White Paper, sponsored by OpenText Corporation

Next-Generation B2B Integration
Enables a Digital-First, Resilient
Supply ChainRESEARCH BY:

Simon Ellis

Program Vice President, IDC

Travis Eide

Research Director, WW Global
Supply Chain Transportation
and Global Trade, IDC

January 2023 | IDC Doc. #CA49778622

Roderick Gaines

Research Director, WW Supply Chain
Strategies: Warehousing, Inventory
and Order Management, IDC

Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

Table of Contents
Click on titles or page numbers to navigate to each section.
In This White Paper/Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Survey Demographics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Key Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Current Dynamics for Supply Chains and B2B Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Digital Transformation Maturity Assessments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
IDC Supply Chain Resiliency Models . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Supply Chain B2B Maturity Model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 0

Clear Benefts of How B2B Automation Can Drive Supply Chain Transformation . . . . . . . . . . 11
Digital Document Sharing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 4Technologies That Will Change How Supply Chains Operate . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Looking Forward . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 8
Essential Guidance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Message from the Sponsor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
OpenText Business Network . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

About the Analysts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

IDC Opinion / Executive Summary
The past three years have been tough on supply chains. Disruptions of difering scale,duration, and complexity have exposed numerous “cracks” across the breadth of operational
processes and revealed a disturbing lack of resiliency in many key areas of the supply
chain. While digital tools and capabilities are not the sole remedy for a lack of resiliency,
there is mounting evidence that companies that are more progressed in their digital journey
outperform less-progressed competitors in both revenue and proft performance.
Over the last couple of years, IDC has heard a familiar refrain from manufacturers and retailers: “We were working
on the right digital capabilities in the supply chain; we just weren’t doing it quickly enough.” Further, in the
IDC’s Worldwide Supply Chain Survey, 2022, when asked about the current gaps that will prove to be the mostproblematic in the future if not addressed, companies most frequently cited a lack of visibility and resiliency tosee changes in time to react efectively. Yet, as this paper will argue, the maturity of the supply chain towarda digital-frst, resilient supply chain remains incomplete, the journey unfnished, with a sizable percentage ofcompanies far less progressed than we might have anticipated by now. According to IDC’s Supply Chain Resiliency
MaturityScape Benchmark Survey, 2022, less than a quarter of supply chains are in the two most mature stages.
It has been the view of IDC for some time now that business-to-business (B2B) integration represents the backboneof the supply chain. As this paper will explore, the automation of various B2B processes and the documents that
underpin those processes are both ubiquitous and signifcant drivers of overall supply chain performance. In thesurvey completed specifcally for this report, 80% of respondent companies said, on average, that the digitizationof B2B documents like advanced shipment notices, invoices, and customs documents has improved their supply
chain. In a supply chain world increasingly intolerant of latency, where speed and visibility are paramount, manual
processes and paper-based document exchanges simply are not adequate anymore.
Digital B2B integration capabilities and progressing maturity align with top business priorities of reduced costs(both operational and logistics), faster time to market, improved data quality/accuracy, and progressive visibility.
Indeed, the focus on scalable analytics and artifcial intelligence (AI) tools doesn’t get the supply chain very far if
the data is not timely and accurate. Ultimately, the challenge for most companies is to decide how to focus theirresiliency eforts and where those eforts will pay of most materially.

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

In This White Paper / Methodology
This IDC white paper, sponsored by OpenText, explores the digital transformation journey for a broad range of companies
and showcases how modern, automated B2B integration capabilities enable the digital supply chain necessary tosupport a resilient business. The research hypothesis is that digital transformation must afect the way that supply chainsare run, from both an IT and a business process perspective. The conclusions and recommendations in this research
paper are based on IDC knowledge and prior survey work as well as a recent survey conducted exclusively to test the
research hypothesis.

Survey Demographics
The survey, sponsored by OpenText, was conducted in the third quarter of 2022 and included 811 respondents
from the manufacturing, life sciences, and retail industries across 10 countries within North America, Western Europe,and Asia/Pacifc (APAC). The splits by country are illustrated in Figure 1. Target sample sizes were 70 respondents
for all countries except the United States, which had 170.
FIGURE 1

Country Demographics(% of respondents)

Other

8%
United States

Japan

24%

12%
India

9%

Canada6%
United Kingdom

Australia

10%

15%

FranceGermany6%10%

n = 811, Source: IDC's OpenText Supply Chain Research, July 2022

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4

Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

Other key demographics include:• Manufacturing accounted for 586 respondents, life sciences 89, and retail the remaining 136.
• Across manufacturing, respondents ranged across multiple subsegments, including discrete and process,high tech, and consumer packaged goods (CPG).

• One-third (33%) of the respondents were companies with revenue above US$10 billion; 67% werecompanies with revenue between US$1–10 billion.

