Andrei Radchenko 28.03.2023 14 min read

The best-of-breed mentality is the only winning strategy for supply chain solution providers in 2023

With all the pressure from customers and the ever-changing business environment, organizations constantly seek new ways to improve internal operations to elevate process efficiency and boost business growth. One of the most common ways to do that is to optimize supply chains and ensure smooth cooperation across all stakeholders in the ecosystem. That is where a modern solution for supply chain management comes into play. To stand out of the crowd, solution providers need to ensure the best service and functionality that would match customers' needs 100 percent.

This article explains why the best-of-breed approach is the only business development strategy allowing supply chain management solution providers to cope with ever-changing market demand and ensure business profitability.

The supply chain issues and the needs of businesses today

It is no secret that poor information exchange and communication between partners can cause process inefficiency, leading to poor customer experience and increased cost of operations. If these issues are not addressed, the business might not bear cost competition, global pressure for sustainability, and the ever-changing business needs of customers and market demand.

To overcome those issues, organizations (specifically manufacturers) adopt innovative technologies and solutions, helping them to coordinate activities across the supply chain better, often resulting in improved business performance. However, due to the conventional on-premise supply chain management system and heterogeneous, disparate data sources businesses use, establishing efficient integration with suppliers, warehouses, logistics service providers, and other supply chain stakeholders is a big challenge. The same applies to multiple third-party solutions companies use for invoicing, payments, PODs, delivery updates, and more. Besides being siloed, these often imply manual processing. So, it can take companies years to integrate one-off solutions, and it will be costly.

To mitigate this pain, organizations rely on all-in-one solutions offering friendly interfaces, ready-to-use connectivity with different stakeholders, and ecosystems of preconnected systems and platforms. A good example can be a transportation management system (TMS) or warehouse management system (WMS). Here, a solution provider takes all the responsibilities for building integrations and offer what customers need - a ready-to-use product allowing achieve improved operational efficiency, enhanced customer experience, and satisfy the demand for legacy system modernization and supply chain digitalization.  

The problems solution providers encounter on the way to perfection

Supply chain solutions depend heavily on data, so if there is any problem with it, the solution's reliability will be questionable. Thus, to offer a product that would match the needs of the supply chain and logistics domain, providers should have unmatched skills in data management and integration. This is alongside unique features such as AI-based warehouse planning, vehicle load and route optimization, transport costs and scheme simulation, shipment batching of orders, freight negotiation, or anything else that can make a solution unique.

The problem here is that the multiple systems and technologies stakeholders can possibly use, as well as formats, standards, and protocols used in the domain for data transfer, make integrations and data management daunting. So, with having no team of experts who could work with old-world EDI-based systems, as well as with more modern API-based ones, a solution provider will always be at risk of offering inefficiency to clients, in the worst case, even causing disruptions in the supply chains of their customers due to errors and inaccurate planning.  

Those providers who decide to invest in a team of experts and consider building integrations as a core in-house competence encounter another issue - a significant increase in the solution cost. Of course, if costs are not properly managed, it can lead to financial issues and a market share loss.

Looking at the most successful and efficient solution providers, you may notice that they often rely on third parties to get a specialized solution that may be better suited for covering specific data integration cases or integrations as a whole. Either way, it will be much cheaper than in-house development, plus the flexibility and scalability in the case of leveraging so-called turn-key fully managed solutions.

An example of such outsourcing is a supply chain solution provider with an API-first vision. Usually, such companies do not want to touch old-school point-to-point integration, which is difficult to avoid in the supply chain and logistics domain. So, such modern companies prefer to rely on partners such as Youredi, allowing streamlining of this process and delivering all the critical data to their systems via API.  

With this strategy, companies can keep their workforce entirely focused on adding value to customers by developing and improving the product's overall capabilities and, at the same time, get unmatched integrations with any system they need. Such a strategy is widely known as the best-of-breed approach in the software industry and tech community.

Best-of-breed mentality

Ultimately, the key for supply chain solution providers is to offer solutions that meet the needs of their customers. This means they may need to adapt and evolve their offerings based on customer demands and market trends to remain competitive. The Best-of-breed mentality is what allows achieving this goal the most efficiently.

As mentioned previously, the idea behind the best-of-breed approach is simple - instead of doing all integrations in-house, solution providers enjoy the best on-the-market solutions to cover their needs while keeping their focus on the domain expertise in developing their solutions further. This way, they get second-to-none functionality, plus enable endless customization and flexibility to offer tailored approaches for the specific needs of any particular customer for a significantly lower cost.

Modern iPaaS to support your best-in-breed strategy

Supply chain and logistics is a niche where outdated approaches and systems are still popular. For instance, badly outdated VAN networks with the event-based approach are inseparable from the domain. However, the number of companies that want to have data updated immediately as an event happens instead of receiving it as a batch-based update every hour/ week/ or any other cycle or time frame is constantly increasing.

Being an API-minded supply chain solution provider, you might think that connecting these two worlds is difficult. And that is so true unless you embrace modern Integration Platform as a Service (iPaaS) solutions.

iPaaS term was launched by Gartner somewhere in 2011. Since then, it has become a secret weapon allowing many solution providers to ensure smooth data flows and seamless integrations for the most complex use cases.

Gartner describes iPaaS as a suite of cloud services enabling the development, execution and governance of integration flows connecting any combination of on premises and cloud-based processes, services, applications and data within individual or across multiple organizations.  So we can say that iPaaS brings endless opportunities to satisfy the most demanding customers on the market.

By complementing your supply chain management system with an iPaaS-based solution, you will get an integration layer making your system effective in providing a tailored approach for the specific needs of a particular customer. However, to get the most out of it, the iPaaS you choose should be designed and developed to match your industry's needs. Only in this case, your solution will allow your customers to achieve greater efficiency and flexibility in their supply chains. If you want to learn more about why industry focuses is so critical, we advise you to read our blog on this topic.

Youredi iPaaS to complement your solution

Youredi is the leading provider of fully managed data integration services and solutions for logistics and the global supply chain. One solution Youredi provides is an iPaaS for supply chain management solution providers. The service aims to strengthen, not compete with, your solution.

Youredi iPaaS is a cloud-based integration platform designed for reliable information exchange between different business systems. Systems can be located on-premise or in the cloud, in various organizations, and provide different interfaces and use diverse data types. Our technology can connect old and new worlds (e.g., EDIFACT and API).

Helped by Youredi iPaaS, you can easily extend your ecosystem with new connections and partners, expand the domain or geographies of your operations, connect any business partner to your ecosystem regardless of technology or data format, or outsource your integrations and stay focused on your core competencies.

Whatever your business goals, Youredi's iPaaS solution enables you to reach them most efficiently!
In this article, we outlined how the best-of-breed mentality can help supply chain management solution providers win the market in 2023. Also, we touch briefly on the role of iPaaS in this endeavour. To learn more about how industry-leading solution providers benefit from iPaaS, we recommend watching our 30 min on-demand webinar, where Jeff Graan (Vice President of Sales Engineering, TURVO TMS) explains how TURVO benefits from partnering with Youredi. Also, you can always contact our team to get a demo tour of the solutions we offer to supply chain solution providers.   


Andrei Radchenko

Global Marketing Manager, Youredi

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