As the SVP of Global Business Development for Sunrise Technologies, Cem Item serves as a trusted advisor to C-level executives running large global enterprises. He conducts corporate business strategy engagements and digital transformation workshops around the world. With over 20 years of consulting experience, Cem specializes in the textile, apparel, footwear, home furnishings, consumer goods manufacturing, and retail industries.
Intelligent product numbers
Like we’ve discussed before, product is the heart of your brand. And since product structure is such an integral part of your business, how you number (or don’t number) those products matter. A lot.
Intelligent numbering is very common in the industries we work with. This is when a product’s number or ID contains meaningful information. For example, a fashion brand might have a jacket label WJF20S123-BLK-S. In the style name, “W” means Women, “J” means Jacket, F20 means Fall 2020 season, S123 means the sequential style number. “BLK” is the color black and “S” stands for small size. The style numbers can get really detailed.
At first, intelligent numbering makes a lot of sense, especially for quick analysis. At a glance, users can see the most important attributes. Especially with companies using legacy inventory management systems, users may rely on those product numbers packed with meaning for reporting and analytics.
Why smart numbering is no longer a best practice
Businesses change. Employees leave and take their institutional knowledge with them. New staff members have to learn and maintain the product numbering schema. Because humans maintain these numbers, mistakes happen. Eventually, you may find that no one understands what your company’s product numbers mean anymore, but you have to maintain it for the sake of not having a better alternative.
In many ways, intelligent numbering is an outdated practice that should be left behind with legacy systems. There are many downsides:
- Someone needs to be well-trained and well-versed in the product numbering schema so they can correctly configure products. Mistakes cost time and money to fix.
- Heavy reliance on insider knowledge — new staff members don’t know the meaning behind the intelligent numbers.
- Hard to maintain — adding new product categories means you might have to rethink the whole data structure and add new, complicated logic.
- Adding new products can be time-consuming, with a higher likelihood of manual entry and errors.
Intelligent numbering isn’t just a human problem, it’s a systems problem. Especially for consumer brands, once they start adding new product categories, additional information must be added to the product master data setup. The extra business logic that comes with this work adds another layer of complexity to something as simple as numbering products.
Trade smart numbers for a smarter system
We’ve discussed this in detail in some of our other blogs — there’s a better way!
Business applications today are built to handle multidimensional products without complex naming schemes. Data entities like dimensions, hierarchies, attributes, categories, and assortments can be used to create a new master data model for a company that is easy to maintain, without intelligent number schemes.
Legacy systems often lack this capability, so we understand why organizations struggle with intelligent product numbering.
Why you should ditch smart numbering in your product data management
Adding new products is quick and easy
They can use other dimensions in the ERP system for search and reporting.
Has your brand expanded into dog beds, home furnishings, or hair products? No problem. Configuring new dimensions is easier and faster than rethinking your numbering schema for your entire product catalog.
If product information changes, the number doesn’t have to.
Product catalogs from different companies or acquisitions can be merged without losing information.
Advanced reporting like data mining, automated queries, and business analytics is easier to do with simple product IDs.
Other considerations for intelligent numbering and ERP systems
A new systems implementation is a complete paradigm shift for your business. Like we discuss in product attributes, an ERP project is an opportunity for you to cleanse your data and setup a new master data structure that works for you. Changing these data entities is a big deal and requires a solid change management strategy.