Why is it important that companies go through this exercise? Why now and not earlier? If you go back to a couple of years ago when I shared my observations on how EDI has evolved over the years, you may recall I mentioned that the interest in the early days of EDI was getting the PO in the hands of the suppliers as quickly as possible. There was very little interest in worrying about the quality of the data on the part of the buyer. However to the supplier, this has always been extremely important. My feeling is that buyers believed they would be made aware of invalid or incomplete information on the orders by their partners as they occurred, and the cleansing would then be conducted one SKU at a time. As these buying organizations started to require that Ship Notices and Invoice be returned electronically, the rest of the Retailer/Grocer's organization realized that when the orders contained bad data content, so would the information being returned by their partners (Garbage In = Garbage Out)
Let me take a minute to review the manual process used for item setup and maintenance which will help you understand the value of the electronic feed of this information –
· New Goods – Adding new items generally is handled where the supplier and the buyer agree on products that the retailer/Grocer would be selling and the supplier would then provide a list of the part numbers and minimal attributes to the buyer. They in turn indicate the items they want added to the vendors item master, and someone does the data entry of the new goods.
· Item maintenance – As changes are made by the suppliers, these are generally done through phone calls, meetings, or email between the buyer and the supplier. These changes are then manually made to the item on the item master file
· Discontinued items – Similar to updates to item information any items being discontinued are communicated outside of technology between buyer and seller and then either the discontinue dates is entered on the item master or the item inventory is manually monitored and the item is flagged as obsolete when there is little or no inventory left.
In working with my retail customers I know that most would agree their item master files are a mess, and their partners would definitely agree as well. Both would say that there is inaccurate information (data entry errors), there is item information that is incomplete (some attributes of the item are blank), or when in the past some attributes were not needed, they are now being looked at as necessary (Weight, item dimensions etc). In many cases a retailer may have more than one item master; one for logistics, one for order management etc., each having different attributes. So managing these can be quite a task. For companies now looking at using a repository of all of this data across their enterprises, having the data clean going in becomes extremely important.
For those of you that are just now being asked by the buyers (that may include logistics departments as well) to investigate how to go about getting the item master in sync with the suppliers, supporting updates, reducing the manual entry of new Goods and trying to manage when a supplier discontinues an item, I thought it appropriate to review how it likely works today, what's available for the automation and what you should be prepared for.
There are several ways that companies are working with partners –
· GDSN/ PIM – some suppliers/retailers use the Global Data Synchronization processes through the GDSN (Global Data Sync Network) and PIM tools to receive and validate Item attributes. Partners join the network, registers products in the network and provide data feeds for validation per partner.
· Universal Catalog Providers – some suppliers use an exclusive Catalog provider data pool for storing the item information. With this method it's the provider that is contacted by the retailer or supplier to send the data requested. Suppliers should also be aware that some retailers are only willing to receive item information through their provider not yours.
· Direct 832 – some suppliers do not subscribe to a catalog service so they are likely to send you an EDI 832 file.
In any of the above options there would need to be a definition of the data requirements, which tends to be driven by the buying organization, but can be a collaborative effort. Information that can be included are lead times, product descriptions, dimensions, attributes such as color size, packaging requirements, selling features, order min/max, sometime list and/or retail price and so on. Each of these is important information for knowing space needed in a warehouse, space used on shipments, controling freight costs to consumers and the attributes provided to selling products to the end consumer.
Things to consider when developing your processes of automating the item information regardless of the method above –
· Not all suppliers can provide information that you'd like. You'll have to decide if you need or will require all information for all or a segment of the supplier community to provide. With some retailers, I've seen that they stage data and they have the one or two fields that only the buyer would know, updated before being loaded to an item master.
· Some suppliers will launch a file of all of the items they've added for new goods, thus there may be an item or two that you as a buyer would never order. Since this is happening today, you'll need a process to manage that file and filter out only what's relevant. Some retailers will load the data to a staged que and then the buyers select items for further updates. Others will use a Catalog provider that offers a method of filtering on the retailers behalf.
· If you're planning on receiving item data to update items already on your item master, be prepared that there needs to be some way for the update program to match the item in your item master to the data provided by the suppliers. That also means that if Vendor part number or UPC number is used, both the data feed and these fields in your item master must be spelled the same why so its possible to that using automation to update items may be 50 – 75% effecitve with the rest needing human entry
· Be prepared to support various methods of the above supplier deliveries or work with a provider to create a normalized data file.
If you're a buying organization and have yet to look at this type of initiative, perhaps now is the time to do so. The 3-way match process between the order, the inventory receipt, and the Invoice require item details for the validation. The cleaner the item data on the PO, the cleaner that same data is on the ASN and invoice. Information made available to the end consumer must be accurate as well.
Be in Synch;