Optimizing the E-Supply Chain: The Final Frontier? - Industry Trend or Event

Information exchange between buyer and seller can reduce the cost of transactions, more closely match goods to services, and improve forecasting. Here is an overview of E-supply change offerings and how they fit together to build customer solutions.

Of the myriad opportunities the Internet offers, perhaps the one providing the most immediate benefit and showing the greatest long-term promise is supply chain optimization. The Internet's ability to remove inefficiencies, break down communication barriers, reach disparate audiences and foster collaboration is perfectly suited to managing and optimizing the diverse and distributed players in supply chains of all sizes.

Cutting edge e-supply chain examples abound. Dell Computer Corp., Austin, Texas, has achieved recognition and financial success for masterfully streamlining its supply chain and business processes while providing customers with personalized product options. Ford Motor Co., DaimlerChrysler and General Motors have teamed to develop Covisint, Southfield, Mich., an online marketplace for purchasing automotive parts and direct materials from those companies' vast group of first-tier suppliers. Boston-based PaperExchange Inc, an Internet-based trade exchange, allows suppliers and buyers to offer and bid on paper products and pulp online. Ford recently announced an initiative to share legacy-created product design drawings with its suppliers using an XML translation tool. Even industries traditionally unaffected by supply chain issues, particularly services industries such as IT consulting, now find a host of online marketplaces and aggregators seeking to match buyers and sellers of services.

Little wonder that so many companies are excited by e-supply chain opportunities. Analyst predictions bear this excitement out. Boston Consulting Group, New York, forecasts that electronic, Internet-based business transactions will amount to $2.8 trillion by 2003, while Gartner Group, Stamford, Conn., predicts they will reach more than $7 trillion. By 2002, Gartner expects 7,500 to 10,000 business-to-business (B2B) marketplaces will emerge. Giga Information Group, Cambridge, Mass., and International Data Corp. (IDC), Framingham, Mass., estimate that these B2B marketplaces will offer savings of $180 billion to $480 billion in transaction costs and expenses come 2003. For the software, hardware and services vendors that would like a piece of the action, Jupiter Research, New York, believes that technology spending to operate B2B marketplaces will increase from about $2 billion last year to $81 billion in 2005.

Truly integrated, optimized supply-and-demand chains offer significant benefits. To understand, imagine what would happen if your company knew in advance exactly when your top clients were going to make their purchases, what they intended to buy and where they needed the items delivered. Armed with these accurate forecasts, you could get the supplies you need when you need them. Instead of buying raw materials at inopportune moments, you could plan your purchases and take advantage of favorable pricing. To lower overhead, you could manufacture and warehouse products in the most ideal location. With more insight into buying patterns, you could better predict customer needs and develop even more suitable products and services in collaboration with your suppliers. Finally, to expand your market, you could offer these products and services online, through e-marketplaces.

Old Concepts, New Levels

The Internet is elevating supply chain optimization to new levels, but the concept of supply chain management (SCM) isn't new. Every company, no matter its industry, is part of some supply chain. Supply chain investments, ranging from direct materials used to manufacture products to indirect materials such as PCs and office equipment, can be huge. Any efficiency that can be introduced into the supply chain can mean enormous savings. For manufactured goods, every dollar squeezed from the "cost of goods sold" is a dollar added to profits. Every reduction in carried inventory frees capital for other uses. Such techniques as just-in-time inventory management, logistics planning, and automating when needed, have enabled many companies to begin integrating and optimizing their supply chains. Auto manufacturers now rely on automated systems to forecast and order parts minutes before they are needed on the assembly line, and retailers like Wal-Mart have squashed their competitors by developing sophisticated logistics, inventory management and distribution systems, all tightly coordinated with suppliers.

In many ways, today's e-SCM efforts are an outgrowth of the enterprise resource planning (ERP) initiatives undertaken by many large companies over the past two decades. With the advent of ERP systems, it became much easier for companies to access production, scheduling and operational data--just the information needed to tighten the supply chain. Companies of all sizes now have automated and rigorous procurement functions to reduce the overhead of purchasing and tracking indirect materials like paper, office supplies and furnishings.

Advanced planning and scheduling systems are common across a range of companies and industries. These enterprise-level systems not only assist companies in integrating their supply chains; they also enable them to deconstruct their businesses, outsourcing inefficient or commodity functions to the most efficient suppliers. Suppliers now regularly manage their customers' inventories and stockrooms, with third- party service providers performing a range of logistics functions.

