Why is GDSN ignored by PIM vendors?

Lately I had a very intensive discussion  on GDSN with one of the major PIM software producer. They were really interested to see whether GDSN could bring them any additional business and if there were relevant customers being in the need of GDSN support in a PIM solution.

They got very detailed presentations on GS1 activities in the Retail & CPG and in the Healthcare space. And they were also presented the actual GDSN growth figures and actually it was tried everything to sell them the relevance of GDSN for their PIM business. They even talked to major retailers using GDSN on their experience and advice and also to some data pools.

Finally they took some time to evaluate what was presented to them and draw some conclusions for their business. Actually I was quite surprised with their key conclusions:

1. Datapools only have relevance in Europe and in US. This really puzzled me because at least Australia is one of the most advanced GDSN communities with the highest adoption rates. But looking at most of the other countries - even within Europe - GDSN is not that much adopted and still manual data exchange (even on paper) is the most spread way of data synchronisation. Although the adoption rate is continuously growing as you can see from the Global Registry Statistics.
   
   
2. The data is not maintained sufficiently and the data quality is considered to be very low.
   In this case this is really a two-sided issue. First I think bad data quality in GDSN data pools is really one of the badest myths at all. In all cases where I did comparisons between retailer product data and the data in a data pool the retailer data was much worse then the data in the data pool. The data in the data pool actually always was in quite a good shape. This is also supported by all recent studies like the GS1 UK datacrunch report or the report from GS1 Belgium.
   The second side of the issue in this case is that their customers are mainly also in the ecommerce space and what you need there is the marketing and sales information on products and this is today really not available in the GDSN.
   It really seems to be a challenge within the GSMP process to get a standard developed for marketing and sales relevant (or let's use the new hype term "B2C") data. If you look for example at Consumer Electronics. The first hints on additional attributes and an additional standard I have found in 2008. And now in 2011 we are getting calls to action to work on the requirements for Consumer Electronics ... For me that does not look convincing too ...
   
   
3. Data enrichment is not covered within the GDSN
   What they meant by "data enrichement" is to add B2C data to the data if that is not available directly from any internal source at the supplier.
   I think here they are going wrong. In my perception the PIM of a retailer should offer a supplier portal where suppliers can enrich their data manually. Also data pools like SA2 Worldsync are starting to offer such functionalities based on their data pools.
   As GDSN is "only" a protocol between data pools (and in some respect between a data source and a data recipient and its corresponding data pool) it does not deal with "manual" data enrichment processes by concept.
   
   
4. They consider GDSN only as  a infrastructure side topic
   Here I think they are really making a big mistake. GDSN is not only about publishing the data to  a data recipient (retailer) but it is also about communication with the retailer (think of the CIC messages which allow retailers to send feedback back to suppliers).
   In my point of view every serious PIM system has to support the full GDSN choreography. And this also means to have specific UI's for the corresponding user roles and being aware that there is a new type of user role which has also to be established in the customers organisation.
   
   
5. As they consider retail as one of their major markets, they also consider supplier data onboarding for retailers as one of their key tasks - but they do not consider GDSN to be one of their main means to do so
   As their customers are very much in the ecommerce space and they are dealing a lot with sales and marketing oriented product information this decisions seems to be very much linked to the above topic 2 and 3 and that this type of data is just not available in the GDSN.
   Although I think that onboarding of supplier data is always following the same principle. It is independant whether I need supplier logistics data or some feature information. Only the content differs.

What is my take away?

GDSN seems to be struggeling from my point of view with two challenges:

1. Market perception: The market does not perceive GDSN as a major, global and successful way to synchronize product information. And this despite the huge community behind GS1 Standards and GDSN.
   I think that is really a misperception mainly because of the huge GS1 community. I am not aware of any comparable standardization organisation which is so user driven and has such a huge supporting community. But here also the second challenge comes into the game.
   
2. GDSN adoption and perception by the implementing companies: Although there is such a huge supporting community the real success stories where the implementing companies really have achieved the promised savings are still rare. And this is not mainly because GDSN is the wrong approach but because companies either have not implemented it at all or have not implemented it properly as part of a MDM program.

In one of my next postings I will discuss some alternatives to GDSN and how a combined approach of GDSN with some alternatives might help user companies to achieve their goals and thereby also help GDSN to improve its market perception.

Have you ever thought through how MDM differs in a multinational company from MDM in a only nationally focused company?

Do you remember my blog post how to organize for MDM? There I described how you should organize your MDM activities in principle. If you are working for a big multinational company you might have thought that this is by far to simple to solve your challenges. 

