How Infor Nexus is helping to digitalise Asia’s supply chain

At the peak of the Covid-19 coronavirus outbreak, buyers were extending payment terms from 30 days to as long as six months, while more shipping firms cancelled scheduled sailings as the amount of cargo declined.

Those were some of the recent challenges faced by companies in the supply chain industry, which saw a decline in business as global trade slowed down amid the pandemic, according to Cas Brentjens, vice-president at Infor’s Nexus unit in Asia-Pacific and Japan.

“There was a lot of pressure on suppliers in Asia, so there was a large demand for supply chain finance programmes,” Brentjens said. “Some brands also reacted quickly by setting up warehouses in Hong Kong or Singapore to support the direct-to-consumer business model.”

Brentjens said with a substantial amount of global trade being managed through the Nexus supply chain platform, the company introduced a visibility programme to provide insights on orders and shipments, as well as a supply chain financing scheme to provide buyers and suppliers with easier access to capital from lenders.

“We also helped companies set up warehouses quickly so they can set up new operations, but there’s still much work left to do in digitalising the enterprise which Covid-19 has accelerated,” he added.

Digitalisation efforts in the supply chain industry started decades ago with electronic data interchange (EDI), but the presence of multiple technology standards meant that suppliers and buyers have had to grapple with different trading systems.

“With multiple trading platforms, it’s important that they can talk with each other though application programming interfaces”, Brentjens said. “But what’s new now is that technology enables us to scale better in a global integrated play through the use of open source technology.”

Brentjens does not think a global EDI standard would emerge given the differing views around standards and technologies, such as the use of blockchain in trading platforms.

In 2018, Singapore’s Global eTrade Services launched an open trade blockchain network to boost cross-border trade between China and the rest of Asia.

By enhancing the security of trading documents, such as certificates of origin and commercial invoices, the network was expected to promote transparency and trust between shippers, freight-forwarders and customers.

To Brentjens, however, blockchain might not be the best way to promote transparency and trace goods for now, because of its complexity as well as performance and cost considerations after Infor tested the technology in some pilot projects.

“There might be a use case for blockchain in some areas and for certain supply chains,” Brentjens said. “But traceability and having one version of the truth can be achieved through certificates of origin. In fact, the technology we’re using has some similarity to blockchain although it is not blockchain.

“The only part that is different is trust, and where blockchain is providing trust, we provide that trust by being part of the Nexus platform.”

The Nexus platform also provides cargo tracking capabilities by linking the location data of vessels to the cargo and individual items being shipped by vessels, aircraft and trucks equipped with location trackers.

Plus, geofencing and machine learning techniques can be applied to that data so that the next party in the supply chain can be informed of when the cargo is expected to arrive at a port, Brentjens said.

The Covid-19 situation has not dented Infor's traction in the Asia-Pacific region, with the company seeing double and triple-digit growth in Japan, China and Southeast Asia, thanks to the growing adoption of cloud, according to Brentjens.

Infor Nexus operates a global datacentre in the US that hosts its supply chain platform while other Infor cloud services may be delivered through regional datacentres in Singapore, Japan, Hong Kong and Sydney to meet performance and data sovereignty requirements.

According to P&S Intelligence, an India-based market research firm, the global cloud supply chain management market is expected to reach $11bn by 2023. Asia-Pacific will see the fastest growth due to automation and swift industrialisation in the region.