• In terms of role, the respondents included CXOs and those at the vice president, director, and manager
level, all of whom were familiar with their organization’s supply chain strategy and operations or
technology supporting the supply chain.

One important goal for the survey was to poll as broad an audience as possible to generate a rich anddiverse set of results. Given the overall sample size, however, narrow data cuts may fall below statisticallysignifcant sample sizes. While this paper will mainly focus on the overall fndings, we will be weaving inindustry, country, or company-size insights where relevant and notable.

586 respondents
accounted forin manufacturing

89 respondents

33%of the respondents werecompanies with revenue
above US$10 billion

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136 respondents

accounted forin life sciences

accounted forin retail67%$

of the respondents werecompanies with revenue
between US$1–10 billion

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

Key Findings
The survey underpinning this research report provided a wealth of data and insights for both supply chain digitaltransformation (DX) and supply chain restructuring. Given the central research hypothesis noted earlier, we haveidentifed four key fndings that we will explore in greater detail in this paper:• Of the survey respondents, 78% said that digital B2B integration has improved the overall performance of

their supply chains, with 40% reporting signifcant improvements. Key benefts include reduced costs, faster
responsiveness, and higher customer satisfaction.

• Integration priorities include collaboration with suppliers, better interconnectivity of internal systems (ERP, SCM),

and improved use of demand data. Barriers that slow progress include signifcant supply and market complexity,
elongated supply chains, and lack of internal resources to manage competing priorities.

• Cloud deployment is clearly the top technology that is changing how supply chains operate, with AI second.
• Very few companies (9%) are at the most immature or the most mature stage of B2B integration supporting

overall procure-to-pay/order-to-cash processes. The majority have begun to adopt some level of automation orsome level of integration but have a way to go for full digital maturity.

78%

of respondents said B2B digital
integration has improved the overall
performance of supply chains

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40%

of respondents reported significant
improvements of B2B digital
integration

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

Current Dynamics for Supply Chains
and B2B Integration
In this research paper, we will argue that digital transformation and automated B2B integration is driving dramaticchanges in the supply chain. Transformation eforts and digital supply chain maturity correlate highly with improved
revenue and proft performance, as illustrated in Figure 2.
FIGURE 2

Digital Maturity Correlation with Business Performance(% of respondents)
130

124.1

130

125.7

127.0

121.4
115.7
112.2
110

102.6
100

107.0

100.0
100.0

103.2
99.0

98.7

90

120.7

118.2

120

PPI Index Score

RPI Index Score

120

125.6

122.6

115.5
110

107.0
100.0

100

106.7

105.0

100.0

99.4

90

80

80

2015

2016

2017

2018

2019

non
vs digital)

Year
Digitally maturecompanies

2020

Digitally immaturecompanies

2015

2016

2017

2018

2019

2020

Year
Digitally maturecompanies

Digitally immaturecompanies

Source: IDC, 2022$

Digital supply chain maturity correlates highly with improved revenue andproft performance

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

The supply chain has clearly emerged as a critical function for companies to realize their business aspirations, and it
has become a competitive weapon in the modern digital economy. Advanced supply chain capabilities can support
more efcient and efective current approaches as well as new models that translate directly to business performancethat is tangible and measurable. One need look no further than the last three years and the supply chain disruptions thathave created major challenges for companies, industries, and, of course, consumers. On the heels of 2021, 2022 hasbeen yet another tough year and has brought out both the best and the worst in supply chains.
The importance of the supply chain to business success in the modern digital economy means transitioning a functional
area that has traditionally been viewed as a cost center to one that must be leveraged as an “opportunity center” —and supported/funded accordingly. In addition to functional excellence, this means having the ability to collect,consume, and disseminate data-driven insights in real time both within the supply chain and to adjacent functions
like sales and marketing. In IDC’s Supply Chain Survey, 2022, one of the biggest gaps was the adoption of modern
digital technologies that enable companies to adapt to changing and emerging business models. In correlation
studies that IDC has done, the companies that are more progressed in their digital transformation journey tend
to outperform those that are less progressed in both revenue and proft.
Over the past few years, we have characterized the supply chain as moving from older analog processes to newer
digital processes. Although most new supply chain application investments are cloud-based, sizable on-premises
capabilities remain that must be maintained and curated. Managing hybrid environments will be necessary for at least
another decade. Although systemic supply and demand disruptions appear to be accelerating the transition tomodern cloud-based applications, some temperance is required with current high infation rates and the specter ofa global economic recession. In recessionary times, companies tend to try to “make do” with what they have. While IDC
does not yet expect IT investment growth in supply chain to decline, we are seeing companies attempt to better
address integration challenges across existing application areas, something we have referred to as “connective
tissue,” or the DNA for today’s modern, integrated supply chain.

