META Group Commerce Chain Management Kip Martin Program Director Electronic Business Strategies Kip Martin Program Director Electronic Business Strategies.

META GroupMETA Group

Commerce Chain Management

Kip MartinKip Martin

Program DirectorProgram Director

Electronic Business StrategiesElectronic Business Strategies

Kip MartinKip Martin

Program DirectorProgram Director

Electronic Business StrategiesElectronic Business Strategies

© 2000 META Group Inc., Stamford, CT, (203) 973-6700, metagroup.com2

eBusiness “Marketplace”eBusiness “Marketplace”

Sell Side/DemandDis

tributo

r

Resel

ler

Busines

s

Cust.

Consum

er

Cust.

Asera, Comergent,

Webridge, Allegis,

Channelwave

Open Market, Intershop,

Interworld, Blue Martini,

Websphere Commerce,

Broadvision, ATG, etc.

NetMarket

Suppliers Buyers

electroneconomy, Casbah,

Tradex, EC Cubed, Ventro,

TradeMatrix, Exterprise, Tradeum,

Intelligent Digital, aatlas, etc.Ventro, e-Steel, Altra, Azurix,

e-Chemicals, TradeOut,

MyAircraft, C1 MarketSite,

Fishmonger.com, Zoho, etc.

Priceline, eBay, CarPoint,

DemandLine, YouDecide

Commerce Chain/Collaborationi2, SAP, Oracle, Manugistics, Logility, Nexprise, PTC, MatrixOne, IPNet, EQOS, STC, Viacore, Cyclone, etc.

G2000Org

Buy Side/SupplierCom

modity

MRO

Direct

PSDI/MRO.com, Remedy,

Peregrine, Indus, etc.

CommerceOne, Ariba, Baan, SAP, Oracle, Walker

Works.com, Intelisys,

Elcom, Infobank, etc.

Partn

er


What Are the ebusiness Pressures?What Are the ebusiness Pressures?

What are the critical skillsets required to deliver effective EB solutions? What role should external parties play? How should EB initiatives be managed?

What are the critical skillsets required to deliver effective EB solutions? What role should external parties play? How should EB initiatives be managed?

EB Team

Corp. Mgmt. Demands Revenue vs. efficiency ROI??? Time to market

Staffing/Personnel Challenges Constrained talent pool Retraining/re-skilling required Technical skills far outweigh

sales/marketing skills

Technology Challenges New business/application functionality Tools are not mature “Legacy” service levels must be maintained

LOB/Constituency Demands Evolving user requirements Greater accountability/scrutiny Financial clout

OutsourcingInsourcing Sourcing Options

Partner/Customer Demands Collaboration Design requirements Supply requirements


How Do I Determine eBusiness Effort Value?How Do I Determine eBusiness Effort Value?

Construct potential scenario(s) from identified opportunities & threats

Derive “value case(s)” for each scenario

For each value case, develop an associated tactical plan

Highly iterative process

Construct potential scenario(s) from identified opportunities & threats

Derive “value case(s)” for each scenario

For each value case, develop an associated tactical plan

Highly iterative process

Breadth of potential scenarios is dependent on available digital weapons and IT’s capacity to deliver

Breadth of potential scenarios is dependent on available digital weapons and IT’s capacity to deliver

Derive Scenarios for Every E-Opportunity Derive Scenarios for Every E-Opportunity

Environment Environment IntelligenceIntelligence

Targets Targets of Valueof Value

Digital Digital WeaponsWeapons

Threat Threat AssessmentAssessment

PartnersPartners

REAL-TIME OPPORTUNITY IDENTIFICATION

ContinuousReassessment Continuous

Reassessment

Value Case(s)Value Case(s)

Scenario(s)Scenario(s)


Innovation PortfolioInnovation Portfolio

Tactical plans created for each e-opportunity value case

Each tactical planning exercise includes: Course(s) of action Limiting-factors analysis Time-phased planning