Why E-SCM?

For e-SCM efforts to make sense, two overriding factors must be present. First, all parties must have sufficient incentives to participate and make needed investments. To thrive, most e-SCM efforts need a critical mass of participants. If prospective players perceive the effort as simply a means of driving down prices, they have little incentive to join. Second, supporting technology, hardware, software and processes must be available so that the efforts can be implemented. Today, the abundance of supply chain software, hardware platforms and delivery options, from the Internet to application service providers (ASPs) to virtual private networks (VPNs), has removed many technological barriers to implementing e-SCM programs.

Not surprisingly, e-SCM efforts can range from simple (an e-catalog posted on an e-marketplace) to complex (a platform to enable product design and development along an entire supply chain). Naturally, these e-SCM projects will offer different benefits. For example, a supplier posting an e-catalog on an industrywide e-marketplace isn't expecting to foster development collaboration with its customers. Despite this caveat, e-SCM has much to recommend it.

You can view e-SCM from the buyer's, supplier's and facilitator's perspective:

Buyer benefits. In general, a buyer can derive three types of benefits from e-SCM efforts:

First, a buyer may be able to buy both direct and indirect materials at a lower cost, primarily due to price transparency and competition. Buyers that purchase goods through an active e-marketplace populated by many suppliers hope to take advantage of competition and dynamic pricing. Although large companies such as Wal-Mart and Ford already enjoy sufficient leverage to command price breaks and discounts, medium- and small-size companies gain access to more favorable pricing when suppliers bid for their business on e-marketplaces and trading exchanges.

Second, with e-SCM, a buyer is likely to achieve greater efficiency when purchasing goods and services, ultimately lowering the overall cost of conducting commerce. By automating procurement, offloading purchasing activities to end users, and integrating purchasing data with legacy accounting systems, companies can lower their transaction costs and overhead. For medium- and smallsize companies, B2B marketplaces offer opportunities for price discovery that would be impractical through human effort alone.

Third, a buyer may be able to forge stronger ties with its suppliers, collaborating with them more closely in designing and developing goods and services, and in forecasting, scheduling and planning production activities. ERP systems have already enabled many companies to share a subset of this information. Today, collaborative software, middleware, XML translators and more powerful customer relationship management (CRM) functionality promise to align buyers more closely with all participants in their supply chain.

Supplier benefits. These generally fall into two classes, depending on the type of e-SCM program the suppliers participate in:

* For e-SCM programs that focus on collaboration--sharing product data, product designs and so on--suppliers can strengthen their forecasting ability and meet or even exceed customer demands by offering the right combination of products and services at the right time. Suppliers can also align their production schedules and manufacturing capacity with buying patterns to improve inventory management.

* For e-SCM programs that concentrate on commerce opportunities, suppliers benefit most from participating in large, active online marketplaces. These marketplaces, if frequented by a critical mass of buyers, extend the supplier's market reach and potentially increase its overall sales. Because this extensive market reach is achieved at a fraction of the cost associated with other sales channels--mass mailings, telemarketing, on-site sales calls-- it is a more cost-effective way to market and sell goods and services. B2B marketplaces can also help suppliers gauge the demand for their goods and services. And dynamic pricing features such as auctions and bids give suppliers a good sense of the price the market is willing to bear for these items. Although price transparency fostered by online marketplaces may initially deter suppliers from participating, once enough buyers and competitors are using the model, every supplier must eventually join. These marketplaces can also help with inventory management activiti es, allowing suppliers to auction off excess inventory to many potential bidders.

Facilitator benefits. A facilitator of e-SCM efforts provides some component or service integral to the effort. A software or hardware vendor is a facilitator, as is an ASP providing application functionality or Internet connectivity. In general, the benefits to a facilitator are strictly monetary: The software or hardware vendor receives license fees, and the ASP normally receives monthly rental or usage fees.

Preparing for E-SCM

Companies, vendors, service providers and investors have all been dazzled by e-SCM's promise. Pick up any publication, surf the Web or attend a conference and you'll find stories about existing and planned electronic supply chain endeavors. . The auto industry exemplifies these developments with its design, collaboration and commerce exchanges. The dairy industry has also gotten into the act by launching a B2B exchange to auction off perishable dairy products.