And you are right!

In a multinational company you have on top of the generic MDM specific tasks additional challenges which you have to address within your organization, your processes and your IT infrastructure (esp. in your metadata model).

Even if you start looking in the data of multinational products you can find very serious challenges for MDM.

Global, regional and local products: In an multinational environment you typically find global products which are sold and relevant to all regions or countries. But you also find products which are region specific (eg. only for the European or Asian market) and also very local products which might be available and target only on one country. Typically you want your local organizations to be able to list and sell the local products while the global products are more or less defined by a central business unit.

Global, regional and local elements in global products: If you have global products which are available in different regional or even local markets you typically have some product information which is really only targeted on local requirements. One good example for those types of requirements is the requirement for the “green dot” information in germany (which by the way became obsolete again due to changed legislations). This information was only relevant if you wanted to sell a product to germany. But even if it was the same product globally, for germany you specifically had to add the information whether the product had the “green dot” certificate or not.

Multi-branded products: Multiple brandings can occure for the same product already from the industry side, but it is even more common in retail where you have two retail brands owned by one company and therefore sharing a big part of their assortment. But when presenting to the market they want to describe the same product typically in different ways to the market to clearly differentiate their products from each other.

How does all of this impact your organization and processes?

If you are a multinational company you will have a strategy which will also cover the parameters “need for integration” and “need for local responsibility”. These two parameters define quite well your internationalization strategy. The same you have to apply to your master data management.

In the end you have to setup a distributed organization for your MDM. A quick shot might look like this:

Leaving SA2 Worldsync …

I am leaving SA2 Worldsync. I have worked now for over 6 years in the area of master data management and global data synchronization with SA2 Worldsync and its predecessors.

And I think it was a great time and esp. a great team to work with. And I think we achieved a lot. SA2 Worldsync has become one of the globally dominant data pool players and also one of the leading PIM vendors at least in the retail market.

Thinking back I started all this master data management stuff right back in 1997 when founding Cataloom AG. There we developed successfully one of the first PIM (Product Information Management) / MDM (Master Data Management) Systems. 

And I still remember very vividly myself coding the first database schemas and graphical user interfaces (still very awkwardly looking) for cataloom 0.1.

We were very quickly successfully fulfilling the requirements of our customers like AXA, BASF, Deutsche Bahn, Emaro (the famous eprocurement marketplace joint venture of SAP and Deutsche Bank), Siemens Medical and many others. It was a real fun time, working with a small but enthusiastic team, having all this great ideas and concepts which are still in the product and which are still the base for its success.

In 2005 PIRONET NDH has taken over Cataloom. My personal journey into the world of GS1 and data synchronization started when PIRONET NDH also took over a majority stake in SINFOS the predecessor of SA2 Worldsync. 

Replacing the proprietary SINFOS technology with my previous Cataloom technology and building this great Webforms with online validations was one of my first responsibilities during that time.

Merging with the Agentrics data pool business unit was the next milestone. And this merger was mainly driven by our superior technology. Esp. I think the usability of our Webforms is still leading edge technology and the team keeps developing and improving it.

After that merger I became responsible for looking into our retail customers understanding their master data management processes and to help them to get those processes organized to be able to also leverage the SA2 Worldsync services better.

I think in the last two to three years I worked with most of the leading retailers globally (from Europe over Japan to the US) to understand their challenges in master data management and to work with them on improving those processes, their organization and sometimes also their IT infrastructure.

Right now SA2 Worldsync is not only supporting world’s largest retailers and brand manufacturers but also some of the most advanced GS1 and GDSN communities like GS1 UK and GS1 Australia by providing our technology to them. And not to forget to mention that the SA2 Worldsync WS|PIM product today is run by some of the largest retailers – and right now there are more to come.

I think SA2 Worldsync has been settled right now and achieved a really leading position in the master data management and global data synchronization business.

That is the time to leave for me.

Why?

I am the more entrepreneurial kind of guy. I have to start up something new. Change the world :-) 

I think Cataloom and SA2 Worldsync had some impact. At least the world changed a little bit. Product Information and data synchronization processes became a little bit more electronically. But I think there is still a long way to go to have all business transactions electronically.

That is where I still see a huge potential! So be prepared to see something new coming up which hopefully will really have some impact!

And in the meantime – if you have some requirements regarding master data management consulting, just let me know. I am helping companies globally to put in organisation and processes and IT infrastructure to manage their master data more efficiently.

PS: Stay tuned - this blog will be continued and now I might even have more time to share my thoughts on MDM and GDSN!

