What We Can Learn from NAED and NAEM About Improving Data Flow in Our Industry

Stacy Ward
Editor In Chief
stacy@feda.com

In October 2014, then FEDA President Brad Pierce introduced a bold plan to modernize communications among channel partners and more efficiently transfer data. He called it the Data Interchange Initiative and many in the industry saw it as a first step in addressing rising labor costs internally as well as customers’ demands to deliver at a breakneck pace.

“Our industry has mastered the high-touch on the front end. What we’re missing is the plumbing on the back end,” commented Pierce on the inspiration behind the Data Interchange.

But laying the groundwork comes at a cost—namely an upfront investment in overhauling systems and processes. Pierce’s rebuttal? “The No. 1 thing I hear at most industry events is labor costs are rising and margins are tightening,” he said. “If you want to raise your margins, cutting expenses through automation is the fastest way to do it.”

A desire to seamlessly exchange data and cut costs also led the National Association of Electrical Distributors (NAED) and the National Association of Electrical Manufacturers (NAEM) to the same conclusion, prompting the two to facilitate the founding of the Industry Data Exchange Association (IDEA). Originally established in 1998, IDEA is the official technology service provider and e-business standards body for the electrical industry. It was initially set up as a not-for-profit non-stock corporation but was converted to a for-profit stock corporation the following year.

A key goal of the 23 companies that originally bought stock in IDEA (along with NAED and NAEM) was to create an Industry Data Warehouse (IDW) or data management platform that would allow manufacturers and distributors to exchange information in a standardized electronic format. According to a brief history posted on IDEA’s website, getting over the hurdle involved hiring an outside tech firm, Triad Systems, to develop and operate IDW on behalf of IDEA, and a team of 22 electrical distribution and manufacturing experts to assist Triad in the design.

Rebranded as the IDEA Connector this past March, the platform has doubled its reach in the electrical industry and is now open to other vertical markets such as industrial, retail and consumer-packaged goods. Yes, there have been frustrations. Over the years, NAED members have voiced concerns that IDEA has yet to reach its full potential because electrical manufacturers are not consistently providing accurate data. But according to 2017 stats, 93 percent of the product fields in IDW were compliant.

What can we learn from the electrical industry if we want to move forward? Here’s another stat from IDEA that should serve as a rallying cry: “Over 80 electrical industry experts from 45 companies have been volunteering their time to contribute to the initiatives of IDEA’s Industry Standards Committee and its subcommittees,” the company reported. “This group works tirelessly to develop and maintain the electrical product data standards for North America.”