Embarking upon the Journey
Organizations across the globe have begun to embark on a journey that, in some ways, has caught them by surprise. Interestingly, some may not even yet realize that they are already on this journey, but they will follow it based on their increasing needs to better manage information about products. Today product information management is about the strategic benefits of data alignment across many internal systems and data sources. It involves several departments and focuses on the repurposing of key item data across multiple channels to optimize external trading partner collaboration.
Challenges in Getting to One Version of the Truth
Whether consciously embarking upon the journey of improved product information management or not, there are numerous challenges that can be overcome with good planning, a capable internal project team, a project sponsor at the executive level who understands the value associated with improved operational efficiencies and savings, and a competent solution provider with the right tools, people, applications and long-term vision and commitment.
The Dynamic Truths of Product Information Management
Once a good internal team is in place and a strong project sponsor is behind the initiative, it is critical that the business drivers of product information are reviewed and categorized. In other words, the right questions have to be asked from a multi-dimensional perspective, including:
Once answers have been gathered to the above questions, this is when the real work begins. Most organizations are not surprised to learn that the primary requesters of product information are external parties such as customers, partners and government regulatory authorities.
Unfortunately, today's industry landscape involves demand for product information beyond considerations of the past. These new demands are based on new industry dynamics that have to be carefully considered and analyzed with any product information management initiative. Some examples of external factors to consider include:
While it is perhaps easier to see how external market factors can highlight gaps in a company's product information management practices, there are equally important internal factors that cannot be ignored.
It is not uncommon for organizations to express disbelief in discovering that much of the product information demanded by their customers or required to meet government regulatory demands does not exist and cannot be sourced from their current systems. Interestingly, many companies that have made significant investments in enterprise resource planning (ERP) implementations have been somewhat disappointed to learn that these systems do not contain all the required product information to meet the growing demand.
The original vision of ERP assumed that companies would deploy a single global instance, which essentially means having a single implementation of the software running on a single database serving the entire organization. Certainly this approach has benefits for reducing data duplication and improving information quality. However, it is important to remember that these applications were designed initially to improve the management of internal business processes rather than to facilitate external data synchronization with trading partners across multiple channels.
Most multinational companies struggle with the geo- graphical challenges of maintaining an overall global presence while also effectively serving key local markets. Serving local markets presents unique challenges in product information management. Ideally, product data needs to be presented to local internal users for management in local languages, according to local customs and regulations, and with the right product data attributes in the appropriate context for the local market.
In addition to internal applications containing some degree of product information, some organizations employ spreadsheets to track base information about a particular product and many additional spreadsheets to provide reference information to other sources of data, such as material safety information, formulations, product images, product and packaging dimensions. Consequently, a well-planned product information management strategy presents opportunities to reduce the number of failure points contributing to the inaccurate and inconsistent product information that leads to inefficiencies in the supply chain.
The diversity of roles and responsibilities within today's corporations also add challenges to effective product information management. Users in their respective roles want to be presented with relevant contextualized information appropriate to their responsibilities and not with extraneous information that they do not care about or wish to see.
During the past decade, supply chains have been under a lot of scrutiny, with repeated calls to become more demand-driven. It is thought that this transformation will free up working capital, reduce inventory bloat across each replenishment point and improve overall agility. There is no argument that a more agile, self-tuning supply chain that can effectively manage relevant demand signals from a multi-tiered visibility perspective will achieve positive results. However, if the demand signal fails to contain accurate product information, the reaction of the supply chain is likely to be misdirected, with severe implications across all points.
The advent of such new technologies as RFID, and their potential impact to improve supply chain operations, also weighs heavily on internal processes for managing product information. The synergies in the marriage of product movement data, product information synchronized with trading partners, and product information found in just about every business transaction offer up tremendous opportunities for cost savings and operational improvements. A product information management strategy that ignores these synergies will never reach its potential to improve supply chain management processes, to serve customers better and to achieve significant cost savings.
The Case for Improved Product Information Management
In the past 18-24 months, product information management has emerged as a mission-critical element for businesses of any size seeking to achieve compliance with government mandates, unify management of product data across company divisions and global locations, and cut costs through better alignment with backend systems and effective synchronization with external partners. More importantly, global companies have begun to recognize applications specifically designed to manage product information as true business process management solutions that play a complementary role to ensure that internal systems and departments are aligned and to significantly improve collaboration with trading partners.
