The hidden cost of secrecy to supply chains

Imagine a world where retailers are so afraid of leaking information to their competitors that they choose not to put any product information on the public internet. They make their eCommerce and product marketing sites private for authenticated users only, and they don’t advertise their web address on Google. 

In this bizarre world, a consumer would be forced to call up the retailer to convince them they aren’t a competitor and are truly interested in buying. They would then be given the address of the eCommerce site and some credentials for access. Meanwhile, retailers everywhere are spending millions of dollars on employees taking calls and verifying consumers aren’t competitors.

This is called friction in an economy. A bleak world like this would have missed a multi-trillion dollar eCommerce market opportunity, making every retailer worse off. Clearly, the model we have today, where retailers tolerate their competitors seeing their products, specs, credentials, suppliers and prices online, allowing everyone to make more money with less cost, is far superior to the situation above.

Yet when it comes to supply chain traceability between manufacturers further up the value chain, we seem to put up with the same inefficient model as that faced by the citizens of our hypothetical commerce dystopia.

As a commercial buyer, imagine you need certification and product traceability data from your suppliers at tier 2, tier 3 and beyond, to comply with regulation, manage your risk profile, investigate the root cause of quality issues, or measure your carbon footprint. Today, you have to either:

• Call up your suppliers and ask them to call their own and so on, get data sent to you, and painstakingly piece together the result
• Spend millions on authenticated system integration with partners
• Join expensive, monopolistic proprietary private networks (and yes, sorry, most “blockchain” supply chain transparency proposals today are nothing more than proprietary private networks in disguise).

Every option is an incredible waste of money for both suppliers and buyers. Money that both sides could be using to improve their products and to grow their businesses.

As a supplier, why not just solve this annoyance once and for all by putting a little bit of data about your products and credentials on the internet, in a standards-compliant, machine-readable way, and letting people who need it just get it themselves?

eCommerce works so well for everyone thanks to open standards and transparency. Consumers use their browser to look up internet servers that use TCP/IP protocols to send HTML and image files their browsers know how to display on screen. So they can find products, learn about them, and make purchasing decisions, in a cheap and friction-free way.

We should have an open, vendor-neutral, friction-free “internet of traceability” based on standards. And the standards we need are already here: GS1 Digital Link and GS1 EPCIS 2.0.

With Digital Link, every product can have a web-address that acts as a gateway for further traceability information from the manufacturer. Where was it made? When was it made? What are the web-addresses of the exact batches of input material? 

If the information returned is made “machine-readable”, what we have is a lightweight public API for every supply chain object on the planet! We just need the API to reply back in a standard-compliant way that everyone understands, and the best standard for that is GS1 EPCIS 2.0.

This approach would allow automated monitoring of all received products at scale, including automatic traversal of the supplier network to fetch information from all participants involved.

Now when any buyer of goods needs assurance across the entire value chain for the products they receive, there is no manual exporting of data, no system integration, no proprietary networks. Their systems can continually monitor for certifications of every actual supplier to ensure they meet legal and ethical policies, calculate real scope 3 carbon footprints, and investigate the root causes of quality issues across multiple tiers of suppliers in seconds rather than weeks. The cost savings of such an integration model would be enormous for all parties involved.

We have created a video that describes this vision in more detail. We hope you find it interesting and thought provoking!

At TrackVision AI, we have all the tools that supply chains need to get onto a standards compliant, vendor neutral “internet of traceability” today. Contact us at https://trackvision.ai/contact to learn more.