Global Logistics Planning Guide: THE GREAT DEBATE

APIs OR EDI FOR SUPPLY CHAIN TRADING PARTNER COMMUNICATIONS?

•    Considerations for businesses looking to replace older EDI models with APIs.

There’s an ongoing debate about utilizing APIs vs EDI for trading partner communications within the supply chain.

Electronic Data Interchange (EDI) was first created in the 1940s-’50s as a set of messaging standards so trading partners could easily communicate with one another. In a standard EDI process, a company sends an electronic file that conforms to an agreed upon format, for that message’s purpose, directly to the recipient’s computer. Today, EDI is transmitted over the Internet and encrypted using what’s generally called B2B Gateway software to establish a secure connection between trading partners. This includes common transmission protocols such as FTP, AS2 and HTTPs.

Application Programming Interfaces (APIs) were created as means to provide broad connectivity between an application’s services and other users. When Amazon launched Simple Storage Service (S3) in 2006, and made the service available via API, it opened the door for entire enterprises to be supported through the cloud.

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New Supply Chain Technology

Today, IT leaders are challenged with satisfying internal and external customers, while business units outside IT want to reduce cost barriers to integration and use data as a competitive advantage. APIs offer the promise of lower integration costs, the ability to make data more accessible and creating new streams of revenue.

However, new challenges come with new capabilities. EDI is an accepted convention that already follows business processes. For example, if a company sends an 850 PO document to a supplier, the recipient already knows to begin the order fulfillment process.

APIs, in this context, would require more collaboration. Each trading partner must agree on the semantics and granularity of the data. One trading partner may refer to a data set as the “shipping location” and the other partner the “shipping address.” How will the consuming system of record understand the relationship between the data? Also, a single EDI purchase order may require 50 operations within an API. If the message is split into a series of calls, can the consuming back end receive that information without performance issues?

An inherent complexity that’s irreducible in trading partner communications are variances in data structure and messiness in securing a protocol. Some of the same challenges with EDI will apply to APIs when one or more of the following events occur:

• New partners must be on boarded
• Changes to trading partner applications occur
• Changes to internal applications occur

At the end of the day, communication standards are really determined by the level of asymmetry in the trading partner relationship.As an example, many credit Wal-Mart with normalizing the use of EDI within the consumer goods supply chain.

On the other side, Salesforce, eBay and Amazon were some of the first companies to make their data available to a broad base of users through APIs. How the data was used to support a particular process was up to the consumer of the API. In either case, a single entity isn’t in a position to ask Wal-Mart or Salesforce to provide a different method of integration to better fit its own needs.

Businesses looking to replace older EDI models with APIs for their B2B transactions should consider the level of asymmetry, and whether their trading partner will be willing to conform data to the intended business process. Bottom line: The information must be translated somehow. The question is, who will do the work? In an API-only world, that work will get pushed down to those with the least leverage.

Previous investments in legacy technology also mean it will be extremely unlikely any business can communicate exclusively via API. Gartner estimates that 25 percent of B2B interactions will be performed through APIs by 2020 while the majority will still be handled by “legacy approaches.” Businesses looking to take advantage of APIs with trading partners should consider whether their technology is able to support both approaches effectively.

Another overlooked challenge with an API-driven approach is compliance.APIs leveraged in a federated development environment increase risk profile and may inadvertently create vulnerabilities or exploits without a strong uniform data governance process and policy.

Developer tools such as iPaaS solutions may be certified “out of the box” but compliance breaks down after the first line of code is developed. Sensitive financial data, like freight payments and invoices, are subject to audits designating which individuals have access to the information. If businesses grant access to an undefined group of future integrators, how will they fulfill their compliance responsibilities to customers?

Ultimately, Liaison Technologies believes the citizen integrator approach is the wrong approach to leveraging APIs and leads companies down a dead end when it comes to innovation. This is because the promises generally stated about APIs replacing EDI reflect an application-to-application paradigm in addressing integration.

