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4 tips that can boost your relationships with suppliers

In just about every product-driven industry, too many dollars are chasing after too few goods. From microchips to crude oil to food staples that are typically well stocked — like wheat, corn and eggs — the items you need to complete your manufacturing processes remain difficult to come by. This puts the suppliers that provide you with these necessities in a bit of a predicament — especially when they have other customers who are looking for the same hard-to-find raw materials that you are.

An approach that can help you more effectively manage this issue is to strengthen the relationships you have with your suppliers. This way, they may be more inclined to prioritize the neeof your supply chain over their other customers', just as soon as the relevant parts, foodstuffs and materials become available. 

1. Invest in strengthening their capacity
The amount of goods a supplier can procure is largely dependent on its capacity limitations — how much the business can obtain or produce at any one time. You may be in a position to help by investing in your suppliers' operations so they have the financial resources to enhance output. This is something tools and hardware manufacturer Stanley Black & Decker has done with its supplier. As Don Allan, the company president and chief financial officer, noted during an earnings call this past February, Stanley Black & Decker co-invested in some vendor projects that will boost capacity for rare earth metals like lithium, which are used for the making of batteries in power tools. Lithium is also need to develop the ion batteries that energize electric vehicles.

Long-term agreements can do a great deal of good to strengthening the relationship you have with key suppliers. Long-term agreements can do a great deal of good to strengthen the relationship you have with key suppliers.

2. Seek a long-term deal
How long have you and your supplier worked together? If all of your contractual agreements have been for a brief period — like a few months — you may want to consider inking a more long-term agreement that is for a year or longer. Long-term agreements help to strengthen the relationship you have with your suppliers by letting them know you're committed to their business. This can incentivize a supplier to attend to your production needs above others who are once-in-a-while clientele or who haven't shown the same level of commitment that you have, backed up by your financial investment.

3. Be open to feedback
Is it possible that some of your production processes are causing you to waste raw materials or use more than is necessary to deliver the same product? Your suppliers may be able to offer some suggestions, but only if they know you're willing to accept their guidance and won't consider their it a slight or somehow undermining your expertise. Making your suppliers aware that you're open to their recommendations on how to minimize waste can make life easier for everyone.

4. Be respectful of their financial commitments
Paying invoices on time — every time — shows your suppliers that you're sensitive to the needs of their business and their ability to run a tight ship. When you're consistently punctual about payment, they're more likely to return the favor by going above and beyond to get the goods that are essential for your profit-making processes.

4 smart supply chain strategies for manufacturers

With manufacturers responsible for approximately 11% of the United States' gross domestic product and employing nearly 8% of the nation's workforce, many of the supply chain problems the country is encountering have fallen squarely on the industry's broad shoulders. Expansive though they may be, manufacturers are feeling the pressure. Indeed, of all the challenges they've encountered — from retention troubles to high operating costs — nearly 90% say the supply chain is their single largest struggle, according to a recent quarterly poll conducted by the National Association of Manufacturers.

While the supply chain will eventually course correct, it could be awhile before it returns to normal, given all the variables and global events that contributed to its disruption. Here are a few ways manufacturers can build a stronger, more resilient supply chain:

1. Partner with several suppliers
When you've maintained a stellar business relationship with an entity that has the materials you need for development — and they've always come through — using more than one supplier may seem superfluous. But if COVID-19 taught the business community anything, it's how quickly circumstances can change. In other words, nothing is a guarantee, even your most reliable suppliers.

Having a backup supplier can help guard against the unexpected. Ideally, it's best to partner with those companies that provide the most essential parts, fabrics or raw materials that you use during production. In other words, have standby suppliers for the materials you can't do without. 

2. Invest in technology that forecast outcomes
To a certain extent, manufacturing in all its forms is a guessing game; you can never be exactly sure what demand will be like for the goods you produce beyond past behavior. However, Internet of Things technology, automation, artificial intelligence and software that leverages those technologies — such as enterprise resource planning — provide more accurate insight on how much interest there will be for a given final product. These demand-prediction capabilities help to lower costs and improve efficiency as well as lead time so items are delivered to buyers or resellers when they're expected.

Business continuity planning and insurance can serve as a stop-gap measure to existential supply chain challenges.  Business continuity planning and insurance can serve as stop-gap measures to existential supply chain challenges.