Businesses worldwide recognize the necessity of using electronic methods to automate and tighten supply chains. They don't really have a choice. One by one, their competitors are doing it. Large buyers use their leverage to demand better supply chain management. Just as one company leans on its supply chain to increase efficiency and reduce costs, it is being pressured by its trading partners to streamline operations and lower prices.

Without the Internet, e-SCM would be on the slow track. The Internet is the ideal platform for launching e-SCM because it has many of the same characteristics as a supply chain. Both comprise a web of participants communicating and sharing data and information in a standard way. The Internet simply makes this communication and data sharing more cost-effective with standard protocols, a choice of relatively inexpensive connections and high adoption rates. Software products, translation middleware and XML are removing the last barriers to widespread data exchange.

Companies can reap the benefits of e-SCM in some fairly painless ways. Participating in an e-marketplace as a buyer or seller is one method. Implementing an automated procurement system is another. To get more out of e-SCM requires some complex and integrated solutions. These take greater effort and investment, and they depend on industry dynamics, competitor activities and customer demands. Before embarking on an e-SCM project, consider these issues:

Leverage. Your company size, relative to others in the supply chain, will determine who has the leverage to dictate terms. A small business doesn't have the clout to tell Staples how to construct its Web storefront; Staples makes that decision. Tier 1 auto suppliers, while individually large, don't have the leverage to refuse participating in the Big Three automakers' marketplace. Be aware of your position in the grand supply chain scheme.

The Tower of Babel. Communicating and sharing data among scores of supply chain partners is utter chaos.

(See Fig. 1. and the table, "E-SCM Scenarios and Solutions.") Most meaningful e-SCM solutions require a fair amount of integration among supplier systems including front-end sell-side, CRM, ERP, and advanced planning and scheduling applications. Except in rare cases, these systems run on different platforms, use different technologies, store and manipulate data in different ways and have ill-defined or nonexistent interfaces. Somehow, a modicum of standardization and definition has to be imposed on this Tower of Babel to enable accurate and timely data sharing. Many point-to-point ERP and electronic data interchange (EDI) implementations permit this type of sharing but aren't widespread enough to integrate an entire supply chain.

Collaboration and coordination. The more complicated the e-SCM solution, the more participants must collaborate. Leverage may determine who gets to run the show, but an uncooperative participant can wreak havoc on the project. Suppliers involved in multiple e-SCM initiatives, perhaps across several industries, will resist adopting conflicting, redundant or grossly expensive e-SCM approaches. Designing, implementing and testing a complex e-SCM solution among scores of players will stress any organization s program management abilities. Commitment and perseverance are essential to putting a large-scale e-SCM effort in place.

Close to Open Solutions

There are virtually hundreds of e-SCM solutions from which to choose, ranging from simple to complex and requiring varying levels of investment, participation and integration. Electing to participate in an e-marketplace is a relatively straightforward decision. Creating an extranet to give suppliers access to your production data and sales forecasts is another matter.

Solutions involving e-SCM range from close to open. (See Fig. 2.) Close e-SCM solutions are custom, private implementations driven by powerful buyers or suppliers. These solutions are built to specification among multiple supply chain participants and may require a high degree of system integration. Close e-SCM solutions include early ERP and EDI implementations but also encompass more functionally rich offerings. Primarily, these solutions foster rich information exchange, although they can also support commercial transactions and a range of specialized services. Although these products can be built using out-of-the-box" components, they may offer customized functionality such as sharing forecasting, sales, production, planning and scheduling data.

Open e-SCM solutions focus on commerce between suppliers and buyers and may include ancillary services such as payment processing, fulfillment and logistics. Open solutions are used by the public and typically revolve around a vertical industry such as healthcare or retail, products such as electronic components, or a service such as travel. These solutions, which include e-marketplaces and trade exchanges, operate much like financial or commodities exchanges. Dynamic bids and sales are generally supported. Buyers may advertise requests for proposals (RFPs) or request for quotes (RFQs), or they may invite sales proposals for commodity goods. Sellers might solicit bids for products or services. Price negotiations, sales and financial settlements are all conducted online.

