Let’s take it from the top. B2B is nothing
fancy. Businesses have been communicating with other Businesses
since the beginning of time. What has changed is the technology
which carries the communication - from smoke plumes to pigeons to
mail to fax to EDI … and now to communication via the internet
(B2B). Communication via the internet (which is what B2B is when you
look under the skin) is simply the latest souped up communications
technology to come along ... allowing for the communications be more
frequent, rapid and accurate. That’s all.
Ok, enabling more frequent, rapid and accurate
communication is quite a big deal. Actually it is a major deal.
A quick comparison of B2B and EDI is in order
before delving further into B2B. Just like B2B, EDI allowed
electronic communication between businesses. There are two major
differences, however:
- EDI is batch while B2B is real-time, and
- EDI was dedicated point to point (which
means that if a business wanted to use EDI to communicate with a
new business partner it was a big hassle), while B2B (using XML)
allows any business to communicate with any other business.
XML is a way to enable data to have
structure. Text documents have no structure... in other words, An
XML file is an old fashioned flat text file (which contains the
data) which also references another flat text file (called a schema)
which contains the structure of that data. If everyone adopts the
same structure for (say) a Purchase Order, then you can zing your
flat text XML file containing your Purchase Order data to someone
else who – using the same schema – can read your Purchase Order
easily. Marvellous! Only problem is that we
humans have succeeded in coming
up with multiple schemas … or multiple versions of descriptions for
a Purchase Order. While predictable (to the defeatists out there
anyway), it is a real pity that the schemas have not been unified
yet. Perhaps they will be … and in the meantime there is software
available that will map the various schemas to each other thus
allowing free and un-fettered communication.
It might sound like a small thing, but being
able to recognize and automatically use a flat file that another
business sends to you is a major step forward. We think we are
pretty clever with computer systems today, but there is almost
always some sort of manual intervention involved, and as we know,
manual intervention leads to a) higher costs and b) time delays and
c) errors.
Ok, so B2B allows for communication which is
more frequent (real-time), rapid (real-time) and accurate
(automated). The question is “what are companies doing to take
advantage of it”?
On to article
2 in this series - How Do
Businesses Benefit