Goal is speed in decision making amid incomplete information

Tactical plans created for each e-opportunity value case

Each tactical planning exercise includes: Course(s) of action Limiting-factors analysis Time-phased planning

Goal is speed in decision making amid incomplete information

Process is similar to military crisis action planning, but outcome is an innovation portfolio for the enterprise

Process is similar to military crisis action planning, but outcome is an innovation portfolio for the enterprise

Creation of Innovation Portfolio of E-OpportunitiesCreation of Innovation Portfolio of E-Opportunities

Value Case(s)Value Case(s)

Scenario(s)Scenario(s)

Tactical Planning

Course(s) of ActionCourse(s) of Action

Limiting-Factors AnalysisLimiting-Factors Analysis

Time-Phased PlanningTime-Phased Planning

Innovation PotfolioInnovation Potfolio


How Do I Organize for ebusiness?How Do I Organize for ebusiness?

CEO/

Board

EB Chief

Other LOBs IT

Influence

Influence

CIO, CTO,CFO, CCO, etc.

Influence

Sales, Service,Marketing

Influence

Supply Chain Management

Influence

Influence

PartnersCustomers

InfluenceProduct

Development


The eb-enabled IT organization must be business aligned; leveraged internally and externally

The eb-enabled IT organization must be business aligned; leveraged internally and externally

Center of ExcellenceEB Steering Committee

IT/LOB TeamsIT EB Group(?)

LOB Cross-Functional Business Processes

BusinessPartners

Customers

IT Services(Insourced/Outsourced)

Process Teams

Vendors/Service Providers

EB Chief

E-organization ComponentsE-organization Components


How Important is Content to ebusiness? How Important is Content to ebusiness?

All forms of e-business require the integration of commerce and content (technologies and processes) to succeed

All forms of e-business require the integration of commerce and content (technologies and processes) to succeed

Community Services

Collection

Approval

ContentContent

CommerceCommerceCollaborateCollaborate

Intranet/

Portals

KM

Personalization

DocumentManagement

B2B

B2E

B2C

Product Info

Search

Integration

Catalog

Sharing

Analytics


What Comprises a Corp.com Strategy?

Co

nte

nt

Ca

ch

e o

rC

on

ten

t C

ac

he

or

Kn

ow

led

ge

Co

nta

ine

rK

no

wle

dg

e C

on

tain

er

Ap

plic

atio

nA

pp

licat

ion

Ap

plic

atio

nA

pp

licat

ion

Ap

plic

atio

nA

pp

licat

ion

Ap

plic

atio

nA

pp

licat

ion

Ap

plic

atio

nA

pp

licat

ion

Ap

plic

atio

nA

pp

licat

ion

Ap

plic

atio

nA

pp

licat

ion

Ap

plic

atio

nA

pp

licat

ion

Security, EAI, Content Mgt., Inter-Enterprise Integration, Personalization

Corp.com InterfaceCorp.com Interface

FirewallFirewall

CustomersCustomers Job SeekersJob Seekers MediaMediaInvestorsInvestorsSuppliersSuppliers

Em

plo

yees

Em

plo

yees

By 2002, organizations will be required to provide a singular view of the corporation across all stakeholders, or risk significant mind/market share loss

By 2002, organizations will be required to provide a singular view of the corporation across all stakeholders, or risk significant mind/market share loss


What Are Key ebusiness Technologies?What Are Key ebusiness Technologies? Integration

Collaboration

Analytics

Process optimization

Personalization

Supply Chain Mgt.

Content Management

Security

Services

Infrastructure and ops flexibility

Integration

Collaboration

Analytics

Process optimization

Personalization

Supply Chain Mgt.

Content Management

Security

Services

Infrastructure and ops flexibility

End-to-end (“straight through,” life cycle, etc.) functionality will differentiate leaders from followers

End-to-end (“straight through,” life cycle, etc.) functionality will differentiate leaders from followers

E-Business EvolutionE-Business EvolutionE-Business EvolutionE-Business Evolution

PartnerPartnerCollabCollab

EngineEngine

Acknowledgment

PartnerPartner

Invoices, ASNs, EFT

Phase I:Transaction Automation

Shared Data (EDI)Shared Data (EDI)

PartnerPartner

Cash Management, Underwriting, Etc.

