A bright future for collaboration across companies

A French version of this article is available here.

Over the past 15 years, each and every business organization realized the absolute necessity to get some proper computer softwares. One of main purposes was obviously to structure their data internally. But what about managing the data flow externally? How do we make sure that data are easily shareable and compatible from one IT system to another? How do we create a collaborative environment which goes beyond our own organization?

The urgency to tackle this challenge has gradually increases as the volume of data exchange with external partners, and therefore outside IT systems, has exponentially increased. As an example, a trading company sales more products which have more attributes and that are distributed through more and more channels. On top of it, legal compliance has increased but also end-consumers have been more and more demanding about product specs. All these factors combined have led to an explosion of data exchange needs between manufacturers, brand and suppliers on one side and distributors / retailers on the other.

Some industries have managed to address this evolution by agreeing on formats, processes and standards related to their own ecosystems in order to facilitate the exchange of data. This was the case of the French retail sector which massively invested in the EDI flows in the early 90s.

Unfortunately, such example has not been the case for the vast majority of industries. Several reasons can explain this lack of organization:

1. The implementation of a standard solution requires that a majority of actors agree on a specific protocol, which is often complicated in fragmented and/or international ecosystems.
2. Moreover, as long as the biggest players don’t play along, enforcing formatting constraints just result in duplicating the content work load. Therefore, such projects were often deprioritized to the benefit of other faster and more tangible ROI oriented ones.
3. Since business data is considered a valuable asset, many organizations want to have strong security guarantees, which adds additional complexity.
4. Finally, it is almost always necessary to go through a business association or some sort of third party organization to ensure that each of the actors involved does not try to pull the cover to itself and tries to impose its own standards. In many cases, such associations were not even existing.

As a result, in many organizations the exchange of content between information systems has become a bottleneck that slows down the time to market and increases the quantity of errors.

Still today, distributors have to copy paste data and send it through an excel attachment to an email. In some cases, they even have to use their personal email addresses in order to bypass size limitations. On the other hand, the recipients, if they are the right correspondents, must download the document and integrate the data by hand into their own system. These workarounds are time-consuming, frustrating and can cause incomplete data, or even errors. Finally, the current process lacks of traceability and synchronicity which could be extremely damaging. This situation is even more catastrophic once you realize that technologically speaking these data flows are not complicated to automate. It is simply the accumulation of poor organizational decisions which lead us to such a mess.

So if a group of companies decide to tackle this collaboration issue, it is important that they tackle two preliminary questions:

• Which protocol should we implement in order to standardize the data?
• How to take advantage of this to simplify the overall data flow?

Standardization is often the stumbling-block and compromise is never the appropriate solution. The adoption of a common terminology such as the one validated by GS1 seems like a good starting point, but they have not mapped yet every industries, quite far from it. Luckily, the recent developments in Machine Learning (ML) enable to automate category, attribute and value mappings in such a way that everyone can transform its data easily. In a sense, ML becomes a super translator where everyone can stick to its own terminology internally while being able to communicate properly with everyone externally.

Finally, it is important that the implementation of this new cross-company tool does not increase the complexity of data flows. Ideally, it should even try to decrease it. One solution is to go through a third-party platform which allows a pooling of flows that streamlines and significantly simplifies the many integration steps to be implemented. For example, consider a closed ecosystem of 4 suppliers and 4 distributors working with each other.

• Without a central consolidation software, there are 4 x 4 = 16 bilateral flows

• With a centralized software via a third-party platform, there will be only one integration of each actor with the platform, i.e. 4 + 4 = 8 flows

If the benefits are obvious for such a small ecosystem, image for a second the productivity gain in a multibillion industry such as a the fashion & lifestyle one.

It is likely that within the next 10 years’ software development will be reaching some kind of plateau as most the current possibilities are already far ahead of most corporate needs. That being said, there is going to be the emergence of connecting softwares helping better collaboration across companies, as this is where most of the productivity gains now are. From a business point of view, these solutions will save a significant time by automating low added value tasks while reducing margins of error and offering more traceability and synchronization. From an IT point of view, this will streamline and concentrate flows which will structurally reduce costs and maintenance efforts.

Scalia is a SaaS platform which help lifestyle and fashion brands to share their product data with retailers and other business partners. Thanks to machine learning algorithms, we consolidate and standardize product data so that anyone can access it in the format they want, offering flexibility, control and consistency to the whole ecosystem.