Do We Need VANs? Reader Comments. If you are into EDI, you have to check this out.
EC-BP, with the help of Todd Gould and Alan Wilensky recently wrote about “Do We Need VANS?” With supply chain platforms providing the E to E linkage and Managed File Transfer Services- do VANS still play a role? The pros and cons of VANs, AS2, FTP, Electronic Commerce Communications Providers. We will be evaluating TRANSPORT, not mapping, Web portals, or other services which could be performed by a VAN as well as by other EDIservice providers.
We had quite a few comments from several forums and groups. We are generalizing and grouping these comments to be able to address them.
Union Pacific Railroad has been marking the occasion all year, and now it’s official. Yesterday, the Class I turned 150 years old.
UP was founded July 1, 1862, when President Abraham Lincoln signed the Pacific Railway Act. The railroad — which helped construct the first transcontinental railroad, survived multiple economic crises, supported the military through various conflicts, and overcame numerous hurricanes, floods and droughts — is just one of a handful of companies to reach the 150-year milestone, UP officials said in a prepared statement.
“We believe President Lincoln would be as proud of today’s Union Pacific as we are,” said Jack Koraleski, interim president and chief executive officer. “Union Pacific has never been stronger or better positioned to serve our 10,000 customers. … And [we] play a key role in the nearly 7,300 communities of which we are a part.”
The Class I continues to build its rail network to support U.S. businesses and the nation’s economy, UP officials said. The railroad has invested more than $31 billion the past 10 years in infrastructure improvements and has set a record $3.6 billion capital spending budget in 2012.
Some ongoing infrastructure projects include adding a second line along the Sunset Corridor, which runs from Los Angeles to El Paso, Texas; constructing a $400 million intermodal and fueling facility in Santa Teresa, N.M.; completing about $500 million worth of capacity improvements and maintenance projects in Louisiana to help accommodate agriculture, chemical and crude oil demand; and improving the Central Corridor through Blair, Neb., by cutting 25 miles from the distance trains need to travel around Omaha, Neb.
For companies seriously considering the cloud, but who are uncertain of the potential benefits, I’ve drawn up a short list of why cloud computing might make sense when compared with hosting in a data center or separately building the required infrastructure. Once considered an unproven technology, cloud computinghas steadily gained mainstream acceptance.
We are seeing a trend in IT project management methodologies : the need for projects to be smaller and faster. Gone are the days of the multi-year, beaucoup dollars, cast of hundreds kind of project. Rather than planning a huge project from start to finish before holding the “kickoff meeting,” CIOs need to fly with shorter projects which keep the customer on top. There is a need to learn to manage unknowns until they are known. There is also a need for speed in project management methodologies. CIOs must adapt their IT project management methodologies while still limiting risks and taking care of business problems.
Project management is still a methodical approach to planning and guiding project processes from start to finish. What’s different now is that the five stages of IT project management methodologies (as defined by the Project Management Institute) — initiation, planning, executing, controlling and closing — need to be applied to smaller projects. These projects have to make a quick difference for the business, because speed is now a competitive weapon for the company. So, CIOs are adapting agile methodologies for projects companywide and considering cloud-based project collaboration tools.
We have recently looked at various Supply Chain models including “Lean” Supply Chain and virtual manufacturing. There are others too; for instance, distributors who purchase everything they sell. We have looked at what kind of software constitutes a Supply Chainsystem.
Some of our conclusions to date are:
- Very few Supply Chain models are identical.
- Yes, a company MIGHT be able to purchase a single system to cover the entire Supply Chain. Some ERP (Enterprise Resource Planning software) vendors furnish enough modules to do everything, but a lot of companies need extensive modifications to complete their mission.
- A lot of companies use their ERP as the “engine” to power their other applications like CRM (Customer Relationship Management software).
- Sharing data with partners has become a necessity to remain competitive. EDI is the enabler to wrap in supply partners, customer, logistics partners, etc.
- Many of the existing ERPs are not suited for all Supply Chain models (example: virtual manufacturers).
Recently we had the opportunity to talk with one of the “near great” visitors to Nice: Todd Gould, President of Loren Data. His company is the leading Electronic Commerce Communications Provider (ECCP) firm in the EDI industry. An ECCP is a neat way of handling all your EDI communications in a centralized and efficient manner. An ECCP replaces a VAN for you; but if your trading partner utilizes a VAN, an ECCP still interfaces with your partner through his VAN. An ECCP is far less labor-intensive for you than either AS2 or MFT (Managed File Transfer).
We met at a beach-front cafe right next to his hotel, the famous “Palais Méditerranée”. While Jen, his wife, went off to explore the “Monday Market” at Cours Saleya in the Vieux Nice, Todd kicked off our discussion with the statement: “Interconnects are what make a network a VAN”. We thought about it for a couple of seconds and quickly agreed with him. He is so very correct. If a network cannot (or will not) interconnect with all the trading partners, then it surely has no value added.
Companies (GXS specifically) are sabotaging the VAN Network by refusing to interconnect with other networks. Is this company trying to “corner” the VAN market or kill the VAN and replace with their own proprietary network? They already “ate up” (politely: mergers) some of their competitors. Bet they want to end up as the only way for a company to reach ALL their trading partners.
But Todd’s little company is going after them in the US Federal Court system. Sounds like they are really scared of him too.
The truth of the matter is that the growth of EDI is “sort of flat”. The big companies already have their trading partners ramped in, and the smaller companies do not have the “clout” to do the same with their even smaller partners.
We understand that a leading Supply Chain/Electronic Commerce online magazine will be addressing a new approach to increasing the number of new EDI implementations: “Hubs and Spokes, Spokes and Hubs”.
Much of the EDI community sticks with a VAN because it is an outsourced operation and because many of us hold to the old saying: “If it ain’t broke, don’t fix it.”
We have previously covered a lot about the Chief Information Officer (CIO): The CIO‘s qualifications, the CIO‘s relationship to the supply chain, and the CIO‘s relationship to EDI. But the biggie is now how the Cloud will impact the CIO. Does the CIO go away or does the CIOget stronger?
Do you really need a CIO? According to a report from Getronics cited on Forbes.com, 17 percent of corporate financial leaders believe the chief information officer position will disappear by 2017.
It is all because of the Cloud changing how companies handle technology.
“CIO‘s who do not value the Cloud in today’s current IT environment are putting an expiration date on their usefulness in the enterprise,” the article says. “The role of the CIO is not disappearing into the Cloud; instead, it is becoming more strategic because of it.”
C-level is used to describe high-ranking executive titles within an organization. C, in this context, stands for Chief. We have a CIO (Chief Information Officer), a CTO (Chief Technology Officer), a CMO (Chief Marketing Officer), a CFO (Chief Financial Officer), a CCO (Chief Compliance Officer), a CFO (Chief Knowledge Officer), a CSO (Chief Security Officer) , a COO (Chief Operating Officer) and, of course, a CEO. What is the head of Supply Chain Management going to be called? More importantly, is SCM a “C-Level” or is SCM a “corporate utility”?
The “Chief Supply Chain Officer” (CSCO) needs to be involved in developing the business strategy rather than just somebody else’s strategy.
If your business is up and running, you probably already have an IT infrastructure, and want to continuously improve that infrastructure. The Cloud could be your answer. Now that the Cloudis here, mainstream IT is figuring out how to best make use of it.
What does the Cloud do for Supply Chain management? Supply Chain is, by nature, inter-company, so you already the Internet to manage your partnerships. Supply Chain Management must look at the Cloud for communication between businesses. Most business software is only designed to work within single companies, not between companies. Here is my list of things to think about when starting to move your supply chain to the cloud: