Electronic Transaction Governance: Implementing Data Quality

This is the second of a series of five blog posts detailing how to implement Electronic Transaction Governance in your custom software interfaces.  We will also discuss how Wovenware implements Electronic Transaction Governance in the Wovenware Integrator. The Wovenware Integrator is an adaptable software platform that provides visibility and accountability to all electronic transaction processes. Please refer to the What is Electronic Transaction Governance blog post for a detailed explanation of the term.

Electronic Transaction Governance: Data Quality

In this blog post we will discuss the area of Data Quality. Data Quality is the area of Electronic Transaction Governance that verifies the data quality of the electronic transaction message. Not all fields of an electronic transaction message carry important data. Therefore, Data Quality limits its process to verifying the data quality of certain key fields of the electronic message exchange between partners.

An electronic message, regardless of its format ASC X12 EDI, NIEM, HL7, etc., transmits critical and non-critical data in its fields. The determination of how to classify the importance of the data contained in a field must be done every time a new software interface is developed and whenever the message is to be transmitted to a new partner. Once critical fields are identified in the electronic transaction message we can perform data quality validation before the transmission is completed.

Lets continue using our previous post example. Partner A and Partner B decide to exchange new purchase orders through electronic messaging and they agree to exchange the messages using the following xml files:

Partner A Sends New Order Request:

<order>
     <item>
          <sku></sku>
          <quantity></quantity>
          <note></note>
     </item>
</order>

Partner B Responds with New Order Request Acknowledgment:

<order>
     <acknowledgment></acknowledgment>
     <item>
          <sku></sku>
          <quantity></quantity>
          <note></note>
          <price_per_item></<price_per_item>
     </item>
     <total_order_price></<total_order_price>
</order>

For our discussion we will use only the New Order Request message sent by Partner A. Data Quality dictates that we begin by determining which are the critical fields in our message. The critical fields in the New Order Request message are:

  • sku
  • quantity

The sku field must contain a valid sku and the quantity field must have a numerical value greater than zero.

To implement Data Quality a software process must exist to verify the data contained in the sku and quantity fields before the message is transmitted to Partner B. The process would validate that the value contained in the sku field is a valid sku. Similarly, the process would validate the quantity field to certify that the value in the field is a number greater than zero. If any of these validations fail, the process would notify and not allow the electronic transaction message to be sent.

The Wovenware Integrator handles this verification through the configuration of its Application Services implementation. Application Services are customizable software processes, based on a Software Pattern developed by Wovenware Engineers, which can execute following a custom defined business workflow. One of the defined tasks of the business workflow is an Application Service that verifies the data quality of all configured critical fields of the electronic transaction message to be exchanged. If any of the verified fields fails validation, the electronic transaction message is not allowed to continue through the business workflow and a notification message is sent to the system administrator.

In our next post we will discuss how to implement the Audit Trails area of Electronic Transaction Governance.

Startup financial advice: Get your bookkeeping in order!

When I am not working with the founders of Wovenware (Carlos and Christian) on financial matters, I spend a lot of my time advising entrepreneurs structuring startups and business owners restructuring their companies and their processes. More often than not, many of them suffer from a common illness: lack of interest in their financials. It is easy for me to push for proper accounting, I am a finance and accounting geek… but I can provide several examples why having lousy bookkeeping will cost you… and it will cost you a lot!