These new business applications, specifically designed to improve the way suppliers and retailers manage information about their products, are revolutionary in the retail and consumer packaged goods industry today, but their benefits have broad applicability to other industries as well. It is very likely that in the next few years there will be increased adoption within other industries, such as healthcare and pharmaceuticals, automotive aftermarket, industrial manufacturing and high tech.
Whether an organization has consciously prepared to embark upon this journey or has happened upon it by circumstance, there is no question that new industry dynamics are prompting suppliers to consolidate product information from multiple sources and to better manage this information in preparation for synchronizing it with trading partners or regulatory authorities. These new dynamics also apply to retailers, who are looking for improved ways to handle the volume of inbound product data from supply-side trading partners to more intelligently manage that data prior to making it available to their backend systems and as repurposed data across multiple channels.
About the author: Larry Rushing, director of product management, is responsible for the strategic direction of GXS' product information management and data synchronization solutions. For the past few years, Rushing has been very heavily focused in the analysis, planning and management of solutions in the areas of global data synchronization and product information management for suppliers and retailers. More information at www.gxs.com.
Organizations across the globe have begun to embark on a journey that, in some ways, has caught them by surprise. Interestingly, some may not even yet realize that they are already on this journey, but they will follow it based on their increasing needs to better manage information about products. Today product information management is about the strategic benefits of data alignment across many internal systems and data sources. It involves several departments and focuses on the repurposing of key item data across multiple channels to optimize external trading partner collaboration.
Challenges in Getting to One Version of the Truth
Whether consciously embarking upon the journey of improved product information management or not, there are numerous challenges that can be overcome with good planning, a capable internal project team, a project sponsor at the executive level who understands the value associated with improved operational efficiencies and savings, and a competent solution provider with the right tools, people, applications and long-term vision and commitment.
The Dynamic Truths of Product Information Management
Once a good internal team is in place and a strong project sponsor is behind the initiative, it is critical that the business drivers of product information are reviewed and categorized. In other words, the right questions have to be asked from a multi-dimensional perspective, including:
- Who internally and externally is asking for information about our products?
- What type of information are they asking for?
- Do these data exist at all? If so, where do these data reside currently in our organization and in what format?
- How are they expecting to receive the data, and in what format and type of media?
- In what way will they use the product information we send them?
- Are they expecting to get updates of the data if it changes, or on a periodic basis, or is it just as a one- time publication requirement?
- How often do the data change, and who is responsible for keeping the data updated?
Once answers have been gathered to the above questions, this is when the real work begins. Most organizations are not surprised to learn that the primary requesters of product information are external parties such as customers, partners and government regulatory authorities.
Unfortunately, today's industry landscape involves demand for product information beyond considerations of the past. These new demands are based on new industry dynamics that have to be carefully considered and analyzed with any product information management initiative. Some examples of external factors to consider include:
- Global data synchronization standards are evolving. These standards affect the exchange of global product data attributes between trading partners and the exchange of product data attributes specific to industry verticals such as hardlines, fast-moving consumer goods, office supplies and entertainment. New product attributes are destined to be introduced for additional industry verticals over time.
- New trans fat labeling requirements that went into effect on January 2006 stimulated massive product reformulations across food categories, increasing the need to better track and maintain information about products on an ongoing basis.
- Nature can have a sudden, unplanned impact on the maintenance and sharing of product information. The recent devastating hurricane season in the United States displaced consumers, forced retailers to close their doors and triggered significant shifts in demand across various product categories. These events also resulted in price increases for fuel and the key ingredients found in many foods, straining consumer budgets and pushing up product packaging and distribution costs.
- Originally enacted in 2002, there are renewed calls for food traceability provisions requiring the implementation of beef country-of-origin labeling and tracking for beef, lamb, pork and other meat products. Moreover, country-of-origin labeling is limited neither to meat products nor to the United States. In fact, some countries have more stringent requirements than those of the United States.
- Proposed environmental protection regulations require disclosure of health and toxicity information regarding pesticides and other chemicals in fruits and vegetables. Other environmental regulations call for labels on pesticide products to include storage instructions to prevent cross- contamination, as well as disposal instructions to ensure proper and safe handling. Similar disclosure demands are being made for bioengineered food products, too.
- For businesses that manufacture or sell clothing or household items that contain wool, including specialty wools, they must comply with the Wool Products Labeling Act, requiring that product labels accurately reflect fiber content, the country of origin and the name of the manufacturer or marketer. In addition, apparel items must also be labeled to show a safe cleaning method.
- With renewable energy is gaining momentum, new requirements (or opportunities) are arising to include information about the use of certified renewable energy in product manufacturing.
