Electronic Cash News

Prior to 2001 it seem like every year there was a new, emerging technology that was revolutionizing the supply chain industry. Technologies included RFID, PDAs / scanners, voice, GPS, wireless, data communications, internet, and so on. Now the challenge is synchronizing all this data from all these different technologies.

The last couple of years I have worked in the area of B2B communications and just recently came back to implementing supply chain solutions. My biggest surprise is that I see no new enabling technologies, just better use of the technologies that were already out there.

On the other hand, there are some interesting, new areas and trends. One area of growth is what I would call data synchronization. Here IT companies are enabling businesses and supply chains to synchronize their data to get better information.

This is why Enterprise Resource Planning (ERP) system providers (SAP, Oracle, and so on) have gobbled up Warehouse Management System (WMS) and Transportation Management System (TMS) software providers the last couple of years. ERP providers are intent on having their software retain and synchronize their customer’s supply chain data.

Value Added Networks (VAN) and manage file transfer providers (nuBridges, SterlingCommerce, AXWAY, and so on) have definitely jumped on the data synchronization bandwagon. They are now moving from being Electronic Data Interchange (EDI) and communications service providers to providing supply chain software and data synchronization services. VANs and Manage File Transfer providers are intent on having their software and services retain and synchronize their customer’s supply chain data. Data synchronization services are emerging to include matching Purchase Order (PO)-Advance Shipping Notice (ASN)-Invoice data, electronic catalog, and even trade network services.

Many times the successful outcome of an IT project is dependent on the original contract or charter document. They do not seem to teach that in IT school. Without a good contract, you get unexpected costs from vendors, you get scope creep that drive up costs, you build a software product that nobody needs, and disappointed business stakeholders.

Joshua Greenbaum, Enterprise anti-matter blog, has a good example of a hardware vendor contract going bad (see ROI Lost: IBM Puts the Screws on a Loyal Customer). Here the customer had a contract with IBM for a mainframe hardware and Peoplesoft software. To save on costs, the customer decided to migrate the Peoplesoft software to a Microsoft SQL server. This looked like a good cost saving project, but there was a clause in the original IBM contract that ruined the project. Basically, the IBM mainframe and Peoplesoft contract had bundled pricing that required that the customer host the Peoplesoft software on the IBM mainframe. When the customer moved Peoplesoft off of the mainframe, the mainframe pricing shot up threefold. Again, bad contracts and bad project charter documents can destroy an IT project. In this case you had an old bundled-pricing contract that put restrictions on the customer years after the contract was signed. Then you had a project that had not scoped all associated vendor costs that would be incurred by implementing the project.

I became interested in Infor when they gobbled up SSA Global. I was interested in SSA Global because they had gobbled up two respected warehouse software providers, Provia Software and EXE Technologies. But who is Infor? Well, warehousing is just their sideline. They are now a $2 billion dollar Enterprise Resource Planning (ERP) company that competes with Oracle and SAP. Besides acquiring warehouse software providers they have also acquired mid-size ERP software providers like Baan and MAPICS. See eWeek article, The $2B Company That No One Has Heard Of for more information on Infor and where they are going.

SupplyChainer has a great video link on ERP in the U.S. Army. Enterprise Resource Planning (ERP) has traditionally been for manufacturers, but with the trend toward ERP II all large organizations are looking to ERP to solve their data synchronization challenges across the organization.

I am seeing three distinct ways that organizations are looking to address data synchronization within their organization and with their suppliers and customers. One is go the ERP route that the U. S. Army is going at the macro level. The other way is to use a managed file transfer solution or value added network (VAN) to exchange information between organizations and systems. Another emerging supply chain technology is RFID tags where the status of the products and shipments can actually be stored on the RFID tag as it travels with the product. Then systems could poll the RFID interrogation network to get the data and process it for the system’s unique needs. No need for systems to exchange data with each other.