  1. You don’t know where you stand – many companies think they are doing fine because they feel busy. Heck! They’re so busy, they don’t have time to invest in proper bookkeeping… While that may earn you bragging rights amongst your competition, colleagues and friends, this is a definite way to ruin an otherwise healthy company. Being busy has nothing to do with properly monitoring your cash flow. You may have clients, but if you cannot pay your employees, suppliers and vendors, you’re pretty much going nowhere fast. I have seen this plenty a time: great visionaries providing great service, yet not having proper bookkeeping resulting in: forgetting to invoice clients and recording accounts receivables, improper invoice management, duplicating vendor payments, amongst other issues… All of these draining cash and if you’re hearing this for the first time: Cash Is fact! Profit is a matter of opinion.
  2. Strategy – You wouldn’t go to war without knowing how strong you compare to your opponent, would you? What makes you think you can tackle your competitors if you don’t know your strengths? Financial strength that is.
  3. That which you don’t measure, you cannot improve – many initial reviews start with analyzing previous financial performance. Analyzing and dissecting trends, asking questions regarding expenses leads to obtaining great insights about a company’s operations.
  4. Expensive financing – many entrepreneurs go to the bank believing that having a huge box of invoices is enough to get them a loan approved from the credit officer. Nothing is farther from the truth. Credit officers analyze the whole scenario. They need to know that you are on top of your game and that you know how your cash flow behaves. Not showing up with an update set of financials will make you look like a fool in front of the credit officer… and even if they believe you have the cash flow to service the debt, they will charge several percentage points higher than if you had proper and timely accounting.
  5. Expensive investment terms – Just like reason #3, raising that Seed or Series A round is the same as raising debt. And not having a set of financials, bank statements and all other schedules reconciled will bring up red flags. This will put you and your company in a disadvantage when negotiating terms. You can expect the investor to feel less certain about investing in you, if you don’t have your game on.
  6. Tax planning – I have seen this many times. Clients are making money, but pay as much as 100% more in income tax at any given year, just because they are not taking advantages of tax planning strategies available to them, depending on their industry, structure or financial performance. In some occasions I have sat down with entrepreneurs and identified anywhere from $500 up to $50,000 in savings in just one year. $50K? That’s a lot of money, even for a millionaire.
  7. Monitor Fraud – if you’re not paying attention to your finances, someone will steal from you. It is not a matter of “if”… it’s a matter of “when”.

While I do recommend focusing mostly on your company’s core offering, I definitely believe proper financial recording and bookkeeping is a must for every company out there. And there’s no excuse, there are many accounting systems that fit the profile of all firms. There are a bunch of web-apps that adjust to any type of business (freelancers, manufacturing, service, etc.) and many offer a free trial, if it’s not free. With as little as one hour a week, you can have your books in order. If you are someone that absolutely despises accounting, then hire an outsourced accountant to perform all the accounting functions… You’ll just have to answer a couple of questions a month, in order to clear some doubts. Just make sure that the accountant is performing monthly reconciliations and sitting down with you once a month to go over the monthly, quarterly and annual performance of your firm. This will let you anticipate road blocks, know when to hire for growth, save / protect cash and invest in the right clients and projects.

Make sure you don’t go into ruins because you run out of cash, or worst yet, scare away a great investors that can help you reach your next level… just because you were reckless with your bookkeeping. Invest as little as an hour a week in your accounting, to make sure that you are monitoring everything you need from a financial perspective. “Lean” doesn’t mean cutting on data, lean is actually about following the insight you derive from your data. Data comes from proper bookkeeping, among other things.

Let me know how much of a burden it is for you to manage your accounting! Maybe I can point you in the right direction.

 

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Do you need luck to be successful?

Constantly I hear people talking about being successful or not. I get the impression they think success is the result of luck or being a lucky person. Maybe it is true but most people believe that luck is something magical, something in the air that if you catch some of it you will achieve something or be a successful person.

A couple of years ago when I was in college I read a quote that changed my perspective about luck. I know very little about Seneca but the quote is from him and it says:

“Luck is what happens when preparation meets opportunity”

I don’t remember if I read it from a book, an article or most probably browsing on the web, but what I do remember is that it redefined my academic and professional expectations. From that point on I just decided to do my best in order to be prepared for every opportunity that may arise. I was not daydreaming anymore or expected to be hired by a big software development company and to have a big salary. I knew opportunities will come at some point and I just needed to be prepared to get the most out of them.