3. Guard against worst-case scenarios with financial instruments
Even when you've gone over all of the potential outcomes and how to diminish their risk, bad things can still happen that are entirely out of your control. But you may be able to soften the blow in terms of how supply chain disruption affects your company financially. Products like contingent business interruption insurance, cyber liability insurance for cyberattacks and other types of coverages can guard against serious hardships that threaten the survival of your operations.

4. Prioritize sustainability
Resources are so often finite, especially when your work processes are creating unnecessary waste. That's why it's important to weave sustainability into your supply chain management efforts wherever possible. Whether it's diminishing energy usage, deploying technologies that help you establish sustainable business practices or developing goals to make better use of natural resources, improved sustainability provides more predictability.

We use palm oil in nearly every facet of our lives, whether we are aware of it or not. From cooking oil, to hair products and biofuel, palm oil is pervasive at every level of society for many different purposes. The ubiquity of the oil cannot be overstated, with an article in The Guardian stating that over 70% of all personal care products contain it, as well as being the cooking oil for major fast food brands and an integral part of baked goods without trans-fats. With its low cost and high versatility, palm oil is here to stay for the foreseeable future.

Palm oil's use as a biofuel is also propelling the large demand for palm oil, with Europe having quickly become the world's second largest consumer of the product, in the wake of its growing shift toward biodiesel. The demand worldwide for palm oil will only keep growing, Vantage Market Research recently put out a press release stating their prediction that the market for palm oil will grow by $13 billion dollars by 2022.

Why the ban?
The ban comes on the heels of a butterfly effect of global supply chain crises that have affected food prices globally, with every sort of cooking oil being hit by separate disasters. Reuters reported recently that drought had taken its toll on the Canadian canola crop and Argentinean soy. At the same time, Russia's military action in Ukraine and NATO's reprisal sanctions on Russia have completely sidelined the region that exports 3/4ths of all raw sunflowers in the world.

With this in mind, Indonesia, the worlds' largest producer of palm oil by a significant margin, decided to ban export of refined cooking oil to protect their domestic food prices in the wake of global inflation. Shortages and price hikes on oil have led to protests and disturbances in the country and become a hot-button political issue. Sourced from Bloomberg, Indonesian President Joko Widodo was quoted as saying, "Once the local need is fulfilled, surely I will revoke the export ban because I understand how the government needs taxes, needs overseas earnings, and needs a trade surplus". He then went on to say, "The people's (Indonesian's) need is a more important priority."

Given the state of the market for edible oil, this may soon become more valuable than printer ink.Given the state of the market for edible oil, this may soon become more valuable than printer ink.

What are the potential worldwide consequences?
Due to its ubiquity, a sudden cut of the supply of palm oil could send many manufacturers and small businesses scrambling to find cheaper or more readily available alternatives. While many companies are saying that this measure is short term, changing which oils are used in a mass-produced recipe may cause short-term supply shortages and increased costs. The Associated Press has reported that Unilever has told their investors that palm oil and other edible oil costs may bite into their earnings in Q3 and Q4. End consumers who are already feeling the sting may have to deal with increased food prices in a period where food prices are already dramatically rising. If you're seeing an increase in food prices at your local grocery store, the state of the edible oil supply might be to blame.

One of the most difficult things in supply chain management is creating and maintaining strong relationships with your suppliers. Building the necessary level of trust, transparency and dedication going both ways is energy-intensive and emotionally draining. As difficult as it can be, the rewards make it incredibly worthwhile. As one writer from the University of North Carolina put it, a comprehensive strategic alliance between a company and their supplier is like a marriage — the more work you put into it, the more successful you will be.

The impact of building close relationships with suppliers can't be overstated. McKinsey research shows that companies that developed and maintained strong working relationships with their suppliers tended to beat industry trends in profitability, growth and lower operational costs at around two times the industry average.

What makes an ideal partnership?
As with most partnerships in life, the most important thing a company can develop with its supply partners is a healthy and trusting relationship. There are a few ways to accomplish this, the most important of which is implementing a set of policies for clear communication. Much like a marriage, if there isn't open communication, things begin to break down and trust erodes. In a field where there's so much potential for mishaps, whether it be a miscommunication, delayed shipments or misread orders, a clear communications plan developed between both parties can ease tensions and build trust in the face of adversity.