Statement Detail, 401(k) Self-Service, Etc.Phase II:Shared

Operating Data

Shared Access (Web)Shared Access (Web)

PartnerPartnerPhase III:

Collaboration

Constraints, Risk, Value

Business Plans, Purchase Histories/Analytics, Research

Shared Process (XML)Shared Process (XML)

Electronic Process Integration (EPI)

CollabCollab

EngineEngine

PartnerPartner

PartnerPartner

PartnerPartnerCollabCollab

EngineEngine


What Comprises Sell-Side Commerce?What Comprises Sell-Side Commerce? Managing channels

Understanding demand

Enabling customers to buy

Leveraging “in place” infrastructure

Integrating best-of-breeds

Product/service lifecycle mgt.

Appointing service provider(s)

Time to volume

Integrated CRM, logistics

Managing channels

Understanding demand

Enabling customers to buy

Leveraging “in place” infrastructure

Integrating best-of-breeds

Product/service lifecycle mgt.

Appointing service provider(s)

Time to volume

Integrated CRM, logistics

As sale of goods becomes frictionless, appropriate channel strategies and experiences must be created

As sale of goods becomes frictionless, appropriate channel strategies and experiences must be created

How Effective Is the Backbone?How Effective Is the Backbone?

Sell Maturity Model

Ph

as

es

Relationships

Tasks

Re

su

lts

Web to Order Management (OM)Web to Order Management (OM)

Web OM integrates with ATP & CTPWeb OM integrates with ATP & CTP

Integrates OM w/Partner Avail.Integrates OM w/Partner Avail.

X-Enterprise X-Enterprise Mfg. FloorMfg. Floor

ValueChain

Optimization

ValueChain

Optimization

Opti-mizeOpti-mize

Exter-nalizeExter-nalize

Inte-grateInte-grate

SellSell

Sto

refr

on

tS

tore

fro

nt

Man

ufa

ctu

rin

gM

anu

fact

uri

ng

Inte

gra

tio

nIn

teg

rati

on

Ch

ann

el

Ch

ann

el

Inte

gra

tio

nIn

teg

rati

on

Su

pp

lier

Su

pp

lier

Inte

gra

tio

nIn

teg

rati

on

11

22

33

44

Intra-Enterprise IntegrationIntra-Enterprise Integration

Inter-Enterprise IntegrationInter-Enterprise Integration

Electro

nic B

on

dE

lectron

ic Bo

nd

with

Cu

stom

ers/w

ith C

usto

mers/

Partn

ersP

artners


Sell-Side ArchitectureSell-Side Architecture Leverage in-place

infrastructure and applications when possible

Enable catalogs, configurations, processes, prices — content — to change dynamically

Integrate applications and data to present a personalized experience

Leverage in-place infrastructure and applications when possible

Enable catalogs, configurations, processes, prices — content — to change dynamically

Integrate applications and data to present a personalized experience

Sell-side initiatives must integrate commerce, content, and CRM with existing back-office app operational data

Sell-side initiatives must integrate commerce, content, and CRM with existing back-office app operational data

Outside In vs. Inside OutOutside In vs. Inside Out

AppApp

ServerServer

Database Database & Business & Business

LogicLogic

Traditional C/STraditional C/S

Web Web

BrowserBrowserWeb Web

BrowserBrowser

AppApp

ServerServer

Leveraging the ERP WebLeveraging the ERP Web


What Comprises Buy-Side Commerce?What Comprises Buy-Side Commerce?