In today’s entrepreneurial world we are not only responsible for being prepared and up to date with the latest technologies and trends. Now we are the ones responsible for creating the opportunities for us and for others. It’s time to review what we have learned and experienced so far, and bring our ideas to the table. Let’s get creative!!! Let’s innovate!!! Let’s be crazy enough to change the world!!! I hope I can keep learning forever and do something amazing along the way… What about you?

Open Letter to Puerto Rico’s Information Technology Sector

Image Credit: Carlo Giovannetti

Note: This letter was originally posted on the News Is My Business website in the context of the CIO & IT Leadership Conference celebrated February 7, 2014 in San Juan, Puerto Rico.

I was recently reading the January 2014 publication “Perspectivas“ from Estudios Técnicos and came across a quote that inspired me to write this letter.

“All nations have opportunities which they may grasp if only they can summon up the courage and the will … it is possible for a nation to take a new turn if it is fortunate to have the right leadership at the right time.“ – W. Arthur Lewis

 

I don’t have to tell you that Puerto Rico is going through the worst economic downturn in its modern history. Underfunded pension plans, overestimated government budgets, increased taxes, higher utility costs, and higher unemployment. Economic indicators like employment, cement sales and gasoline consumption show a constant downward trend. Bankruptcy filings are up from 2012 and the government’s credit rating is junk. Young professionals and retirees are leaving the island for one of the 50 states at an alarming rate.

As all of this happens, companies tend to be more cautious and more timid in terms of expansion and investments opportunities. It’s a normal and typical response.  Once you identify the possibility of a risky future, you tend to preserve cash to maintain operations in rough times. Creativity becomes worry and strategic plans become no more than a cash flow strategy plan.

But as it becomes more evident day after day, the recovery from this depression won’t be easy. We have been trying to jumpstart our economy since 2008. Since then we have had government incentives, economic forums, multi sector summits, seminars from experts, and roadmaps. It is time that we stop thinking that things will be solved magically or that some federal agency will save us. If we don’t do it ourselves, nobody will.

There is no other way. We have to do it ourselves.

Puerto Rico’s Information Technology sector represents all that is great about our biggest asset, our people. Our people have the talent and the skills to excel in the global marketplace. Something envied by other cities and countries. Highly educated, bilingual, professional, quality oriented, multicultural.

We have to harness the power of our biggest asset and create our future. Not by exporting our people but by exporting our knowledge and creativity through exciting products and services.

So, this is my challenge to all of you.

  1. Ask yourself, what is your biggest competitive advantage?
  2. Use a lean methodology and create a product or service around it.
  3. Target customers and clients in the states and especially in Latin America.
  4. Hear your customers and ask for help.
  5. Be relentless.

Let’s focus on building intellectual property and products and services that people want.  If we do that, the jobs will follow. The time to talk about plans is over. It is time to do and execute.

Focus on exporting. This is our platform. This is what’s needed from you.

Puerto Rico depends on it.

Electronic Transaction Governance: Implementing Standard Compliance

This is the first of a series of five blog posts detailing how to implement Electronic Transaction Governance in your software interfaces.  We will also discuss how Wovenware implements Electronic Transaction Governance in the Wovenware Integrator. The Wovenware Integrator is an adaptable software platform that provides visibility and accountability to all electronic transaction processes. Please refer to the What is Electronic Transaction Governance blog post for a detailed explanation of the term.

Electronic Transaction Governance: Standard Compliance

In this first blog post we will discuss the area Standard Compliance. Standard Compliance is the area of Electronic Transaction Governance that mitigates processing risks and assures proper handling of the electronic interaction through the initial verification of the electronic message. Standard Compliance limits its process to the verification of the electronic contract between the partners. That is, Standard Compliance will only verify the message format and not the data that is embedded in the message.

The message format can be a standard based format (e.g. ASC X12 EDI, NIEM, HL7, etc.) or a custom defined message format agreed to by the communicating parties.