Another way to develop a strong relationship with your suppliers is to establish an atmosphere of transparency. This is achievable in many ways — one of the most important of which is being proactive about informing your suppliers of any changes or issues that might arise. Being consistently clear about your needs and expectations helps reduce the possibility of misunderstandings severely damaging the relationship between supplier and customer. To misquote an old adage, talking out your issues might hurt, but keeping them silent will kill.

Learning to prioritize
Creating a close relationship of trust, transparency and goodwill takes a lot of time and effort, which most teams won't have the bandwidth for across all suppliers. To develop strong strategic partnerships, organizations must be willing to prioritize their efforts by the importance of their suppliers to their overall goals. For example, a major coffee chain might prioritize their relationship with their largest bean suppliers while being less involved in their providers of cup sleeves or stir sticks. However, reducing bandwidth cost isn't always about prioritization. The U.K.-based Chartered Institute of Procurement & Supply recommends that one of the best ways to build trust is through using technology to develop an easy transparent relationship. The Institute goes on to state that using a procure-to-pay system that is well understood by both parties can make transactions smooth and remove chances for human error.

At the end of the day, what's most important in building a relationship with your suppliers is creating an atmosphere of trust and respect — like a good marriage. The more a company works closely with their suppliers in a transparent and direct manner, the better results they can expect.

Akin to a test drive with a new car or an open house before making an offer on a potential next home, furniture is the kind of merchandise that consumers like to try before they buy. But during the pandemic, when supply chain and shipping bottlenecks were pervasive and home furnishing shopping soared — largely due to people spending much more time at home — "try and buy" was more like "buy and wait." Due to unprecedented demand, the love seats, sofa chairs and bedroom bureaus that customers were used to getting the next day came next month —  if not later.

Numerous household name manufacturers, retailers and e-commerce giants were affected by these unusually long delays, including La-Z-Boy, Williams-Sonoma and Overstock.com. The bulky, cumbersome nature of household, home office and bedroom furniture further exacerbated these issues; items take up a lot of space and can be challenging to move.

Given these realities — which continue to plague the industry — furniture suppliers and retailers have adjusted their supply chain planning processes as well as their customers' expectations. In short, they're trying to make the best out of a series of unfortunate events. 

Overstock is stocking up
One of those organizations is Overstock.com, a Utah-based e-commerce conglomerate that specializes in home decor and bedding products. Speaking to Retail Dive, CEO Jonathan Johnson said the company has prioritized advertising the items that it has readily available rather than those that need to be imported by sea. Indeed, Johnson noted that 99% of the goods that Overstock advertises on its website are in warehouses somewhere inside the continental U.S. This has enabled the company to avoid major shipping ports like those in Los Angeles and Long Beach, where massive volumes of inventory have idled, waiting to be offloaded.

"A lot of companies historically have been able to say, 'Well, once it's on the water, we know it's six weeks to your house,'" Johnson explained. "[But] when the Port of Long Beach in Los Angeles looks like the 405 freeway, backed up out into the ocean, that 'six weeks to home' doesn't happen."

More proactive inventory management has helped furniture suppliers deal with ongoing supply chain frustrations.More proactive inventory management has helped furniture suppliers deal with ongoing supply chain frustrations.

Another strategy retailers and suppliers have turned to is better inventory management. Prior to COVID, just-in-time inventory — having the bare minimum amount of merchandise available to satisfy demand — was considered best practice. Now, providers are shoring up their most in-demand products in anticipation of new disruptions that could lead to shortages. They've also built more lead time into their buyers' expectations.

Rick Jordon, senior managing director for FTI Consulting, told Supply Chain Dive that uncertainty has become the norm.

"It's pretty much normalized to something that's inconsistent, which means everyone just has to build a little more time into their supply chain," Jordon said.

Despite the higher warehousing costs — and lengthy wait times for customers — the supply chain pains don't seem to have impaired suppliers' sales goals. Williams-Sonoma, La-Z-Boy, Basset Furniture and Overstock have been on firm financial footing over the past year, according to RapidRatings data obtained by Retail Dive. La-Z-Boy saw sales rise 22% to $572 million in the third quarter of the 2022 fiscal year, the company announced.

The domino-like effect inflation has exacted on supply chains, the economy and its participants is forcing the vast majority of small-business owners around the country to do what their buyers detest: raise prices. And it may be a while before said companies can return those prices to where they were. 