Digital Transformation Maturity Assessments
The use of modern, predominantly cloud-based technology tools to enable advanced supply chain capabilities andrelated performance is now broadly accepted as best-in-class. Although signifcant legacy on-premises tools remain,
the leading edge of growth is clearly to the cloud and digitally enabled tools. As we noted in Figure 2, page 7,
this approach correlates highly with superior business performance.
There are hierarchically diferent ways to look at supply chain maturity. The following sections highlight two of theseapproaches. The IDC supply chain model looks at resiliency quite broadly across dimensions, including strategy,
people/culture, key supply chain business processes, and the deployment of technology. The second, the B2B maturity
model, looks at B2B integration specifcally across purchase-to-pay and order-to-cash.

The supply chain is evolving toward being more of an opportunity center rather than acost center”

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8Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

IDC Supply Chain Resiliency Model
In early 2022, IDC conducted a survey against a set of supply chain maturity indices, yielding a quantitative
maturity progression across fve broad stages:• Ad hoc: In terms of supply chain resiliency, organizations at this stage are characterized as being “resistant”

and refect largely disconnected eforts within their supply chain. Supply chains at this stage are likely to havepoor visibility capabilities and a very limited ability to be agile, and intelligence/analytics rely highly on
manual spreadsheets.

• Opportunistic: In terms of supply chain resiliency, organizations at this stage are characterized as being“reactive” and predominantly refect an efciency mindset. Supply chains at this stage are likely to have some
limited visibility capabilities and the ability to be agile within a constrained set of parameters, and intelligence/
analytics still rely heavily on manual spreadsheets.

• Repeatable: In terms of supply chain resiliency, organizations at this stage are characterized as being “responsive”
and represent the middle stage of resiliency. We see supply chains at this stage of maturity with modern supply
chain management tools in place, though integration among those tools lags and there is still common use ofmanual spreadsheets.

• Managed: In terms of supply chain resiliency, organizations at this stage are characterized as being “predictive”
and represent the initial leadership level of maturity. Supply chains at this stage are likely to have extensive
visibility capabilities and the ability to be agile within a wide range of parameters. We do still see somespreadsheet use, though it is more as a complement to (rather than a poor substitute for) purpose-built supply
chain tools.

• Optimized: In terms of supply chain resiliency, organizations at this stage are characterized as being “prescient”
and represent the leadership level of maturity. Supply chains at this stage have comprehensive visibility
capabilities and the ability to be agile within all parameters. We see almost no spreadsheet use, other than foroccasional pilot projects.

The self-reported results of 500 companies are illustrated in Figure 3 (next page). Only about a quarter of theseorganizations are at the highest levels of digital supply chain resiliency maturity, indicating there is still signifcant
progress to be made and value to be realized by utilizing modern processes and digital technologies. Conversely, almost
half of respondent organizations are at the lowest two stages of maturity, with supply chains that are either competitively
neutral or a source of competitive disadvantage.

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9Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

FIGURE 3

IDC Supply Chain Resiliency Maturity Model(% of respondents)

Low

7%

39%

32%

16%

6%

STAGE

STAGE

STAGE

STAGE

STAGE

Focused onfunctional metrics
and performance,
without consideration
for the digital tools
or key processes
to identify, anticipate,or eectively respondto disruption.

Some adoption ofdigital tools, butsiloed and sporadic,
and poorly linked to
key businessprocesses, resulting
in limited
identifcation or
anticipation of
disruption.

A range of digital
tools are in place
and the beginningsof supply chain
resiliency are
established, butcapabilities remain
disconnected withkey processes,
and disruption
response is modest.

Digital tools arewell establishedand eectively
connected to
key processes,
resulting in good
capabilities toproactively identify,
anticipate, andmanage disruptions.

A digitally enabled,
thinking supply chainthat can easily andcomprehensively
identify and anticipate
disruptions and either
mitigate them aheadof time or be
prepared to react
quickly when
they occur.

1

2

3

4

5

High

n = 500; Source: IDC's Supply Chain Resiliency MaturityScape Benchmark, 2022

Although supply chain resiliency is critical in today’s disruptive environment, companies have often found it difcult todetail the business case fully and justify its return on investment — and to build the necessary internal capabilities.
However, both the pandemic and subsequent disruptions have revealed persistent “cracks” in the supply chain andpresented organizations with a unique opportunity to transform their supply chain and become truly resilient.
Disruption has been occurring across the breadth of the supply chain, and the capabilities and tools necessary to better
manage risk, both proactively and reactively, must span that width. The emergence of cloud platforms that integrate thedisparate elements of supply, demand, and fulfllment are helping, as are the ecosystems and multi-enterprise supply
chain commerce networks that many forward-looking companies are using to great efect. IDC provides a view of theworldwide multi-enterprise supply chain commerce network market in its MarketScape document IDC MarketScape:Worldwide Multi-Enterprise Supply Chain Commerce Network 2021 Vendor Assessment (IDC #US48202217,
September 2021).

