The Importance of Good Data
By Bob Boyles, President, Smarter Distribution

The old saying is "Garbage In & Garbage Out" evokes a time past when computers were new and it was common practice to blame the computer for glitches, snafus and foul-ups. Used to be that you could shake your head and pound on a few keys and no one would think twice about what was wrong. But the problem never went any further than a frustrated counter man or an exasperated billing clerk. If the computer gave them enough problems they just snuck out the back door and took a smoke break until their head was clear and they were ready to go another round with the computer. Today things have changed drastically. Not only has everyone has quit smoking and the computers now make fewer errors but the most important part is something we don't discuss nearly as much as we need to. We've moved into an era where the importance of good data has never been more in demand.

It used to be that your data was exactly that, your data. If there was a wrong cost in the system the billing clerk would catch when she ran her green-bar reports. If there was a unit of measure problem the counter salesmen would notice it when they sold something and the extension was all wrong. Today the importance of good data has much farther reaching implications. Whether it's selling products on the web or integrating your billing system to a WMS (Warehouse Management System) or CRM system (Customer Relationship Management) the importance of getting your product data correct is becoming a mandatory business requirement rather than a luxury.

In the old world that operated in a batch mode you could catch a problem with one of the many review steps that were built into the process. Today many of those redundant steps have been removed and the speed at which information flows has drastically increased. If you're selling on the web and updating your costs with vendor disks or association flat-file FTPs and your selling prices are multipliers against Cost or List then the link between costing problems from the vendor and pricing problems with the customer can be almost instantaneous. In today's environment we need tools that allow for the automatic tracking and elimination of these types of problems before they enter our distribution systems.

Times have changed drastically in other areas as well. It was many years ago when I spoke to the President of a distributorship about sharing product information with vendors and the blunt answer was "over my dead body". The President's fear was that the vendor now armed with sales data would be in the position to edge the distributor out of the market and bring in his own hand picked partner! How times have changed, today data sharing up and down the supply chain has become a common practice as manufacturers and distributors have been forced to work more closely together with the common goal of squeezing out cost and hopefully improving profits. But the data sharing has not come with out some problems. Data formats are different between systems and association standards have been slow to develop in some markets.

New Solutions - Fortunately, as luck would have it, a new breed of software is entering the market and fast making a name for it self. The genre of Product Information Management or PIM software has come to the forefront recently as companies world wide have struggled with how to manage data across multiple systems and varying formats. This new breed of software is effectively known as middleware and sits between the data feeds from your vendors and your in-house transaction system filtering the data as it comes into your organization and directing it to the proper data table.

Companies aren't stopping with just the plain data correction mode however. These PIM systems have become critical pieces of software for the data conversion process. Imagine you’re a large company and have just purchased another distributor on the opposite coast. You want to consolidate operations onto one distribution system to save on data processing costs, etc. In your first planning meeting since the ink has dried on the purchase agreement you begin map out how you're going to operate as one company. The thing that jumps off the screen is that the acquired company not only uses different part numbers and descriptions but that the costs are radically different than your own. How in the world are you going to merge these two systems? Well your new PIM software has the ability to map data from two different systems, take feeds from a common source and update both databases. Once the mapping is complete the data conversion process becomes a much easier chore since we now know that a "GFX47" on the east coast system is the same part as "MX99" on the west coast system!

Perhaps you're in a situation where you have two divisions operating on separate pieces of software and you want to leave those legacy systems in place because each has shown itself to handle that division's business perfectly. Although you're not ready for a data conversion it sure would be nice to know what the on-hand was across the company so that when the vendor showed up for his annual meeting you weren't pulling out a calculator and adding up columns of numbers just to negotiate a corporate purchase agreement. Some of the best PIM systems also have the ability to take data back from the transaction system and create a view of product data for the entire enterprise. When these types of tools allow you to effectively handle special purchasing agreements and rebate situations across a multitude of systems it's not hard to begin to calculating the payback for the investment.

Problems begin to multiple when customers expect to receive the same price regardless of which division they purchase material from, not mention how these two systems are going to handle a web order entry system. The best-of-breed in PIM software allows you to not only massage the in-bound product information but to also manage the selling price to the customer. The PIM software has the ability to create a matrix and feed resell prices down into the distribution systems. The scenario we looked at above where there were two distribution software packages with abundant problems now offers a very manageable environment despite existing on two differing systems.

Summary - Effective IT executives at many of the more progressive distributors and manufacturers are beginning to warm to the idea of moving data between disparate systems and quality PIM software has become another reliable tool in their toolbox.

About Bob Boyles and Smarter Distribution:
Bob Boyles is the principal of Smarter Distribution in Coppell, Texas, a strategic coaching business focusing on assisting distributors in using technology. He is also the author of "Succeeding With Distribution Technology" a practical how-to guide for selecting and implementing the right technology. You may reach him at (972) 304-1180, via e-mail at bob@smarterdistribution.com or on the Web at www.smarterdistribution.com

© Copyright 2003, Robert S. Boyles Jr. All rights reserved. This article cannot be reprinted or reproduced in whole or in part, without the express written permission of Robert S. Boyles Jr.