Over the past year, more than two-thirds of small-business owners say they've increased what they charge customers for their traditional products and services, according to the results of a quarterly survey conducted by the U.S. Chamber of Commerce. But they've done so reluctantly, with approximately 8 in 10 citing inflation as their primary business concern, which has overtaken the supply chain as their biggest ongoing worry.

Tom Sullivan, vice president for the Chamber's small business policy division, noted that there are no winners in a hyperinflation environment; everybody's dollar buys less.

"Inflation is top of mind for small businesses as it continues to limit their purchasing power, forcing small businesses to raise their prices and absorb higher costs within already thin margins," Sullivan said, as reported by Supply Chain Dive.

6 in 10 Americans are very concerned about inflation
Unsurprisingly, small-business owners aren't the only ones preoccupied by sky-high costs. Roughly 60% of Americans in a recent Gallup poll said inflation worries them "a great deal" and nearly 1 in 5 cite it as the U.S.' single biggest problem — tied with the overall economy, the cost of fuel, and income inequality when combined. 

Inflation is a byproduct of too much money chasing too few goods.Inflation is a product of too much money chasing too few goods.

Aside from the budgetary challenges inflation causes for business owners as well as everyday consumers, another consequence is the impact of efforts to fix it. From the Federal Reserve increasing key interest rates to families opting to not buy as much — which reduces the demand — the solutions frequently involve some level of hardship. In the 1970s, for example, when inflation was severe, it triggered a recession in the early 1980s. At the time, interest rates were at record highs.

A perfect storm
Economists are at odds over how entrenched inflation is this time around, but as with the previous era of elevated inflation, the Fed has begun to increase interest rates, doing so in March for the first time in almost four years.

Neil Bradley, chief policy officer and head of strategic advocacy at the Chamber of Commerce, told Supply Chain Dive that a perfect storm of conditions has led to the current economic environment, much of it brought on by the pandemic.

"Supply chain disruptions, energy prices and a persistent shortage of labor are all coming together at a time of sustained demand to force prices up," Bradley said in email to the news source. He further noted that small-business owners frequently bear the brunt of inflationary pressures. Not only are their margins leaner, but they also have to increase their prices more quickly, something that larger organizations can put off, given they have more sources of income to maintain adequate cash flow.

In the meantime, organizations of all sizes will continue to strategize and coordinate to rein in their expenses wherever possible without compromising quality.

Used as a glue alternative and in the manufacturing process of vaccines, eggs are an invaluable component of the supply chain, with applications that go far beyond the kitchen and what's for breakfast. But the national availability of them may be compromised in the days ahead due to a bird flu strain that appears to have impacted tens of million of hens.

According to multiple sources, million of chickens from roughly half of the U.S. have died as a result of avian flu. The highly transmissible virus is believed to have impacted egg-laying flocks in at least 24 states, according to National Public Radio, killing up to as many as 22 million birds. Some of the birds died from the virus itself, but most were culled by poultry farmers as a precautionary measure.

That's a tremendous amount of eggs that will be taken out of the supply chain pipeline, especially for a country that is among the world leaders in egg consumption, albeit in lower per-capita volumes than in previous years.

Iowa taken largest losses
Some states have been hit harder by the outbreak than others. Chicken farmers in Iowa, for example, have killed off at least 13 million birds, with nearly half of those cullings occurring at a facility in Osceola, according to the Department of Agriculture. The Hawkeye State leads the nation in overall egg production, according to the United Egg Producers. Indiana and Ohio, which round out the top three, are some of the other states the avian flu has reached.

Farmers have culled hens by the millions due the Avian flu.Farmers have culled hens by the millions due the avian flu.

Iowa-based poultry farmer Ben Slinger has emerged unscathed from the flu strain thus far, but he knows what it's like to be impacted. Slinger told NPR he lost tens of thousands of turkeys in 2015 when some of them became infected with a strain at the time. He's since learned from that experience and is taking precautions with this flock to stymie transmission.

"We know what the aftermath of that is like, and it is pretty disheartening," Slinger said.