In general, e-SCM solutions can be categorized in the following ways:

Basic supply chain execution components. Although many e-SCM systems focus on enabling communications and collaboration with external entities, a host of internal, back-office systems help companies execute various supply chain-related functions apart from their suppliers and partners. These systems include custom-developed and packaged software systems that aid in product design, order processing, inventory management, logistics (transportation, warehouse management, fulfillment), forecasting, planning and scheduling. In addition, companies rely on strategic planning tools to help them optimize their sourcing and other aspects of their supply relationships. Decision support tools are also used to access and manipulate the data produced by these systems. (See vendor list for companies that provide supply chain execution solutions.) Several IT consulting firms, such as Boston-based Keane Inc. and Cap Gemini Ernst & Young, New York, have dedicated practices to help companies implement supply chain execution co mponents.

ERP/EDI. ERP systems standardize companies' internal applications and give them access to data generated across the enterprise, from accounting to operations to sales and marketing. As a result, companies can share data with suppliers and partners using similar paradigms. EDI implementations are generally custom interfaces built to exchange data between dissimilar systems. The type of data exchanged is generally product/inventory information, reflecting some sort of contractual agreement. However many ERP vendors are adding functionality that allows for broader exchange of information and collaboration.

ERP solutions typically cost millions of dollars to implement. They are advantageous, however, because they integrate all the back-end systems that often prevent companies from instigating meaningful e-SCM programs. Because of this integration, ERP systems provide companies with access to abundant data. While this feature makes ERP systems very powerful, it also complicates integration with outside entities because suppliers may not have the same type of ERP system, or any ERP system at all. As a result, companies usually devise point solutions, linking their most important suppliers one by one. Historically, these interfaces have been implemented using EDI. (See vendor list for companies that offer ERP/e-SCM solutions.) Consulting help abounds, especially from firms such as Accenture (formerly Andersen Consulting), Price WaterhouseCoopers, and KPMG to implement ERP packaged solutions and design solutions.

Custom interfaces with trading partners. Some companies have devised customized interfaces with their trading partners, vendors and customers to share information and strengthen relationships. These custom interfaces may rely on extranets or VPNs that allow one-to-many interactions with third parties. These custom interfaces may involve data exchange--sharing information to enable better materials planning, inventory management, and so on--or may facilitate some form of commerce between the parties. Because these are customized solutions, they often involve outside consulting assistance and may incorporate some of the e-SCM offerings you'll find in the vendor list.

Web storefronts. Although not thought of as a classic example of e-SCM, Web storefronts give companies another selling channel. Depending on the storefront's sophistication and its underlying technology and functionality (CRM, ERP, etc.), it may help businesses accumulate significant information about their demand chains. That in turn can improve forecasting, scheduling and planning. Although a storefront benefits the seller, allowing it to reach a potentially huge audience, it isn't as beneficial to buyers. Storefronts facilitate one-on-one transactions rather than aggregate buyers and sellers. A buyer that wishes to purchase goods or services through Web storefronts still must conduct extensive research and price discovery manually. (See vendor list for companies that provide Web storefront components.}. Most Internet and IT consulting firms can handle the interactive design work and technology/infrastructure components required by a Web storefront.

Procurement systems. Standalone corporate procurement systems, typically implemented over an intranet, are used to distribute the purchasing function to companies doing the buying. Such a system posts information about supplies and electronic catalogs from preapproved vendors. These vendors usually have some minimal agreement with the procurement company about price discounts, volume purchases and so on. Procurement systems also allow authorizations, rules and approvals to be specified and applied automatically as users perform their purchasing activities. Purchases are fed into back-office accounting and legacy systems, which helps to reduce overhead and data entry errors.

Companies generally use procurement systems to lower transaction costs rather than to obtain the lowest price for supplies. Because procurement systems work with a set of preapproved vendors and don't support dynamic selling or bidding, they aren't designed to force down prices. The cost of implementing a procurement system, and maintaining electronic catalogs, puts it outside the reach of small- and medium-size companies; ASP offerings may be more cost-effective. (See vendor list for companies that offer procurement systems.)

Marketplaces and exchanges. Electronic marketplaces, also known as trading exchanges, trading hubs and trading communities, support many-to-many relationships between buyers and sellers. Members of these communities conduct commerce, offering and purchasing commodities, products and services. Marketplaces can be private or public and may be formed around a product or service, the needs of a large supplier or buyer, or a particular industry. They may include electronic catalogs of suppliers' wares, or simply a posting board that broadcasts offers, bids and requests, similar to a financial exchange. Most marketplaces allow suppliers and buyers to conduct auctions and other price negotiations online. In addition, the marketplace is increasingly offering ancillary services such as financial settlement, fulfillment, logistics and transportation.

