastics and related services have exploded in recent years. And perhaps one could even be so bold as to say that it’s the expansion of global trade that affords us the opportunity to rediscover and reinvent the art of “making” itself, which could in turn profoundly impact what we make and what we trade.

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Andrea Durkin is the Editor-in-Chief of TradeVistas and Founder of Sparkplug, LLC. Ms. Durkin previously served as a U.S. Government trade negotiator and has proudly taught international trade policy and negotiations for the last fourteen years as an Adjunct Professor at Georgetown University’s Master of Science in Foreign Service program.

This article originally appeared on TradeVistas.org. Republished with permission.

AI

How AI can Amp Up Thematic Investment Strategies

One of the persistent criticisms facing equity investors is their short-term view. They are characterized by adding or dropping stocks as the quarterly earnings roll in. Thematic investment, on the other hand, provides one counterpoint to earnings-focused stock picking.

Thematic investing  – a strategy designed to capitalize on broad economic or social changes – has seen increasing use in recent years. In 2016, thematic funds accounted for 30% of new ETFs introduced, on topics ranging from obesity, millennial consumption habits, and health and fitness.

Yet, asking questions about anything long term can be complex and often obscure. The trends and themes themselves that will reshape economies may be easy to identify, but translating them into quality investment vehicles is another matter. Using themes like clean energy, disruptive technologies, aging populations, or emerging markets to structure portfolios comes with its own unique challenges: successfully sifting genuine long-term trends from flash-in-the-pan fads – and critically, doing so early – is no easy task. Good analysis requires a massive amount of diverse data that, once structured in a way, it would facilitate thematic analysis.

A Knowledge Graph-based framework is uniquely positioned to provide both the data and analytic framework, with the inference capabilities necessary to provide actionable insights into large data sets.

A properly built Knowledge Graph describes the interrelations between real-world entities through a multidisciplinary, multidimensional correlated structure, comparing common themes and concepts across hundreds of millions of data assets over several years of correlated data embedded into the Knowledge Graph.
Such a framework can automatically calculate thousands of strategies for any investable concept an investor can think of – ranging from sustainability themes like clean energy to disruptive technologies like 5G or cloud computing.

A functional Knowledge Graph can rapidly build new, flexible strategies for thousands of concepts, deriving insights from millions of combined sources, and in ways that a typical analyst approach cannot match. Data sets can have global coverage – with strategies tailored to and applicable to multiple regions and countries – while also being highly specialized. They’re equally capable of taking in structured and unstructured data sets; everything from news reports, SEC filings, and financial or macroeconomic reports to court opinions and clinical trial data or patents. This multidimensional approach powers a dynamic point-in-time Knowledge Graph framework to produce exposure indices with precision.

Knowledge Graphs can further offer special insights in building a thematic investing portfolio through the way they look at concepts, both – quantitative (AAPL stock prices or its fundamental indicators for example) and qualitative. This offers not only the numbers behind what makes a wise investment, but also the context behind those numbers, which is especially critical when tracking themes.

Taking that capability a step further, it can also weigh data points based on the strength of their correlation to a given data set, or screen against undesirable exposure that might at first glance appear to be on theme. This scoring can be done at the entity level, offering sourced data on every point used in the process. When the process is complete, the final index that is produced has been weighed on multiple levels, accounting for variables such as market caps and liquidity for each company, and the aggregated exposures.

This type of analysis illustrates one of the key strengths of thematic investing: its concentration. Thematic investments are typically concentrated on a smaller selection of stocks but a Knowledge Graph framework offers the opportunity to build thematic strategies based on a larger constituents basket. This pushes market analysis away from being a purely reactive prospect; through identifying anticipated changes in the world, investors can take a forward-looking approach to capitalize on opportunities as they are forming, leading to potentially greater long-term growth opportunities.

Contrast that approach with mutual funds, which are typically concentrated on 40-80 stocks in a portfolio. The emphasis is generally on diversification, which manages risk, but is not necessarily the optimal way to achieve growth.

Some funds have already begun to turn to technology to do some of this critical analysis work. The AI-powered International Equity ATF (NYSEArca: AIIQ) has been doing just this since 2018. The fund runs on the Equbot Model, a proprietary algorithm that compares and analyzes data points and international companies on a daily basis to find and optimize portfolio exposures.