By building new APIs for every integration use case, companies are taking their eye off the ball, and neglecting to focus on creating sound governance that will enable the ability to make data available in any scenario. Companies will inevitably constrain their application purchase and design choices around the ability to maintain integration processes. Furthermore, new use cases for the same information will require more APIs to be extended to applications, analytic models, etc. That’s why Liaison engineered the ALLOY Platform to collapse these disparate forms of integration into single service that adheres to the highest levels of compliance.

Application Programming Interface usage will continue to grow in trading partner relationships, and APIs can and should be leveraged where it adds value. However, it is unlikely they will completely replace EDI.

When forming an integration strategy, businesses should consider three key factors before replacing EDI with APIs:

• What levels of symmetry exist in trading partner relationships and will changes to communication be easily accepted?
• What types of data are being shared and will the considered approach create compliance and security risks?
• What types of governance policies will be put in place to make sure that companies can make technology decisions without testing an infinite number of dependent connections?

Following these guidelines will allow firms to leverage new technology effectively and sustainably.

This 4-Letter Acronym Will Revolutionize the Way You Think About Leadership

C.O.R.E. stands for Communication, Organization, Relationship, and Expectations. Try it today.

By John Brandon

Contributing editor, Inc.com@jmbrandonbb

CREDIT: Getty Images

 She walked into my office and slumped into a chair.

“You don’t have a clue do you?” she asked in an exasperated tone, with a few extra “colorful” words thrown in for emphasis. I didn’t quite follow her line of reasoning. I was managing a large team of designers, writers, and usability experts. We had just finished building an internal website and assisting with an external site, providing design feedback and testing. The team consisted of around 50 people including all of the managers, supervisors, and what we called individual contributors at the time (there’s a friendly term you should probably not borrow). In my own defense, I was also riding high on a wave of success, having built up a team from just four people a few years prior. And, I was a young father of four kids–not sleeping much and dealing with soiled diapers at home.

“What do you mean?” I asked with a puzzled (and tired) look.

“I never know what you’re thinking,” she said.

I felt a pang of familiarity. I am a confirmed introvert, and my best form of communication involves a keyboard and mouse. My project manager had a good point, and she took the opportunity to lay out all of her frustrations in full glory. I didn’t see it at the time, mostly because I lacked empathy and couldn’t understand her point of view, but she was definitely giving me an opportunity to adjust my tactics and become a better leader. If only Slack had existed at the time, right? It’s a bit of a savior for me now, giving me the freedom to communicate effectively as a writer and think through what I want to say (and when).

Now that I’ve been mentoring and training college students one day per week, I’m back in the flow. I’ve learned a few things about effective leadership, in most cases comparing what worked and didn’t work long ago as a leader before starting my career as a writer in 2001. It’s a wonderful exercise because I’m using a newly created prescription for management with 20 people in a real-world setting but constantly comparing back to my previous jobs (which lasted about ten years). I’ve honed these lessons from the past and present into a simple acronym you can follow, called C.O.R.E. (see below).

It’s handy, because it reads like a concise field manual for what I should have done back in my corporate life and what I’m trying to do more effectively now.

Before you dive into it and read how it all works, can you do me a favor? Monitor yourself as a leader for one solid week using the C.O.R.E. principles as described below, constantly measuring all four areas and taking notes, then send me a detailed description of how it all worked out for you. Here’s the thing. I know it works. I’m living it right now, and I may even write a book about it soon because it’s something I really believe in with everything in me, so much so that I’m living and breathing it weekly. Will you do the same?

1. Communication

Everything hinges on communication on a team. It is the connective tissue. That employee who told me she was practicing the art of mind-reading with me would have loved a little more communication. In my mentoring role now, I always talk about over-communicating as a way to avoid conflict. People tend to sit on their complaints like they are warming them up for later, afraid to really talk it out. As a manager, you have to constantly ask people what they think, how they are feeling, what they would change. Feedback isn’t a checkbox on a spreadsheet, it’s a way of life. Communicate effectively and get everyone else to communicate with each other and you will have a good team.

