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Gaining Supply Chain Efficiency Through Global Data Synchronization

 

David Barkwell and Winson Woo
Cactus Commerce Inc.

May 2006

Applies to:
   Architecture Development

Summary: This article examines how the trading of item data and the ordering of trade items in the supply chain can be made more efficient by integrating processes and systems, and by leveraging standards. (10 printed pages)

Contents

Introduction
Scenario Overview
1. Trade Partner Integration
2. Ordering
Conclusion

Introduction

This is the first in a multipart series explaining core processes in the supply chain. This first article will focus on trading partner integration/management, and the processes needed to synchronize product data so that ordering products from a vendor is made easier.

With the introduction of technologies such as RFID, new and existing business processes must be revamped, or even recreated, in order to take advantage of the benefits offered. It should be noted that existing technologies are still of value, and they form the basis of an integrated solution offering by combining bleeding-edge technologies with more stable technologies.

We'll examine the technologies that enable business processes in the supply chain, and provide an example of how to leverage these technologies to realize efficiencies, increase savings, and provide overall competitive advantage.

Scenario Overview

Traditionally, moving product data from a vendor/supplier to a retailer/distributor has been labor-intensive and error-prone, because of the amount of manual labor required to get product data into the retailer systems. In addition, because the transfer of data is traditionally very slow, by the time the data is received and entered into the retailer databases, the information is likely out-of-date, and therefore it requires updating. Due to these issues, industry groups decided to work together on new technologies such as Global Data Synchronization (GDS), to help ease and speed the transfer of product data from manufacturer to retailer, as well as to increase accuracy and security.

GDS is made possible by a global network called the Global Data Synchronization Network (GDSN) and is managed by GS1. GS1 is the global organization responsible for the design and implementation of global standards and solutions to improve efficiency and visibility in the supply and demand chains across verticals. GS1 has regional data pools—for example, a country data pool—that connect to the Global Registry (see Figure 1).

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Figure 1. Global Data Synchronization Network, GS1

The Global Registry is a worldwide directory to help the GDSN community locate data sources and manage ongoing synchronization relationships between trading partners (see Figure 2).

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Figure 2. Global Data Synchronization entities (Click on the image for a larger picture)

One of the main data pools is 1Sync. 1Sync defines GDS as:

"Data synchronization is the electronic transfer of standardized product and location information and the continuous synchronization of that data over time."

Product information includes:

  • Item attributes controlled by the supplier, such as size, packaging, and country of origin.

Location information includes:

  • Locations involved in trade, such as headquarter, billing, and ship to addresses.

There are a few core processes that exist within any supply chain ecosystem. We'll focus on the following processes between a supplier and a retailer:

  1. Trade partner integration/management
    1. Setting up a retailer as a trading partner
    2. Exchanging trade item information (essentially what to sell) between the supplier and retailer
  2. Ordering products from the supplier
  3. Order fulfillment
    1. Supplier picking and packing the products
    2. Supplier staging products to send
    3. Supplier shipping the products
  4. Receiving
    1. Retailer receiving the products
    2. Retailer inventory systems updated (single view, all channels)
  5. Supplier billing for the products
  6. Retailer paying for the products

The above process seems very simple; however, there are many steps, and these processes are core to all players in the supply chain. The paper will look into how technologies available today can supercharge this process.

1. Trade Partner Integration

1a. Setting Up a Retailer As a Trading Partner

The lifeline of any supplier is good relationships with its trading partners—in this example, retailers. Once a vendor has made the link to a retailer, and the retailer agrees to buy the vendor's products, the work is just beginning. In today's electronic world, there are many options available to suppliers to pass product data or catalogue information to retailers. The traditional method of passing product data to retailers might require a peer-to-peer connection from the supplier to the retailer, or even more traditional methods, such as a paper document passing to the retailer by fax or mail.

GDS is an ongoing business process that enables continuous exchange of data between trading partners to ensure synchronized data, and it is accomplished by means of a publish/subscribe model. The supplier is required to publish its product data to a data pool (1Sync), and the data pool then matches the published data to the known subscribers of the data. As an example, if there were a manufacturer of brownie mix that has just received notice from their sales team that there is a new retailer that will be selling their products. At this time, a deeper relationship must be forged with the retailer, in order to align the manufacturer's product data with the retailer's system. To do this, the manufacturer will need to send their product data from their database or Product Information Manager (PIM) to the customer's or retailer's ordering systems. To facilitate this process, both the manufacturer and retailer have purchased Cactus's GDS Accelerator for BizTalk, although this is not required. By using a GS1-certified solution, both parties are able to abstract the details of all the standards from their internal software to the data pools and GDSN.

Using BizTalk Server as the base platform for the GDS Accelerator, Cactus Commerce offers a GS1-certified GDS solution (on both 1Sync and Agentrics data pools). A certified solution indicates support for the XML schemas and commands that the data pools set as requirements.

Since the Cactus solution is an accelerator for BizTalk, and accelerators are tightly integrated with BizTalk Server, and since GDS is accomplished through a set of asynchronous commands and a set of XML schemas, BizTalk is a very good fit for GDS.

