With mounting financial and operational pressures, the way organizations collaborate with suppliers can make or break supply chain efficiency. We sat down with Sree Mangalampalli, VP of Digital Transformation Solutions at FourKites, to explore why traditional approaches to supplier collaboration are falling short and what innovative solutions are emerging to address these challenges.
Sree: What we’re seeing is a fundamental misalignment between how businesses want to collaborate with suppliers and how suppliers actually work. Companies spend considerable resources — sometimes years of transformation efforts — configuring systems and onboarding thousands of suppliers. Yet, adoption plateaus far below expectations.
The critical issue isn’t the technology itself but rather the approach. Traditional solutions don’t address how suppliers naturally operate. Instead, they impose rigid requirements that force suppliers to change their processes. Suppliers are understandably resistant; they’re already navigating multiple portal systems for different customers, each with its own interface and data requirements.
Sree: The challenges are numerous and costly. Organizations waste countless hours manually processing thousands of documents from suppliers — purchase orders, air waybills, invoices — each in different formats. Despite this immense effort, critical updates that could prevent disruptions are often missed, creating blind spots between order placement and delivery.
There’s also the issue of information overload. Many enterprises prioritize comprehensive data collection over practical usability, requesting excessive information from suppliers. This perfectionist approach overwhelms suppliers, discouraging them from engaging even with essential portal functions.
For procurement teams, this means spending mornings wading through dozens of supplier emails, manually extracting data, and chasing suppliers for missing information — all while warehouse teams scramble with unexpected deliveries and finance departments deal with avoidable premium freight charges.
Sree: While this affects virtually all sectors, industries with complex supplier networks feel the pain most acutely. Consumer Packaged Goods, Retail, Food & Beverage, and Manufacturing typically manage high supplier volumes, complex document formats, and strict delivery windows, making them particularly vulnerable.
Automotive and electronics manufacturers, for example, face extreme complexity with vast multi-tier supplier networks and just-in-time delivery requirements. A single missing component update can potentially shut down production lines, resulting in millions in lost revenue.
Similarly, pharmaceutical companies operate under intense regulatory scrutiny where documentation and traceability are non-negotiable, yet they struggle with standardizing information exchange across diverse supplier networks.
Sree: Traditional approaches to supplier integration tend to be organization-centric rather than network-centric. They prioritize the enterprise’s needs without sufficient consideration for suppliers’ operational realities.
Think about it — the average supplier must navigate more than five different portal systems for their various customers. Each portal requires learning a new interface and often entering similar information repeatedly. For smaller suppliers with limited technological infrastructure, this becomes an overwhelming burden.
When we force standardized templates, IT changes, or new portal systems, we’re essentially asking suppliers to adapt to us rather than meeting them where they are. Suppliers naturally gravitate toward familiar collaboration methods like email, documents, and spreadsheets instead of adopting new technologies that disrupt their workflows.
Sree: We’re witnessing an evolution toward more supplier-centric approaches. Leading organizations are recognizing that effective collaboration requires adapting to suppliers’ existing processes rather than forcing change.
The emergence of sophisticated AI agents is fundamentally transforming how we think about supplier collaboration. These intelligent systems can communicate with suppliers through their preferred channels — whether that’s email, documents, or spreadsheets — while automatically extracting and structuring information from unstructured communications.
Unlike traditional integration approaches that require months or years of implementation, these AI solutions can onboard suppliers in days, not months, allowing them to work exactly as they do today.
Sree: Traditional document digitization and OCR (Optical Character Recognition) solutions have been around for years, but they have significant limitations. They typically require manual review and data entry after digitization, can’t handle the full variety of supplier document formats, and lack proactive communication capabilities.
Modern AI agents go far beyond basic digitization. They don’t just process documents; they understand them contextually. They can extract critical data from any format — PDFs, Excel files, emails, even screenshots — without requiring template standardization. When suppliers modify their formats, these systems simply adapt rather than breaking.
Most importantly, these agents don’t just passively accept what comes in. They can proactively identify missing information and initiate communication with suppliers to obtain it, creating a constant flow of accurate data that gives organizations complete visibility into their inbound shipments.
Sree: That’s precisely where the paradigm shift is happening. Traditional approaches required lengthy implementation cycles with complex IT requirements and ongoing maintenance. They needed suppliers to change how they work, which created immediate resistance.
New AI agent approaches flip this model by eliminating the need for suppliers to change anything about how they operate. There’s no new portal to learn, no template to follow, no IT project on their end. The system works with whatever documents they’re already generating, in whatever format they prefer.
This fundamentally changes the implementation dynamic. Instead of a multi-year project with uncertain outcomes, organizations can implement these solutions rapidly and see immediate benefits, regardless of supplier technical sophistication.
Sree: The ROI shows up in multiple dimensions. First, there’s the direct productivity gain — organizations typically see a 75% reduction in manual document processing, freeing procurement teams to focus on strategic supplier relationships rather than administrative tasks.
Second, there’s significant cost avoidance. With better visibility into inbound shipments, organizations can reduce premium freight costs by 10-15% through improved planning. They also avoid the millions typically spent on integration projects that often fail to deliver expected returns.
Third, there’s the revenue protection angle. Improved visibility enables customer service teams to provide accurate information about order status and delivery timing, leading to increased customer satisfaction and, in some cases, measurable sales growth of 10-15 basis points.
Finally, there’s the resilience factor. Organizations gain the ability to identify and address supply chain disruptions proactively rather than reactively, which has become increasingly valuable.
Sree: Look for solutions that combine intelligent document processing with proactive communication capabilities. They should handle multiple file formats without requiring standardization, work through existing communication channels, and integrate directly with your visibility and transportation systems.
The most effective solutions operate continuously rather than in batches, processing documents immediately upon receipt and monitoring for exceptions around the clock. They should learn and adapt over time, becoming more efficient with each document processed.
Also, consider scalability. Can the solution handle your full supplier network, from the largest to the smallest partners? Does it address the varying levels of technical sophistication across your supply base?
Sree: That skepticism is completely warranted. The history of supply chain technology is littered with promises that fell short in real-world implementation. What’s different now is that we’re not asking suppliers to change — we’re changing our approach to meet suppliers where they are.
I would encourage skeptical leaders to start small. Identify a subset of suppliers where manual processing is particularly burdensome or where improved visibility would deliver clear value. Implement a solution with this group and measure the results. The beauty of these new approaches is that they don’t require massive upfront investment or risk.
Also, look for solutions that demonstrate value immediately rather than promising returns after lengthy implementation. If a solution requires months of configuration before delivering results, that’s a red flag.
Sree: I believe we’re moving toward truly autonomous supply networks where AI agents handle routine collaboration while humans focus on exception management and relationship building. These networks will be self-healing, with the ability to identify and address disruptions without human intervention in many cases.
The traditional supplier portal as we know it today will likely become obsolete. Instead, we’ll see intelligent systems that adapt to whatever communication methods suppliers prefer, extracting and structuring the information enterprises need while eliminating the administrative burden on both sides.
Ultimately, supplier collaboration will shift from being a technical integration challenge to a strategic advantage. Organizations that embrace this new paradigm will not only reduce costs but also build more resilient, responsive supply chains that can adapt quickly to changing market conditions.
Sree Mangalampalli is VP of Digital Transformation Solutions at FourKites, where he leads initiatives to help organizations transform their supply chains through intelligent automation and advanced visibility solutions.
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