2. Organization

That said, communication is only one part of the C.O.R.E. concept. Organization is something I’m currently working on (or re-learning from my corporate days) because it’s so important. It also takes time, effort, intention, and skill. The best leaders are alwaysorganized because they have great empathy for the people on their team and know that keeping things in order and scheduled is what every person craves. Bad leaders live in an eternal state of chaos–you don’t know what they are thinking (due to their lack of communication) and you don’t know the plan (because they are so disorganized). I’m still learning how this interchange of communication and organization play off of one another, because they really do go hand-in-hand. You can communicate in chaos. You can organize quietly. The best leaders know how to do both of those things consistently.

3. Relationship

But isn’t that all pretty cold and impersonal? Yes it is. You can be perfectly well-organized and communicate every little concept and plan to your team and still fail miserably as a leader. What makes all of the difference? It’s your ability to build a relationship. Make sure the first question you ask an employee is not about a deadline or a task, and isn’t about the org chart changes or the project that is over-budget. Ask about their kids. Ask about real life. We’re humans, we need a personal approach that is fully cognizant of what happens outside of work (also known as–the important stuff like the birth of a child or buying a new car). Does your staff know you care about them? Do you treat them like numbers or human beings? Make sure you add a heavy dose of relationship-building to all of that fluid communication and detail-oriented planning. This is where empathy comes into play–that is–your ability as a leader to see life from the eyes of your staff.

4. Expectations

Wrap up this entire package by setting expectations that are clear and obtainable. I’m not talking about setting repercussions, or establishing goals, or even communicating about some well-intentioned Key Performance Indicators (or KPIs). Set those things aside for a moment. They are tools for running a team, but I’m talking about making it clear what you expect out of an employee in terms of what they do in their role, what you want them to achieve, and where this is all heading. It’s your “must do” list, the things you care most about as a leader. That employee that was trying to read my mind long ago was not seeing good communication. She hated the chaos. She didn’t think we had a good relationship. But in the end what really ticked her off the most is that she didn’t know what was expected of her at work. Are you doing that on a daily basis? Have you told every employee exactly what you really want them to do and made it perfectly clear?

Do all four of these things and you will see changes on your team. Get serious about communication. Make organization a huge priority. Strive really hard to build relationships in tangible ways. And state the expectations like they are set in stone. It works.

Here’s who really runs Amazon — and only 2 of the top 38 execs are women

• Jeff Bezos has diversified his business but not his top ranks.
• An organizational chart viewed by CNBC shows only two women at the VP level or higher reporting directly to one of the company’s CEOs.
• Amazon appears to be making an effort to have more female leaders.

Eugene Kim | @eugenekim222

Getty Images | Alex Wong

It’s a big week for Amazon.

Cyber Monday and the mass of online shoppers brought another record high in Amazon’s stock price, while in Las Vegas, the company’s cloud computing business kicked off its annual re:Invent conference.

Amazon’s 2017 rally lifted Jeff Bezos’ net worth past $100 billion on Friday, and he now towers over Bill Gates and Warren Buffett on the list of the world’s richest people.

With so much going on inside Amazon, including the hunt for a second headquarters location, CNBC decided it was a good time to find out who are the power players at this sprawling company.

We tracked down an organization chart, which is available internally but not to the public.

One immediately noticeable fact is that Amazon, like so much of the tech universe, is a company run by men. Specifically white men.

In marketplace, Prime and AWS, or what Bezos likes to call the three pillars of the business, there are 37 people under the CEO who report directly to him — or are one layer removed — with at least the title of vice president. Only two of them are women.

‘Simply right’

That theme will be clearly on display at re:Invent. Andy Jassy is CEO of the cloud unit and only one of the 15 most senior people below him is a woman.

Amazon appears to be making an effort to fix this problem. As Recode reported last month, a growing number of women are leading important parts of the company. They include Toni Reid with Alexa, Stephenie Landry in Prime Now and Jennifer Cast at Amazon Books. The company also has technical advisors, who shadow the unit CEOs and attend all of their meetings for training purposes. Currently, two of the three are women.

