HP DutchworldHP Dutchworld

Electronic Commerce IntegrityElectronic Commerce Integrity

What happens if something goes wrong?What happens if something goes wrong?

Alexander Drobik

Research DirectorGartnerGroup

October 1998

Technology Issues• Buy vs. build• Web security• Standardisation• Web vs. Extranets• EC objects

Strategies• Coercion/Collaboration• Channel extension • Supply chain mgmt.• Community Extranets• E-Marketplace mgmt.

Applications • EDI• E-Storefront• E-Procurement• E-Catalogues • E-Billing/Payment

Electronic Commerce and Extranet Applications

Management Issues• EC outsourcing• EC organisation• Content and context• Regulatory and tax• Willingness to pay

Supplier Customer

Community

Consumers

Definition: EC and Extranet Applications

Impact of EC on Industry Restructuring

Investmentby Leaders

EC will impactmarketing, selling

and customer service

EC will impact structure ofofferings and how delivered

EC will restructurethe entire industry

Information as a Percent of the Total Offering

Impact of EC on Industry Restructuring

Delivery

Transportation

Consumer Prod.ManufacturingLogistics

Investmentby Leaders

EC will impactmarketing, selling

and customer service

GovernmentServices

AutomotiveManufacturing

Information as a Percent of the Total Offering

Impact of EC on Industry Restructuring

RetailGrocery

Home Services

Office Supplies

Delivery

TransportationBook

Selling

TelecomConsumer Prod.ManufacturingLogistics

Recreationand Leisure

Cards and Gifts

Healthcare

Investmentby Leaders

EC will impactmarketing, selling

and customer service

EC will impact structure ofofferings and how delivered

GovernmentServices

X-Mart

RetailDry Goods

AutomotiveManufacturing

Information as a Percent of the Total Offering

Impact of EC on Industry Restructuring

RetailGrocery

Home Services

Office Supplies

Delivery

Transportation

Advertising

Book Selling

Publishing

Entertainment

TelecomConsumer Prod.Manufacturing

StockTrading

Logistics

Recreationand Leisure

Cards and Gifts

Healthcare

Investmentby Leaders

EC will impactmarketing, selling

and customer service

EC will impact structure ofofferings and how delivered

EC will restructurethe entire industry

ElectricUtilities

Travel

Gaming

GovernmentServices

X-Mart

RetailDry Goods

AutomotiveManufacturing

BANK

Banking

Information as a Percent of the Total Offering

High

High

Low

BusinessValue

Short-Term Projects

Long-Term StrategiesShort-Term Strategies

Operations Automation

Time to Implement

B2B Vs. B2C Paths to EC Strategic Success

Community Extranets

CollaborativeExtranets

Supply ChainManagement

Channel MasterExtranets

Customer Self-Service

UnassistedSelling

E-Business?

ProcurementAutomation

InteractiveMarketing

Tech.-EnabledRelationship Mgmt.Integrated

Web Store

Web Brochures

B2C

Web Storefront and E-Catalogue

B2B

European Web-Commerce Market

• European ‘Hockey Stick’• Jam tomorrow BUT some Gems• Business-to-Business Focus

1997 1998 1999 2000 2001 2002

$100 BN

• European Market Inhibitors– Multiple Currencies– Multiple Tax Domains– Multiple Legislation Domains– Low PC & Internet Adoption– Less Perfomant Internet

Impact of EC Enablers Over Time

1998 1999 2000 2001 2002 2003

LittleEC

Impact

AffectsEC

Marketing

AffectsEC

Imple.

AffectsEC

Strategy

AffectsBusinessStrategy

PackagedEC Apps.

OBIProcurement

Standard

MicroPayments

Real-Time-CapablePackaged EC Apps.

Vendor-Driven

EC Stds.

XMLStandard(content)

Agents

Web-ECExtranetEC Apps.

InternetSecurity

Smart Cards

Certification

Process-Ware

Subsidised Apps.

ContentRationalisation

EDIWEB-EDI

SETE-PaymentStandard

DistributedEC Object

Apps.

NetworkedEC Apps.

ComponentEC Apps.

E-Bills

Real-Time Applications? Gets Real!

High-SpeedPrivate Fibre Net.

Dealer

Develop-mentServer

Dealer

OnlineDynamicServer

StorageArray

WebContentServer

FTP ServerContentChanges

New Apps.

Interactive Hostingand Development

BackEnd

Backup Server

TapeLibrary

Formatted data and images

Searches & P.O.s

Network and Content Redundancy

PublicInternet

Consumer

EC Creates Data Velocity Disconnects

Purchase Manageror Consumer

Front-End EC

Technologychangesdrive thefulfilmentprocesses

faster.