For example, Partner A and Partner B decide to exchange new purchase orders through electronic messaging and they agree to exchange the messages using the following xml files:

Partner A Sends New Order Request:

<order>
  <item>
    <sku></sku>
    <quantity></quantity>
  </item>
</order>

Partner B Responds with New Order Request Acknowledgment:

<order>
  <acknowledgment></acknowledgment>
  <item>
    <sku></sku>
    <quantity></quantity>
    <price_per_item></<price_per_item>
  </item>
  <total_order_price></<total_order_price>
</order>

Standard Compliance dictates that when Partner B receives a New Order Request the first step in the electronic message handling process is the verification of the message. That is, the certification that the received message conforms to the agreed communication standard. The same would apply to Partner A when a New Order Acknowledgment is received.

To implement Standard Compliance an initial software process must exist to verify all incoming messages. The process will validate that the received message follows the established messaging format. If the tested message does not adhere to the established messaging format then the Standard Compliance software process must notify or return the message to the sender and not allow the message to continue processing.

The Wovenware Integrator handles this verification through the configuration of its Application Services implementations. Application Services are customizable software processes, based on a Software Pattern developed by Wovenware Engineers, which can execute following a custom defined business workflow. The first defined task of the business workflow is an Application Service that is configured to validate the format of all incoming messages. If a message does not conform to the expected format, the message is not allowed to continue through the business workflow and a notification message is sent to the sender.

In our next post we will discuss how to implement the Data Quality area of Electronic Transaction Governance.

Social Media: What’s the point of blogging if there’s no content?

We are living in a time where posting things on Facebook is “more important than anything” and tweeting about how great the service was at that store is what’s in. For us, marketers, it is getting harder and harder every day to reach our customers especially through traditional methods like phone calls or meetings. It sounds all so difficult, right? Well it is not. We have the perfect tool in our hands, we are… blind. We don’t see past our noses and we are ignoring a big important, “ginormous” fact: SOCIAL MEDIA IS EVERYTHING AND EVERYWHERE!

For most businesses, selling is the most important thing. Businesses sometimes forget that to achieve a good sale… and a continuous sale you need to obtain your client’s trust. So, nowadays where reaching for them is harder, we can use social media as a tool to gain their trust. Social sites like Facebook and Twitter help people connect with each other; but now, more than ever, they serve as a way in which people can stay in touch with your business and they can see what you are up to. Take for example, blogging. Here at Wovenware we focus on establishing a trustworthy relationship with our clients. We mainly sell custom software development services so it is hard to show that on a Facebook photo album. But we can blog about the things we do, we can tweet interesting topics and even things we’ve done, so our clients in Puerto Rico, Dominican Republic, United States and the rest of the World know we are constantly searching for new ways to improve our technologies and provide them with better solutions.

 It is very important to use social media, in this case blogging, wisely. People, and this is something I’ve witnessed, are constantly searching for solutions in the Internet. Be it: recipes, guides to do a particular thing, cats, news, or how-that-experiment-went-from-success-to-disaster-in-0.5-seconds, among many other things. I’ve read so many studies about social media and about blogging and all of them conclude: blogging content + blogging constantly = WIN!  When potential clients visit your web page they will most likely look at your “About Us” and this is where the magic happens, here is where you have to update valuable content to trigger the interest in them. For example, when I need to research a specific topic, facts or read how to get something done, I visit YouTube or search for blog post written by an expert. This is why you have to update content every day, so when a potential client looks for a solution on the web your website will pop out of the rest. What do customers look for in a blog post? They look for experience and answers to their problems. They want a blogger that writes about solving the problem they encounter every day.

 The most important thing you need to know is that you should write about something you’ve experienced yourself. People often tend to make decisions based on others experience. Experience is what every company should try to sell; experience, trust and killer customer service, then everything will fall into place, the way it is supposed to. The key to a good blog is great content that can be of help for the readers. Write about topics that concern the services you provide and show your knowledge and expertise in each of blog post.