I am of course referring to the global economy. The banks here in the UK are predicting that we are on the verge of a recession, interest rates are likely to remain at the same level until 2010 and the price of petrol has reached £5 a gallon!

Now if you are a relatively small company, comprising of perhaps a couple of manufacturing plants or a chain of ten retail stores, how do you remain competitive in this tough economic climate and how do you survive any impending recession that may be knocking on your door?. You can just imagine that there are board rooms all over the world full of executives trying to work out their strategies for riding the recession rollercoaster, looking for ways to reduce costs, restructure their businesses and at the same time try and remain competitive in order to make that all important and often elusive operational profit.

Normally when recessions come knocking on the door,  the larger global companies will delay implementing large scale IT projects, they will look to reduce costs by outsourcing key business processes and make their creaking IT infrastructures last until the economy picks up again.  But who knows when this will happen and in the meantime how are the smaller companies suppose to restructure their own IT infrastructures in order to reduce costs and keep their businesses above water.  Again, outsourcing is an efficient way to reduce IT related costs and streamline supply chain strategies, however outsourcing, especially from a B2B perspective, has traditionally been the preserve of the much larger companies. 

Until now that is, GXS has recently introduced a Managed Services offering called MX which allows companies of any size to outsource their B2B infrastructures.  But what are the business drivers for the smaller companies wanting to outsource their B2B infrastructures. Well, let us take a quick look at some of the more important business drivers and areas of a business where B2B outsourcing can help the smaller company.

Company Restructuring – each industry sector is experiencing company divestitures, merger & acquisition activities or more general company restructuring.  Often through a potential acquisition for example there will be a period of consolidation, rationalisation of departmental infrastructures.  In a similar way, IT and B2B infrastructures will have to be reviewed to see if cost savings can be made by for example having a common infrastructure or outsource B2B services to a single trusted vendor rather than having to deal with several vendors.  B2B outsourcing offers a means of managing your B2B trading platform during a period of change.

ERP Projects – many companies today, no matter what their size, will have a wealth of information locked away in back office systems such as ERP and CRM solutions.  As described by my colleague Steve Keifer in a couple of recent ERP related posts, ERP information will normally stay within the confines of an enterprise and yet a company is expected to work seamlessly with perhaps hundreds of different trading partners who may find this ERP information helpful, if only they could get access to it.  B2B outsourcing offers a way of unlocking ERP information and allows the relevant pieces of information to flow uninterrupted up and down the supply chain.  Many companies will not have the internal resources to undertake this kind of integration project, B2B outsourcing, especially through GXS Managed Services MX allows seamless ERP to B2B supply chain integration to take place.

Manual Process Improvement – in today’s ‘green’ culture, removing waste, especially paper from a supply chain is one of the key goals of B2B automation.  Implementing an e-Invoicing solution for example helps alleviate the need to send paper copies of invoices across a supply chain, which ultimately helps companies to get paid much more quickly.  Hosted web based form environments allow your suppliers, no matter what their technical capability, to complete order forms etc in a very short time, reducing the need to re-key in form related data and ensure that all transactions can be accurately traced across all trading partners.

Improve Global Connectivity – many automotive companies for example are being asked to support their customers in new emerging markets where a multitude of different communication standards or document formats could be in use.  GXS Managed Services MX is built on GXS Trading Grid, so companies will have access to a B2B platform that can connect to any trading partner around the world, no matter where they may be located. GXS has operations in over 18 countries around the world.  As a result, GXS can support your supply chain operations in Asia Pacific, Europe, North and South America.

Trading Partner On-boarding – B2B outsourcing can help to improve the way in which you work with new trading partners and it can help reduce the time it takes to get new partners up to speed with new B2B technology and integrated within a company’s B2B infrastructure.  For new customers projects, adopting an outsourced B2B strategy will allow your trading partners to engage in projects much more quickly, this improving the efficiency of your supply chain.

Legacy System Upgrade – B2B Outsourcing also allows a company to upgrade legacy and outdated IT infrastructures with a state of the art B2B platform. The outsourced environment shields users from learning about how to manage new connectivity options or document translation standards. GXS provides the ideal opportunity to employ new Software as a Service (SaaS) or Service Oriented Architecture (SOA) based B2B environments. These are easy to deploy  to trading partners as there is minimal implementation required and a company can be rest assured that every trading partner is using an identical ‘version’ of the B2B platform.

If you feel that your company, irrespective of size, could benefit from outsourcing your B2B environment then please feel free to visit our website for further information, click here to visit the GXS Managed Services MX specific page.  In further blogs we will take a more in depth look at how some other recession related business issues could be addressed through the adoption of leading edge B2B services & technology.