With a properly designed framework, a Knowledge Graph’s AI-based exposure engine can draw inferences to understand the dynamic market trends constantly driving returns while promoting concepts investors feel strongly about. Properly deployed, AI-based thematic investment strategies can instantly create new strategies or power existing ones – and in a fraction of the cost and time that traditional analysis could yield.

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Ruggero Gramatica is founder and CEO of Yewno, innovator of the Knowledge graph that generates actionable knowledge from today’s vast informationYewno has created an extensive multi-domain knowledge graph using proprietary AI algorithms, combined with a multi-disciplinary technology platform that extracts insights and delivers products and services tailored to specific industries. Yewno generates actionable knowledge from the ever-increasing amount of information available today.

As a pioneer in the Knowledge Economy and the innovator of the proprietary Yewno Knowledge Graph, an artificial intelligence-based framework powered by billions of disparate data sources, Yewno provides continuously evolving inferences that uncover unexpected insights for financial services, education, life sciences, government and beyond.  By delivering more meaningful intelligence, Yewno is revolutionizing how information is processed and understood, enabling users to more quickly analyze complex problems and improve decision-making. For more information, visit https://www.yewno.com/.

production

The Countries Leading the Way in the Future of Production

The First Industrial Revolution dates back to the 18th century, with the manufacturing and production process evolving significantly to improve efficiency. Since then, the world has gone through a series of changes with the present-day seeing us in full swing of the world’s Fourth Industrial Revolution. 

Using data from the World Economic Forum’s ‘Readiness for the Future of Production’ report, RS Components have taken a look at the countries that are leading the way when it comes to driving production forward. The six main drivers are ‘Technology & Innovation’, ‘Human Capital’, ‘Global Trade & Investment’, ‘Institutional Framework’, ‘Sustainable Resources’, and ‘Demand Environment’. See how each country compares when it comes to being ready to produce more products, technologies, and goods here.

The 21st century is a truly digital age, with technology now intertwined and cemented into both our personal and professional lives. Over the last two decades, in particular, technology has become increasingly advanced and has seen the emergence of the Fourth Industrial Revolution. Complicated and impressive technologies such as artificial intelligence (AI), robotics, the Internet of Things (IoT), 3D printing, genetic engineering, and quantum computing have all emerged and are being used across the globe in a variety of industries, businesses and processes.

As a result of the new technological age, the speed, efficiency, and accuracy of production levels have improved astronomically, with less room for human error as machinery takes over, making production levels much faster and hassle-free.  

With the rise of these advancements, it is important for countries and businesses across all industries to be tapping into these changes to keep up with the future of production. But which countries are leading the way?

RS Components have produced a graphic analyzing data from the World Economic Forum’s Readiness for the Future of Production report, to reveal the countries leading the way when it comes to driving production forward. With each country analyzed by a series of metrics including global trade and investment, institutional framework, sustainable resources, demand environment, and emerging technologies, the top 10 countries leading production levels forward have been scored out of 10.

The top 10 countries driving the future of production include:

The US takes the crown as the leading country in the world driving the future of production forward. Scoring at the top of the leaderboard across all metrics excluding Sustainable Resources and Institutional Framework, the US holds an overall score of 8.16 out of 10. The US is renowned for its innovation and holds an advanced, connected and secure technological platform that allows production to drive forward in the most efficient way possible.

Singapore ranks as the second country driving the future of production and the UK sits at fourth place with a score of 7.84. Singapore sits as one of the world’s leading chemical manufacturing sites, with over 100 global petroleum, petrochemical and specialty chemical companies situated on 12 square miles of land. Singapore today sits as the world’s fifth-largest refinery export hub and amongst the top 10 global chemical hubs by export volume. Involved in these systems includes advancements in manufacturing from robots, to predictive analytics and artificial intelligence. Singapore, like the US, is a key driver in testing, experimenting and trialing the latest technologies. In addition, manufacturing continues to contribute around 20% to Singapore’s GDP.

The importance of having the right technological foundations 

In order for production levels to thrive, it is crucial that technological foundations are cemented in supply chains across the globe. For example, in a warehouse, the speed and availability of the internet is crucial when the Internet of Things is being adopted on the factory floor. In addition, it is also greatly important for businesses and industries to have strong, connected cybersecurity systems to ensure digital security is maintained to a high standard. Having the technological foundations of this, like the US, allows the nation to drive forward technologies to increase production levels.