Marketplaces are established, administered and managed by a large buyer, seller or market maker. The market maker typically receives a percentage of each transaction; PaperExchange, for example, charges 3% of each transaction completed by its members. These market-places require a critical mass of buyers and suppliers for the model to work. (See vendor list for ASPs that offer marketplace services. Many consulting firms work with e-marketplace participants to integrate their back-office systems with marketplace transactional data. Keane; Intelligent Information Systems, Durham, N.C.; and Sapient Corp., Cambridge, Mass., are on that list.

Collaboration platforms.

Many companies are looking for ways to enrich their communication and relationships with the important players in their supply-and-demand chains. These initiatives are based more on collaboration than they are on commerce and are meant to optimize supply chain operations, particularly in product design, planning and forecasting. Ford's effort to improve the sharing of product design information with its suppliers is one example. Kmart Corp.'s trial of CPRF (collaborative planning, forecasting, and replenishment) with its suppliers is another example. (See vendor list for companies that handle software collaboration.)

Enabling Technologies

Whether a company is just joining a marketplace, establishing a private extranet with trading partners or collaborating on product design with a supplier, e-SCM solutions demand a high degree of systems integration. Some solutions may require that supply chain participants integrate their systems and data with other participants; other solutions may require that a participant's back-end systems be able to handle new data sources. Because e-SCM solutions are so widespread, affecting the systems and data of many organizations, a standard is required that will enable participants to interact in a common manner, and to understand the data and information underlying those interactions.

Using the Internet as a platform for e-SCM solutions establishes standards for connectivity and communication. But standards must also be defined for the data exchanged by e-SCM solutions. XML is emerging as the de facto standard for data exchange over the Internet, creating common data definitions and formats. An array of software vendors offers translation tools that allow companies to translate their internal data into XML. (See vendor list for companies that offer XML translation tools.) Several IT consulting firms such as Intelligent Information Systems specialize in data translation tasks. In addition to XML, a host of middleware products assist companies in communicating with their supply chain participants. (See vendor list.) These include messaging and communication products, integration services, and database and server products.

Solutions Weigh In

Implementing an e-SCM solution can be simple such as joining an e-marketplace, or complex such as implementing an ERP package and establishing a proprietary, collaborative platform to share production data. Not surprisingly, the most beneficial e-SCM solutions are usually most difficult to implement and may require a significant investment. Massive integration with multiple suppliers' systems, new software systems, hardware upgrades and consulting assistance are often necessary.

A company can select a custom, package or ASP solution. Custom development is expensive, but it is the only alternative when the e-SCM software itself will provide a competitive advantage. A growing number of package solutions handle a wide range of c-SCM requirements. Packages decrease time to market, allow multiple companies to share the same functionality, and reduce maintenance costs. These solutions work for companies with the resources and desire to operate their own software, but that don't need unique e-SCM functionality. By combining software, hardware and support into a single monthly fee, ASPs frequently offer the fastest and least capital-intensive means of obtaining an e-SCM solution. ASP solutions exchange unique functionality for ease of implementation and operation. As such, many medium- and small-size companies may find an ASP solution is the most cost-effective option, particularly for e-SCM solutions such as procurement systems and e-markerplaces.

Integration issues take center stage in almost any e-SCM implementation. First, in-house supply chain systems must be integrated to optimize internal supply chain operations. Second, these systems must be integrated with those of outside parties such as trading partners and/or customers to share important data. Finally, internal processes must be upgraded to reflect the changes introduced by the e-SCM systems. True integration requires in-depth understanding of the data produced by different systems. In addition, a company must determine the appropriate integration approach for its systems. Other issues affect an e-SCM implementation. Whenever data is shared with third parties, security and privacy become paramount. Companies closely guard their customer, sales and forecasting data, and want to ensure that the e-SCM applications producing and exchanging this data can prevent unauthorized access.

Companies must also have management structures in place to oversee e-SCM implementation. Representatives from all affected organizations must participate, and they must have the clout to reconcile differences. Testing an e-SCM solution across multiple organizations is no small feat, a fact demonstrated by many Year 2000 programs.