Supply Chain B2B Maturity Model
It is the view of IDC that B2B integration maturity is a critical element of overall supply chain transformation.
We would argue that supply chains that aspire to be truly resilient must have modern, integrated B2B capabilities.
In the survey that underpins this paper, we asked respondents specifcally about the levels of sophistication of
integration capabilities to support their purchase-to-pay and order-to-cash end-to-end processes. Based on their
responses, we have grouped the companies into four distinct levels.

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10Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain• Level 1: Mostly focused on unstructured communication but slowly moving toward other portal and web-based
electronic data interchange (EDI) solutions• Level 2: Has a range of structured communications, such as web EDI and other portal solutions, but also has
begun to adopt automated message-based integration• Level 3: Mostly focused on message-based integration, with some remaining manual structured communicationand the beginnings of real-time systems integration• Level 4: Extensive automated real-time or message-based integration; manual communication is nonexistent
Based on the defnitions above, companies self-assessed their maturity as shown in Figure 4.
FIGURE 4

B2B Integration Maturity(% of respondents)

59%

32%

5%

4%
Level 1

Level 2

Level 3

Level 4n = 811; Source: IDC’s OpenText Supply Chain Research, July 2022

Although the levels of B2B integration skew to the more mature end of the scale than the overall supply chain
resiliency levels do, there remain signifcant levels of progress to be made for most companies, with only 5%
reporting to be the most mature. As noted in Figure 2, page 7, the clear correlation between overall digitalmaturity and measurable business results means that if a lack of supply chain maturity doesn’t entail leaving
revenue and profts “on the table” now, it soon will.

Clear Benefts of How B2B Automation Can Drive
Supply Chain Transformation
If the correlation cited in Figure 2, page 7, is too broad, let’s focus specifcally. When asked about the level of
improvements made to their supply chain by automating a range of diferent collaboration documents, 8 out of 10
survey respondents cited some level of improvement, ranging from the cost of handling and sharing information tostafng efciencies to improvements in key performance indicators. When asked about metrics, for example, the8 out of 10

cited some level of improvement ranging from the cost of handling and sharing information
to stafng efciencies to improvements in KPIs

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

companies that said their B2B integration was automated saw, on average, a 10% reduction in order cycle times and a
7% reduction in the time taken to respond to unforeseen disruptions versus companies that remain largely manual or
paper-based.

TABLE 1B2B Integration Maturity Drives Supply Chain Benefts
Q: To the best of your knowledge, how much has sharing each of the following items of information digitally
improved your organization’s supply chain?

Signifcantly
Improved
Supply Chain
Performance

Some
Improvement toSupply Chain
Performance

Sum ofTop 2 Results

Sharing product catalog digitally

42%

42%

84%

Sharing price information digitally

44%

38%

82%

Sharing customs documents digitally

49%

31%

80%

Sharing invoices digitally

42%

36%

78%

Sharing purchase orders digitally

43%

36%

79%

Sharing advanced shipment notices digitally

44%

40%

84%

n = 811; Source: IDC’s OpenText Supply Chain Research, July 2022

Table 1 illustrates six kinds of documents and the degree to which survey respondents cited either signifcant
or some level of improvement in their supply chain. All of these documents play a critical role in supply chain
operations, but two are particularly interesting. Manufacturers frequently tell IDC that customs documents are asource of bottlenecks in their supply chain. In the In IDC’s Supply Chain Survey, 2022, 58% of manufacturers told
us that they had experienced transportation issues in 2022, with a signifcant number of those issues resulting
from port delays. Not all were document-related, of course, but 49% of companies said that sharing customs
documents digitally signifcantly improved supply chain performance. This will certainly help to alleviate a key areaof recent supply chain disruption. The advanced shipment notice (ASN) is the other document of particular interest:
A digital ASN means quick communication and confrmation of a shipment to a customer or to a customs agency.
At a time when speed and agility are more important than ever, the ability to quickly know the precise status ofshipments is critical.
With the current levels of supply chain complexity, global reach, and partner/supplier diversity, it is becoming
abundantly clear that the old ways of doing things simply will not sufce. Even if companies are successfully using
manual or limited digital tools for B2B data exchange, they are usually accomplishing this by employing signifcant
labor resources. In an environment where labor is increasingly expensive (if you can even fnd the skills you need),“throwing labor at the problem” seems like a solution from a bygone time.

