Disconnected IT Systems and Manual Processes
In the State of the Fuel Supply Chain infographic below you will note several rising business costs that are leading to the margin squeeze in the supply chain. I am going to focus on two of those in the blog post: Disconnected IT Systems and Manual Processes.
What is a disconnected IT system? Think about all the systems you use to run your wholesale or carrier business. The workflow in your business is connected, but is the data from that workflow? Do all these systems share data where they could or is someone manually typing data from one system into another system, also known as “Swivel Chair Integration”? Many wholesalers and carriers involved in last mile fuel delivery are using a number of technology systems and most of them do not share data.
Disconnected IT Systems make your business inefficient and probably cost you money for a number of reasons. The first of which is that duplicate data entry leads to typing errors. Depending on the study you reference this can be between 1% and 10% of the entries typed. Where in the process you discover the mistype changes how much that typo cost you to correct. If it is found early in the process then it is cheaply correctable. However, if it is in your back office and it is discovered by the customer with a wrong invoice, it can cost you significant time and money to correct.
In addition, relying on manual entry is slow and can lead to skipped steps in a process if the person is interrupted while completing these manual tasks. Data can automatically flow from one system to another with integration in seconds, whereas manual “Swivel Chair Integration” can take up a significant amount of time for your personnel that could be used to complete value added tasks for the organization. Also, if they need to look up information they have to know which system to look in and the systems could contain different variations of the same data.
Lastly, another reason that disconnected IT Systems are an issue for an organization is that you do not have data in real-time, which affects your ability to understand what is happening in your business and limits the validity of analytics and trend reporting you may be relying on to make critical decisions.
To summarize, the disconnect between the systems is leading to higher than necessary business costs from redundant, potentially inaccurate, and delayed data in a time where revenue margins in fuel logistics and delivery is being squeezed. The goal should be to create one integrated system where data is created and flows through all the systems that rely on that data automatically.
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