A couple posts ago, I discussed the role of IT in manufacturing outsourcing. I'd like to come back to this topic, and discuss more in details the need for a cross-enterprise backbone allowing the companies members of the ecosystem to share information in an easy and transparent manner. Obviously, the same backbone may serve the collaboration requirements highlighted in my last post, titled "ecosystem collaboration, from tools to an integrated approach."

Today most companies are part of large and global eco-systems, as many products travel the world before being sold to the end-user. In that process, information is generated and needs to be shared to ensure proper traceability of the product. As cost reduction exercises increase, so decrease the buffer stocks used to shield portions of the ecosystem from variances elsewhere. This increases the dependency on timely information to ensure appropriate action is planned to reduce the effect of the variance to the customer service.

This requires visibility of what happens throughout the supply chain. In case of outsourced manufacturing, logistics and/or distribution, the implications are that multiple companies need to share data and make them available to the others. That data should comply with a number of criteria:

• The data should be correct and trustworthy
• The data should be understandable, which amongst others mean they should be in clearly defined units of measure
• The data should be timely and detailed enough
• The data should be consistent and sharable

Multiple approaches exist to share the data. It can start with a very simple website in which the partners provide the data, either through entering them from their browser or by using tools such as InfoPath. The advantage of such approach is to get the partners integrated quickly at limited costs. The first step is often the most difficult and requires most convincing as the partner may not have experienced yet what he can gain from sharing the data. So, having the barrier as low as possible makes it easier for the partner to embark on this transformation. In our experience it will take him about one year to really experience the benefits of collaboration, after which he is starting to look at more advanced communication mechanisms.

B2B communications can be used, exchanging messages between two companies. Standard message formats such as RosettaNet, eb-XML, EDI or others should be used to facilitate the definition of the formats and allow re-use. The drawback of such point to point approach is that, in case of the presence of many partners in the eco-system, managing those communications is becoming quite cumbersome. This had lead to the creation of private hubs. In the same way as the e-hubs that mushroomed in the Internet boom, a private hub links a large number of partners together. The functionality in the hub routes the messages to the appropriate receiver, eventually translating them along the way to ensure data relevance to all parties.

This approach facilitates the links between the partners, but forces one of the members of the eco-system to implement and manage the hub. Often this is the OEM or brand owner. All data is centralized in the hub or in the owner's systems, resulting in a potential security point of failure.

Cloud computing allows another approach in so that it makes the location of the data irrelevant. Indeed, one could imagine having hub type functionality available in the cloud, directly accessing the data of each of the partners in their location of origin. This distributed data would be seen as one logical entity although it is distributed along the ecosystem. Each partner would own its data, updating it whenever new information is available, while limiting access to the partners allowed seeing the data. Beside the fact nobody needs to invest in the infrastructure necessary for the partners to communicate, the approach leaves each of the partners in direct control of its data, making it easier for them to share the data with the relevant players, allowing an increased visibility of what happens throughout the eco-system. This in turn may result in greater responsiveness and cost reductions, benefiting all partners and the final customer.

As cloud computing is still in its early days, only a small number of companies are looking at such approaches at the moment. However, as the technology matures, this will most probably become one of the key applications for which the cloud is used in the manufacturing industry.