Vendor-Managed Inventory Platforms Seen as Time-Consuming
Business' goals of reducing costs and improving customer service with VMI are beset by a persistent crop of challenges.Less than a quarter (22 percent) of businesses use automated B2B technology to share inventory information, primarily because they view doing so as time-consuming, according to according to a survey of 300 executives by Gatepoint Research and sponsored by E2open. One-third of all respondents rated their visibility levels between average and non-existent. Only 26 percent of executives rated visibility into current inventory levels as great. The results indicate the adoption and execution of vendor managed inventory (VMI) programs is of interest to organizations, but the drive to reduce costs and improve customer service by levels by doing so is beset by a persistent crop of challenges. Only 30 percent of those surveyed report using VMI on both buy-side and sell-side, whereas those implementing solely buy-side VMI programs outnumber those implementing solely sell-side programs by more than two to one. "What surprised me is that it’s 2015, and there is still a heavy reliance on manual communication for sharing inventory information. And, while 42 percent say they are sharing inventory via their ERP system, satisfaction on overall visibility remains low," Sean Rollings, vice president of product marketing at E2open, told eWEEK. "The satisfaction part isn’t surprising. With manual communication, you rely on individuals to share information in a one-to-one fashion. That means you depend on a person to share it – on their timetable."
Rollings also noted manual processes are rife with errors, so the timing isn’t reliable, and it’s prone to errors, something he says is not exactly confidence-inspiring.