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

In Figure 5, we illustrate the specifc benefts cited by survey respondents for B2B integration. Clearly, cost is amajor focus, particularly given the prior comment about companies’ using labor as a Band-Aid for poor processes
and technology. We also see speed in the form of faster time to market, which is particularly poignant at a time
when supply chain disruptions have put a lot of pressure on predictability, timeliness, and speed in general.
Interestingly, while improved supply chain visibility remains a notable beneft, it takes a back seat to bothcost- and speed-related benefts.
FIGURE 5

Digital B2B Integration Benefts by Region(% of respondents)

Asia/Pacifc (n = 357)

Western Europe (n = 213)

North America (n = 241)

Total (n = 811)

40%

Reduced operational costs.......................................

40%
42%
41%

Reduced logistics costs...............................................

30%

29%

Faster time to market ......................................................

40%
44%
35%
37%

34%
28%
29%
31%

Improved data quality and accuracy ...................

49%

34%

28%

Improved customer satisfaction ...........................

47%

39%

35%

31%

Improved inventory turnover rate..........................

27%

Reduced cash-to-cash cycle time ..........................

26%
25%
28%

30%
30%
31%

30%

Reduced procurement/sourcing costs...............

21%

Improved supply chain visibility ..............................

21%
22%
24%

24%
26%
28%

n = 811; Source: IDC’s OpenText Supply Chain Research, July 2022

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

We see some diferences by region. Companies in Europe, the Middle East, and Africa (EMEA) tend to be more
focused on operational and logistics cost reductions, driven in part by skyrocketing energy costs in that part of theworld and a greater emphasis on sustainability. IDC has found that companies in EMEA are particularly receptive toengagements that ofer improved efciency and lower waste. Asia/Pacifc (APAC) tends to be a bit more focusedon accelerating time to market, in part because their B2B customers often have long lead times and signifcant
fulfllment distances. Interestingly, improved customer satisfaction is a top two priority only for companies in North
America. For them, customer satisfaction remains a critical priority, in part because shortages and unreliablesupply have plagued this region since late 2019.
Looking at the same survey question for diferent industries, we see priorities that align with current problems orwith emerging business opportunities. In automotive, for example, reducing operational costs is the top priority,
given the complexity of assembly and the increasing reliance on suppliers for drop-in components. Automotive isalso increasingly adopting more adaptive inventory models rather than traditional just-in-time inventory models,and improved data quality and accuracy is critical for this evolving approach. In the consumer packaged goods
industry, where fulfllment and fulfllment costs are a big part of the cost of goods sold, we see reducing logistics
costs as the top priority. In high tech, the short life cycle of new products increases pressure to get products tomarket (and to full production) quickly, meaning that faster time to market is their top priority.

Digital Document Sharing
B2B integration has been something of a protracted journey. Although automation is more progressed today
than it was 10 years ago, there remains a signifcant opportunity for many companies, as noted in Figure 4, page 11.
Even today, when asked about the percentage of collaborative operations with customers that are expected
to be done in the future (three years hence) via advanced automated real-time system integration (API-based
synchronous integration), the percentage is 36% for order-to-cash and only 17% for procure-to-pay. The relatively
low number for the latter is somewhat surprising, though the persistence of manual direct-procurement processes
across most industries is likely part of the reason. Certainly, companies expect to increasingly share procure-to-pay
documents digitally, though again, not to the degree that one might anticipate in the current supply chain environment.

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

FIGURE 6

Plans to Share Digitally(% of respondents)

Q: Which of the following items of information do you expect to increasingly share digitally in the next
three years?
Asia/Pacifc (n = 357)

Western Europe (n = 213)

North America (n = 241)

Total (n = 811)

39%

Purchase order....................................................................

37%
37%
35%

Shipping status...................................................................

37%
34%

Invoice ............................................................................................

32%

32%
34%

27%
27%
28%

Forecast/planning schedule.......................................

Payment remittance advice........................................

42%

40%

31%

28%
29%
29%
28%

Advance ship notices.......................................................

Returns .......................................................................................

40%

32%
30%
32%
31%

Inventory inquiry.................................................................

Logistics service request/response......................

40%

35%

32%

Price information..................................................................

46%

24%

23%

22%

29%
30%
28%
27%
29%
27%
28%
29%

26%

n = 811; Source: IDC’s OpenText Supply Chain Research, July 2022

As shown in Figure 6, regionally, EMEA companies are the most aspirational in their expectations for sharing
information digitally over the next three years. EMEA’s country complexity, e-invoicing mandates, and sustainability
eforts are behind this push. APAC and North America are quite similar in their views.

