July 13, 2005

Whats the Big Idea?

Electrical distributors (such as Rexel) have long wanted to synchronize data directly with electrical manufacturers. In 1997, they began work on a project designed to overcome many data inconsistency issues. Previous solutions had failed, due to either a lack of completeness, shortfalls in timeliness of information, and other issues. Supplying electrical distributor business systems with data directly from manufacturers in a standardized method-the key to doing business faster and smarter- became the preferred process.

As a result, manufacturers (through the National Electrical Manufacturers Association) and distributors (via the National Association of Electrical Distributors) developed the Industry Data Warehouse (IDW) to achieve data synchronization between trading partners.

But getting data to/from the IDW-and using it in the flow of business documents (such as purchase orders and invoices in electronic data interchange (EDI) format)-created high transportation costs. That led the industry to develop the Industry Data Exchange (IDX), a less-expensive option for moving data.

IDW and IDX needed a home. NAED and NEMA together established the Industry Data Exchange Association- IDEA.


Many organizations outsource warehouses; IDEA found a vendor (CCITRIAD, now called Activant Solutions) to run its virtual IDW. When the data warehouse became operational, 31 manufacturers provided data directly to it.

While 31 seems a small number, those companies represented 60% of the items (stock-keeping units, or SKUs) sold by electrical distributors. At the July 1999 launch, 64 distributors actively drew data from the IDW pool.

In November 1999, the IDX went live. Again, this service was outsourced (to MCI Worldcom). B2B documents were exchanged by 53 electrical industry companies.

In the two years that followed, IDEA worked to interest more manufacturers and distributors in the IDW and IDX. Remember that E-business in 1997-2001 was in its infancy, growing and changing rapidly.

Original visions had to be modified. The IDX had competitors, including EDI value-added networks (VANs). It became clear that an Internet-based exchange might work better than the original IDX, perhaps providing the same service at lower prices. IDEA was led to create the IDX2-with Activant winning the outsourcing contract.

While it had only 52 users at its April 2002 launch, today more than 220 companies use the IDX2 for inexpensive, high-speed business document exchange.


E-business does not work-even with the IDX2’s speeds and low costs-if the data being transported aren’t "clean" and comprehensible throughout a supply chain. Detailed studies completed in 2002 and 2003, which sought to detail the financial benefits of data synchronization in the electrical industry, produced unsatisfactory results.

One effort was a pilot program that measured the benefits manufacturers and distributors were realizing from synchronized data. Indicators were that the industry still had a long way to go to get "in sync."

How could "clean" data be ensured? IDEA rolled out its Data Audit and Certification (DAC) program in November 2003. Manufacturers (who create the data) voluntarily seek DAC certification. Audits involved pinpointing data errors, helping manufacturers make necessary data and process corrections.

With DAC corrections, manufacturers send data through the supply chain that are clean and useful. Result: Business data can be "in sync" throughout the supply chain.


The electrical industry’s history in data exchange can be seen as a constant push to upgrade methods and techniques. From one perspective, the industry’s data users- including contractors and other distributor customers-are destinations, and the IDX2 is a data superhighway… and the IDW is the world’s largest "parking garage." If all data sent over the superhighway carry information that is unambiguous and useful, the industry’s efforts to move into a more efficient future will succeed. If the data are "richer"-with more detail beyond price and item number-they will be still more useful.

That’s why IDEA plans a second industry data warehouse, the IDW2. This revamped central data repository will, like the original, consist of manufacturer-provided and controlled product, pricing, and supply chain data.

What’s driving this new project? The IDW2 will host information to meet data requirements for all trading partners-incorporating future functionality for contractors, manufacturer representatives, and other end users. It will interface with any user’s back-end system-enabling scheduled access or serving as an on-line data portal. Approximately 200 plus data attributes will be available-including product images, technical drawings, and marketing catalogs.

In other words, the IDW2 will warehouse "richer" items, each carrying more information. The data will be more useful to electrical product buyers and users (not just manufacturers and distributors).

Further, the new system will offer capabilities based on a number of data formats-including extensible mark-up language (XML) and "flat file" formats. The IDW2 will support all Uniform Commercial Code (UCC) data validation rules-for all manufacturers-requiring this functionality and imposing the rules required for the DAC program.

Electrical manufacturers, distributors, contractors, product end-users, and all others in the industry’s supply chain have entered a new era with the IDW2. There is great potential for E-business advance embedded in the capabilities it offers the industry.