How to organise for MDM?

Have you ever thought through how to build an organisation for master data management?

One of the key issues I always find at customers who are struggeling with their quality of master data is that their organisation is not really prepared to deal with master data in a sustainable manner.

In my view Gartner has done quite a good job in proposing a generic organisation for master data management. Actually this organisation implies that you are introducing a new business process - Master Data Management.

Please look at the following orgchart - this is how I remember the generic organisation Gartner is proposing:

The generic MDM organisation

One of the key ideas is that business has to lead the MDM organisation. A quick description of the different roles & responsibilities:

1. The Information Governance Board should consist of executive level sponsors. They should  set and enforce information management policies. In this board you should have representatives from the business - that is key - but you also should have a representation from your IT executives in here.
2. The MDM Team is responsible to manage the MDM program and who authors and maintains the master data. If you are also implementing GDSN or any other means to collect item data from your suppliers the supplier onboarding and communication is also a key task for this team.
3. Data Stewards sit in the business unit and they are responsible for data quality monitoring, improvement and issue resolution. They are NOT maintaining the data themselves but work closely with the MDM Team to get the master data quality on to the level the business needs it.
4. The MDM Infrastructure Team is a kind of virtual team responsible for all aspects of the IT implementation needed for the MDM business process.
5. In the GDSN context I only want to highlight the importance of the Data Modeling and Information Architecture role. If participating in the GDSN this role is key because it is the link to the GSMP process and defining change requests and also anticipating and adopting the changes coming through the GSMP / GDSN.

Please take this organisation template as what it is - only a template. In real life you have to look at your current organisation and see how you can adopt the different roles and responsibilities within your organisation.

But also be aware - you want to introduce a new business process which you did not have in the past.

And if your organisation is multinational or even global I will discuss in one of my next posts what impact that has on the MDM organisation.

Don't brands want to communicate transparently to the consumer?

Do you remember one of my earlier postings Brand owners loose sales due to mobile scanning?

Actually my main message was that brands have to invest into MDM to be able to publish their product information in a high quality way to all those app providers to have control over the branded product information publically available.

I thought that it is mainly a technical and effort issue!

But I had to learn that there are also other issues.

Last couple of days there was the SA2 Worldsync's Annual User Congress 2011where we promoted a lot the new mobile century. We had great presentations from the mobile space (eg. from Mirasense and from barcoo) which made it clear that there is a massive demand for extensive product information from the consumer. And those app providers are fulfilling this demand - either with or without the support from the brand owners.

We got quite some good feedback from some major brand manufacturers for our activities to deliver trusted, manufacturer product information to those platforms. See one of our press releases here.

But we also got quite some negative feedback from some other major brand manufacturers.

Quote: "That is not in our interest."

It is not in your interest to communicate with your customers?
It is not in your interest to provide correct and honest information to your customers?
It is not in your interest to use the new media?

One argument I heard was "We cannot give allergene information to the consumer via such platforms because then we could be held liable for it. And we could be sued if the data is incorrect and thereby somebody gets harmed.".

But you are putting allergene information on the packaging and on your website.

Are your processes so much more reliable for putting information on the packaging or on your website then publishing it to the GDSN?

Or are there other reasons behind your reluctancy to provide transparent information to the consumer?

Actually I haven't got it yet. I would be happy to get some feedback on that topic ...

Even with GDSN - retailers product master data is still crap!?

Just recently GS1 Belgium did  a "Mini Data Crunch Survey 2011" where they did a survey what the impact of bad data on the belgian grocery market is. This is a survey which stands in a line with what GS1 UK started with their "GS1 UK Datacrunch Report 2009".

I think GS1 Belgium really put together a very nice report - and the results are - I would like to say "as expected" - very bad. The data between suppliers and retailers is significantly out of sync. And there is a huge cost to the market for that.

What I liked most is that GS1 Belgium not only looked at suppliers and retailers who were not yet doing GDSN but also at suppliers and retailers who are heavy GDSN users. Surprisingly by looking at the figures they have measured regarding "missing data" and "mismatches supplier-retailer" you really cannot tell who is doing GDSN and who is not. The percentage of incorrect data ranges from 49% to 67% - and keep in mind they only researched the data of 4 suppliers at 4 retailers and even that with only 100 products:

I would have expected that the retailers who are using GDSN have significant better data then those who are not using GDSN at all.

If that is not the case, what are the reasons for those issues?

GS1 Belgium does not directly address this subject, but indirectly they are proposing an answer with their analysis what is happening behind the firewalls of suppliers and retailers.

