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Develop a Comprehensive Business-toBusiness Integration Strategy
Strong partnerships require seamless integration; don’t let lagging integration capabilities
undermine your B2B relationships.
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- 2014 Info-Tech
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Project Rationale
Sections:
Project Rationale
Structure the Project
Gather Requirements
Identify Solution Alternatives
Create a Roadmap
Make the Business Case
Implement the Strategy
What’s in this Section:
•
•
•
•
•
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B2B strategic drivers
Cost savings from B2B integration
IT pain points
The importance of a B2B strategy
Take advantage of B2B future trends
Follow the Info-Tech method
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Project Rationale
Activities in this step
• Understand what B2B integration is and how the business can benefit from it.
• Understand the variability across B2B integrations and make the case for a cohesive strategy to help
eliminate the pains we are currently feeling in the IT department.
• Review the Info-Tech Research Group approach to building a B2B integration strategy.
Key Question
Key Insights
Why is B2B integration so important for the business
and what can we do in IT to reduce the pain of B2B
integration?
• The business can reap the benefits of B2B
integration, while IT can gain control over variability
with a cohesive B2B integration strategy.
Section Outcomes
• A firm understanding of the benefits of integration
with their partners.
• A sense of urgency to get caught up before we get
left behind.
• IT will be committed to a cohesive B2B strategy.
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Our Understanding of the Problem
This Research is
Is Designed For:
This Research Will Help You:
 The Enterprise Architect of a small to large
 Define a structured approach for identifying the
organization, looking to enhance B2B
integration capabilities.
gaps in your current B2B integration process
and analyzing solutions.
 Create a comprehensive roadmap that
addresses and prioritizes the necessary
initiatives to attain the desired B2B maturity
state.
This Research Will Also
Assist:
Assist:
This Research Will Help You:
Them:
 Application Managers
 CIO
 Business Analysts
 Understand the value of B2B integration to the
business.
 Learn what skills, processes, technology, and
data are required to be successful with B2B
integration for your organization.
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Executive Summary: Create a Comprehensive B2B Integration
Strategy
Situation
!
• As the business recognizes the importance of B2B integration, they
•
place increasing pressure on IT to accommodate the onboarding of
additional trading partners and data exchanges.
IT must enhance their current integration capabilities to efficiently meet
the needs of the business and take advantage of future trends.
Complication
• Despite the recognized importance of enhancing B2B integration
•
capabilities, many organizations struggle to define a strategy that will
meet business and IT needs while providing a cost-effective solution.
IT often finds itself in a challenging situation uncertain of best methods
and practices for leveraging people, process, technology, and data.
?
Info-Tech Insight
1. Consider In-Source, Out-source, or
Hybrid deployment options to maximize
value and minimize cost.
2. Leverage your power of negotiation
with partners to enforce standards and
promote flexibility in your B2B
integration environment for cost
effective solutions.
3. B2B strategies need to be able to
scale to meet volume, protocol, partner,
and performance objectives.

Resolution
• IT and business needs must be aligned from the beginning to create and deliver a B2B integration strategy that is capable
of scaling with business growth.
• B2B requirements must be derived from the following: business goals and objectives, specific data exchange standards of
trading partners, as well as people, process, technology, and data components of the future state.
• The B2B integration requirements will dictate the solution selection for target B2B architecture, the deployment model (insource, out-source, hybrid), necessary roles/responsibilities, and internal/external processes.
• Creating the B2B integration strategy is a multi-step process. After identifying gaps and choosing a solution, initiatives
must be mapped out and prioritized through use of a comprehensive roadmap. A critical aspect of the B2B integration
strategy will involve selling the benefits, gaining buy-in, and obtaining implementation approval.
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No business is an island; you must connect and integrate with
your trading partners to maintain a competitive edge
Understand the numerous benefits enhanced integration can provide for the
business.
The Business Needs:
The B2B Results:
 Seamless integration that can sustain a
build to order supply chain.
 Speed
 Automated methods of communication
and data exchanges that can save time
and money while meeting the needs of
today’s fast-paced B2B transactions.
 Synchronized tools that provide realtime data exchange to support
successful business relationships.
o
o
Electronic messages are received in
seconds as opposed to days.
Data is exchanged and ready for use
immediately.
 Accuracy
o
Less human error.
 Cost Savings
o
o
Reduction in overhead costs.
Reduction in inventory costs.
 Operational Efficiency
o
o
o
Enhanced trading partner relationships.
Greater process visibility.
Improved cash flow.
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Statistics show that more and more businesses are recognizing
the need for seamless integration
Today’s global marketplace is impacting the nature of business and the way business is
being conducted. Businesses are required to enhance collaboration with trading partners
and exchange more information in a smaller time frame.