Looking to the Future

What e-SCM areas promise to be hot? E-marketplaces will continue to evolve until the best economic model surfaces. Because it is crucial for these marketplaces to attain a critical mass of suppliers and buyers to survive, companies will need sufficient incentives to join. Marketplaces that revolve around large buyers or suppliers with a great deal of leverage are likely to be the most successful. Integrating internal procurement systems into marketplaces, and services such as financial settlement, logistics and fulfillment, will give many companies the impetus to conduct more of their commerce through marketplaces. Medium- and small-size companies will find it economical to join these marketplaces, since the market-maker absorbs all the setup costs; however, their lack of leverage will not bring them the big gains enjoyed by the larger players.

Perhaps the most exciting direction for e-SCM lies in the collaboration. Several fortuitous events are converging. First, companies have developed a mindset and culture that is open to optimizing the supply chain by working with partners and customers. Second, an increasing number of platforms, packages and technologies allow meaningful collaboration from sharing product design data to developing joint forecasts and customer reward programs.

Ian S. Hayes, founder and president of Clarity Consulting Inc., Hamilton, Mass., provides management consulting on IT strategies, emerging trends, markets and challenges. He is a popular speaker and has coauthored two IT books.

E-SCM Scenarios and Solutions
Buyer/Supplier                Private SCM
One-to-one                    One-to-many
Private, point solution       Private
Large investment              Collaboration and/or commerce
Limited information exchange  Rich information exchange
Relationship building         Relationship building
High integration              High integration
Buyer/Supplier                Vertical Marketplace
One-to-one                    Many-to-many
Private, point solution       Public
Large investment              Industry, product or service based
Limited information exchange  Fosters liquidity, dynamic pricing
Relationship building         Little information exchange
High integration              Low integration
Buyer/Supplier                Global Marketplace
One-to-one                    Many-to-many
Private, point solution       Public
Large investment              Commodity products/services
Limited information exchange  Fosters liquidity, dynamic pricing
Relationship building         Little information exchange
High integration              Low integration
E-SCM Vendors: A Sampling
Company                                  Web Site
ASP offerings
Clarus                                   clarus.com
Interliant Inc.                          interliant.com
Masg.com                                 masg.com
PurchasePro                              purchasepro.com
USinternetworking Inc.                   usinet.com
VerticalNet Inc.                         verticalnet.com
Collaboration platforms
Demand Management Inc.                   demandsolutions.com
i2 Technologies                          i2.com
Logility Inc.                            logility.com
Manugistics Inc.                         manugistics.com
Syncra Systems Inc.                      syncra.com
WebPLAN                                  webplan.com
DSS tool vendors for implementing e-SCM
Demand Management Inc.                   demandsolutions.com
12 Technologies                          i2.com
SynQuest Inc.                            synquest.com
McHugh Software Intl.                    mchugh.com
Lagility Inc.                            logility.com
Optum                                    optum.com
E-marketplace services/software
Ariba Inc.                               ariba.com
Commerce One Inc.                        commerceone.com
Demand Management Inc.                   demandsolutions.com
i2 Technologies                          i2.com
Manugistics Inc.                         manugistics.com
Masg.com                                 masg.com
VerticalNet Inc.                         verticalnet.com
Enabling technologies
BEA Systems Inc.                         bea.com
Neon Systems Inc.                        neonsys.com
Oracle Corp.                             oracle.com
Progress Software                        progress.com
Unify Corp.                              unify.com
Vitria Technology Inc.                   vitria.com
XML Solutions (Vitria)                   xmlsolutions.com
ERP/EDI solutions
Baan (Invensys)                          baan.com
Great Plains Software                    greatplains.com
J.D. Edwards                             jdedwards.com
Masg.com                                 masg.com
Oracle Corp.                             oracle.com
Peoplesaft                               peoplesoft.com
SAP AG                                   sap.com
Procurement systems/software
Ariba Inc.                               ariba.com
Commerce One Inc.                        commerceone.com
i2 Technologies                          i2.com
Trilogy                                  trilogy.com
Web storefront components/software
Ariba Inc.                               ariba.com
BroadVision Inc.                         broadvision.com
Commerce One Inc.                        commerceone.com
Company                                  Location
ASP offerings
Clarus                                   San Rafael, Calif.
Interliant Inc.                          Purchase, N.Y.
Masg.com                                 New York, N.Y.
PurchasePro                              Las Vegas, N.V.
USinternetworking Inc.                   Annapolis, Md.
VerticalNet Inc.                         Harsham, Pa.
Collaboration platforms
Demand Management Inc.                   St. Louis, Mo.
i2 Technologies                          Cambridge, Mass.
Logility Inc.                            Atlanta, Ga.
Manugistics Inc.                         Rockville, Md.
Syncra Systems Inc.                      Waltham, Mass.
WebPLAN                                  Newport Beach, Calif.
DSS tool vendors for implementing e-SCM
Demand Management Inc.                   St. Louis, Mo.
12 Technologies                          Cambridge, Mass.
SynQuest Inc.                            Narcross, Ga.
McHugh Software Intl.                    Waukesha, Wis.
Lagility Inc.                            Atlanta, Ga.
Optum                                    White Plains, N.Y.
E-marketplace services/software
Ariba Inc.                               Mountain View, Calif.
Commerce One Inc.                        Pleasanton, Calif.
Demand Management Inc.                   St. Louis, Mo.
i2 Technologies                          Cambridge, Mass.
Manugistics Inc.                         Rockville, Md.
Masg.com                                 New York, N.Y.
VerticalNet Inc.                         Horsham, Pa.
Enabling technologies
BEA Systems Inc.                         San Jose, Calif.
Neon Systems Inc.                        Sugarland, Texas
Oracle Corp.                             Redwood Shores, Calif.
Progress Software                        Bedford, Mass.
Unify Corp.                              Sacramento, Calif.
Vitria Technology Inc.                   Sunnyvale, Calif.
XML Solutions (Vitria)                   McLean, Va.
ERP/EDI solutions
Baan (Invensys)                          Barneveld, Netherlands
Great Plains Software                    Fargo, N.D.
J.D. Edwards                             Denver, Cola.
Masg.com                                 New York, N.Y.
Oracle Carp.                             Redwood Shares, Calif.
Peoplesoft                               Pleasanton, Calif.
SAP AG                                   Newtown Square, Pa.
Procurement systems/software
Ariba Inc.                               Mountain View, Calif.
Commerce One Inc.                        Pleasanton, Calif.
i2 Technologies                          Cambridge, Mass.
Trilogy                                  Austin, Texas
Web storefront components/software
Ariba Inc.                               Mountain View, Calif.
Broad Vision Inc.                        Redwood City, Calif.
Commerce One Inc.                        Pleasanton, Calif.