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

TABLE 2

Industry Priority Document
Industry

Document Type

Increasingly Share in 3 Years

Automotive

Purchase order

47%

Life sciences

Purchase order

45%

RetailPurchase order

43%

Consumer packaged goods

Shipping status

41%

High tech

Forecast/planning schedule

38%

Heavy manufacturing

Purchase order41%

n = varies by industry; Source: IDC’s OpenText Supply Chain Research, July 2022

Quickly looking across industries (see Table 2), the purchase order was cited by four out of six as their highest-priority
document to digitize. For CPG it was shipping status, and for high tech it was forecast/planning schedule; these areconsistent with the priorities of those industries. The purchase order is the most common document, so industries
looking for efciency and waste reduction will tend to look there frst. CPG is focused frst and foremost on customer
satisfaction, so shipping status must be the top priority. Likewise, high tech is focused on time to market and time
to volume, so efcient sharing of forecast and planning schedules is paramount.

Technologies That Will Change How Supply Chains Operate
No discussion of B2B integration is complete without addressing and assessing the technologies that underpin
maturity. We asked respondents about a handful of technologies, and the results are illustrated in Figure 7, next page.
Although artifcial intelligence usually sits atop the ranking, here deployment via cloud is the clear front-runner,both overall and in all regions. Smaller companies view cloud as even more important than larger ones do, whichmakes sense given the role cloud can play in democratizing technology and ofering scalable B2B integration tocompanies of any size. Looking at industries specifcally, the dominance of cloud persists.
The benefts cited for cloud are varied, with 49% of survey respondents saying it helps improve visibility, 45% thatit improves data sharing and collaboration, and 43% that it ofers more robust security and data protection.
The latter point is an almost 180-degree shift from where opinions were even fve years ago; cloud, and the cloudproviders, have largely demonstrated that their facilities are more secure than company-owned datacenters.

4 out of 6

cited purchase order as
highest-priority document to digitize

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49%

of respondents said cloud helps
improve visibility

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

Although the technological capabilities to automate B2B integration do not hinge exclusively on cloud, the reality isthat almost all new application development for the supply chain is taking place in software-as-a-service(SaaS) applications.
The role for artifcial intelligence and machine learning (ML), and advanced analytics more broadly, is also importantto the maturity of B2B integration. While 44% of companies said they are using AI/ML to generate more predictive
or prescriptive insights from across their supply chain operations, the remainder of companies are not, with 17%
saying they use only basic analytics. Whether with B2B information sharing specifcally or with supply chains more
broadly, the ability to leverage all available data is rapidly becoming table stakes and a potential source of competitive
disadvantage for companies that fall behind.
FIGURE 7

Technology Impact(% of respondents)

Q: Which of the following technologies are most likely to drive change in the way you integrate and execute yoursupply chain in the next two years?
Asia/Pacifc (n = 357)

Western Europe (n = 213)

North America (n = 241)

Total (n = 811)

66%
62%

Cloud ..........................................................................................

67%
48%

35%

AI/ML...........................................................................................

45%
44%
41%

27%

Ecosystem collaboration .............................................

38%
24%

Supply chain orchestration/control tower ....

Internet of Things (IoT) ........................................

6%
7%
9%

72%

44%

35%
28%
30%

13%

n = 811; Source: IDC’s OpenText Supply Chain Research, July 2022

As we close the discussion on technology, it is worth remembering the crucial importance of supply chain visibility
and how limited it is for many companies. At IDC, we have noted that resiliency = visibility + intelligence/analytics + agility.
Seeing what is happening is the frst step to knowing how and where to respond. It is notable that in this survey, only
19% of companies reported having advanced or comprehensive visibility, and 36% said they have only basic visibility.

resiliency = visibility + intelligence | analytics + agility

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Looking Forward
Not new news, certainly, but the last few years have been tough on global supply chains. Disruption now seems aconstant companion, with supply chains moving from one crisis to the next. Just as some light began to show at
the end of the global pandemic tunnel, Russia invaded Ukraine and added a further layer of chaos to the supply
chain. At IDC, we have observed with some frequency over the last year that disruption is not only about the
pandemic — it is also about the specter of cybersecurity, severe weather caused by climate change, global shipping
constraints caused by chronic labor and skills shortages, and rising input costs (infation). The confict in Eastern
Europe seems likely to impact both cyberactivity and input costs. How must companies address these changes,
and what is the future role for supply chain transformation and B2B integration?
There is little question that eforts to improve supply chain collaboration have been met with success. There is also
little question that there is still signifcant progress to be made and capabilities to be aspired to, in both the extent towhich collaboration reaches across the entire supply chain and the efciency of that reach.
FIGURE 8

Supply Chain Transformation and B2B Integration Priorities(% of respondents)

Q: Which of the following would you prioritize to improve integration across your supply chain operations
over the next two years?
Increased digital communication across trading
partner community
Better visibility of inventory

Improved integration of ERP, transportation, warehousing,
and/or planning systems
Improved collaboration with suppliers