Obviously suppliers and retailers still have to do a lot of manual work on both sides of the table even if they have implemented an automated GDS process.

From my perspective the two most important recommendations of GS1 Belgium are:

1. Use an automated exchange of data between suppliers and retailers. Here GS1 Belgium for a good reason refers to their GDSN datapool offering. But I think that is only the one part needed. The other part is that retailers have to implement internal automatic integration processes to really integrate the data into all their business applications.
   
   Just recently I found out at a major german retailer who is already doing GDSN for quite some time that they are not integrating the GDSN data into their purchasing system!? How do they expect to benefit from GDSN for their order and invoice processes???
   
2. Introduce a so called "data team" on suppliers and on retailers side to be the one and only team to maintain the data.
   

They are also proposing a lot of other very reasonable actions to be taken like establish data ownership, data quality dashboards, etc.

But I really think you have to establish a dedicated organisation and then you have to integrate the data into your business applications in an automated way. Actually straight forward, isn't it?

But my expierence is that suppliers and retailers are really struggeling at this point and typically do not implement this consequently ...

Let me repeat my mantra: Suppliers and Retailers simply have to implement a MDM program and make their GDSN initiative part of that MDM program. This is the only way to implement GDS successfully and gain the business benefits out of it.

Retailers: GDSN Changes - the productivity killer?

Lately I talked to one of the bigger european retailers who has recently fully adopted the GDSN processes to receive item data from his suppliers.

Meaningless changes!?

He was complaining that they were receiving so many changes and that he needed more staff to get control of this stream of changes although he thought that most of those changes were not meaningful to them!?

How can a change of an item from a supplier be not meaningful to a retailer? At first sight I really questioned this statement and we started investigating what was happening.

First of all I sat down for a couple of days with the data stewarts who are in charge to approve all changes to really see what was happening.

50 - 1,000 changes / day

My first observation was that they really had to approve a huge amount of changed items each day. They had to manage a minimum of 50 changes per day but also one day it was more than 1000 changes which they were not any more able to approve with the existing staff in that day and changes began to pile up.

Up to 10 minutes for approval of a single item

My second observation was that it was quite painful to look at each and every item and to figure out what the change was. Although they have implemented a quite fancy looking comparison screen it takes the data stewart up to 10 minutes to do the item review and to decide whether to synchronize, review or reject the item.

90% of changes meaningless

My third observation then was the eye opener. Approx. 90% of the changes were meaningless for this retailer. How come? Actually every retailer is only using a subset of the attributes which are available in the GDSN. None uses all 1,600 attributes available. All retailers I have seen use between 100 and 250 attributes. But suppliers have to maintain actually the superset of all attributes required by their retail customers.

So what is happening is that supplierA is maintaining Attr1 - Attr200, while retailerB is using Attr1 - Attr100 and retailerC is using Attr90 - Attr200.

If supplierA is changing Attr1 of an item this change gets send automatically to retailerB and retailerC. But it is only relevant for retailerB. retailerC is not using Attr1, so the change is not relevant to him. But according to the GDSN rules he has to synchronize this version of the item to stay synchronized with the supplier. Sending back a CIC review or reject would not make any sense because that is just not what he wants to do.

Solution 1

What is the solution? The first solution approach is to evaluate automatically whether a change is relevant to a retailer and if it is not to automatically synchronize (meaning store the item and send back a CIC synchronized) the item change. Only if the change is relevant put the item into the manual approval workflow.

With this solution this retailer could already save up to 50-60% of the needed effort in his approval process.

Solution 2 - and my recommendation

My recommendation is to take it even one step further. Why do you have to look at each and every item change even if it is relevant to you? Do you really think that your data stewart can judge for all your items whether a slight change in the measurements or in the ingredients or in the packaging or where ever is correct without pulling the concrete product and remeasuring?

My experience is that the whole manual approval process mostly is pure waste of time.

Instead turn the process around. Define rules when an item change cannot be automatically approved (eg. if the description changes, if measurements change more then 10%, etc.). If an item change passes all those rules it should be synchronized automatically. Otherwise you put it to the manual approval process.

And then measure what is your ratio during manual approval between sending a review or reject to the supplier and synchronized. If you have more than 50% getting an immediate synchronized than your approval rules are still to strict and you should further relax them.

Now you should be down to 10% or even less of the original effort.

Btw. dealing with ADD's is typically a little bit more complicated because you typically have a manual enrichment process ...


UPDATE: 
There is a very interesting discussion on LinkedIn regarding this Blogpost, see here.