DMI Reduces Inventory and Improves Service

Since 1985 Demand Management Inc., St. Louis, has provided manufacturing and retail industries with the most reliable, easy-to-use and powerful tools for managing the supply chain and maximizing profits.

Today multinational corporations such as Goodyear Tire & Rubber Co. and Black & Decker Corp., as well as numerous medium- and small-size companies, use Demand Solutions software. More than 10,000 users in 67 countries depend on Demand Solutions Product Suite's effective formulas, reliable performance and logical display of critical data.

The Demand Solutions Product Suite is the backbone of a quick response system. The suite has a variety of components. Forecast Management is the forecasting engine and data warehouse of choice for effective supply chain management. DSRC is a critical capacity planning tool that will eliminate the unknown by analyzing and validating production-planning data. DSRP dynamically assesses requirements using a time-phased replenishment plan showing monthly, weekly or daily time periods. Electronic Demand Solutions Interface (EDSI) provides the consistent, open communication critical for any partnership. DSS&OP consolidates relevant supply chain data such as bookings, sales, production, inventory, shipments and backlog/backorders. DSSTORES, handles inventory turns, reduces out-of-stocks and improves customer service.

In addition, Feedback enables companies to improve customer connectivity by allowing those in direct and regular contact with customers--or the customers themselves-to provide input. DSView gets decision makers timely answers so that they can make informed decisions, by manipulating large volumes of data into meaningful information.

Demand Solutions interfaces with SAP, BPICS, J.D. Edwards, Baan, MFGPro, Dataworks, and Marcam Prism, among other companies. XML extensions are constantly updated to take advantage of the latest developments for corporate and collaborative networks.

Demand Management provides installation, training, support and consulting services. The company services and sells supply chain management software exclusively, and direct feedback from users guides many new enhancements. Demand Management makes the customer more profitable with software tools to reduce inventories while raising customer service levels.