Figure 3 shows a snippet of the Subscription schema.

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Figure 3. Subscription schema (Click on the image for a larger picture)

To reduce the complexity and errors associated with coding raw XML, the Cactus GDS Accelerator for BizTalk provides a user interface (see Figure 4).

The Cactus GDS Accelerator for BizTalk Server is designed to help Consumer Goods Manufacturers and Retailers take full advantage of the power of the Global Registry through the 1Sync and Agentrics Synchronization Services. Utilizing the robust integration capabilities of BizTalk Server, Cactus GDS Accelerator for BizTalk provides a cost-effective way to quickly connect to 1Sync (formerly UCCnet and Transora), manage communications with trading partners, and integrate real-time data into existing product management systems.

The first step in creating a relationship is to create a synchronization relationship (that is, set up the publish/subscribe model) with a retailer within the Cactus GDS Accelerator for BizTalk Server.

The retailer that wishes to purchase the brownie mix would do the following steps (the trade item and its hierarchy [for example, Pallet, Case, Each] have been sent to the data pool):

  1. Create a subscription to the supplier's Global Location Number (GLN). The GLN is a globally-unique identification number used for locations, or legal or functional entities of an organization.
  2. Create a subscription to the supplier's Global Product Classification (GPC) codes or the specific product GTIN number. GPC is a product classification system based on the EAN.UCC standards, which describes products in terms of attributes, bricks, and their values. The GTIN is the Global Trade Identification Number, which uniquely identifies a specific product based on the EAN.UCC standards. The retailer is now ready to receive any trade items published by the supplier.
  3. Create Request For Catalogue Information Notification (RFCIN). The RFCIN is a one-time request from a retailer to the supplier, requesting the republishing of existing trade item data. The RFCIN is an XML message type supported by 1Sync, and it is very similar in structure to the subscription message. The RFCIN is largely utilized by trading partners who have previously exchanged product information through other methods, such as spreadsheets. To send an RFCIN, the retailer merely selects that message type from a drop-down list in the GDS Accelerator.

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Figure 4. Cactus GDS Accelerator for BizTalk Server user interface

Now that the retailer has requested a subscription to the brownie mix supplier, the supplier will:

  • Receive notification of the RFCIN within their notification services, which can be within the Cactus GDS Accelerator for BizTalk or their own GDS software.

Figure 5 shows a snippet of the RFCIN schema that the Cactus GDS Accelerator utilizes in the background.

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Figure 5. RFCIN schema (Click on the image for a larger picture)

The example in Figure 5 shows one of the first commands required to register an item to being the process of data synchronization. This example demonstrates the complexity and the amount of information required to manually code an RFCIN command (and this is only 20 percent of the full command). The RFCIN command contains various important pieces of information required for product registration, such as the UDEX codes (categorization codes), target market codes, various parties' Global Location Numbers, and various metadata tags, including date and time stamps.

At this time, since the supplier has accepted the subscription request from the retailer, when a supplier now publishes new data about their brownie mix, the retailer will be able to receive this updated information automatically. With automatic updates, the retailer is certain that the information they have in their systems is the latest and greatest to share with their customers. The next section will go into more detail about how the retailer will first receive the product data, and how they will receive updates.

1b. Exchanging Trade Item Information Between the Supplier and Retailer

To be able to order brownie mix from the supplier, the retailer will need to get information about the product from the manufacturer. The types of information include price, packaging, and ingredients, to name a few.

To accomplish this task, the following supplier steps are required (the trading partner has created a subscription to the supplier and/or to the supplier's product; if there was no subscription, an error message will be returned to the supplier):

  1. Enter the trading partner's Global Location Number (new trading partner only).
  2. Enter the name of the retailer in the GDS Admin Console (see Figure 6).
  3. Synchronize the trade items with the trading partner (for example, send the product attributes to the trading partner for consumption).

    Aa479352.rfed06(en-us,MSDN.10).gif

    Figure 6. GDS Administration Console

Once the supplier is completed, the retailer will:

  1. Query the data pool for trade item data, and all new trade item information will be sent to the retailer.
  2. Choose one of the following actions (see Figure 7):
    1. Synchronize the trade item (agrees to download and receive updates).
    2. Accept the item (provides future updates).
    3. Review the trade item (has not accepted or synchronized).
    4. Reject (no further updates on this product are provided by the data pool).

    Aa479352.rfed07(en-us,MSDN.10).gif

    Figure 7. Trade item notification

Once the retailer is complete, the supplier is then provided a notification that details which state the retailer has chosen. From this point on, assuming that the retailer has synchronized the product data, the retailer will receive any and all updates from the supplier as they become available. This process will work for each and every retailer that has subscribed to this supplier's product data, and therefore it reduces the workload that a supplier may have in updating product data with its trading partners. Instead of a peer-to-peer relationship being set up with every retailer that the brownie mix supplier sells to, they can now submit their data to one data pool, and have that data pool determine which retailers need to receive the updates or the new information that has been published by the supplier. This process relieves the supplier from having to continuously update the information with each of the retailers, allowing them to work on other tasks.

