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Business-2-Business (B2B) eCommerce has gone through a lot of transitions in the last decade. My question is has B2B eCommerce just been a big train wreck of late? Has there really been any real progress in realizing the dream of true electronic document exchange between businesses. Until the last decade, B2B eCommerce, which started with Electronic Data Interchange (EDI) in the 60’s, was adopted by businesses very slowly and with not much fanfare. Suddenly with the advent of the internet and the breakaway from the traditional Value Added Networks (VAN), B2B eCommerce exploded. All of a sudden there were dozens of “killer” integration applications, and new standards such as XML that were to revolutionize the way we do business. Now after a decade, is B2B eCommerce any further along? There are now so many EDI-type standards and so many proprietary integration applications that many businesses are locked into proprietary EDI / B2B solutions or they are so confused about B2B eCommerce that they do not know what to do.

B2B eCommerce - Order Out of Chaos?

It would be nice if a supreme authority would come along and clean up this B2B eCommerce mess. In my heart, an overall authority, even a Government agency, that would “lay down the law” would be wonderful. From my past experience, I do not believe that there will ever be a supreme authority over global data standards and data exchange.

Standards committees act too slow, and there are too many “800 lb. gorillas” that will disrupt any attempt at global data standards and data exchange standards. These “800 lb. gorillas” include Fortune 500 companies like large retailers, manufacturers, and service providers that have immediate real-world issues that need an EDI-type solution now. Other “800 lb. gorillas” are large EDI / integration / software vendors that are either protecting their existing turf or are attempting to expand market share by offering a new, proprietary “silver bullet” that will solve all B2B integration problems.

B2B eCommerce is important and businesses really do need a solution to electronically exchange their business documents with their suppliers and customers. B2B eCommerce saves money, improves supply chains, and speeds procurement cycles. One of the biggest challenges with B2B eCommerce is that the person that holds the purse string knows little about EDI. His or her most trusted advisors in most cases know nothing about B2B eCommerce and EDI solutions. Are the subjects of B2B eCommerce and Electronic Data Exchange even taught in college and universities? How is the business sponsor for a B2B eCommerce project to know who can implement a good B2B solution and what is a bad B2B solution? I have seen too many B2B solutions that were too overpriced to implement and maintain or did not meet the business objectives. Also, there are too many businesses out there that have not implemented any serious B2B solutions. Many businesses just do not see the value of standardizing the electronic exchange of business documents between their suppliers and customers.

It use to be that Business-To-Business (B2B) eCommerce had all the exciting technologies. There was RFID, EDI, internet (yes internet started with Government and businesses), broadband, fiber optics, electronic payments, cloud computing, wireless, and so on. This was neat stuff. Now it seems that person-to-person (P2P) communications is using all the neat technologies. Things like cell phones, wireless internet, YouTube, social networks, Twitter, and so on.

B2B eCommerce

Most businesses seem to be still caught in the Dot.com bubble of 2001. Web sites still look about the same as in 2001. Seems like most companies print more paper per employee than a decade ago. Businesses have limited information on their customers and what they should be selling them. Companies have limited B2B ecommerce and integration with most of their trading partners. Many companies have spent too much on technology with nothing to show for it. Other companies have spent too little on technology as they are unsure how to us it.

Hopefully soon, we will breakout of this B2B logjam. Technology integrators need to do a better job of selling B2B ecommerce solutions that add value to the businesses. Businesses need to do a better job of understanding B2B ecommerce technology and how they can use it to provide superior products and services. Seems like both IT and businesses have focused too much on the “shiny, new” technology instead of figuring out what works for a given business. P2P ecommerce and information exchange has rapidly outdistanced anything going on in B2B ecommerce.

See Scobleizer posting, What are the tech bloggers missing? Your business! on how tech bloggers get too focused on the “shiny, new” technology instead of communicating the value the technology can provide to a business.

If I recommend or mention to a business user an eCommerce solution involving EDI (Electronic Data Interchange) instead of using XML (eXtensible Markup Language), I usually lose at least some credibility. I am not really tied to EDI, but every time I look at XML for a specific business solution it ends up lacking. The primary reason that it lacks is there is a lack of standards when it comes to defining the specific data elements in a business transaction. For example, EDI has mature data definitions for things like a transaction number field for a shipment status electronic document.

XML seems to be only useful for real-time, simple transactional-level processing or for machine-to-human interface such as an RSS-type feed or web page presentation. At sometime in the future, XML may have mature data definitions that support system-to-system interfaces for different types of electronic documents. Data definition standards is something that EDI already has to support system-to-system integration. See Skip Stien’s paper, Co-existence of Traditional EDI with XML-EDI, on the purpose of XML and EDI.

XML has a lot of myths. Myths include: simple to implement, cheap to implement, easy data format, and technically superior. If you look at the business case for system-to-system data exchange between different businesses, EDI usually wins out. See Comparison Chart Between EDI and XML on the myths and the business cases in regard to implementing EDI or XML.