In Sync for the Future
A lack of confidence in data quality between retailers and manufacturers, as well as several related technology issues, is making needed efficiencies difficult to achieve. This presents a huge opportunity for the industry to work together for the benefit of all stakeholders.
An industry consensus on that issue led to the launch of a collaborative effort eight months ago. The GS1 US Retail Grocery Initiative aims to enhance data quality and improve product information and images, supply chain visibility, and operational efficiencies.
“We anticipate this year to be a pivotal year in shaping the future of the retail grocery industry,” says Angela Fernandez, GS1 US’s VP of retail grocery and foodservice.
Lawrenceville, N.J.-based GS1 US, a member of the global information standards organization GS1, brings industry stakeholders together to solve problems. The major organizations involved in the grocery initiative include retailers such as Wegmans Food Markets, Publix Super Markets and The Kroger Co.; CPGs (The Coca-Cola Co. and Kraft Foods Group); solution providers (Gladson and Clavis Insight); and trade associations (the Food Marketing Institute and the Grocery Manufacturers Association), among others.
“We have long believed that standards and collaboration among retailers and manufacturers are essential,” says Marty Gardner, SVP of merchandising at Rochester, N.Y.-based Wegmans and a GS1 board member. “Our industry must work together to build a solid foundation for the future. Without this discipline, there is waste and added cost for both the retailer and the manufacturer.”
Sadly, the quality of the data shared between retailers and manufacturers is still not where it should be, despite numerous industry efforts over the past 10 years, according to Nona Cusick, SVP of consumer products, retail and distribution at Capgemini, a global consultancy. “Organizing good-quality data has proven to be difficult for both retailers and consumer goods companies. Often, the data is still treated in a fragmented way — with too few data-quality feedback loops between retailers and manufacturers — and lacks the required business focus,” she says.
GS1 US’ Fernandez says data synchronization is very important to improving confidence in data quality. Providing complete and accurate data about products to trading partners, and ultimately consumers, is imperative.
Instead of pulling from many different sources, she adds, companies have access to a single source of the truth by using the Global Data Synchronization Network (GDSN), which is the electronic transfer of standardized product information between trading partners. It ensures that everyone has access to the same accurate information. Trading partners need only one connection to send and/or receive accurate and up-to-date product information.
That capability pleases grocery retailers such as Wegmans and Publix.
“Data quality is mission-critical, and it’s incumbent on the brand owner to get it right,” Wegmans’ Gardner stresses. “That’s not just national brand manufacturers, but also retailers with private brands.”
He adds that the consumer goods and retail value chain isn’t a closed community of retailers and manufacturers; there are many other stakeholders, including consumers, downstream suppliers, logistics service providers, technology providers and governments, to name just a few.
“This requires full transparency, the right level of standardization, and highly accurate and reliable data,” he says. “Additionally, synchronization of accurate product information is a pivotal element in providing a transparent data foundation for the entire value chain and all stakeholders.”
Maria Brous, spokeswoman for Lakeland, Fla.-based Publix, agrees: “True data synchronization will be required to efficiently publish and receive product attribute data timely and with accuracy. The current opportunity is for our suppliers to have this data in one place internally and to publish when changes occur like primary product panels, ingredients, etc.”
GS1 US is currently working with suppliers, distributors and solution providers on the launch of the GS1 US National Data Quality Program. A discussion group with nearly 300 members representing 179 unique companies came together in 2013. These industry stakeholders agreed to focus on a clear mission: steering industry to adopt, implement and adhere to an industry-driven and defined data quality program to improve current business processes. They say success in data quality for exchange between trading partners depends on creating and maintaining accurate and complete product information by leveraging GS1 standards, the most widely used supply chain standards in the world.
The discussion group developed 5-Point Data Quality Best Practices and the GS1 US National Data Quality Program to help companies establish and sustain effective data quality programs.
The 5-Point Data Quality Best Practices are:
- Adhere to GS1 standards and rules for initial attributes in an internal setup.
- Assign data owners throughout the organization.
- Appoint one entity/department/individual as the sole owner of product data.
- Audit all new items produced in a sustainable production environment and ready for shipment (finished goods).
- Execute communication of initial attributes and package measurements, both internally and externally.
The National Data Quality Program is designed to be universal across all sectors, and consists of the three essential components of good-quality data:
Data governance: Ensuring processes and procedures are in place to set up and maintain accurate data over time. This includes the use of industry best practices and data stewards.
Education and training: This ensures that the people responsible have the knowledge to implement the program, with particular focus on synchronizing data to the GDSN, an internet-based, interconnected network of interoperable data pools, and a global registry known as the GS1 Global Registry. They enable companies around the globe to exchange standardized, synchronized supply chain data with their trading partners.
Attribute audit: This is the physical audit of the product compared with the most recent information shared. It validates the data governance processes and institutional knowledge as demonstrated in the first two components.