Seconds or Minutes

E-Catalogues,E-Procurement,Messaging, EDI,

E-Payments,Interactive Apps.

ERP Vendor orOther Packaged

Application

Proprietary APIs

PublicInternet

EC Integration SWVendor or Custom

Code From SI Vendor

Manufacturer

Back-EndEC

Warehouse CarrierRetailerReseller

Availableto Promise Non-integrated File Transfer and EDI

X-Mart

Days or Weeks

Purchase Manageror Consumer

SCM Visibility and Process Smoothing

Delivery

PlantScheduling

VMI-Driven Spikes

Smooth Idealism of SCP Messy Reality

How “Smooth” Can Replenishment Get Through the Chain?

Deal BuyingDC ReplenishmentRetail

Replenishment

Flow of Data, Flow of GoodsFlow of Data, Flow of Goods

Web SCM: Vendors’ Variability Vision

Manufacturing(Sites)

Plant Warehouse(s)

Distribution Centre(s)

ComponentAssemblers

Purchasing

OrderManagement

BuyingCo-operatives

Demand Planning

TransportationPlanning

DistributionPlanning

Production Planningand Scheduling

Capacity Planning

Years

Minutes

Network Planning

Deployment Planning

Sales andOperations Planning

PersonalisedSupplierDatabase

PersonalisedCustomerDatabase

Carriers/Fleet Mgrs.

Web-Based Apps. and Repositories

Inter-enterprise Vision of SCM Applications

Pla

nn

ing

Ho

rizo

n

Ap

pli

cati

on

In

teg

rati

on

Lay

er

Reality: Limited Near-Term Variability

Manufacturing(Sites)

Plant Warehouse(s)

Distribution Centre(s)

ComponentAssemblers

Purchasing

OrderManagement

BuyingCo-operatives

Demand Planning

TransportationPlanning

DistributionPlanning

Production Planningand Scheduling

Capacity Planning

Years

Minutes

Network Planning

Deployment Planning

Sales andOperations Planning

PersonalisedSupplierDatabase

PersonalisedCustomerDatabase

Carriers/Fleet Mgrs.

Web-Based Apps. and Repositories

Deliverable Reality,1998-1999

Inter-enterprise Vision of SCM Applications

Pla

nn

ing

Ho

rizo

n

Ap

pli

cati

on

In

teg

rati

on

Lay

er

PotentialCustomers& Influencers

PotentialCompetitors“Just a URL &

a Dream”

E-Business: High Level & Invasive

SuppliersIndustry

Network(s)

DistributionChannels

BusinessPartners

Product & ServiceCreation

Logistics& Fulfil-

ment

Admin &Operations

Marketing,Sales &Service

LegallyDefined

Enterprise

SupplyChain

“Virtual Partners”Informal Info.Sharing Deals

Competitors

Customers

Supply Chain Management Technology-Enabled Relationship Management

Electronic Commerce Back Office Web Commerce Front Office

E-Business Architecture Components

IntranetUsers

Suppliers and

Customers

Marketing

Logistics

Procurement

Customer Service

Web Browsers: Std. Look and Feel

Customer Service

OrderMgmt.

InventoryMgmt.

Transpor-tation

Procure-ment

Marketing

Firewall

APIs, Message Queuing, Processware

Firewall

Extranet/VPNExtranet/VPN

Common Data Warehouse

Semantic Reconciliation

ChannelPartners

Consultantware

Transaction Manager

Catalogues/Configurators

MembershipDirectory

ApplicationRulebooks

ContentDatabases

DynamicPricing

PersonalisationTP Data Cleaning Tools

Integration Services

EDI/EC Software and Svcs.

Extranet Member Controls

EC Toolsand

Services

Internet

Indirect Channel

Direct Channel

E-Business Recommendations

For Enterprises

Analyse the E-business “forcing functions” in your industry or market. Decide when and how to act.

Begin to work to get SCM, TERM and EC teams to communicate and develop common goals and strategies.

Develop the financials for new business models, new sources of revenue, and new processes and partners.

For Vendors

Focus on solving the “SI burden” of E-business. Deliver solutions to reduce the 20-to-1 services to software.

Partner with applications vendors to deliver quality, reliable and performant EC solutions.

For the majority of EC vendors, forget the “land grab” game. Get focused and build a defensible market.

Electronic Commerce IntegrityElectronic Commerce Integrity

What happens if something goes wrong?What happens if something goes wrong?

Thank YouThank You

You lose your business!You lose your business!