HOW FEDERATED NETWORKS SIMPLIFY, OPTIMIZE, AND SECURE GLOBAL SUPPLY CHAINS
In today’s turbulent world of changing regulations, pandemics, and trade wars, federated networks are coming to the forefront in global supply chain management as an essential element to optimize supply chain performance, provide security, and maintain regulatory compliance.
What is a federated network? A federated network is a group of interconnected networks that function as a single network. In supply chains, a federated network is a group of digital business networks with the ability to transparently send secure data and messages between any individuals or companies on any network.
An example is the various cell phone networks that interoperate and facilitate communications between users, regardless of the user’s particular network affiliation. In supply chain management, a federated network enables multiple network platform instances to operate as a single integrated virtual network, with a Single Version of the Truth (SVOT) for all networks and parties. This enables complex global supply chains spanning corporate, geographic, and political boundaries to function and optimize as one system.
In supply chain management, a federated network enables multiple network platform instances to operate as a single integrated virtual network, with a Single Version of the Truth (SVOT) for all networks and parties. This enables complex global supply chains spanning corporate, geographic, and political boundaries to function and optimize as one system.
Why Federated Networks for Supply Chains?
Federated networks offer powerful capabilities that are not possible on standard systems and networks. For example, One Network Enterprise’s federated network, the Real Time Value Network, provides supply chain planning and execution capabilities that span all networks and trading partners – from inbound supply to outbound order fulfillment and logistics, as well as global demand-supply matching. Other advantages of federated networks include:
Federated networks establish a single version of the truth across regional networks and industries. All partners operate on an accurate near real-time demand signal (e.g. point-of-sale data), and partners can plan, prepare and react much faster to the ongoing shifts in conditions, whether in demand, supply or logistics.
Federated networks simplify, standardize and streamline data management. A community master data repository streamlines and standardizes data and information flows across all supply chain functions and all public and private networks
Federated networks are customizable and flexible. For example, they can be customized to a particular region, its privacy laws, language, currency, regulations, and business practices. They can be customized to serve a particular industry with its particular items, terminology, and workflows (for example, in healthcare, automotive, and defense).
Federated networks are highly scalable. They support unlimited connections among trading partners, including manufacturers, suppliers, customers, logistics providers, and their networks. They can run on low-cost hardware using a grid architecture, and can easily scale up with new hardware added as needed. This is critical to maintaining a real-time SVOT and vital to making sure that all information is accurate, trustworthy, and actionable.
Federated networks secure confidentiality and privacy. A roles-based permissions framework ensures that data is only accessible to those who need to see it. For highly secure environments, networks can be deployed as private instances.
Federated networks are robust and resilient. Networks can function even if disconnected from other networks. The network stores data and then synchronizes changes on reconnection, so they are more resilient to disruptions. Your business is more agile and resilient too. Connecting and transacting with new trading partners on the network is simply a matter of clicking checkboxes to enable view/execute permissions on your data. Enhancing your network with new suppliers, distributors, manufacturers, carriers, freight forwarders, and retailers takes minutes not months. Thus, your supply chain is more agile and adaptable to change, whether to seize new opportunities or responding to a crisis and potential disruption.
“In today’s turbulent world of changing regulations, pandemics, and trade wars, federated networks are coming to the forefront in global supply chain management as an essential element to maintain regulatory compliance and optimize supply chain performance.”
Master Data in Federated Networks
Data-sharing across enterprises is a perennial problem in supply chain management. One Network has solved this problem using a federated master data management model. It consists of a community master data repository to standardize data and streamline sharing across all network services (solutions), and all public and private networks.
Companies map their data once, then the network automatically translates data between networks and parties. Each company maintains a single instance of their own data, not multiple copies or references to partner data. This eliminates data duplication, minimizes data errors, and enables a near-real-time single version of the truth for all partners.
One Network Enterprises has a federated network running today called CMD (Common Master Data) that works with a variety of industries from healthcare to automotive/ manufacturing to foods and more. The CMD stores all credentials and those of your business partners, as well as common master data, such as your sites, parts, items, etc. After signing into an industry network through the CMD, the credentials used are transferred from that network to the other networks. But it’s only very specific data that is shared for whoever signed in and only the data required for whatever they’re going to do.
CMD plays a key role in keeping networks and enterprises interconnected, without creating complexity, slowing down the network, or creating redundant data. Organizations avoid replicating their own data and infrastructure, so there’s no maintenance on their part. Data errors and data conflicts are minimized as all parties are working from a SVOT, making it far more scalable when dealing with large industry networks where you have thousands of companies and SKUs. The federated network’s SVOT eliminates data and infrastructure duplication across networks, making it more economical to manage and support — and these savings can be passed on to customers to grow revenues or improve margins.
Managing Multi-Party Permissions in a Federated Network
Countries are increasingly flexing their regulatory muscles and controlling the way data is collected and used within their borders. This has led to variations in regulations across regions that cover security, privacy, and trade – all of which impact global supply chains. Some countries even have the ability to shut off internet access to and from the outside world. This means if you’re operating in one of these countries, you’d better have a contingency plan to deal with such scenarios. Fines for violating these regulations can be up to 4.5 percent of the revenue of your company, so you need take them seriously.