5-day supply of eggs nationally
Even without a deadly pathogen decimating flocks, the poultry industry is a shell of its former self. In 2019, for example, there were 340 million egg-laying hens nationwide, CoBank reported from government data. That number has since fallen to roughly 322 million. Some of these losses derive from there simply not being as many poultry farmers as there used to be, while others stem from compliance and regulatory scrutiny that has made remaining in business unsustainable. Combined with the overall supply chain complications, egg inventories are down from their former perch. Indeed, there are approximately 1.6 million 30-dozen egg cases on hand at a national level, based on the most recent weekly figures available from the U.S. Department of Agriculture. Based on the rate of consumption, this translates to around five days' worth. 

These inventory pressures combined with inflation have pushed egg prices increasingly higher, both for wholesale and retail. For the week of April 4, a dozen large eggs were selling for an average of approximately $2.60, up from $1.60 in January, the USDA said.

Prices for consumers haven't climbed quite like this since the early 1980s. But it turns out business owners are feeling costs pressures like never before, providing added context for why everything is coming at an ever higher expense.

The Producer Price Index, which tracks what business owners pay for the materials involved in their goods and services, rose more than 11% (unadjusted) in March compared to a year ago, according to the Department of Labor. Not only was the increase more substantial than what consumers felt — 8.5%, according to the Labor Department's Consumer Price Index report — it's the most substantial year-over-year growth on record.

Energy prices, which are a major contributor to inflation, also rose from March 2021 and were responsible for more than half of the upward movement to the PPI, the Labor Department revealed.

As with previous economic challenges, the problems plaguing the supply chain and runaway inflation are feeding upon one another, although it's unclear which issue triggered the other. But everyone — business owners as well as customers — is being impacted. These same people largely expect the price hikes to continue. Indeed, nearly 80% of Americans said they anticipate inflation to be a major problem even six months from now, according to a Gallup survey. Just 9% think prices will be lower than they are today. Economists believe the rising price trend could last well into 2020.

While economists did forecast the PPI to rise, the degree to which it did came as a surprise. Economists polled by Reuters forecast a hike of 10.6% on a year-over-year basis. The PPI for final demand measure also came in higher than anticipated, increasing 1.4% versus the 1.1% advanced that economists hypothesized.

Rising foods costs contributed to the record growth in the Producer Price Index.Rising food costs contributed to the record growth in the Producer Price Index.

Proposed solutions to high energy prices may not be fruitful
Meanwhile lawmakers are taking steps to help Americans lower their expenses. In addition to tapping into the Strategic Oil Reserve, President Joe Biden announced that oil producers could start using more corn-based ethanol in their gas production. Currently, environmental strictures are in place that limit the sale and development of E15. But starting in June, some of those restrictions will be lifted.

However, critics don't believe this move will make much of a difference in the price of gas. As Reuters points out, E15 doesn't have the same kind of energy density compared to traditional unleaded fuel. This means on a gallon-per-gallon basis, consumers will have to buy more than they would with regular gas.

Furthermore, similar to electric charging stations, there aren't many gas stations that offer E15 as an alternative. Of the country's 150,000 gas stations, only 2,300 sell E15, according to The Wall Street Journal.

With the war still raging in the Ukraine, COVID infections beginning to rise again and a sweeping lockdown being imposed in Shanghai by China, economists believe the worst may be yet to come, both for the supply chain and for Americans' bottom line.

Perhaps the only thing more difficult than fixing the supply chain is settling on the main source of its breakdown. From the effects of the pandemic to environmental catastrophes affecting infrastructure to the Great Resignation, there are no shortage of contributors. A top contender, however, is high turnover. During the height of the COVID-19 crisis, when employers and government officials initiated lockdowns as a safety precaution, the experience led millions of people to reevaluate their careers, with some opting to leave their industry entirely. As a 2021 survey from Gallup found, half of Americans are actively on the hunt for a different job opportunity. Many of these employees are in industries where a well-oiled supply chain is pivotal to success, including manufacturing, logistics and trucking.

Employers are implementing various strategies to blunt the employee exodus, one of which is stay interviews. Leveraging this strategy may prove effective in improving retention and — as a result — supporting your supply chain.

What is a stay interview?
As its title implies, a stay interview is a retention technique designed to persuade current employees to remain at their present jobs. Whereas an exit interview is more about the why  — namely, why a worker is quitting — a stay interview is focused on the how. In other words, it's a determination of how the worker's employer can make the job better.

How does a stay interview positively affect the supply chain?
Of course, there are many aspects to the supply chain. But a supply chain doesn't exist without workers there to support it and churn out product. If an extraordinarily talented individual in warehousing leaves their job, the supply chain winds up suffering, evidenced by increased downtime, diminished productivity, accounting errors and process redundancies.  