Still, the numbers are vastly underwhelming for a company that makes diversity part of its leadership principles. In fact, Bezos wrote in a letter last year that diversity and inclusion are not just good for business, but “simply right.” In the list below, there are no African-Americans and three people of Asian descent.

Amazon didn’t respond to a request for comment.

Most people on the list have spent years, if not decades, at the company. Jassy along with Jeff Wilke, CEO of the consumer group, and Jeff Blackburn, who runs the video and ads businesses, have been at Amazon since its early days. Dave Clark, who runs retail operations, and Greg Greeley, who leads Prime, both joined the company in 1999.

There have also been more recent high-profile hires. Babak Parviz, who created Google Glass, joined Amazon in 2014 and now runs a special team called “Grand Challenge.” Adam Bosworth, who left Salesforcelast year, is in charge of the AWS software team. Dave Treadwell, a 27-year Microsoft veteran, joined Amazon last year as vice president of e-commerce services.

Aegis Capital: This will be the best ever holiday season for Amazon  1:10 PM ET Fri, 24 Nov 2017 | 04:16

These are the people directly reporting to Amazon’s three CEOs:

Jeff Bezos, Amazon CEO:

• Jeff Wilke, CEO of worldwide consumer
• Andy Jassy, CEO of Amazon Web Services
• Jeff Blackburn, SVP, business and corporate development
• Dave Limp, SVP, Amazon devices, digital management
• Diego Piacentini, SVP, international retail
• Brian Olsavsky, SVP & CFO
• David Zapolsky, SVP & general counsel
• Beth Galetti, SVP, human resources
• Jay Carney, SVP, corporate affairs
• Jeff Helbling, VP technical advisor to CEO

Tony Hsieh, CEO of Zappos

Jeff Wilke, CEO of worldwide consumer:

• Dave Clark, SVP, WW operations
• Dave Treadwell, VP, e-commerce services
• Doug Herrington, SVP, NA retail
• Greg Greeley, VP, WW Prime
• Gur Kimchi, VP, Prime Air
• Neil Lindsay, VP, worldwide marketing
• Pat Bajari, VP and chief economist
• Russell Grandinetti, SVP, international consumer
• Sebastian Gunningham, SVP, Amazon marketplace
• Steven Kessel, SVP
• Tony Hsieh, CEO, consumer
• Chee Chew, VP, consumer engagement

Patrick T. Fallon | Bloomberg | Getty Images

Andy Jassy, chief executive officer of web services at Amazon.com Inc.

Andy Jassy, AWS CEO:

• Adam Bosworth, VP, software
• Alex Yung, VP, AWS sales China, AWS commercial sales
• Ariel Kelman, VP, AWS marketing
• Babak Parviz, VP, Grand Challenge
• Brent Jaye, VP, AWS support
• Charlie Bell, SVP, utility computing services
• Emmett Shear, CEO of Twitch
• James Hamilton, VP/distinguished engineer, AWS
• Michael Frazzini, VP, games services and studios, Lumberyard Engine
• Mike Clayville, VP, WW sales & BD AWS
• Peter DeSantis, VP, infrastructure
• Scott Wiltamuth, VP, AWS dev & management tools
• Stephen Schmidt, chief info sec officer, AWS
• Teresa Carlson, VP, worldwide public sector
• Werner Vogels, VP and CTO

Werner Vogels, CTO of Amazon

Jack Ma Went From English Teacher to the Richest CEO in China Using These 6 Practices

Alibaba has become a massive success due in large part to the leadership of Jack Ma and these six practices.

