Entertainment (Hong Kong) Ltd – ebXML and Hermes Streamline CD Ordering Process
n this e-procurement system project, CECID collaborates with Hong Kong Article Numbering Association (HKANA)1 and two multinational entertainment retail companies, HMV (Hong Kong) Ltd and Sony Music Entertainment (Hong Kong) Ltd.
The aim of the project is to improve B2B communication between HMV and Sony by using the global standard EAN．UCC XML schemas and ebXML communication protocol for their
procurement process. The project involves deployment of Hermes to their existing backend systems. This B2B e-commerce solution enhances the accuracy and efficiency of CDs ordering process and gives HMV control over its procurement data.
The Business Challenges – Missing Purchase Orders via Fax Transmission and Disputes over Order Discrepancies
HMV operates four stores in Hong Kong with more than 100 suppliers, including Sony. From time-to-time, each HMV store independently orders CDs from Sony. HMV used to send purchase orders (POs) of CD to Sony by fax. Subsequently, Sony would consolidate and deliver the ordered items to HMV outlets by the next working day. However, there was no confirmation on receipt of the POs from Sony. Missing fax copies were not uncommon, as with other enterprises operating in this mode. In some cases, the error rate was as high as 25%. The result used to be more than just endless arguments. Demand of a particular CD is
1 The HKANA is the local chapter of EAN International to issue EAN．UCC article numbers (also known as e-IDs) for products, shipments, and locations which can be represented by a barcode format.
time-sensitive; music lovers’ buying patterns are closely attuned to what is in vogue. Quick replenishment is therefore critical to the business. In an effort to improve the supply-chain management, HMV and Sony attempted to deploy ebXML technology to their procurement system and order management system respectively.
The Business Solution – Deployment of ebXML and Hermes to Backend Systems
Although EANCOM Electronic Data Interchange (EDI) is the most commonly adopted format in B2B data exchange at the local Fast Moving Consumer Goods industry, XML offers a user-friendly and economical option. As a result, HMV and Sony are keen to realize cost saving and efficiency with the use of ebXML messaging.
In this project, CECID helps Sony and HMV to adopt the global standard EAN．UCC XML
Schemas developed by Hong Kong Article Numbering Association (HKANA) and ebXML communication protocol for their procurement process. CECID provides consultancy services in integrating the ebXML Message Service (ebMS) gateway, Hermes, to their backend systems for enhancing its capability to process XML messages.
Under the new workflow, sending hard copies of POs is no longer needed. The ordering process begins with front-line staff of HMV entering into the company’s system their required Sony items. After getting approval from the management for the order online, staff can send out the PO straight away. The PO in the backend system of HMV is then transformed to EAN．UCC XML format and packaged as an ebXML message before sending to Sony via
Hermes. Upon successful receipt of the PO, Hermes at Sony Music's side automatically sends an electronic acknowledgment to HMV. The PO in XML format received is then uploaded to the backend system of Sony and transformed into Excel file. Sony users then process the PO stored in their backend file system and return an exception report in case of any errors spotted.
The Business Results – Enhanced CD Ordering Process and Customer Relationship
Thanks to the new system, accuracy throughout the ordering process increases significantly. There are no more missing orders. In addition, as the in and out of POs become traceable, disputes over order discrepancies have disappeared. More importantly, it has enhanced customer relationship through the use of XML technology with minimal technical effort. The new working mode also has alleviated the workload on the side of Sony. Improvement is most apparent before and after the weekend when POs tend to arrive in bulk. In the past, a lot of resources and time were spent on data entry and error-finding. With the ebXML messaging-transmission infrastructure in place, the ordering process is streamlined, thus allowing more lead time for the warehouse to fulfill its next-day delivery commitment. Compared with the traditional means of sending POs via fax, the present messaging mode can consolidate orders from different HMV stores. Hence, it gives HMV control over its
After two pilots testing, the system went on live after six months. The adoption of the ebXML and standardized data format also pave way for global implementation and the roll-out of the new practices to SME partners.