Stay interviews should ideally be more conversational in tone.Stay interviews should ideally be more conversational in tone.

Here are a few example questions for stay interviews:

What do you like best about your job?
Here, the goal is to identify what aspects of a job your star employees like so they can do more of it. The more specifics they can identify as to what makes it great, the better.

What do you like the least?
Every occupation has its downsides, some of which may be unavoidable. But feedback in this regard can help you determine what tweaks can be made to make the task less onerous or unpleasant. In warehousing-related positions, where manual labor is often involved, leveraging automation may be a potential solution.

What would lead you to quit?
The salary of a position is and always will be a contributor to turnover, but it's not the leading reason for why individuals opt to seek out a different job opportunity. According to a survey conducted by MIT Sloan Management Review, the biggest motivator is a toxic workplace culture. Indeed, the poll revealed that an employee is 10 times more likely to quit in a toxic work environment than if another job is offering more money.

By getting out ahead of turnover and replicating the aspects of the job your workers enjoy — while eliminating those they don't — you can maintain or improve the performance of your supply chain by keeping your workers engaged.

Just as the ongoing supply chain problems have many causes, they also have many aftereffects, one of which is rising inflation. And in March, the continuation of too many dollars chasing after too few goods pushed the Consumer Price Index to fresh heights, dealing a blow to business owners' and consumers' already stretched budgets.  

The Consumer Price Index in March rose 8.5% on a year-over-year basis, according to newly released data from the Department of Labor. Additionally, the CPI grew a seasonally adjusted 1.2% from the previous month, a notable uptick from the 0.8% gain seen in the February report.

With the 8.5% gain, this latest CPI report is the sixth consecutive month in which inflation has been at or above 6%, The Wall Street Journal pointed out.

The biggest contributor to the latest surge in prices is the cost of fuel, the report said. Indeed, the gasoline index jumped more than 18% in March from 12 months earlier. The food index, meanwhile, elevated approximately 1% over the same period.

Increasing what they charge is often the last resort for businesses that are spending more to stay afloat, as they prefer to opt instead for alternative cost-cutting strategies wherever possible, such as staffing cuts or applying for a loan. But it's been unavoidable for the vast majority of both small and large organizations over the past year. In the past 12 months, fully 66% of small businesses have been forced to increase prices on the services and goods they sell, according to a quarterly report from the U.S. Chamber of Commerce.

Added supply helped dealers rein in new and used car prices.Added supply helped dealers rein in new and used car prices in March. 

Slight dip in month-over-month inflation
But the latest CPI report wasn't all bad news. When excluding the cost of food and energy — meaning core inflation — prices climbed 0.3% in March, the Labor Department reported. In February, the same measure was 0.5%.

As for why core inflation slowed down, falling car prices likely represent the main reason, according to Fitch Chief Economist Brian Coulton in an email to CNN. Blerina Uruci, an economist at T. Rowe Price, told The Wall Street Journal that with automobiles being the exception, prices are higher for just about everything else.

"To me, this is a red flag," Uruci explained. "The other red flag is Russia's invasion of Ukraine and the rise of COVID in China. "Those pose risks that the so-called normalization of supply chains takes longer to materialize."

While economists are at odds as to how to resolve inflation and when prices will finally start to pull back, many agree that supply chain disruptions were the tipping point. From how the COVID-19 lockdown diminished production to the dramatic surge in demand fueled by government stimulus spending, a severe shortage of products forced businesses to raise their prices.

So long as the supply chain interruptions remain problematic, inflation will likely remain a theme for the economy for the foreseeable future. Indeed, economists suspect it will be "uncomfortably high" for the rest of the year, according to a WSJ poll.



AI artificial intelligence mapping brain as digital circuit network
If you search on the internet, it is no surprise that Artificial Intelligence (AI) and its potential to significantly change the workplace is a consistent trend with companies that want to grow. While it is not a new concept, the opportunity for application and saturation in financial services is accelerating.

AI is no longer reserved for big tech and entertainment-focused companies. Albeit these organizations tend to lead the way with integrating AI in their most recent product launches.

The relatively inexpensive cost to create and implement AI into software applications has broadened the scope of use, specifically when it comes to everyday business processes. The first question to ask when considering the adoption of AI, or any technology for your company, is how will it help grow the business, reduce costs, and improve cashflow?

