You are probably familiar with the "goldrush" image of a haggard but hopeful miner kneeling in a stream, panning for gold. The "rush" by businesses of all sizes towards e-commerce and the Internet brings to mind the same image - many organizations attempting to determine where to stake their claim to the riches which surely await. The difference, as I see it, is that the miner had only one choice of tool - you have your basic "pan" with which you can sift through the silt to find your fortune. In the case of technology-driven businesses, the number of tools available seems to increase daily. Furthermore, one's selection of the correct tool for the job can make or break one's level of success.

While most of the non-business world continues to believe that e-commerce is about money changing hands through the Internet, the business industry experts have long been convinced that data exchange, not cash exchange, is the real "gold nugget" that this new information-based economy has to offer. The businesses that can most effectively exchange the most valuable data with the most players (other businesses), in the most effective, efficient and secure manner, will win. The pinnacle of effective and efficient information exchange is achieved when two or more businesses have integrated their systems to allow the seamless exchange of data. For example, when you use your debit card at your local gas bar, several information systems securely handle that data (amount of money to be transferred, PIN authorization, account to be charged, account to be credited, etc.) in a matter of seconds. This is not news - however, imagine that the gas bar, fuel supplier, and fuel trucking company are also linked to a system which tracks, at every card swipe, the volume of gas sold. After a pre-determined amount of fuel has been sold, a fuel truck is dispatched to top up the gas bar supply. No phone calls, no faxing, no ordering, no paperwork - most importantly, the duplicated data entry resulting from phone calls, faxing, ordering, paperwork is also missing at a substantial cost saving all around. Invoicing between the retailer, carrier and supplier can also be handled electronically and automatically. From the supplier's point of view, a gas bar that would be equipped to participate in such a system is a more valuable customer than a gas bar that relies on manual systems which result in data being entered into separate systems at several points along the order route.

Until recently, the expense involved in synchronizing information systems with the big guys has left the small guys out of the business-to-business e-commerce "rush". Imagine that you are a small distributor of widget grease and your three largest customers inform you that to keep their business, you must install an exclusive, proprietary automatic order and invoicing system - at your own expense. That would be three new systems you need to install, maintain and monitor just to do the same level of business as before. From the three manufacturers' points of view, if they can exchange order and invoicing data with you automatically, they cut labour, time, and inventory costs. From your point of view, because you have had to install multiple systems, you have gained only a series of new expenses which are unlikely to carry similar productivity gains.

Enter XML to save the day for many small businesses. There exists a full spectrum of XML pundits, from hard core skeptics to evangelical enthusiasts. Although it will not be an easy and quick fix, XML may yet fulfill its promise as the universal data exchange format of the early 21st Century.

Extensible Markup Language (XML) looks quite similar to HTML - it uses tags to "mark up" the content between the tags. Without going into a lot of technical detail, XML differs from HTML in that the content within the tags is identified by the tags themselves. Where HTML told a browser how to display the content (bold, indented, centred, etc.), XML identifies what the content means (customer name, e-mail address, order number, etc.). Furthermore, the "extensible" part of XML's name means that you can create tag definitions on the fly, according to your needs. Therefore, as long as you share tag definitions with your trading partners, it is possible to trade data between systems without installing new expensive hardware and software. As Tim Bray, one of the inventors of XML and a columnist for CIO Magazine states, "XML is a set of rules for taking your data and encoding it in chunks of text, which you can easily send across the Net and unpack at the receiving end. It has good internationalization and error handling, and nobody owns it. That's all there is to it." (1)

The Benefits of XML to Small Business

1. Play with the Big Guys: Many large companies are seeing the benefits of replacing expensive, proprietary systems with XML data formatting. First Union Bank (US) uses XML to link data from their mainframe to their call centre to their front line workers. Sabre and Nokia are partnering on a project to deliver real time flight information to cell phones using an XML format. Delta Airlines has replaced its legacy booking system (which was unable to communicate seamlessly other systems) with an XML-based system. This new open booking engine can now link to hundreds of agents, web-sites and customers with ease. Daimler Chrysler uses an XML-based system to collect information from many different sources, and different platforms, in the production of updated service manuals. The list of such projects is massive and growing every day (2). A small business that can demonstrate an ability to exchange data using an XML format will find many barriers removed to its ability to trade with large companies.

   
   

2. Customize, customize, customize: Many small businesses offer highly specialized products and services. XML is actually not a formatting language itself - it is a meta-language which offers developers the ability to create specific tags for specific applications. In May 2000, a new subset of XML for small business, SMBXML, was launched (3). This formatting standard offers small and medium-sized businesses a way to exchange data and can itself be customized and augmented with tags that suit highly unique businesses, solving the problem we have all had upon discovering that a financial or database system does not quite fit our needs. XML and its subsets offers the hope that we can design precisely the data tracking, storage and exchange systems we require without compromising our ability to share data with our business partners.

   
   

Anyone who possesses HTML skills coupled with a solid understanding of database design is well-positioned to step up to XML development. There are many excellent online tutorials - check also with your local community colleges for XML courses. Small business owners should take a look at the organizations they share data with, be that through a manual (paper) system or electronically. Anticipate that you will be asked to submit data in XML format - discuss this with your trading partners and begin to plan how to make this happen. I would strongly recommend that all online databases (any database linked to a web site) be targeted as a top priority conversion project. Create a competitive advantage - show that your small business is "open for business" with large companies.