Wheat industry pilot shows rapid ROI

A framework set up with seed funding of under $500,000 to improve information systems interoperability in the wheat industry may save it millions of dollars.

The BizDex project targeted the industry's information bottleneck which arose because large suppliers dictated application frameworks, according to Mark Bezzina, general manager of strategy at Standards Australia. The standards body has stewardship of the project, which is part of a larger, DCITA e-business plan for both the wheat sector and business generally. Stakeholders in the wheat industry program are AWB Limited, AWB Grainflow, and Pacific National.

"It's always been difficult to trace the movements of grain," Bezzina said. "Systems are so inefficient that distributors wouldn't know a shipment was available until it turned up.

"If a supplier had multiple customers it would require multiple systems," Bezzina said. Bezzina said adopting a standard supply chain process creates greater visibility of the produce.

BizDex is expected to deliver $300,000 in tangible cost savings in the first year and $600,000 a year thereafter when implemented across the project's stakeholders.

When in use throughout the wheat industry ROI could be as high as $3 million and take only 12 months to realize.

"The goal is to map processes and applications to an industry standard," Bezzina said. We create an open registry based on ebXML that holds the public processes. This yields a one-to-one interface between partners [and] prevents vendor lock-in."

BizDex was developed to international standards, but since few had been used here before, the pilot group provided feedback to standards developers to identify room for improvement.

AWB's architecture and planning manager Tony Clement believes the entire grain industry has scope for improvement as there are "very old" supply chain systems highly reliant on "antiquated" infrastructure.

"It's a combination of ad hoc manual processes that are not integrated - such as using FTP for file transfer - and not even EDI," Clement said.

AWB joined BizDex - a combined Department of Communications, IT and the Arts (DCITA) and Standards Australia initiative to promote B2B integration - to work on the ITOL (Information Technology Online) project to gain an understanding of the possibilities B2B technologies have to offer the industry and what infrastructure is required to facilitate interoperability.

"This is an education and discovery process for the wheat industry which makes up 2 to 3 percent of exports," Clement said.

"Australia has a great opportunity to engage large numbers of businesses in electronic commerce."

Although the pilot was tailored for the wheat industry, Clement said the work done could be readily applied to other industries and should be "quite transparent".

"BizDex is a service oriented architecture (SOA) with public and private aspects," he said. "The loosely coupled characteristic of SOAs allows for easier integration between organizations. With standards for defining business processes, integration can become simpler."

Although the reported numbers are impressive, Clement said the ROI is not the sole focus of the project, which is understanding which part of B2B collaboration in public infrastructure is of more concern.

"In the same way telecommunications and roads require public governance, standards for e-business is similar," he said.

"E-business is not going to get happening by natural gravitation and the pilot project demonstrated that it's doable technologically."

Standards Australia project manager Michael Groom said other enterprises involved in such e-business developments include BlueScope Steel, Auspost, and Boral. Retail behemoths Woolworths and Coles have also been "given information".

"We've taken a best-of-breed standards approach," Groom said, adding that the intention is to put back into the community and apply the framework to similar industries.

"The winners are the [wheat] growers and the collaborative approach saves the industry as a whole."

Groom said the key deliverables were "predominantly" eliminating manual processes like faxing, and an increase in the rate information is shared and its value.

"We're very grateful for the $200,000 government grant which has been put towards public good," he said.

The government grant was matched with $270,000 from the participants.

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