Demonstrating proficiency in all three pillars will enable a supplier to become certified either by a third-party solution provider or by GS1 US. Meanwhile, another trio of pillars forms the basis of the Retail Grocery Initiative: digital product information and images, supply chain visibility, and operational efficiencies.
Product Information and Images
“Data is no longer limited to supply chain metrics and physical characteristics,” says Gardner, of Wegmans. “It is also consumer-facing, and these attributes need to be part of the model.”
Indeed, of the three areas of focus in the initiative, product information and images is the only one dealing with consumer-facing issues. Trading partners are concerned about the data density and quality to support product catalogs and e-commerce solutions.
“As technology continues to evolve, customers expect more product attributes and product images to review products online,” says Brous, of Publix. “There are also concerns about the authentication of the data, which we believe should be from our suppliers and manufacturers.
“We have already participated in some initial data-quality measurement efforts with GS1,” she continues. “Along with several other suppliers and retailers, we confirmed that data quality and density for product catalogs and e-commerce solutions remain a large opportunity. Product data for traditional supply chain needs is available, but not for consumer catalogs. We are sharing this opportunity with our suppliers and working with several data pools to secure this product attribute data in our product catalog for customer convenience.”
A GS1 US workgroup is actively addressing the issues related to product information, including images, to ensure that data synchronization based on GS1 standards is seamless.
“The need for expanded product attributes is driven by consumer empowerment,” says Fernandez. “Never before has there been such a desire for more information about food origins and … ingredients. This has driven the industry to respond to be able to deliver upon the needs of the consumer. Also, reliable data and images are a necessity when communicating and marketing in today’s mobile environment. The initiative will be focused on helping the industry better identify, capture and share the information that is important to both consumers and trading partners in a standardized, more efficient way.”
Isabel DuPont, SVP of content production at Lisle, Ill.-based Gladson, agrees that it’s imperative for manufacturers and retailers to present accurate, compelling and extensive product information online.
“But that doesn’t mean it’s easy,” she’s quick to add. “With shoppers traveling a digitally fueled path to purchase, brands and retailers face growing pressure to provide more detailed product information across a surging number of shopper touchpoints. More data means more complexity. With product information for B2B and B2C processes needing to be accurate and available to give shoppers the experience they’re looking for, retailers’ scrutiny of product information is not only justified, but necessary.”
Fortunately, manufacturers understand this imperative and are taking steps to deliver. They’re partnering with third-party content providers that can offer standards-compliant, sustainable processes for creating, maintaining and distributing digital product information. For example, in the past 12 months alone, Gladson has added 1,000 manufacturer customers, largely driven by their need to provide retailers and shoppers with up-to-date brand content for e-commerce and product catalogs.
In addition to helping manufacturers and retailers with product data quality and the consistency of that information across channels, Gladson is being called upon to provide an increasing number of product attributes and images to support shoppers’ research-heavy buying journeys. As the quantity and complexity of product content increases, it’s crucial that this content is distributed in formats that are “enterprise-ready,” DuPont says, meaning that the content should be formatted to allow for fast and seamless integration into specific enterprise applications.
Supply Chain Visibility
GS1 US officials stress the critical need for improved supply chain visibility to ensure the accurate identification of products, as well as the delivery and tracking of safe foods and other products. Supply chain visibility aims to remove barriers and silos, leading to more process improvements such as better inventory/category management, more accurate ordering, improved shelf availability, improved shrink management, and, ultimately, efficient and accurate traceability when required.
“Supply chain visibility is also a major focus area that affects all areas of traceability,” explains Fernandez. “Many industry stakeholders we work with are placing a greater emphasis on supply chain visibility using GS1 standards, not only because their focus on FDA [Food and Drug Administration] regulations will require them to have better traceability capabilities, but also because they are discovering they’ll gain additional business benefits when they can better see the details of their internal processes.”
Operational Efficiencies
The initiative seeks to reduce supply chain inefficiencies from decreasing total delivered costs (TDCs) to help companies remain competitive and successful. GS1 US is currently identifying the gaps and opportunities for operational efficiencies where leveraging the common language of GS1 standards can lead to positive results.
“Operational efficiency is an internal benefit of leveraging standards,” notes Fernandez, who’s enthusiastic about the next steps for the initiative as it kicks off 2015 with an Executive Leadership Committee composed of key stakeholders. For example, Wegmans is one of the pilot participants in the National Data Quality Program.
“They are providing strategic guidance and expertise,” Fernandez says, “and maintaining a focus on creating a unified industry approach to leverage GS1 standards implementation to solve [further] challenges.”
“We have long believed that standards and collaboration among retailers and manufacturers are essential.”
—Marty Gardner, Wegmans Food Markets
“With shoppers traveling a digitally fueled path to purchase, brands and retailers face growing pressure to provide more detailed product information across a surging number of shopper touchpoints.”
—Isabel DuPont, Gladson