By: Cortland J. Fondon
Data is the lifeblood of business. In today’s business world, data can help determine who to market a new coat to. Data can help determine who will like a new movie. Data can help determine who drives a 10 year old car that might be ready to trade for the newest model. Because data is so important, no one in their right mind would want to trade that information with anyone else, right? The correct answer, for any business that wants to thrive, the answer is wrong.
Data partners should be willing to share data. Two groups should be willing to exchange very specific, confidential, and valuable data with business partners, and if they do that, everyone’s business should improve according to Sir Tim Berners-Lee, a web creator who was instrumental in the creation of the World Wide Web. By sharing data, businesses are able to see their entire supply chain more efficiently where problems may occur in the future. An important issue with this data sharing is ensuring data security so that the personal and private information can be kept confidential and safe from the outside. If different businesses involved in a supply train share data, the suppliers must ensure the integrity of the information with their other supply customers and partners.
In a report on Project Syndicate, Nathan Eagle estimates that passive data, the data that is a byproduct of normal internet usage, may be worth hundreds of billions of dollars. The truth is, if businesses along a supply line were to share information with each other, the data could be worth more than that, not only in finding businesses and people to market goods to, but also as a means of becoming predictive in problem solving.
A company may produce a good that requires a dozen parts from four distributers. If those five companies, the four distributors and the final producer share data, inventory of parts and of the final product may never run out, and the inventory may never get too large which could waste resources on product not ready to be moved.
Another data partnership example could be hospitals sharing data with convenience stores and other shops that sell over the counter remedies. If there is a sudden increase in certain goods being sold, that might tell the hospital they are about to see a run on patients with a particular malady and they can be certain to have enough medicines in stock and enough staff on duty.
Data must be generalized into a form that will benefit all parties in a sharing arrangement. The benefit of sharing the data can help all parties’ financially through increased sales and even through a more organized approach to manufacturing or improved options for transportation. New markets can also be discovered by examining the data more closely and sharing that data with more parties. Since it is beneficial for everyone who is sharing data in a supply-line to see more end product moved, information and suggestions will made to increase sales.
In reality, although sharing data can and should benefit the producer in a supply chain by creating more business, it can also benefit suppliers. Suppliers are able to predict a decrease in the producer’s bottom line by allowing them to find more businesses to supply.