The actual schemas that have been processed in the preceding scenario include:

  • CIN (Catalog Item Notification)—An XML document, sent by the supplier, that describes all the attributes of the trade item.
  • CIC (Catalog Item Confirmation)—An XML document, sent by the retailer, that informs the supplier whether the retailer wishes to continue to receive information about that trade item.

The CIN will contain the item data that the supplier wishes to send to the retailer. Figure 8 shows a snippet of the CIN schema.

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Figure 8. CIN schema (Click on the image for a larger picture)

The CIN example in Figure 8 contains only about 15 percent of the original command. Important attributes to note on the CIN are the actual product attributes. Note that the UDEX code is present again, but, more importantly, the actual product is described—in this case, the supplier is providing Beef Dog Food with the description of Chunky Beef in U.S. English.

The CIC will contain the confirmation of these items in the CIN from the supplier. Figure 9 shows a snippet of the CIC schema.

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Figure 9. CIC schema (Click on the image for a larger picture)

The CIC command in Figure 9 is the confirmation to the CIN. Note that the catalogueItemConfirmationState is Accepted, and the CIC indicates all the relevant parties' GLNs, as well as the GTIN of the product that was accepted. The CIC is one of the simpler documents in GDS.

2. Ordering

2a. Retailer Ordering Products from the Supplier

Now that the retailer has synchronized all of the brownie mix product data, they are able to use this item data to order products (or trade items) from the supplier. Generally, once product data is synchronized, it will be part of a Product Item Master (PIM), where there exists one, and only one, version of the true item available for sale on both the supplier and retailer side. Since GDS guarantees that the item data is up-to-date, integration of the PIM to the retailer's ordering system would guarantee that the correct item is ordered.

To order products that are synchronized, companies will often use a standard set of documents to convey their order requests. The de facto standard for transmitting orders from customers to suppliers is a technology called Electronic Data Interchange (EDI), and it is the most recognized method in which trading partners exchange electronic data through a VAN (Value Added Network) or the Internet. A VAN is simply a third-party Electronic Data Interchange (EDI) service provider that provides a communication link between companies in order to enable electronic exchange of business data/documents.

EDI defines structures for trading documents such as purchase orders, advance shipment notices (ASNs), and invoices, to name a few. Figure 10 shows an example of a purchase order standard (EDI 850 document) (on the right), next to a fax or form purchase order (on the left).

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Figure 10. Standard (EDI 850) purchase order document, versus a fax or form purchase order document

By having a defined standard on a business document, systems know what to expect in each of the sections of a particular form, making it easy to understand the information.

Both of these standards generate send/acknowledgments, thus guaranteeing non-repudiation. By using these standards, the ordering of trade items between the supplier and retailer obtains the following benefits:

  • Reduction of manual entry of ordering information
  • Reduction in errors from ordering incorrect items
  • Benefits from non-repudiation
  • Faster turnaround times due to a speed increase in the automation of item ordering

In the next part of the series, we will discuss how RFID (Radio Frequency Identification), combined with EDI, can provide greater visibility and faster payment in the supply chain when an order is being fulfilled at the supplier, and when it is received at the retailer.

Conclusion

This paper has provided insight into how leveraging standards such as GDS and EDI, along with integration into processes and systems, allow for increases in efficiencies in the trading of item data and the ordering of trade items in the supply chain. Although seemingly simple, getting the right data to a retailer's POS (point of sale) is a process that needs priority and focus within an organization. Having quality data to order items from your suppliers leads to less re-work and greater profitability.

The next article in the series will continue where this article leaves off, with the fulfillment of the orders and the receiving of orders at the retailer. The article will focus on EDI and RFID as the main technologies to drive efficiencies and visibility into these processes.

 

About the authors

Mr. David Barkwell is the Group Product Manager at Cactus Commerce. In this role, Mr. Barkwell works with customers to develop products and solutions in the Global Data Synchronization (GDS), Radio Frequency Identification (RFID), and Trade Partner Management (TPM) solution space. Mr. Barkwell is the former chair of the EPCGlobal Canada Education committee and is a founding member of the EPCGlobal Canada Strategic Advisory Council (SAC).

Mr. Winson Woo is the Director of Supply Chain Management at Cactus Commerce Inc. In this role, Mr. Woo leverages BizTalk Server and the BizTalk Accelerators including Cactus GDS Accelerator for BizTalk and the BizTalk Accelerator for RosettaNet to help organizations resolve their B2B and E-Commerce challenges. Mr. Woo is both a Microsoft Certified Professional and a 1SYNC-Certified Consultant.

About Cactus

Cactus Commerce is an e-business software and services company with over 10 years of experience integrating Microsoft solutions. Dedicated to helping organizations of all sizes drive additional revenue through electronic commerce in B2C, B2B and B2E scenarios, Cactus offers solutions for Supply Chain Management, Enterprise Collaboration & Integration and E-Commerce. Cactus solutions combine a wide array of professional services and unique industry expertise that enables companies in the Retail, Consumer Goods, Manufacturing and Healthcare industries to collaborate electronically with business partners, taking full advantage of their existing and future Microsoft technology investments.

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