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  Global Supply Chain and Logistics Focus: Our Weekly Feature Article on Topics Related to the Global Supply Chain and related Logistics News and Issues  
  - April 21, 2008 -  

Global Logistics News: Five Surprises from a Trade Compliance Application


Looking for Global Trade Management Software Support? These Tips on What’s Often Missing can Help Improve Vendor Evaluation Process



By Giridhar Gopal Nagarajan

Nagarajan Says:
While vendors have out-of-the-box or customized interfaces to support the processing of data, they lack tools to display the records that were not processed.

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You have recently implemented a trade compliance application in-house or have outsourced your needs to an Application Service Provider. You and your boss are obviously elated as you have cut down on thousands of hours of manual work and reduced the percentage of errors. This is great news! You realize that this is the first step in the right direction and that there are many more miles to go in this journey. You wonder what surprises you will encounter while using the application. Here are five surprises you may encounter in your journey:

Surprise #1: Tools for data archiving where are you?

You are currently at the starting line. As years progress, the amount of transactional data you have in your application will grow. After some years, adding more data will slow down the retrieval of data from the application. This is the point at which the brainstorming session for improving performance will start. A good solution for this problem is to purge and archive your data. Most vendors do not have readily available tools to purge and archive your data. If you have an in-house implementation, you will have to work on a 3-month to 1-year project. The objectives of such a project would be:        

  • How to safely purge and archive your old transactional data.
  • How to retrieve this data and provide it to auditors during an audit or investigation.

A data purge and archive tool is a great tool to have as part of the Trade Compliance application suite. Here are some of the features that will make the tool cutting edge:

  • The ability to safely purge and archive thousands of rows from a production database.
  • An easy-to-use interface that will allow the selection of data to be archived.
  • The interface should show the progress of archiving, and after it is completed, it should display the number of rows of data that are successfully purged and archived.

(Global Supply Chain and Logistics Article - Continued Below)


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Surprise #3: Has all the data been processed?

Trade compliance applications have interfaces with Order Management and Logistics applications. Data that is sent from these applications needs to be processed in a timely manner. While vendors have out-of-the-box or customized interfaces to support the processing of data, they lack tools to display the records that were not processed. Some features that would be great are:

  • A means of finding out the data that was not processed in a particular time frame.
  • Details on which data was successfully and unsuccessfully processed: if the data was processed unsuccessfully, what errors were encountered?

Surprise #4: Automated compliance updates anyone?

The core of a trade compliance application is compliance master data. Changes to trade regulations lead to government agencies publishing the change and vendors creating updates/patches for the updates. The patches/updates are time-sensitive and need to be applied to the application within a period of 1-2 days. Many vendors post the updates/patches on a secure Web site and ask customers to apply them by using tools within the application. While this is a good approach from the perspective of vendors, it is a time-consuming and frustrating process for customers.

Customers have to download and apply the patch, and this consumes substantial time and effort. Vendors must enable automatic application of updates/patches. The automated application of updates/patches must inform customers as to where they stand in terms of having the latest compliance data. After the patches are successfully or unsuccessfully applied, a notification must be sent to the customer of successful/unsuccessful patching and inform them of the next steps, for example, bouncing the application or calling customer support. Patches that were successfully or unsuccessfully applied must be logged into log files to maintain audit trails.

Surprise #5: Missing tools for product classification

Governments have grouping products into Harmonized Schedule (HS) and Export Control categories to make imports and exports easy. All a company needs to do is to classify its product into one of the categories. This process can be very labor-intensive as a Trade Compliance user needs to look up each and every product, check their description, evaluate the products’ characteristics, and then classify them. Because Trade Compliance professionals are always in short supply, companies may find that there is a bottleneck created in the timely import and export classification of products across borders.

Technology can alleviate the problem by the use of mass classification utilities. These utilities must identify products with similar descriptions and enable their classification in a mass fashion, while at the same time maintaining audit trails. The tools must be able to recommend a list of HS and export license categories based on a word match between the product description of the product that needs to be classified and the description of products that have already been classified. After classification has been selected, the tool must be able to update the classification details for a large number of products at the same time.

These surprises will give you a good understanding of potential gaps in any trade compliance application. Good luck in your journey!

About the author: Giridhar Gopal Nagarajan is an experience supply chain IT professional who currently works for a high tech company. He can be reached at

Do you have experience with trade compliance applications? Are these “surprises” consistent with your experience? What would you add or take issue with? Let us know your thoughts at the Feedback button below.

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