Today's global supply chains extend across multiple companies, systems, cultures, and time zones, making collaboration and communication among trading partners a formidable challenge. Ever-increasing compliance requirements also are driving manufacturers to find ways to collect information from and send data to a myriad of sources both within and outside the four walls. Not long ago, the major means for moving information consisted of faxes and, perhaps, electronic data interchange (EDI). Although it does its job well, EDI is rigid, limited to certain pieces of information, and expensive. As use of enterprise applications grew, manufacturers began seeking ways to enable system-to-system linkage to obtain and provide needed information. Such interfaces typically require writing custom code, an often time-consuming, difficult, and costly undertaking. In an effort to simplify and automate this movement of information from system to system, enterprise application providers have been including more and more tools that enhance flexibility and improve integration without the need for custom code. For instance, a lot of newer technologies can switch among multiple currencies and permit data to be entered in one language but read by a co-worker, supplier, or customer in another language. In addition, enterprise application providers, particularly ERP vendors, are working to extend their systems beyond the four walls to make it possible to exchange real-time information electronically using the common language of XML. SAP AG (Walldorf, Germany) builds integration and communication capabilities into a number of its modules. HP (Palo Alto, CA) uses SAP's SD module for its LEGO messaging system to streamline communication with third-party logistics (3PL) providers. HP has already implemented SD at seven locations in Asia, is in the process of rolling it out in North America, and will eventually implement it in Europe as well, all with the aim of reducing costs and cycle time. The LEGO messaging system, which standardizes content but uses whatever language is needed -- EDIFACT, Vista, etc. -- helps overcome the fact that HP itself runs multiple systems. It also cuts implementation time, increases flexibility, and boosts efficiency for its 3PL vendors since they no longer need to be tightly coupled with HP's system. "In tightly coupled systems, 3PLs have to train workers on every customer's system," explains John Daniels, business solutions manager for HP's worldwide logistics solutions practice. Generally, this means the 3PL must dedicate labor to specific customers. With LEGO, the 3PL simply receives the information needed to ship orders and reports back when the order ships, but is free to determine how fulfillment is done and what technology is used. "It's a much more accountable and metrics-driven system," Daniels says. It also allows the 3PL to put consistent technology and processes in place and make more efficient use of its workforce. As a result, some 3PLs have boosted productivity to the point that they can ship significantly more each day without increasing costs. Sea of Solutions Many manufacturers are taking advantage of data synchronization standards like the Global Data Synchronization Network (GDSN) used by retailers. The GDSN gives manufacturers and retailers around the world a common language and data pool for interchange of products. In some cases, adoption of this model is happening under duress -- most food, CPG, and hard goods manufacturers selling to retailers are facing a deadline later this year to comply with data synchronization requirements and publish item information through the GS1 Global Registry. To help small to medium-sized businesses meet the deadline, software providers LANSA (Downers Grove, IL) and DIcentral (Houston) are partnering to offer a solution that enables exchange of item information via the GDSN. "DIcentral provides EDI services for thousands of customers, many of whom need to participate in GDSN and communicate item and Global Trade Item Number [GTIN] information to their trading partners," explains Jeff Holzman, LANSA's director of solution sales. "Through our partnership with DIcentral, these customers can participate in GDSN using... LANSA Data Sync Direct, in the environment that makes the most sense for them -- hosted or fully integrated behind the firewall," he says. Another GDSN specialist, GXS (Gaithersburg, MD), is a B2B integration service provider with 10 certified GDSN data pools spanning 18 countries. Customers include 75% of the Fortune 500 and more than 40,000 small and medium-sized businesses. Bausch & Lomb's subsidiary Dr. Mann Pharma (Berlin, Germany) is adopting the GXS Trading Grid to improve its ability to communicate with a broader base of trading partners. The manufacturer of pharmaceutical and ophthalmic products will use a key component of the grid called the GXS Network Based Translation (NBT) service to communicate with trading partners that use different transfer protocols and data formats for e-commerce and document exchange. Based on service-oriented architecture, the GXS Trading Grid enables instant electronic transactions and messaging to and from a wide range of formats, including EDI, EDIFACT, and XML, for trading documents such as purchase orders, shipment documentation, and invoices. "For Dr. Mann Pharma, the expansion of its business activities involves reaching a broader customer base with a wide range of technical capabilities," reports Steve Keifer, vice president of industry and product marketing at GXS. "Such an undertaking, tackled in house, would demand a large commitment of internal resources," he adds. Bolt-on integration solutions also are available. Adeptron Technologies Corp. (Markham, ON), a contract manufacturer for the electronics industry, uses RapidResponse from Kinaxis Inc. (Ottawa, ON). Integrated with Adeptron's ERP system from SYSPRO (Costa Mesa, CA), RapidResponse provides customers with access to supply chain information such as order status. For the supplier side, RapidResponse provides a web portal that allows Adeptron to send and receive information from suppliers. SYSPRO itself takes a different tack in fostering integration and communication with trading