By Dana Severson

Co-Founder, StartupsAnonymous.com@danerobert

Jack Ma

CREDIT: Getty Images

Without a doubt, Alibaba is an e-commerce giant. These statistics say it all:

• In 2014, it set a record as the company with the largest initial public offering (IPO) in history, taking home $25 billion from the New York stock exchange.
• 200 million people shop on Alibaba’s mobile sites daily.
• The organization sold $550 billion worth of products in the 2016 fiscal year.
• Alibaba announced annual revenues had gone up 56 percent to almost $23 billion in May.
• Its market capitalization as of October was $473 billion.

Behind this all is Ma Yun, the 53-year-old unassuming entrepreneur, better known as Jack Ma. He started the company with 17 others in his Hangzhou apartment, a city close to China’s east coast. His seed capital was $50,000. The year was 1999.

How has he been able to hold his own in the competitive e-commerce space? What lessons can we learn from him? Below are six lessons that can help any emerging entrepreneur: 

1. Face threats bravely.

Ma believes an entrepreneur should face threats squarely and bravely.

In 2003, he launched Taobao, an eBay-like marketplace, to counter the power of EachNet, a consumer-to-consumer online platform, which had been established in China by eBay.

He just wanted to slow down the American company’s inroads into China. So while EachNet was charging a fee per transaction to bring buyers and sellers together, Taobao was absolutely free to use. While Taobao didn’t make money initially, it drew mass appearl and helped Ma face eBay’s threat.

The lesson? You may need to lose money, sometimes, in order to firmly establish your brand in the marketplace.

2. Prepare early for change.

If any kind of change is coming, Ma believes it pays to prepare early. That philosophy enabled Alibaba to fend off eBay’s strong competition in the early days.

“When we see something is coming, we have to prepare now,” Ma once said. “My belief is [that] you have to repair the roof while it is still [sunny].”

He’s already preparing for the change technologies such as artificial intelligence and machine learning are going to bring.

Even though the technologies are going to challenge a lot of job opportunities, Ma thinks they would improve lives.

To prepare for that inevitable change, Alibaba has announced a $15 billion investment in technological research and development over the next three years.

3. Make tough decisions when necessary.

Ma was forced to cut back on staff during the dotcom bust. It wasn’t an easy decision to make but he rose up to the challenge.

Even though it was painful and made him momentarily doubt the sustainability of his business, Ma heeded the tough call. Former Alibaba Vice President, Porter Erisman, recalled that this taught Ma the difference between being an English teacher and CEO.

“Being a CEO means making the tough decisions and sometimes cutting back in order to allow the company to survive,” Erisman said in an interview about Ma.

From my own experience as a startup founder and CEO, I can tell you that your ability to make tough decisions will single-handedly define your success as a leader.

4. Keep moving despite rejection.

Don’t allow rejection to cripple your dreams. Keep moving in spite of them.

Ma faced failure and rejection but he kept moving. Alibaba was rejected by about 30 venture capitalists before Softbank founder Masayoshi Son came to his rescue.

He says the string of rejections helped to build his courage as an entrepreneur. “As an entrepreneur, one of the qualities I have is that when I’m rejected by people, I get used to them,” Ma said in a CNBC interview.

Rejection isn’t always the easiest to deal with. However, there are countless stories, including my own, where entrepreneurs came out ahead through perseverance.

5. Apply yourself to relentless salesmanship.

No matter what type of startup you are, it takes relentless salesmanship to get your business off the ground.

Don’t underestimate the level of commitment this deserves. You just have got to be out there, convincing people to do business with you.

The former VP, Erisman, gave an insight into the kind of effort Ma invested into the Alibaba enterprise at the beginning. He said Ma would travel across China on road shows where 100 or 200 people would turn up to listen to him. In a kind of “mass movement,” Ma was going door-to-door to talk to business owners about why they needed to get online.

6. Engage the power of your personality.

Just like Steve Jobs (who pushed the Apple brand with his face), Ma relied on the power of his personality to convince people to invest.

While others gave detailed business plans, Erisman said Ma simply talked about his story and vision. This got him the $40 million-dollar investment offer from Softbank shortly after Alibaba was established.

By injecting your personality into your company, you’re able to humanize your brand into more than just an entity, which often leads to more opportunities.