In addition, in order to ensure these new innovations are implemented effectively, it is crucial that employees have a good understanding of the technology they are interacting with on a daily basis, as the skills required of workers will evolve with the new advancements.

Combined, industries and countries will be able to adapt rapidly emerging technologies into their production lives, which will have a global impact on both businesses and consumers across the world.

payments

The Chicken or the Egg: Should You Automate P2P or Payments First?

I’ve been in the P2P/payment space for over 15 years. Before that, I spent a bunch of years selling payroll automation. Payroll automation achieved mass adoption relatively quickly—few companies today pay employees manually.

I figured—wrongly—that procure-to-pay was the next green field for back office technology. Just as every company has to pay its employees, every company also has to pay its suppliers. Manual processing for both payroll and supplier payments is expensive, inefficient, and non-scalable. Technology for procurement and invoice handling seemed on the verge of breaking through, similarly to payroll technology back in the day.

I wasn’t alone in thinking that. In 2005, the company I worked for brought in an analyst in the space to address our sales team about industry trends. He told us that invoice processing would be paperless by 2010. We’ve come a long way, but here in late 2019, far too many companies still deal with paper invoices and manual processes. Supplier payment automation can help change that—here’s how.

Not Just the Novelty

When I first started selling P2P solutions, the primary challenge I faced was a lack of awareness—most organizations didn’t know there was a better way to process invoices. Standard operating procedure was to hire a bunch of people to review invoices, manually enter them into the financial system, and get them paid. More invoices? Hire more people—just as it had been with payroll.

Some companies hired “Black Belts” to make changes to their processes by creating shared service centers or, in some cases, outsourcing the entire department to a Business Process Outsourcing (BPO) company. That had its own issues—namely lack of control and timing gaps, since many of these BPOs sat halfway across the globe.

As time went on, P2P solution providers became more widely known, and a growing number of companies adopted these solutions in order to reduce costs and increase efficiency by getting visibility into spend and putting more controls on how employees purchased goods or approved invoices.

Clearly that real challenge wasn’t lack of awareness. It was getting the project to the top of the list in a given company. Without a doubt, P2P solutions can drive positive ROI, but so can many other initiatives. Implementation of these types of projects can be lengthy, and eat up time and resources in procurement, finance and IT.

Based on my experience, for organizations with annual revenues greater than $500m, a typical P2P project can come with one-time implementation fees north of $250k (or more with the addition professional services) and implementation timeframes of nine months to a year or more. That’s a pretty big chunk of change for ROI that may take another year or so to manifest. As a result, these projects get pushed aside in favor of initiatives that generate revenue relatively quickly.

That was the case with countless companies I called on—they saw the value but still couldn’t get it done. Selling the ROI for P2P solutions was far more challenging than doing the same for payroll solutions. It was frustrating as hell.

The lightbulb clicked on for me in 2013 while attending an IOFM show in Orlando. Across the aisle from our booth was a company I’d never heard of: Nvoicepay. Thinking they were a competitor, I ventured over to see if I could gather some intelligence on them.

They weren’t a competitor at all. They didn’t match invoices to POs or automate the approval workflow for posting invoices to a financial system. They were a payment company that simplified supplier payments by any method—check, ACH or card—through a single interface. Plus, their solution complemented my invoice automation solution, and the increased efficiency and card rebates would significantly increase the ROI for my customer and help get the project to the top of their list! Now we could actually offer customer a procure-to-pay, solution, not just procure-to-ost.

Fast forward to 2019: I’m now working for Nvoicepay. Companies still want to automate their procure-to-pay processes, and still can’t figure out how to get the project onto the go list. Although P2P technology has improved significantly, those projects are still relatively lengthy and require resources—and therefore buy-in—from procurement, finance and IT.

Nvoicepay implementation is fast—we’re talking weeks, not months or years, to go live like a P2P project. We also require very few IT resources during the implementation, which doesn’t require the level of integration a P2P solution does. Quite frankly, when you send us a remittance file, we’ll pay 100% of your vendors regardless of payment type. Additionally, because we collect banking info from your vendors, we indemnify all payments and guarantee that funds will get to the appropriate supplier/vendor. You get a ton of process efficiencies, and the ROI starts on the first day a customer goes live, with monthly rebates generated from virtual card payments.

