Magazine Article | January 1, 2001

Extending The Enterprise

Source: Field Technologies Magazine

Achieving seamless machine-to-machine transaction capability is the Holy Grail of the e-business evolution.

Integrated Solutions, January 2001

It's well established that ERP (enterprise resource planning) rollouts have been anything but a walk in the park. But considering their complexity, this really shouldn't be much of a surprise. After all, aligning business processes across previously independent functions can introduce a range of technical and nontechnical challenges.

However, this pain wasn't for naught; standardizing business processes has provided the foundation for addressing the latest enterprise urgency - customer-facing e-commerce capability. Surprisingly few companies, however, realize that the business logic and processes driving these enterprise systems can be leveraged to serve new and existing customers over the Web. Instead, many companies effectively recreate the wheel, duplicating a subset of this logic onto a dedicated Web server.

This is an inefficient (and potentially destructive) model for a variety of reasons. This strategy introduces considerable drag to the implementation process. It drives a wedge between the enterprise and the Web channel, disconnecting hard-won trading partners from suppliers' back end systems. A Web channel disconnected from back end systems and business processes will drive inefficiencies and customer-service issues that scale in exponential proportion.

Indeed, sophisticated back end integration is the first order of any e-business strategy. But as e-business evolves, new channels beyond the traditional point-to-point browser-based model continue to emerge. This creates additional opportunities for extending the enterprise. Suppliers must begin to think beyond traditional definitions of e-business, considering e-marketplaces, wireless technologies, machine-to-machine procurement relationships, and complementary fulfillment partnerships as new opportunities to drive revenue.

The E-Marketplace Proposition
Unlike a traditional point-to-point trading partner interaction, e-marketplaces link a multitude of buyers and sellers for the purpose of conducting business. For suppliers, it's an opportunity to secure new customers through occasional spot purchases and by dynamically matching supply with demand. But it's not quite so simple. Suppliers that want to credibly deliver the levels of service demanded in a B2B (business-to-business) environment now have integration to consider on both the back and front ends.

Into The Ether
Suppliers must also consider incorporating a wireless component into their customer-facing e-commerce strategy. This is emerging as an important component of any e-business strategy, particularly for expansion into emerging global markets where Internet infrastructure may remain less than robust. An integrated wireless channel can also be a powerful complement to a traditional sales force, providing on-demand access to account status and inventory availability - all with up-to-the-second accuracy.

Thinking Out-Of-The-Box
E-tail dot-coms have emerged across virtually every market segment, each with an equally bombastic promise for industry revolution. Despite bold claims, many of these companies lack the sourcing relationships and fulfillment infrastructures to viably scale their business models. B2B suppliers with integrated back end systems in place have the opportunity to invest in leading-edge sell-side technologies to effectively share in these emerging opportunities, "back-ending" complementary e-tail storefronts. While channel conflict with traditional downstream trading partners must often be examined as a first consideration, some creative thinking can introduce an entirely new set of revenue streams, adding richness and depth to a traditional supplier's business model.

Companies on the heels of large capital investments in enterprise integration should recognize the future value of what they now have in place. Others still making sense of their ERP strategies remain at a significant e-business disadvantage. Suppliers with their houses in order will be well advised to leverage these investments to reach new and emerging online revenue opportunities. After all, new markets await and much of the work is already complete.

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