partners. Standardized on .NET, the SYSPRO e-net offerings create business objects that can be independently accessed to perform specific business functions and processes, facilitate integration with best-of-breed applications, and enable remote data entry or retrieval using web services technologies. "We've always strived to create a system that is as open as possible without compromising business logic," says Harold Katz, technology-enabling manager at SYSPRO. "We adopted .NET before it was launched," he recalls. "It not only gives us the ability to deliver a functionally rich core application... but also creates interoperability with disparate systems." SYSPRO's Document Flow Manager acts as an integral collaborative commerce engine, facilitating interoperability by sending and receiving documents or transactions in XML. XML not only transfers data between objects, but also into and out of the core SYSPRO ERP system. The Document Flow Manager makes it possible to retrieve documents as they arrive electronically, and track and post them to the ERP system. It also can transform documents from one format to another. "This creates an environment where communication can occur in an automated manner," Katz says. Reorientation Perhaps the most encouraging development in simplifying integration with supply chain partners is the growing reliance on SOA, which replaces the traditional view of a physical supply chain linked by transportation with that of a virtual supply chain consisting of interconnected databases. Since much of the information a manufacturer needs is in someone else's database -- a supplier's, a partner's, or a customer's -- SOA makes it possible to request the data needed instead of duplicating it at each stop, a time-consuming, potentially error-prone process. "This means you don't have to go to your supplier and learn how their system works," says Grant Opperman, president and chief strategy officer at DW Morgan Co. (Pleasanton, CA), a provider of supply chain management products. It also means not having to allowing partners access to your systems. SOA bridges the different islands of information created by multiple enterprise applications and bolt-on tools, relying on XML as the common format to exchange information in a Web-based environment. "There are big issues with legacy and customized systems," explains John Fontanella, an analyst with Aberdeen Group (Boston). "SOA builds a wrapper around these systems," he continues. "It's basically an integration layer with one basic language [XML] coming in. The wrapper helps the system understand the message even though it is not a native speaker of the language. It won't solve all problems, but it will make it far easier to integrate into different environments," he concludes. As a result, "SOA gives smaller companies the flexibility needed to compete with the big boys," according to Opperman. "We have one customer that could not have moved production to China without SOA," he reports. The service-oriented architecture provides a way to ensure that the contractor's shipment matches the customer's order. SOA is needed to communicate with the manufacturer's ERP system, which requires everything to be physically present to book a transaction and generate customer paperwork. Integration Glue Using an SOA approach, DW Morgan created connections for exchange of XML messages between the customer's system, the contractors' systems, and Morgan's transportation management system. This allows orders to be compared to what the contract manufacturer planned to ship. If there is a match, shipping documents are produced dynamically and a message is sent to the manufacturer's ERP system about what was just bought and sold so it can do a revenue reconciliation. For Morgan, the result was a 20% reduction in shipping costs, savings of 80% on logistics personnel, as well as faster, better service for customers. In addition to improving functionality, SOA also resolves some security concerns inherent in exchanging information with partners. "Any time you are sharing information, there are trust issues," Opperman explains. "With SOA, you don't actually touch each other's systems." Instead, messages are sent in a neutral third language (XML) requesting information, and the enterprise system furnishes the information if the person/system sending the query is permitted to have it. SOA also is real-time rather than batched, as is typical with EDI or flat file exchange. This simplifies coordination with partners scattered across many time zones, whose workdays may have little or no overlap. One company that has embraced SOA is Cisco Systems, Inc. (San Jose, CA), a DW Morgan partner. It calls its approach SONA, an acronym for service-oriented network architecture. Cisco's goal is an "intelligent networked manufacturing vision with solutions underneath that address factory and supply chain," explains Scott Westlake, global manufacturing industry market director at the supplier of hardware, software, and services for IP-based networking solutions. The goal is to communicate in real time with the smallest number of gateways and translations possible. Cisco's SONA is an interactive services layer that resides between the network layer below and the business application layer above. It enables various functions -- including security, mobility, and storage -- and allows collaboration in distributing information according to policies that reside in the network layer. It also offers multi-modal capability, letting messages be transmitted by the optimum method for the recipient -- phone, instant message, data screen, etc. As a result, information moves faster to whomever needs to take action. Without this capability, it's not uncommon "for the entire process to stall because someone can't get the information quickly enough," Westlake says. SONA also helps synchronize data and create a single source of truth for the entire supply chain. "When everyone has the same information, they can take the correct action," Westlake says. That is the essence of an integrated supply chain -- a finely orchestrated sharing of information among all involved parties. While it remains a sizable challenge, today's tools bring it much closer to reality.