When Two Networks Collide
When Two Networks Collide
In the mid-1980s, John Gage coined the phrase “The network is the computer.” In the mid-1990s, his employer, Sun Microsytems, trademarked the slogan and it became their tag line for many years to come. It helped define the soul of the internet age and was the precursor to the term “cloud computing.” Perhaps we can borrow the famous phrase to help capture the essence of our global world today - “the network is the global supply chain.” The analogy is that today’s global supply chain is really comprised of a giant network of participants. Every cross-border move requires collaboration between all sorts of different entities.
It starts with the procurement process between the buyer and supplier, which includes due diligence and vetting of the supplier. This requires information sharing from third party audit companies, who can determine whether a given supplier or factory is socially and ethically acceptable to the buyer’s standards. Next, product specifications are communicated from the buyer to the supplier. Third party inspection companies share quality test and inspection results of early production runs. Suppliers provide information needed by the importer to clear customs and minimize duties via preferential trade agreements. Real time raw material inventory is made visible to the buyer so they can determine the ability for the supplier to meet promised quantity and delivery commitments. Finally, shipments rolling off the factory docks provide early visibility to their global journey.
Let’s take a quick timeout, and get back to our network theme. In today’s world, where the “network is the computer”, all of this collaboration and process synchronization can occur digitally, in the cloud. That’s right, both networks, the global digital computing network (otherwise known as the internet) and the global supply chain network, can be combined to deliver great value. All the information that is crucial to creating an efficient global supply chain can be communicated between the right parties at the right time, at the speed of light. Timeout over, back to the game.
When we last left our shipment, it was being loaded on to a truck at the foreign factory. Now it needs to be moved to the port, perhaps consolidated or deconsolidated with other shipments, loaded on to a vessel or aircraft, and begin its journey. Information must be provided to the carrier to make the booking. Next, the status and event information along its journey is collected. This information can be used to send proactive alerts, which can be used to make smart decisions, like coordinating assets and people. Information about the shipment, combined with product and regulatory data, is shared with customs brokers, customs, and other government agencies.
Frankly, the examples of collaboration across the global supply chain are just too numerous to mention here. The number of parties involved in an international transaction can range between 10 and 40. Amber Road provides a Global Trade Management (GTM) solution platform called Trade Automation, which provides a digital model of the global supply chain in the cloud. This solution enables synchronous collaboration between all the global supply chain participants. The Trade Automation solution is the intersection between two networks, the digital and global supply chain networks; and when these networks collide, efficiency and agility are born!