Achieving Regulatory Compliance. Supply chains span regional and national borders, so companies doing business across borders, and software vendors supporting them, have to ensure that they can comply with these differing and sometimes contradictory regulations. Then there are the customers who use the software that have their own requirements, regional sites, and business processes that must be accommodated. Of course, security and confidentiality of their corporate data is of supreme importance.
The bottom line is that in many situations, you cannot disclose key information. However, your supply chain platform must run globally, across a multitude of trading partners, spanning tiers, transportation modes, and national boundaries while complying with all mandates and customer requirements. A federated network is one way that organizations can address these significant challenges.
Managing Security and Privacy. The federated network provides a near real-time shared environment that opens up a host of options for sharing data across the network. Data can be open, filtered, modified, and blocked, all depending on the situation:
- Shared as is, visible to parties with the relevant permissions to view it
- Blocked, so it is inaccessible to all
- Masked, so that only portions of the data are shared
- Anonymized, so the data is shared but without identifying the person whose owns the data
Combining these capabilities enables companies to share the data across their business network with multiple parties, but allows counterparts to see only what they need and are entitled to see. Like the cell phone network example, when making a call, only the data that’s needed to make that specific call is replicated from one network and phone to the other. It’s the same with a federated network and transactions across the supply chain.
Controlling Access. With a federated network, each company can manage their supply and demand networks according to their corporate governance, values, and objectives, while accommodating regional laws in all countries where they operate. Data from any network can be shared across the networks. This can be network to network, partner to partner, and even to firewalled and third-party systems. In unrestricted scenarios, parties can see order numbers, item numbers, quantity, etc. At the opposite end of the scale, the network can block everything so that no one sees anything, or perhaps information is shared only with certain roles in a very specific department within a company, such as human resources or finance.
One Network offers the industry’s most sophisticated multi-level role-based permissions framework, with capabilities far beyond traditional 1-level or 2-level permissions management.
With this permissions management capability, each party in a transaction has permission to execute their step in the process, and each party determines what data they want other parties to see. One Network provides N-tier access and control, so that any number of people can be on a single version of the truth to a particular transaction. And this is where all competing technologies are simply hub-and-spoke. Therefore, when you have complex global supply chain transactions with 4 or 5 or more parties and multiple legs, simplistic approaches are not going to work.
“If you can’t model permissions in a multi-party way, you’re not really running a network.”
Dealing with Data Challenges in Global Supply Chains
By applying these data modifiers and filters, the One Network platform can handle the many supply chain challenges that arise with respect to privacy laws and in trading across national boundaries. Here are a couple of examples.
Anonymizing: Many of these privacy regulations require that a person have the right to be “forgotten” and wiped from your system. But practical considerations and other regulations require that you can’t just delete transactions that a given person was involved with. So, for example, if you’re moving hazardous material from Point A to Point B, the U.S. Department of Transportation says you need to keep a record of those transactions and movements for a minimum of seven years.
This data has to be treated carefully, so the transaction records are maintained, without identifying the person involved. Yet, it is also required by law that you need to be able to reconstruct the full transaction with the persons involved. So, behind the scenes, you need to maintain certain cross-referencing to your anonymized records, in case you are required to provide such information in the future.
Masking: The network can also mask data. This common scenario involves keeping information in the database, but without presenting it to another party. For example, contact information might be masked, with telephone numbers and email addresses blanked out when a given record is shared, but remaining available for sharing in other contexts. This capability is invaluable in many industries – for example, in healthcare for patient privacy and in defense which deals with ammunition stores, troop movements, and other classified information.
In supply chain applications, masking enables the business to share an order number to certain parties, while others see a dummy order number. That order number can still be cross-referenced to an order number on another federated network.
One Network’s Real Time Value Network is Federated
One Network Enterprises was founded in 2003, and as the name implies, the company was founded on the idea of a single federated network for business operations and supply chain management.
One Network’s Real Time Value Network is a federated network spanning multiple industries and the globe. It supports almost any type of good or service. It is also highly scalable, processing more than 5.6 million transactions a day. The network includes two of the top three largest grocery chains in the U.S. Another network tracks ammunition for the U.S. Marine Corps. Other networks manage grocery produce, automotive parts, and pharmaceuticals worldwide. Another network is being used to track all the physical currency, from entry to exit, for a central bank in a major African country. So federated networks are highly customizable, yet also interoperable and incorporated into a single federation for more powerful optimization, efficiency, and scalability.
Secure and Trusted. The One Network platform is also very secure. With the U.S. Dept. of Defense implementing One Network’s federated network technology, you can be sure it has been rigorously tested for security, scalability and for performance in mission critical applications. Nevertheless, it has a dedicated reserve system that is always in sync, so that in the event of a catastrophic failure at one location, the network fails over to the disaster recovery network and continues to run. This takes a huge burden off companies, who no longer have to worry about maintaining, backing up, or losing their data or systems.
This is why, in today’s turbulent world of changing regulations, pandemics and trade wars, federated networks are coming to the forefront in global supply chain management as an essential element to maintain regulatory compliance and optimize supply chain performance. Contact us to learn more.