Better use of demand data

29% 28%

28%
25%

28%

26% 26%22%

North America

23% 24%

Western Europe

26% 25%28% 28%30%

Asia/Pacifc

n = 811; Source: IDC’s OpenText Supply Chain Research, July 2022

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

Even the companies that IDC would judge to be the most efective in their industries in collaborating with suppliers
freely admit that there are improvements to be made. Whether it’s improving communications across trading
partners or better connecting ERP systems to the edge supply chain systems, respondents to the survey identifed
a range of priorities. As illustrated in Figure 8, page 18, companies in APAC view improved collaboration with
suppliers as their top priority; EMEA organizations are looking for increased digital communication across trading
partner communities; and North American respondents want improved integration of ERP and supply chain systems.
These priorities make sense within the context of the current environment for supply chains, where disruptions
are constant and people resources are becoming harder and harder to fnd. Indeed, ever-growing complexity inthe supply chain has companies of all sizes and in all industries looking for ways to simplify their processes andautomate where appropriate. At IDC, we have noted the role of technology and automation as task replacement
rather than job replacement; given the mechanical and often repetitive nature of B2B collaboration, it seems an
ideal candidate for automation.
FIGURE 9

Supply Chain Transformation and B2B Integration Barriers(% of respondents)

Q: What are the barriers that your organization has identifed that could disrupt the improvement efortsof B2B integration?
Global and elongated supply chains, long and uncertain
lead times

Multiple sales channels: web, B2B, email,fax, phone
Competing IT projects such as the ERP

Complex supply networks with multiple tiers

Too complex integration of multiple IT system21%

23% 24%

26%

30%

28%
25%

27%

21% 20%17%

Total(n = 811)

North America(n = 241)25%
22% 21%

30%
26%

28% 27%23%

19%

Western Europe(n = 213)

Asia/Pacifc(n = 357)

n = 811; Source: IDC’s OpenText Supply Chain Research, July 2022

Of course, there are barriers, as shown in Figure 9. Broadly, these align with the prior comment about complexity.
Complexity cries out for technology and automation, yet complexity makes this same automation tricky and fraught
with implementation challenges. Fortunately, companies don’t have to fgure this out for themselves, as there are anumber of well-considered, capable vendor tools available in the marketplace.
As the global pandemic exposed, and the Russian invasion of Ukraine reinforced, the supply chain is a complex,
intertwined global entity. Even some of the recent aspirations for nearshoring don’t change the reality of thisglobal reach. Proclamations of “Made in America” simply expose a broad naivete: It is not made in America,

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

it is assembled in America. Parts and components still come from international suppliers. While complex supply
networks or the IT systems that support them are viewed as barriers to eforts to better integrate B2B processes,
complexity is among the main reasons supply chains must be undaunted in progressing their eforts.
FIGURE 10

Supply Chain Future Gaps(% of respondents)

Lack of supply chain visibility and resiliency to seenecessary changes in time to react efectively.....................

46%

Robust data analytics and insight intelligence .............................

37%

Lack of digital competencies limits the ability totransition the supply chain to new business models ......

32%

The lack of deep insight into our customers andconsumers ...............................................................................................................

31%

Lack of sufcient collaboration with external
suppliers and/or customers.....................................................................

30%

n = 1,109; Source: IDC’s Supply Chain Survey, March 2022

Indeed, the responses to a question in the IDC’s Supply Chain Survey, 2022 — in which we asked what current gaps,
if not closed, would present major problems for manufacturers and retailers moving forward — show a recognitionof the importance of supply chain resiliency generally, and the necessary digital competencies specifcally. If wecome back around to the central research hypothesis of this paper, that digital transformation must afect the waythat supply chains are run from both an IT and a business process perspective, the survey responses are quite clearthat that is the case.
It has been a recurring refrain over the last few years from the many companies IDC speaks with: that when
considering supply chain transformation, “we were working on the right things; we just weren’t going fast enough.”46%

of respondents say there is a lack of supply chain visibility and resiliency to seenecessary changes in time to react efectively