There’s still a conundrum. Companies want P2P but can’t figure out how to get there, and they’re not sure what to do first. Do we automate P2P and then finish it off by automating payments, or do we flip the scenario around? As companies trying to discern which should come first, I firmly believe that many companies may not fully understand what an enterprise payment platform can bring to the table and how the ROI it drives can fund their P2P project.

What I’ve Seen in 15+ Years in the P2P Space

Swinerton is a $3.6b construction company that implemented Nvoicepay’s Payment Gateway in a manner of weeks for just a few thousand dollars. They quickly started seeing monthly rebates via payments processed on virtual cards add up to $1m in the first year. Their finance department saw huge process efficiencies in their first year, and actually generated better relations with their vendors and contractors. Swinerton planned on leveraging the annual rebates to fund a T&E solution that they wanted to implement. The only thing they wished they did differently was to not take so long to decide on automation.

So, what should come first, the chicken or the egg? If egg = payments, then I say egg—and not because of the side of the aisle I sit on. I say this for my investment over the past 15+ years in the space with a desire to help our customers achieve their P2P goals and operate more profitably. Additionally, it is why most if not all P2P (procure-to-post) providers are trying to figure out how to automate payments!

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Jim Wright is the Vice President of Enterprise Sales in the East Region at Nvoicepay. He is a veteran of the financial industry, having served in senior roles at companies like Zycus, Corcentric, and SAP Ariba. With Nvoicepay, he delivers scalable payment solutions to enterprise companies and other large organizations.

tech

How to Succeed in the Competitive Tech Industry

Succeeding in any competitive environment requires having basic traits or advantages that your competitors do not have. The same premise applies to the global tech industry. There are plenty of people with ferocious work ethic, tremendous technical expertise, strong connections and a vision of what they want to accomplish. With such competition, how can you succeed? The key is to look at where most people fail.

One – Keep the Vision Simple

Start with simple challenges that need to be addressed by your technology.

People will typically start off with goals that are too grandiose or theoretical. That’s what investors ask for. Rather than focusing on simple things that users need, the goal is to create a platform that will disrupt, revolutionize, re-imagine or shake-up an entire industry. That’s also what’s most attractive. But it’s also a road that will lead to a high failure rate. It does not matter if your vision is sexy and attractive or not. What matters is if people have the problem that you can fix and if they are willing to pay for that.

Two – Take One Step at a Time

Again. Take the megalomania and tuck it away. Keep overhead low. Hire as little as possible and allow your product vision to mature naturally. Once it generates initial traction, the product will catapult revenues and allow you to make smart decisions around budget allocation. But don’t give in to the temptation of looking for things that reaffirm your abilities such as nice office space, and expensive advisors and consultants. Focus on having a product that works and that people know about which brings me to point three.

Three – Make sure people know about it

There is no use for great technology if people don’t know about it. How you will get people to know about it is an entirely different subject. But make sure you emphasize and understand digital marketing just as much as you understand product development. Start with a small but energetic and enthusiastic community and build from there. Just remember that from a budget and prioritization standpoint this is as important as the product itself.

Four – Even though the aim may be global, start local

Similar to the one step at a time point. Even though you may have an ultimate global end-game to your product development. Make sure you start by addressing a single market first. The region focused the better. Then roll out to other regions slowly and adjust accordingly prior to a big global roll-out. In my experience, different parts of the world, the country, the state and even a city may react very differently to the same concepts. Don’t push too much for a global approach. If the product has the fundamental qualities available, it will naturally become global.

Five – Be Hands On

Don’t rely too much on an incipient organization. Even if you have great people, be sure to be involved in key processes, to challenge people and introduce checks and balances throughout the organization. Make sure things are moving at your speed and insert yourself wherever you believe your presence is necessary. Don’t get hung up on organizational charts, roles and responsibilities. Just make things happen!

Six – Establish a Culture Early On

As a natural consequence of your engagement, your unique company culture will start to mold. Do you like solving things collectively or individually? Do you like abrasive or tender discussions, long or short meetings, laughter or just down to business. What are your values? And not from a theoretical perspective but from actual behavioral analysis. This lucidity is paramount towards building a successful organization.