- The increase in working parents during economic downturns has prompted some food companies to simplify language used to describe cooking instructions that are eventually passed on to consumers. Unfortunately for most companies, there is no central repository for maintaining this information, and consequently changes must be made in several places.
- The economic downturn has also contributed to the growth in demand for private labeled goods (i.e., department store or grocery store brands), requiring product information from the manufacturer as well as from the brand owner.
While it is perhaps easier to see how external market factors can highlight gaps in a company's product information management practices, there are equally important internal factors that cannot be ignored.
It is not uncommon for organizations to express disbelief in discovering that much of the product information demanded by their customers or required to meet government regulatory demands does not exist and cannot be sourced from their current systems. Interestingly, many companies that have made significant investments in enterprise resource planning (ERP) implementations have been somewhat disappointed to learn that these systems do not contain all the required product information to meet the growing demand.
The original vision of ERP assumed that companies would deploy a single global instance, which essentially means having a single implementation of the software running on a single database serving the entire organization. Certainly this approach has benefits for reducing data duplication and improving information quality. However, it is important to remember that these applications were designed initially to improve the management of internal business processes rather than to facilitate external data synchronization with trading partners across multiple channels.
Most multinational companies struggle with the geo- graphical challenges of maintaining an overall global presence while also effectively serving key local markets. Serving local markets presents unique challenges in product information management. Ideally, product data needs to be presented to local internal users for management in local languages, according to local customs and regulations, and with the right product data attributes in the appropriate context for the local market.
In addition to internal applications containing some degree of product information, some organizations employ spreadsheets to track base information about a particular product and many additional spreadsheets to provide reference information to other sources of data, such as material safety information, formulations, product images, product and packaging dimensions. Consequently, a well-planned product information management strategy presents opportunities to reduce the number of failure points contributing to the inaccurate and inconsistent product information that leads to inefficiencies in the supply chain.
The diversity of roles and responsibilities within today's corporations also add challenges to effective product information management. Users in their respective roles want to be presented with relevant contextualized information appropriate to their responsibilities and not with extraneous information that they do not care about or wish to see.
During the past decade, supply chains have been under a lot of scrutiny, with repeated calls to become more demand-driven. It is thought that this transformation will free up working capital, reduce inventory bloat across each replenishment point and improve overall agility. There is no argument that a more agile, self-tuning supply chain that can effectively manage relevant demand signals from a multi-tiered visibility perspective will achieve positive results. However, if the demand signal fails to contain accurate product information, the reaction of the supply chain is likely to be misdirected, with severe implications across all points.
The advent of such new technologies as RFID, and their potential impact to improve supply chain operations, also weighs heavily on internal processes for managing product information. The synergies in the marriage of product movement data, product information synchronized with trading partners, and product information found in just about every business transaction offer up tremendous opportunities for cost savings and operational improvements. A product information management strategy that ignores these synergies will never reach its potential to improve supply chain management processes, to serve customers better and to achieve significant cost savings.
The Case for Improved Product Information Management
In the past 18-24 months, product information management has emerged as a mission-critical element for businesses of any size seeking to achieve compliance with government mandates, unify management of product data across company divisions and global locations, and cut costs through better alignment with backend systems and effective synchronization with external partners. More importantly, global companies have begun to recognize applications specifically designed to manage product information as true business process management solutions that play a complementary role to ensure that internal systems and departments are aligned and to significantly improve collaboration with trading partners.
These new business applications, specifically designed to improve the way suppliers and retailers manage information about their products, are revolutionary in the retail and consumer packaged goods industry today, but their benefits have broad applicability to other industries as well. It is very likely that in the next few years there will be increased adoption within other industries, such as healthcare and pharmaceuticals, automotive aftermarket, industrial manufacturing and high tech.
Whether an organization has consciously prepared to embark upon this journey or has happened upon it by circumstance, there is no question that new industry dynamics are prompting suppliers to consolidate product information from multiple sources and to better manage this information in preparation for synchronizing it with trading partners or regulatory authorities. These new dynamics also apply to retailers, who are looking for improved ways to handle the volume of inbound product data from supply-side trading partners to more intelligently manage that data prior to making it available to their backend systems and as repurposed data across multiple channels.
About the author: Larry Rushing, director of product management, is responsible for the strategic direction of GXS' product information management and data synchronization solutions. For the past few years, Rushing has been very heavily focused in the analysis, planning and management of solutions in the areas of global data synchronization and product information management for suppliers and retailers. More information at www.gxs.com.