One use case explored involves AI Automation within a finance organization. The solution was deployed to automate invoice processing, a monotonous task that was time-consuming for employees who manually entered large amounts of data and reconciled against multiple records. The use of AI invoice automation software has significantly reduced processing inefficiency, data entry errors and processing time.

In another use scenario, a company was able to reduce their data extraction manual efforts by two full days. On average, reading and keying data from an invoice takes an employee approximately three (3) minutes per invoice. Automating that process for close to 500 invoices monthly, results in 25+ hours of time savings. This reduction is attributed to the ability of AI to read, extract, and transpose:

  • Supplier Names
  • Payment Terms
  • Bill Dates
  • Invoice Numbers
  • Line-Item SKUs and Descriptions
  • Quantities
  • Prices and Taxes
As a bonus, the AI results in fewer keying errors than the customer’s existing manual processes.

AI invoice automation “learns” and evolves on an ongoing basis. While processing big data, it contextualizes information and understands different languages. Most importantly, employees previously responsible for related tasks are free to focus on more strategic contributions to the organization.

It is difficult to envision any market that would not benefit from AI invoice automation technology. If your organization procures products or services, paying invoices quickly should be a top priority. As a finance team, using AI invoice AP (Accounts Payable) processing software should be simple and easy.

Are you a CFO or business leader interested in reducing expenses and improving your procurement process? Learn more about AI-driven invoice automation in the AI, Automation and Invoicing Revolution webinar with Julien Nadaud, Senior Vice President of Innovation at Corcentric.



Amid growing calls from the American public and fossil fuel industry stakeholders to increase domestic drilling, the Biden administration is taking a different approach to the country's energy crunch by increasing the supply of raw materials needed for electric vehicles. But critics suspect the move may have unintended consequences.

The White House recently authorized the Defense Production Act, an executive action that is available to the sitting president. In this instance, invoking the Defense Production Act will provide miners with the resources needed to acquire more minerals — such as manganese, graphite, cobalt and lithium — that can be leveraged for electric vehicle production and to manufacture the batteries that electric vehicles run on.

To ensure that the drilling for these minerals don't compromise the strides the United States has made in carbon emission reduction, the White House noted it will work in tandem with the Department of Defense to maintain "strong environmental, labor, community and tribal consultation standards."

This latest action by the Biden administration is part of a multi-pronged effort to bring some semblance of balance and normalcy to the energy supply chain. With a war being waged in Ukraine, hyperinflation pushing prices increasingly higher and more individuals returning to the workplace after COVID-19 protocols had many people telecommuting — thus increasing the demand for gas — the combination of these factors has only further destabilized the economic landscape. With more access to the resources needed for alternative energy, supporters of the administration's actions say the latest move will help to diminish the nation's reliance on fossil fuels.

Nickel is a key ingredient for electric vehicle batteries.Nickel is a key ingredient for electric vehicle batteries.

NMA warns supply chains aren't ready
However, critics of the president's policy don't believe it will be beneficial — in fact, it may even be harmful. Speaking on behalf of the National Mining Association, NMA President and CEO Rich Nolan warned that the directive from the White House could create more demand than the domestic minerals supply chain can reasonably satisfy. That's largely because many of the minerals required to make electric vehicles are primarily imported from overseas.

"[T]he approaching minerals demand wave is set to strain every sector of the economy and requires an urgency in action from government and industry never before seen," Nolan said. "Unless we continue to build on this action, and get serious about reshoring these supply chains and bringing new mines and mineral processing online, we risk feeding the minerals dominance of geopolitical rivals."

According to the Office of Energy Efficiency & Renewable Energy, between 2016 and 2019, more than half of the lithium the United States imported derived from Argentina and approximately 36% came from Chile, which borders Argentina to the west.

The Natural Resources Defense Council, meanwhile, said that while the Biden administration's actions are laudable, the president must urge miners to use all due discretion in terms of how these strategic minerals are obtained. In short, the preservation of the environment must be prioritized. 

"Rather than just digging up or importing more, we should start with improved recovery and waste reduction throughout supply chains," said Bobby McEnaney, senor lands analyst for the NRDC.

He added these materials should be recycled to ensure the U.S. maintains its commitment to environmental sustainability.