Majority of companies saw a 10% increase in their B2B
budget over the last three years.
96% of companies plan to increase their number of
electronic partners.
Between 2010 and 2015, the global top 2000
enterprises are expected to double their B2B integration
data exchange volume.
Majority of companies expect to see a 25% increase
in transaction volume over the next three years.
Source: Stanford Global Supply Chain Forum- B2B Integration
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A quick look at handling paper invoices manually vs.
electronically illustrates significant benefits of B2B integration
Buy side
Sell side
• The cost for a buyer to manually process an invoice can
• The cost for a supplier to generate and send a paper
•
•
range from $10 - $35 per invoice. It costs much less to
process the same invoice electronically: at most $1 per
invoice. At the low end, an organization that processes
1,000 invoices per day stands to save $9,000 per day
on processing costs alone.
Many buyers are losing out on early payment discounts
because they are simply not getting and processing
paper invoices fast enough. Even if a buyer could get a
1% discount, it could mean lower costs and higher
profit margins.
Buyers and suppliers mutually benefit from removal of
data entry errors, resulting in fewer disputes.
•
•
invoice ranges from $1 - $3 depending on postage and
paper costs. Today’s VANs and managed service
offerings charge between $0.10 and $1 per invoice. At
the low end, the supplier may not save anything; at the
high end, they could save $2,900 on 1000 invoices.
The real cost savings for suppliers is in the reduction of
their Day Sales Outstanding (DSO). If an invoice can be
delivered quicker, there is a better chance of getting paid
quicker and reducing DSO.
Reduction of 1 day of sales outstanding can mean
thousands to millions in savings.
The power struggle
• Which side of the equation are you on? Buyer or Seller? Service Consumer or Service Provider?
◦
◦
Power to dictate standards, protocols, and processes typically sits with the buyer (e.g. Walmart) in the retail industry.
Suppliers that have cornered the market with their products or services tend to have the power to dictate. For example,
Johnson & Johnson, GE, and McKesson have a lot of power to dictate their standards in the medical industry.
Having a strategy that leverages your power of negotiation with partners will allow you to be more flexible
and/or capable in your IT environment so that your business can reap the most benefit.
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As an enterprise architect, are you experiencing these
pressures?
If so, we can help.
• New trading partners are requesting complex data
types you’ve never used before.
• You don’t have the capabilities to support enough
data types and protocols to fully integrate with key
trading partners.
• As the business grows and recognizes B2B cost
savings; they are requesting that IT integrates with a
whole new set of trading partners.
• You only integrated with a few key trading partners
because it is too difficult and costly to integrate with
smaller trading partners.
• With the existing process, it takes you too long to
onboard new trading partners.
• You find it difficult to make decisions without expertise
in B2B collaboration processes and technologies.
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As B2B integration becomes more complex, a strategy
becomes more important
IT Pains
Why a Strategy?
• The business overlooks the implications of increasing
• A strategic plan will help to identify the best
ways to alleviate pressures from IT, minimize
costs, and maximize return on investment.
integration capabilities with trading partners.
• Every additional protocol IT decides to accommodate
comes at a cost. Every new partner that is onboarded
comes at a cost.
• As a result of not fully understanding the complexity
and implications of B2B integration, projects get
postponed.
• Delays in integration further drive up the total cost of
ownership for B2B.
XML
o Increase reliability.
o Develop stronger trading partner
relationships.
o Choose the right protocols, standards,
and data types.
o Choose a cost effective deployment
alternative to maximize benefits.
Swift
HTTP
ERP
Swift
CRM
HL7
AP2
EDI
POS
AP2
HL7
POS
HTTP
ERP
EDI
CRM
XML
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Learn how IT and the business can benefit from a scalable B2B
integration strategy
Volume: IT will be able to scale their infrastructure
and processes to meet fluctuating business
demand. The more transactions the business can
do with their partners, the higher potential there is
for reduced costs and increased revenue.
Volume
Protocol: IT will be able to accommodate new
Performance
Scalability
trading partner protocols and have greater ability to
deal with variations. The business will benefit from
being able to expand their scope to include more
partners.
Protocol
Partner: The business will place pressure on IT to
integrate with more partners. IT will have the ability
to onboard new partners accurately, quickly, and
affordably. The business will have the ability to
expand their trading partner relationships without IT
getting in the way.
Partner
Performance: IT will be able to improve their
performance, not only with their implementation, but
also with their people and processes for B2B
integration. The business will benefit from IT’s
ability to perform, and expansion of their partner
interactions will not be constrained by IT.
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