Seven – Don’t stop innovating

The minute you have reached goal number one, rest-assured it’s already obsolete. Continue to establish new goals, new visions and new dreams. Continue to adjust according to market and user response. Continue to pivot based on insights and revelations. Don’t give in to the temptation of making it. There is no such thing. Making it is a daily achievement.

The common thread is that people get excessively hung up on business models, concepts and theory and rely little on their empirical data to make key business decisions. A no nonsense, down to earth approach towards these challenges and taking it one step at a time is pivotal in terms of building a global and successful tech organization.

freight invoicing

How to Tackle the Freight Invoice Management Obstacles

A freight invoice is a detailed bill which includes information regarding the transportation of a company’s goods from one place to the other, along with the inclusion of the amount of charges, its weight, due dates, complete goods’ description, contact information, and names of both the receiver and the shipper, etc.

On the other hand, logistics is defined as the process of planning, implementing, and controlling the storage and movement of services and goods from the point of origin to the point of consumption within a supply chain, explains a top provider of Invoice Processing Services. The companies which deal with these processes become a part of the logistics industry and handle a few or all of the functions of supply chains as per the logistic requirements of the client.

Past Examples of Invoice Issues

-In recent times, an IT company was overbilled throughout 14 days by an amount of $935,578 owing to the incorrect weight applied by a parcel carrier.

-Auditing helped a national level entertainment retailer in saving around $35,000 from a wrong monthly invoice charge

-A worldwide renowned LED manufacturer had to pay $93,147 more due to incorrect billing currency, but the amount was recovered after the fault was discovered during the auditing process.

Top Freight Invoice Management Obstacles

Multiple Challenges

Managing invoices is extremely hard as a lot of challenges like reconciling contract terms with Bill Of Lading (BOL), invoices’ rating for correct rate selection, decisions about the acceptance of differences in charges, getting invoices resubmitted after making the carriers do corrections, etc. have to be dealt with extreme care. When these challenges are not addressed properly, they lead to errors, which further lead to overcharging, eventually adding to the overall Invoice Processing complexity.

Tedious Information Processing

The processing of information for the invoices is really tiring and tedious in nature. This is the reason employees who process the information for billing, weight, ledgers, data entry, and more commit multiple mistakes and make the final outcome inaccurate and hard to understand.

Bill Entry Issues

The very first concern which the logistics industry has to deal with during invoice management is the efficient functionality of the billing entry process which is defined below:

-Shortage of non-standardized processes and control due to operations which are not centralized for billing entry

-Multiple systems integration

-Due to missing BOL information, incomplete billable items are captured

-Multiple formats for BOL 

-Lost information regarding a customer or local-specific procedures for billing

Refund Management Issues

There are a lot of instances where the goods and services do not land safely at the doorstep of the receivers. In such cases, goods and services are returned back to the suppliers, which involves going through all the invoice processing steps again, which is extremely time-consuming for the owners of the logistics company.

Best Practices to Tackle Invoice Management Obstacles

Must-Include Invoice Listings

-Consignee and consignor names

-Shipment date

-Packages number

-Freight description

-Volume, weight, and measurement of freight

-Total outstanding charges

-Each carrier name engaging in transportation and movement route

-Shipment’s transfer point

-Issuer’s business address and remittance address

Freight Management Controls

It is important to incorporate internal controls which are powerful into the management structure of the freight. An authorization system, duty separations, and internal audits on a periodical basis are one of the most important tasks for managing risks like favoritism and fraud, which have the potential to bring down the overall profitability. 

The main objective is to make sure none of the employees have any chance for concealing and committing any illegal or unethical activity. For example, an employee who has been given the responsibility of getting the estimates should never be made the in charge of making the final freight invoice payment or selection.

Proficient Auditing System

According to a report by ReconLOgistics.com, wrong freight bills appear in about 5-6% of the entire invoices, which can raise the expenses of transportation to a great extent. With a proficient auditing system in place, along with a thorough recalculation and review can save you from overpaying due to inaccuracies in the freight bills. 

Apart from this, normal dealing procedures for lost shipment or damaged dealing, and timely claims reconciliation are an imperative part of a cost-saving management program for the freight.