Masg.com: More Choices for Less

As the world's largest online resource of its kind, masg.com offers companies unique advantages. It gives users many ways to research, evaluate and select enterprise applications and manufacturing point solutions and services.

Masg.com enables users to spend less time gathering information and more time analyzing the best fit for their businesses. Users can trim as much as a third of their research time, eliminate off-target bids from consideration, and anticipate the internal financial impact of new software solutions.

A typical selection process for a business-critical application involves months of research and weeks of management evaluation. Once features and functions have been compared with company requirements, specifications become obsolete as new versions and upgrades replace existing products faster than evaluators can keep pace. Masg.com alleviates this risk by continually updating information on-line.

The masg.com database contains more than 90 application categories with 950 detailed vendor profiles. Users may review and compare 15,000 software functions and features, all defined.

Masg.com eliminates bias by providing tools to evaluate software solutions according to objective criteria. Users can create custom specifications, identify qualified vendors, and match and compare products by specifications and functionalities.

Users can begin searching for applications quickly based on platform, industry type, manufacturing process, and other parameters. The site returns an unbiased list of qualifying products with links to more detailed pages.

Evaluators can then create customized specifications and generate a side-by-side product comparison table based on the thousands of features and functions covered in the masg.com database. Applications can be ranked according to the buyer criteria. When complete, this chart can be printed and saved to the user's hard drive or the masg.com server.

After identifying products that closely match specs, users can translate this insight and information into RFP, RFI, or REQ documents, which can be e-mailed to vendors.

Customers include Impco Technologies Inc., Cerritos, Calif., named one of the "200 best small companies in America" by Forbes in 1998. Rick Range, lmpco's MIS director, used masg.com to pick six ERP suppliers from a list of more than 120 initial vendors.

"Once we found those six, we were able to use other resources, too," says Range. His staff built on the foundation masg.com provided with Dun & Bradstreet reports, articles from trade publications, Web site reviews and in-house expertise. "[Masg.com] gave us the ability to sort and rank the software packages according' to our own requirements," explains Range. "It paid for itself within a week. ... I looked at another package that offers the same kind of functionality, but it cost 30 times more than masg.com."

PurchasePro Boosts the Bottom Line

Wandering through the B2B desert, searching for products that provide significant R OI and customer efficiencies often results in more mirage than reality. However, some notable companies have found an oasis in that desert and selected Las Vegas-based PurchasePro as their e-commerce solution and, more importantly, their e-commerce strategy.

Hilton Hotels Corp., Honeywell International Inc., iGetSmart.com, and LawCommerce.com are among the 150,000 companies that benefit from PurchasePro's suite of e-commerce solutions.

Mark Larson, sales director for iGetSmart.com, is also a PurchasePro believer. "Not only has our business model evolved quickly with the implementation of PurchasePro's software, but we have experienced significant results to our bottom line and in the amount of products we sell to end users," Larson says.

PurchasePro is one of the world's largest B2B e-commerce software organizations, and companies across countless vertical industries have adopted PurchasePro's highly scalable, hosted e-commerce software to drive down procurement costs, uncovere sales opportunities and create business efficiencies.

The company offers four marketplace products: e-Source, e-MarketMaker, e-Procurement, and v-Distributor. PurchasePro's Web-based e-Procurement product streamlines corporate procurement procedures by connecting companies with their suppliers, saving time and money by bringing all purchasing under one virtual roof.

"PurchasePro's e-Procurement product enables us to operate our organization much more cost effectively and ultimately enhance our value to the guests who frequent our hotels," says Anthony Nieves, Hilton's senior vice president of purchasing and general manager.

In an industry estimated by research firm Gartner Group to grow 40% a year and reach $7.3 trillion by 2004, PurchasePro offers the best total value and fastest e-commerce solution. PurchasePro powers marketplaces to full functionality in 45 days or less, with thousands of buyers and sellers ready to transact business on Day 1.

"Although we looked at several e-commerce companies before implementing our e-commerce solution, PurchasePro was the right choice for us. PurchasePro has significant technology, exchange, and procurement expertise that will be integral in the development and operation of our e-marketplace," says Richard D. Harroch, LawCommerce.com founder and chairman.

COPYRIGHT 2001 Wiesner Publications, Inc.
COPYRIGHT 2001 Gale Group