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Commodity firms and other businesses in the supply chain space (shipping, logistics) have a long history of trying to build platforms to simplify global trade.

Commodity firms and other businesses in the supply chain space (shipping, logistics) have a long history of trying to build platforms to simplify global trade. While a great goal, over and over again these initiatives have failed because of immense inertia in the industries and because of the fact that every single counter-party involved in a transaction must be on the platform for it to work. For a merchant to use Shopify, connected to Stripe, connected to Visa, working with me, it’s relatively “easy”. Not many people involved in the process and some of them (me) don’t have any power to control how the flow works. When Cargill ships a 100,000 MT parcel of grain to be processed, there are SO many people and organisations that touch the commodity in some form. From inspection companies like SGS, to rail lines, to customs authorities, to port representatives, to ocean transportation, to banks....the list goes on. And historically the vision has been an “all or nothing” style of platform. One day we will figure out the solution to this problem, but not anytime soon and probably not with Splinter. Four of the world’s five largest grain companies, three of the world’s five largest iron ore companies, and many more use the product that I work on (www.SEDNA.com) to manage their global supply chains, and their workflows remain to be very email-based and driven by traditional ERPs. You see this in action with businesses like Flexport who started with a very formidable vision to build a platform for third-party logistics, and ultimately had to pivot to become a very digital freight forwarder after being trapped by the traditions and slow-moving nature of the industry. In these organisations there is incredible buzz and thought around digital transformation, but many of these companies are also only recently beginning to trust cloud software. So although there is a big desire to innovate and operate on the cutting edge, so many primitives and so much of the day-to-day process keeps them lagging behind.

LaundroMat 6y ago
One innovation that really got adopted throughout the supply chain is the container. Agreed that it's only part of the supply chain compared to what you describe, but it was a major change that affected a very large amount of processes and businesses. The scale of things such as worldwide supply chains makes you wonder whether competition is really the right catalyst for efficiency. Cooperation and the setting of standards seems to be a better answer, but of course this leads to a whole lot of different issues.
- mschuster91 6y ago
  The container was adopted very fast and very thoroughly throughout worldwide supply chains because it was many, many orders of magnitude better - and allowed a massive reduction in staff. No proposal for better IT integration in freight comes even close to that level of saving, mostly because the existing chaos is "good enough" and the executives are very, very old and very conservative compared to "digital natives".
  - Ericson2314 6y ago
    And sticking it to the once-fearsome longshormen's union is much more appealing to sticking to yourself and your manager retainers.
- menzoic 6y ago
  It took collaboration to integrate the containers but not necessarily to create it. Creating requires risking resources which is incentivized by the potential monetary gain. Without that potential, it's hard to imagine competitors risking their resources. Another point about collaboration in this case is that it only happened because all parties benefited more. If you don't adopt new things that optimize operations then you'll be left behind by your competitors who are operating more efficiently and have wider support for the customers everyone is competing for.
- Closi 6y ago
  A closer innovation for supply chain might be the concept of an ASN (although anyone who works in logistics knows how disparate different supplier portals can be...)
- throw0101a 6y ago
  > One innovation that really got adopted throughout the supply chain is the container. If anyone is interested in learning the history of this, a good book (2e: ISBN 978-0-691-17081-7): * https://en.wikipedia.org/wiki/The_Box_(Levinson_book) https://en.wikipedia.org/wiki/The_Box_(Levinson_book) It really took off during/after the Vietnam War as the Pentagon saw its benefits in efficiency and not having to use Old School longshoreman and switching to cranes.
vmception 6y ago
> there are SO many people and organisations that touch the commodity in some form and 99.9% of those people are a joke and don’t even realize it. commodities traders are the most gullible lot I’ve ever encountered, chasing a pot of gold at the end of a rainbow. they’re so dumb as they cannot tell reality from fiction.
- robk 6y ago
  Explain more?
  - vmception 6y ago
    There is a shadow economy full of people chasing fake commodity trades. There’s nothing more to explain.
- craftinator 6y ago
  > they’re so dumb as they cannot tell reality from fiction Ya know, here in the US we just found out that nearly have of our population and our last president have this problem. Maybe they should move into trading commodities?
  - vmception 6y ago
    the answer is yes its the same current of people and it is global Think of it like real estate agents, but without even the bare minimum of the license. You have people with no marketable skills, no formal education, no success at anything else all chasing commissions. Its going to be a circus.
- jeffreyrogers 6y ago
  I don't think you know much about how commodities are traded. Can you even name the main players?
a3n 6y ago
Truck driver. I just picked up a trailer of toilet paper in Portland, bound for Ontario CA. The guard handling the paperwork asked me "Are you able to sign online?" I desperately tried to come up with a snappy "yep," it sounded like such a good idea. But I finally had to say "I'm not sure what you mean." He handled it, gave me my bill of lading, and away I went with toilet paper in tow and paperwork in hand. Because it's still not finished until the paperwork is done.
- azinman2 6y ago
  I’m curious about this intersection of truck driver and HN: not the typical demographics. What got you into either trucking or tech (not sure which was first)?
  - jhayward 6y ago
    There are a lot of people who left white-collar jobs for trucking; engineers especially. Something about wanting to be more or less your own boss, control your own schedule, and not be in an office is appealing. So your stereotype for "trucker" has to be resilient to the occasional former nuclear physicist or mathematician showing up.
  - a3n 6y ago
    I used to be in software, which is how I found HN. Then I rage-quit my last in-career job. I was a B-player, and past my fresh date. I stumbled around a bit, and wound up here. I like it. I haven't been in a meeting in three years, and my commute is three feet. Right now I'm in California on I-5, looking at Mt Shasta floating above the clouds. I get paid to look out the window.
Spooky23 6y ago
I think some of these things also start to address internal controls issues. The Cargill branch in my area lost at least $3M to embezzlement by an accountant who just paid phony or stretched invoices for years, which gives you an idea of the risks associated with paper and excel processes combined with lean staffing and lack of controls.
- pm90 6y ago
  Yeah, but this person will probably get prosecuted and fired; corporate attorneys are probably already on hand and expected to fight these sorts of cases. It’s unlikely that this is too common of a situation. Compare that to fully digitizing. Will cost many more millions in procurement and training. There are advantages to digitizing. But until they’re really transformative, conservative industries won’t budge. And they won’t budge until the benefits of going fully digital become so large that a competitor/startup comes along and realizes these benefits and kicks their asses at which point they too need to transform or die.
plaidfuji 6y ago
> their workflows remain to be very email-based and driven by traditional ERPs This really is the crux of the issue. It comes down to “your ERP has some information I want in my ERP” - followed by twenty emails, redirects to find the person who actually understands the schema of the ERP on each end, mapping the fields, and finally sending the info. What’s missing is not some omniscient decentralized master system, but a standard framework to rapidly conduct data negotiations between private parties and systems. Each party needs a public-facing searchable data catalog of some kind so requests can be made precisely the first time, and so each party understands what they’re agreeing to.
- aaron_m04 6y ago
  > What’s missing is not some omniscient decentralized master system, but a standard framework to rapidly conduct data negotiations between private parties and systems. What is the difference? You seem to be recommending a protocol (maybe with some level of human involvement) between two centralized systems. OK now that sounds more like federation than decentralization, but still, there's not much of a distinction.
- openthc 6y ago
  This happens in the cannabis game. There are 120+ software vendors, so to make it easy humans email each other links, those links also have pointers to the data (JSON), so that the receving end can just paste it into their end. But, wow! Is it hard to get your competitors to adopt an open protocol. Whole bunch of NIH syndrome. And each player can sit on the sidelines, or invent their own "protocol" and not adopt another (que that XKCD about 14+ standards). Converstaions: A: our clients want to work together, so our softwares should work together. B: Yea, well, how many clients do you have? A: Well how many do you have? B: Use my protocol, we'll build a spec. A: here's our protocol with public spec & moderate adoption. B: Well, we didn't get to have input so we don't like it, you're clearly not a team player. A: It's on Github! I'm literally inviting you to participate right now!? B: ... It's very hard to build open, distributed, federated systems when all the other parties in the game are more interested in building up their own walled garden.