Understanding types of procurement

Indirect Direct

Managing suppliers and components

Participating in marketplaces (suppliers and buyers)

Understanding types of procurement

Indirect Direct

Managing suppliers and components

Participating in marketplaces (suppliers and buyers)

Organizations must drive procurement efficiencies, but determine requirements and return prior to investment

Organizations must drive procurement efficiencies, but determine requirements and return prior to investment

Procurement FuturesProcurement Futures

Com-Com-moditymodity

Integrated Integrated

ProcurementProcurement

Networks & Markets

GlobalProcurement

LOBProcurement

CorporateProcurement

<1995 1999-2001 2000-02

Home-Grown

Multi-ChannelVendorsSingle-

ChannelVendors

Multi-Channel/

Multi-MarketVendors

Indirect Indirect &&

DirectDirect


Procurement PoliticsProcurement Politics Focus on internal costs

and processes for commodity procurement

Focus on asset management/maintenance for MRO procurement

Focus on SC efficiency and product management for direct procurement

Tactics first, then strategy Integrated procurement by

2001

Focus on internal costs and processes for commodity procurement

Focus on asset management/maintenance for MRO procurement

Focus on SC efficiency and product management for direct procurement

Tactics first, then strategy Integrated procurement by

2001

E-procurement success in 2000 means focusing on one/more processes and applying solutions

E-procurement success in 2000 means focusing on one/more processes and applying solutions

No Wonder It’s So Difficult . . .No Wonder It’s So Difficult . . .

New Product New Product DevelopmentDevelopment ManufacturingManufacturing

LogisticsLogisticsCustomerCustomer

ManagementManagement

AssetAsset

ManagementManagement

FinancialFinancial

MaintenanceRepair

Operations

SourcingDesign

Production Maintenance Execution

Quality Accounts PayableAccounts ReceivableGeneral Ledger

Customer

Self-Service

Customer ServiceField ServiceProduct Config

PurchasingDistributionInventory

SupplyChainPlanning


Direct Procurement: More Bang for the Buck? Direct Procurement: More Bang for the Buck?

Focus direct procurement efforts on:

Supplier management Component

rationalization Integration with product

life cycle Supply chain visibility

Focus direct procurement efforts on:

Supplier management Component

rationalization Integration with product

life cycle Supply chain visibility

Integrate product development/life cycle and procurement solutions; increase quality/decrease time to market

Integrate product development/life cycle and procurement solutions; increase quality/decrease time to market

Direct Procurement Excellence Solves . . . Direct Procurement Excellence Solves . . .

Part/supplier proliferation

Part/supplier proliferation

Manual processes/spreadsheets

Manual processes/spreadsheets

Little reuse ofstandard partsLittle reuse ofstandard parts

Long designcycle times

Long designcycle times

Rampant ECOsRampant ECOs

Cost overrunsCost overruns


What Are Characteristics of Net Markets?What Are Characteristics of Net Markets? Equity investment

Regulation

Finance

Staffing

Globalization

Channel “mastery”

Channel/customer relationship management

Co-opetition

Equity investment

Regulation

Finance

Staffing

Globalization

Channel “mastery”

Channel/customer relationship management

Co-opetition

A robust net market replicates an organization’s entire business model…only much faster and more often

A robust net market replicates an organization’s entire business model…only much faster and more often

Trusted Intermediary Components/ServicesTrusted Intermediary Components/Services


Why Net Markets Are CriticalWhy Net Markets Are Critical Matchmaking

Reduce friction between suppliers and buyers

Add value to complex processes

Decrease cost of commodity products/services

Extend reach to unserved markets

But don’t expect huge revenues all the time

Matchmaking

Reduce friction between suppliers and buyers

Add value to complex processes

Decrease cost of commodity products/services

Extend reach to unserved markets

But don’t expect huge revenues all the time

Significant investment must go only to Net Markets that optimize industry processes and focus on buyers

Significant investment must go only to Net Markets that optimize industry processes and focus on buyers

All Net Markets Are Not Created EqualAll Net Markets Are Not Created Equal

Net Market Maturity Model

Ph

as

es

Relationships

Tasks

Re

su

lts

Product categories, text, e-mail communicationsProduct categories, text, e-mail communications

