Thursday 28 May 2009

When Lost, it helps to remember where you want to go

I have the occasional high school student pass through my office on work experience. They do the rounds going to each department. When they come to me they have already spent time in the Sales and Purchasing departments. I am expected to give them a 30 minute overview of EDI (I don't just do EDI, but no one else understands it, or wants to understand it, so that is what they ask me to do). Then they move on to the help desk where they occupy them with tasks, like prepping desktops. They always like that, but I can't claim any are enthusiastically interested in what I have to say. I find the exercise helps to keep my feet firmly on the ground and head out of the stars, as they sit there wondering (despite my best efforts) what I'm talking about.

Well, the other day it was the turn of the one of my IT colleagues offspring. Keen to make a good impression, I was spurred on to think up a new and better explanation than I had used before. I was pleased with the results so I thought I would reproduce a version of it here.

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When you enter Sales Order Processing department, you will see people opening the mail and extracting customer purchase order forms. Some of them are hand written, some are computer printed.

There is also have a Fax machine dedicated to customer orders that spews out a steady stream of order forms. Again, some of them are hand written, some are copies of computer generated order forms.

We also have a team of people who take orders verbally over the phone.

Finally, some customer orders come in as emails. Usually as PDF or Microsoft Word attachments. All these orders are read and the details typed into our Computer system.

This raises 2 questions, and leads to a 3rd great big "What If" question.

Q1. Why aren't all orders emailed?

It is cheaper not to have labor deployed in the mail room, or manning the phones, or maintaining the fax line and fax machine. The cost of receiving emails is tiny in comparison. When you scale up to hundreds, thousands, tens of thousands a day - for emails, the cost graph raises far less steeply. The same is true for our customers. Most of them are companies and organisations. It is cheaper for them not to pay for postage, or phone calls.

So I repeat the question. Why aren't all orders emailed? The answer? I don't know, you should ask the customers. But the point is, whatever the real answer (and it might be different for different customers) take a note of how difficult it is to change our customers behaviour. We can't afford to turn away business by not accepting the orders and we don't want, or to make it hard to order from us.

Q2. Why do all orders have to be re-typed into our Computer system?

Every product is made up of many components and materials. All of which have to be purchased. Every product requires many different sorts of resources, people and machines. All have to be planned and instructed what to do. Controlling all these aspects takes a complicated Computer program (called an ERP system) and that is why they have to be entered.

Q3. What if, instead of having to re-type everything, you could click and drag the email attachment, drop it on the ERP icon on your desktop, and the software processed it for you?

I will tell you "what if". If you could do that you will have achieved what businesses and organisations have been trying to achieve for decades. This is the ultimate aim of EDI.

Why is this so difficult?
To a computer, text, is text, is text. How does a computer tell one piece of text is a product description and another is an address, one is a quantity and another is a price, one a delivery date another is a created date? To humans this is easy. For computers this is hard.

Ever tried to open a Microsoft Word document with Notepad? That is what the file looks like to a programmer. What do all the non-text characters mean? Only those who have signed a non-disclosure contract with Microsoft know, and none of them have permission to tell you.

First thing you have to do is agree a document format that is open to everyone. Then everyone has to agree where to place each bit of data or how to label it. In short, globally speaking, we can't agree. Many have been expecting one of the many formats to emerge as the dominant one, like the way every one uses MP3 instead of WMA or WAV, but this hasn't happened.

The next thing is product identity. We distribute a catalogue describing all our products and product options along with product codes (you see these bar-coded on the packaging). We encourage our customers to quote these in the order so that there is no miss-understanding. How do our customers (and their computer systems) know this information? If they order the same product from different suppliers, each will have their own code.

At least sending the document is easy. I mean everyone uses email, right? How else would you send electronic data from A to B? Er.. hmm... well... No. We have been moving electronic data around since before email and the Internet. There are dedicated EDI networks. There are Extranet web sites. Third party hosted web app clearing houses. There are different ways of securing emails. There are different encryption solutions. Security Certificates. Web of trust. etc. etc. etc.

So what are we to do? We could pick one solution and tell all our customers to communicate in that way. But remember these are the same customers, some of whom are still using post and fax. Remember how difficult it is to change some customers behaviour? Some of the big customers might prefer a different solution. We won't turn them away, but very quickly we find ourselves supporting many different forms of EDI. The cost of implementing another one has to be weighed against the volume of business (and cost saving) we can expect in the future.

Now turn your point of view around. When we order from our suppliers, we become the customer. The complexity just doubled. I have only talked about orders, but there are many other documents that are exchanged in business.

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Are you Lost? Can you remember where we were heading? Any bright ideas?