Outsourcing Payment and Freight Audit

When it comes to finding the best solutions for streamlining the freight invoice management process, Outsource Invoice Processing remains a top favorite amongst the businesses due to its cost-cutting feature, along with the following benefits provided by it:

-Paper routing, filing, and handling elimination

-Centralized system for entire processing functions of the freight invoice

-Eliminating multiple systems and non-uniform processes

-Real-time insights into the invoices

-Latest technology use like artificial intelligence and automation

-Invoices’ long-term archival in the electronic form

-Carrier queries

-Increase cash flow to the maximum levels with timely invoice payments

-Receive correct and detailed accrual files and cost allocation straight into your system

-Gain visibility into operational metrics, invoice status, and payment information

Invoice Automation

Most of the industries have already incorporated the use of automation in a majority of their work processes, and have reaped great benefits in the following forms:

-Faster processing of invoices

-Elimination of costly human errors

-Invoice costs reduction by 80%

-Preventing payments duplicity and maximizing initial incentives for payments

-Enabling enhanced cash flow control and visibility

-Achieving 100% accuracy for invoice entry

Freight Software

Businesses who are trying to manage their freight invoices by themselves can ease their management workload with some of the top freight software mentioned below:

The Magaya Cargo System

This user-friendly software helps in eliminating duplicity of data entry, streamlining shipment workflows, generating Bill Of Lading, etc., along with a fully-integrated system for Invoice Accounting.

A1 Tracker

This software meets the unique business demands of the present scenario, make the working of the logistics systems smooth, and bring the required value to your business.

Freightos

The online platform for global trade management and freight booking, along with providing logistics owners with digital sales tools.

Excalibur WMS

This is a software which is fully integrated for warehouse management, accounting system, and third-party logistics (3PL) service billing.

CargoWise One

A central software system platform for worldwide providers giving logistics services.

Managing the freight invoices is definitely challenging owing to the various complexities in the form of inaccuracies and irregularities in the data and work processes, respectively. These complexities can be brought down greatly with the use of automation, outsourcing, audit systems, etc., eventually streamlining the process of freight invoice management at large, along with saving time and money at the same time.

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Gia Glad holds the position of Business Content Writer at Cogneesol – an outsourcing firm offering finance and accounting services along with other value-added services to the small and mid-sized businesses globally.

Intermodal Expo

Intermodal Expo Brings the Best in Business and Expertise

September 15 marked the first day of this year’s IANA Intermodal Expo in Long Beach, California. This is no ordinary expo, however. While more than 125 exhibitors and 60 plus intermodal experts in attendance, this conference covers all bases for three days each year, leaving no unfinished business. It’s no wonder why some are referring to the paramount event as “all-encompassing” while addressing all tiers of business.

Whether you’re interested in learning about the latest and greatest in intermodal solutions or seeking the expertise from an industry expert on strategic planning, IANA’s Intermodal Expo undoubtedly provides a clear view of where the industry stands while navigating the current landscape.

Among leading companies in attendance discussing the latest and greatest topics, business strategies, trends, and solutions in intermodal and supply chain include Loadsmart, Armstrong & Associates, SeaIntelligence Consulting, Canadian National Railway (CN), United Parcel Service, BNSF Railway, and many more.

Technology and automation continue leading trends as more companies continue to report increasing demand for the capabilities, efficiencies, and opportunities enabled through innovation

“There’s always a force in this space right now that changes everything and one needs to be cognizant of that force,” explained Jeffrey Leppert, Senior Vice President, Capacity Solutions, Redwood Logistics during the “Growth Strategies for Non-Asset 3PLs session.

Maintaining an advantageous position against competitors in an evergreen business landscape can be tricky. Hunter Yaw, Vice President of Product Management and Business Development, at Loadsmart addressed this topic head-on, leaving all apprehensions aside.

“We focus on what systems our customers are currently using and we integrate a lot with major TMS systems. We could ask folks to come  to us one way or another but, the reality is… we’re much better off partnering with the existing players in the industry and teaming with them to add more value within the current system’s framework rather than try to reinvent the wheel across the board.”

As the final day quickly approaches, Intermodal Expo will resume at 8 a.m. sharp on Wednesday with the Intermodal Safety Committee Meeting followed by the Operations Committee Meeting.

Global Trade Magazine will continue participating throughout the remainder of the conference at booth 812 ready to discuss your business goals for growth and expansion. Come by and see us for the final day of Intermodal Expo 2019!