The Rise of Global Standards

Introduction

The emergence of the Internet as a universal communications network has created in its wake the necessity for global standards to structure the conduct of electronic business. Proprietary systems or standards limited to regions or industries can no longer survive in this new business ecosystem.

ebXML (electronic business eXtensible Markup Language) is the emerging standard for worldwide business-to-business electronic commerce - the external exchanges between companies. Part of the foundation model for ebXML is called REA (Resources, Events and Agents). REA could become the standard for all automated business activity, both external and internal to a company, forming totally-connected Internet supply chain systems.

Internet supply chains cause the walls between external and internal systems to break down. From that perspective, ebXML + REA could become the new International language of all business.



The United Nations of electronic business

The United Nations has taken the lead in developing a worldwide, cross-industry standard for electronic commerce over the Internet. The UN has a long history of developing standards for international trade, and e-commerce is no exception.

UN/CEFACT and OASIS started ebXML.

The United Nations body for Trade Facilitation and Electronic Business (UN/CEFACT) and the Organization for the Advancement of Structured Information Standards (OASIS) have joined forces to initiate a worldwide project to standardize XML business specifications. UN/CEFACT and OASIS have established the Electronic Business XML initiative to develop a technical framework that will enable XML to be utilized in a consistent manner for the exchange of all electronic business data. Industry groups currently working on XML specifications have been invited to participate in the 18-month project. A primary objective of ebXML is to lower the barrier of entry to electronic business in order to facilitate trade, particularly with respect to small- and medium-sized enterprises (SMEs) and developing nations.

ebXML Mission:

To provide an open XML-based infrastructure enabling the global use of electronic business information in an interoperable, secure and consistent manner by all parties.

A. UN/CEFACT

UN/CEFACT ( www.unece.org/cefact ) is the United Nations body whose mandate covers worldwide policy and technical development in the area of trade facilitation and electronic business. Headquartered in Geneva, it has developed and promoted many tools for the facilitation of global business processes including UN/EDIFACT, the international EDI standard. Its current work programme includes such topics as Simpl-edi and Object Oriented edi and it strongly supports the development and implementation of open interoperable, global standards and specifications for electronic business.

B. Before ebXML

Before ebXML, there have been standards for electronic commerce, but they have all been regional and/or industry-wide - never before worldwide and cross-industry.

1. Regional standards:

a) US: ANSI X12

b) Europe: EDIFACT

2. Industry standards:

a) Auto: AIAG

b) Electronics: RosettaNet

c) Retail: VICS


III. The World Wide Web of E-Commerce

A. ebXML = Purchasing

The scope of ebXML is limited to the external information exchanges between companies - in other words, mostly information exchanges related to purchases of products and services.

ebXML does not even consider the integration of ebXML collaboration process with each company's internal business application systems.

B. REA = Everything

1. Step-by-step from ebXML to everything
Start at the inner-most rectangle, Document.

a) Document:
The business content being sent between trading partners, for example, Purchase Order, Advanced Shipping Notice, Electronic Kanban, Price Change, etc. The contribution of the ebXML Core Components group is to break the common business documents up into re-usable components such as Address, Currency, etc. that can be composed to form new documents.

b) Transport
The protocol being used to send the document, for example, HTTP, SMTP (email), FTP, etc.

c) Routing
How the document gets to its addressee, usually determined by the transport protocol, but the address must be part of the package being sent over the protocol.

d) Packaging
The structure of the whole electronic message being sent, which includes not only the document but the "envelope", addresses, multi-part messages, etc.

e) Commercial Transaction Protocol
The rules and procedures required for a legally binding electronic business transaction, including explicit acceptance, electronic signatures, tamper-proofing, non-repudiability, etc.

Here is a list of such features from ebXML documents:
· Authentication (valid electronic signature of authorized agent)
· Tamper-proofing (check sum computed over message contents to detect changes) · Confidentiality (encryption)
· Time limits

It is common today for electronic documents to be sent without the necessities for legally binding transactions. ebXML protocols will correct this flaw.

f) Business Collaboration Protocol
The definition of a series of Documents being sent back and forth to perform a complete business exchange or set of exchanges, for example, Order, Fulfillment and Payment.

g) Long Term Contract
In some business relationships, it is usual for trading partners to make contracts for products or services to be purchased over the course of the contract, usually a year or a project.
The LTC usually defines gross quantities and prices, but not specific delivery dates.

h) Trading Partner Agreement
Agreements about protocols and standards to use, error handling, and other technical and procedural aspects of electronic commerce. The difference between TPAs and LTCs is that TPAs do not carry any economic commitments, whereas LTCs do.

i) Supply Chain Network
Most B2B e-commerce is conducted between two trading partners, but those trading partners often live in larger chains of supply and demand relationships: for example, in the auto industry, there are dealers, car manufacturers, tier 1 suppliers (to the car manufacturer), tier 2 suppliers (to the tier 1 suppliers), etc.

In retail, there may be stores, distributors, manufacturers, raw material suppliers, transportation carriers, etc.

Supply chain networks connect all of the related trading partners and send related messages (such as dependent demands) across all affected partners.

There are very few running Internet supply chain networks, but that is where the big payoffs will be.

2. From orders to fulfillment to supply chains

ebXML has a set of specifications for business activities that is unique among e-commerce frameworks. In the ebXML metamodel, diagrammed above, these specifications are called Resources and Contracts. These specs come from REA (Resources, Events and Agents), an economic model extended for Internet supply chains by Logistical Software LLC.

One gaping hole in most e-commerce schemes is automated and intelligent order acceptance. Most e-commerce sites accept orders blindly, regardless of whether they can be fulfilled as promised. The REA elements of ebXML provide hooks for keeping orders in suspense while automatically executing an Available-To-Promise query.


b) From orders to fulfillment

Most B2B e-commerce now is like most B2C e-commerce: just order-placement.

Like B2C, B2B will next graduate to the stage where order fulfillment is connected to order placement. Wouldn't that be nice?

The REA elements Commitments and Economic Events provide the framework for order fulfillment: orders represent commitments for future events, that is, the supplier promises to deliver products, the customer promises to pay for them. Then the events happen (or fail to happen) to fulfill the commitments.


c) Integration with internal business systems

The REA elements of ebXML are the hooks for integration with internal business applications. For example, Commitments become Orders in legacy systems; Economic Events become Shipments or Payments.


d) Supply chain contract patterns