Better links to suppliers, fulfillment; Better links to suppliers, fulfillment; transactionstransactions

Buyer-market-supplier integration,Buyer-market-supplier integration,mostly comms/transmostly comms/trans

EPI for market/industryEPI for market/industry

CommerceChain

Optimization

CommerceChain

Optimization

E-HubE-

Hub

E-Market

E-Market

E-MailE-Mail

E-Classifieds

E-Classifieds

Ad

ve

rtis

me

nt/

Lis

tin

gA

dv

ert

ism

en

t/L

isti

ng

Cat

alo

gs,

pri

ce h

isto

ry,

Cat

alo

gs,

pri

ce h

isto

ry,

in-d

epth

pro

du

ct i

nfo

,in

-dep

th p

rod

uct

in

fo,

lin

ks t

o f

ulf

illm

ent,

off

lin

eli

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to

fu

lfil

lmen

t, o

ffli

ne

tran

sact

ion

str

ansa

ctio

ns

On

lin

e tr

ansa

ctio

ns,

On

lin

e tr

ansa

ctio

ns,

inte

gra

ted

fu

lfil

lmen

tin

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rate

d f

ulf

illm

ent

Bu

yer-

to-s

up

plie

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uye

r-to

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lier

inte

gra

tio

n v

iain

teg

rati

on

via

hu

b s

ervi

ces

hu

b s

ervi

ces

Intra-Enterprise IntegrationIntra-Enterprise Integration

Inter-Enterprise IntegrationInter-Enterprise Integration

En

d-to

-en

dE

nd

-to-e

nd

ele

ctron

ic b

on

d/

ele

ctron

ic b

on

d/

pro

ce

ss in

teg

ratio

np

roc

es

s inte

gra

tion

Consolidator Model ChangeConsolidator Model Change

44

33

22

11


Net Market-tectureNet Market-tecture ERP vs. best-of-breed backbones

Application integration/middleware

Inter-enterprise integration

Websourcing providers

Operations sourcing

Collaboration

Transaction/order management

Billing

Catalog content management

Content management and personalization

ERP vs. best-of-breed backbones

Application integration/middleware

Inter-enterprise integration

Websourcing providers

Operations sourcing

Collaboration

Transaction/order management

Billing

Catalog content management

Content management and personalization

Rapid deployment and flexibility win; sourcing and operations are critical components

Rapid deployment and flexibility win; sourcing and operations are critical components

3-Month vs. 2-Year Deployment 3-Month vs. 2-Year Deployment

Transport, Security/SSO, Availability,

Uptime, Application Mgt., etc.Operations

Financials, HR

Database

Transaction/Brokerage

Middleware

Billing

Order Mgt.

Buyer Process Integration

Assessment

Supply Chain/Logistics

Messaging Analytics

Auction Catalog/Content Workflow

Reporting

Financial Services

Contract/Channel/Customer Mgt.

Value Added

Services

Net Market

Services

Infrastructure

Portal Services


SummarySummary

Commerce Chain Management: Bottom LineCommerce Chain Management: Bottom Line

Integrate partners, customers, content, and commerce to drive sell-side success

Pursue buy-side commerce tactically, but evolve toward integrated strategy

Sell side commerce equals integration, CRM, and the “other CRM.”

Participate in Net markets to drive revenue, create efficiencies, and/or maintain relationships

Understand that the e-business end game is a sum of all the parts

Integrate partners, customers, content, and commerce to drive sell-side success

Pursue buy-side commerce tactically, but evolve toward integrated strategy

Sell side commerce equals integration, CRM, and the “other CRM.”

Participate in Net markets to drive revenue, create efficiencies, and/or maintain relationships

Understand that the e-business end game is a sum of all the parts

META Group Commerce Chain Management Kip Martin Program Director Electronic Business Strategies Kip Martin Program Director Electronic Business Strategies.

Documents

eopportunity value case

ebusiness effort value

tactical planning exercise

associated tactical

partner slide

available digital weapons

websphere commerce

design requirements