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

Essential Guidance
Digital B2B integration remains aspirational for many companies. In the survey that underpins this paper, only 5% of
respondent companies met the criteria for the most mature level and have completely automated their B2B backbone.
A further 59% have mostly banished manual processes and paper-based documentation, but that leaves 36% with
their feet frmly planted in the old ways of communicating and collaborating. As the survey results show, digital B2B
integration ofers substantial benefts in cost, speed, and visibility, and companies that are more progressed in theirdigital journeys tend to outperform companies that are lagging.
Companies across geographic regions show similar levels of B2B maturity, and while the cited benefts ofautomation vary slightly, there is more consensus than diversion. Organizations in EMEA and North American areslightly more cost-focused, while in APAC they are more about speed. Industry diferences tend to be in termsof the priority documents to share. In automotive, life sciences, and retail, the purchase order was cited as thehighest-priority document to digitize; for CPG it was shipping status, and for high tech it was forecast/planningschedule. Yet regardless of the specifc document, all industries that have automated B2B integration are seeing
corresponding improvements in their supply chain operations.
Supply chains now operate in an inherently more disruptive environment, that is quite clear. Although IDC has written
about the need to be able to predict potential disruptions, the reality is that it is more important to be prepared forthem. If companies cannot predict a disruption, they had better be prepared to respond quickly once something goes
wrong. Nobody predicted that a ship would get wedged across the Suez Canal, yet some companies were able tominimize the efects by understanding the impact and responding quickly. They were able to do this because theirprocesses were automated and they were able to quickly and easily collaborate with alternative suppliers, shortening
the time it took to respond to an unexpected disruption. Indeed, this is a good example of how companies that canquickly consume and disseminate data (and the insights from that data) will outperform competitors that cannot.
As the supply chain world becomes more uncertain, companies are struggling with the complexity of supply chain
integration and with competing priorities. While most would agree that a resilient supply chain must be collaborative atscale given the underlying complexity, the precise path to get there can be daunting. The good news is that there are
a number of vendors ofering digital B2B integration capabilities that are both willing and able to help. It is IDC’s viewthat digital B2B integration represents the backbone of a digital-frst, resilient supply chain and should be a top priority
for those companies that remain encumbered by manual paper-based processes.

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

Message from the Sponsor
OpenText Business Network
OpenText Business Network helps companies transform and future proof supply chain integration environments.
We achieve this by enabling companies to seamlessly integrate people, systems, and things across a securecommon platform that can underpin digital transformation initiatives. Once connected to our platform, users have theability to automate internal and external processes, driving greater process efciencies and business optimization
opportunities. Users can also leverage a powerful suite of SaaS applications that allows internal and external
stakeholders to collaborate across the supply chain. Finally, establishing a more secure supply chain is top of mind
for every business leader, and we help companies control access to the information and applications being used
across the business ecosystem.
Companies are able to embrace a scalable integration platform that meets changing business needs, provides insights
to automate and optimize processes, and supports regional and industry compliance requirements.

To learn more, please visit businessnetwork.opentext.com

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Next-Generation B2B Integration Enables a Digital-First, Resilient Supply Chain

About the Analysts
Simon Ellis
Program Vice President, IDC
As a program vice president, Simon Ellis is responsible for providing research, analysis,
and guidance on key business and IT issues for manufacturers. He currently leads the supply chain
strategies practices at IDC Manufacturing Insights, one of IDC’s industry research companies that
addresses the current market gap by providing fact-based research and analysis on best practices
and the use of information technology to assist clients in improving their capabilities in criticalprocess areas. Within the supply chain practice, Simon is directly responsible for the research inthe supply chain planning strategies practice while also managing the supply chain execution
strategies practice. These supply chain practices specialize in advising clients on supply chain network
design, sales, and operations planning (S&OP), global sourcing (proftable proximity and low-cost sourcing),
transportation, logistics, and more. He also supports IDC Retail Insights IT strategies practices.
More about Simon Ellis

Travis Eide
Research Director, WW Global Supply Chain Transportation and Global Trade, IDC
Travis Eide is the research director of the IDC Worldwide Supply Chain Strategies Program,
responsible for providing research, analysis, and guidance on key business and IT issues pertaining
to manufacturing, retail, and healthcare supply chains. He currently leads the Worldwide Supply Chain
Strategies: Transportation, Logistics, and Global Trade Management practice, providing fact-based
research, analysis, and insight on best practices and the use of information technology to assist clientsin improving their capabilities in these critical supply chain fulfllment areas. This practice specializes
in advising clients on transportation management, route management, global trade management,
driver compliance management software applications, and more, as well as 3PL, 4PL, full-truckload,
and less-than-truckload services. Travis also covers the commercial transportation and 3PL industry.
More about Travis Eide

Roderick Gaines
Research Director, Software Defned Compute, IDC
Roderick Gaines is a research director in IDC’s Worldwide Supply Chain Strategies Program,
responsible for providing research, analysis, and guidance on key business and IT issues pertaining
to manufacturing, retail, and healthcare supply chains. He currently leads the Worldwide Supply Chain
Strategies: Warehousing, Inventory, and Order Management practice, providing fact-based research,
analysis, and insight on best practices and the use of information technology to assist clients in improving
their capabilities in these critical supply chain fulfllment areas. This practice specializes in advising clientson warehouse management systems, warehouse control and automation systems, distributed ordermanagement systems, and more. Roderick also covers the Wholesale Distribution industry.
More about Roderick Gaines

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