LaundroMat 6y ago

One innovation that really got adopted throughout the supply chain is the container. Agreed that it's only part of the supply chain compared to what you describe, but it was a major change that affected a very large amount of processes and businesses. The scale of things such as worldwide supply chains makes you wonder whether competition is really the right catalyst for efficiency. Cooperation and the setting of standards seems to be a better answer, but of course this leads to a whole lot of different issues.

mschuster91 6y ago
The container was adopted very fast and very thoroughly throughout worldwide supply chains because it was many, many orders of magnitude better - and allowed a massive reduction in staff. No proposal for better IT integration in freight comes even close to that level of saving, mostly because the existing chaos is "good enough" and the executives are very, very old and very conservative compared to "digital natives".
- Ericson2314 6y ago
  And sticking it to the once-fearsome longshormen's union is much more appealing to sticking to yourself and your manager retainers.
menzoic 6y ago
It took collaboration to integrate the containers but not necessarily to create it. Creating requires risking resources which is incentivized by the potential monetary gain. Without that potential, it's hard to imagine competitors risking their resources. Another point about collaboration in this case is that it only happened because all parties benefited more. If you don't adopt new things that optimize operations then you'll be left behind by your competitors who are operating more efficiently and have wider support for the customers everyone is competing for.
Closi 6y ago
A closer innovation for supply chain might be the concept of an ASN (although anyone who works in logistics knows how disparate different supplier portals can be...)
throw0101a 6y ago
> One innovation that really got adopted throughout the supply chain is the container. If anyone is interested in learning the history of this, a good book (2e: ISBN 978-0-691-17081-7): * https://en.wikipedia.org/wiki/The_Box_(Levinson_book) https://en.wikipedia.org/wiki/The_Box_(Levinson_book) It really took off during/after the Vietnam War as the Pentagon saw its benefits in efficiency and not having to use Old School longshoreman and switching to cranes.

vmception 6y ago

> there are SO many people and organisations that touch the commodity in some form and 99.9% of those people are a joke and don’t even realize it. commodities traders are the most gullible lot I’ve ever encountered, chasing a pot of gold at the end of a rainbow. they’re so dumb as they cannot tell reality from fiction.

robk 6y ago
Explain more?
- vmception 6y ago
  There is a shadow economy full of people chasing fake commodity trades. There’s nothing more to explain.
craftinator 6y ago
> they’re so dumb as they cannot tell reality from fiction Ya know, here in the US we just found out that nearly have of our population and our last president have this problem. Maybe they should move into trading commodities?
- vmception 6y ago
  the answer is yes its the same current of people and it is global Think of it like real estate agents, but without even the bare minimum of the license. You have people with no marketable skills, no formal education, no success at anything else all chasing commissions. Its going to be a circus.
jeffreyrogers 6y ago
I don't think you know much about how commodities are traded. Can you even name the main players?

a3n 6y ago

Truck driver. I just picked up a trailer of toilet paper in Portland, bound for Ontario CA. The guard handling the paperwork asked me "Are you able to sign online?" I desperately tried to come up with a snappy "yep," it sounded like such a good idea. But I finally had to say "I'm not sure what you mean." He handled it, gave me my bill of lading, and away I went with toilet paper in tow and paperwork in hand. Because it's still not finished until the paperwork is done.

azinman2 6y ago
I’m curious about this intersection of truck driver and HN: not the typical demographics. What got you into either trucking or tech (not sure which was first)?
- jhayward 6y ago
  There are a lot of people who left white-collar jobs for trucking; engineers especially. Something about wanting to be more or less your own boss, control your own schedule, and not be in an office is appealing. So your stereotype for "trucker" has to be resilient to the occasional former nuclear physicist or mathematician showing up.
- a3n 6y ago
  I used to be in software, which is how I found HN. Then I rage-quit my last in-career job. I was a B-player, and past my fresh date. I stumbled around a bit, and wound up here. I like it. I haven't been in a meeting in three years, and my commute is three feet. Right now I'm in California on I-5, looking at Mt Shasta floating above the clouds. I get paid to look out the window.

Spooky23 6y ago

I think some of these things also start to address internal controls issues. The Cargill branch in my area lost at least $3M to embezzlement by an accountant who just paid phony or stretched invoices for years, which gives you an idea of the risks associated with paper and excel processes combined with lean staffing and lack of controls.

pm90 6y ago
Yeah, but this person will probably get prosecuted and fired; corporate attorneys are probably already on hand and expected to fight these sorts of cases. It’s unlikely that this is too common of a situation. Compare that to fully digitizing. Will cost many more millions in procurement and training. There are advantages to digitizing. But until they’re really transformative, conservative industries won’t budge. And they won’t budge until the benefits of going fully digital become so large that a competitor/startup comes along and realizes these benefits and kicks their asses at which point they too need to transform or die.

plaidfuji 6y ago

> their workflows remain to be very email-based and driven by traditional ERPs This really is the crux of the issue. It comes down to “your ERP has some information I want in my ERP” - followed by twenty emails, redirects to find the person who actually understands the schema of the ERP on each end, mapping the fields, and finally sending the info. What’s missing is not some omniscient decentralized master system, but a standard framework to rapidly conduct data negotiations between private parties and systems. Each party needs a public-facing searchable data catalog of some kind so requests can be made precisely the first time, and so each party understands what they’re agreeing to.

aaron_m04 6y ago
> What’s missing is not some omniscient decentralized master system, but a standard framework to rapidly conduct data negotiations between private parties and systems. What is the difference? You seem to be recommending a protocol (maybe with some level of human involvement) between two centralized systems. OK now that sounds more like federation than decentralization, but still, there's not much of a distinction.
openthc 6y ago
This happens in the cannabis game. There are 120+ software vendors, so to make it easy humans email each other links, those links also have pointers to the data (JSON), so that the receving end can just paste it into their end. But, wow! Is it hard to get your competitors to adopt an open protocol. Whole bunch of NIH syndrome. And each player can sit on the sidelines, or invent their own "protocol" and not adopt another (que that XKCD about 14+ standards). Converstaions: A: our clients want to work together, so our softwares should work together. B: Yea, well, how many clients do you have? A: Well how many do you have? B: Use my protocol, we'll build a spec. A: here's our protocol with public spec & moderate adoption. B: Well, we didn't get to have input so we don't like it, you're clearly not a team player. A: It's on Github! I'm literally inviting you to participate right now!? B: ... It's very hard to build open, distributed, federated systems when all the other parties in the game are more interested in building up their own walled garden.