Transformation Weblog

FRIDAY

• Covisint will host its online auto exchange with Exodus, according to published reports. The move makes sense, and will allow Covisint to expand its operation without incurring the massive costs of building the data centers to support the global e-marketplace in-house in this tight economy.

• The WSJ reports this morning that problems with b-to-b exchanges have spread to Europe as well.

• Today's the last day we feature our forum Microsoft vs. Open Source. Not surprisingly, it's been getting some heated comments and good debate.

  THURSDAY

  Quick Hits
  • We wrote earlier this week about Ingram Micro's new reverse logistics warehouse. Today, Jupiter Media Metrix put some numbers to the problem, reporting that e-tail returns by U.S. consumers will reach 90 million, or $5.8 billion, by 2005. Jupiter analysts said online retailers will never recover the high costs of doing business online if they do not improve their reverse logistics systems.

    According to Jupiter, it's not enough to just concentrate on improving the returns process. Rather, e-tailers must also be able to collect and analyze returns data and use that info to improve their inventory and supply chain planning--not to mention the need to re-sell the items to recoup lost sales.

  • Insurance providers, relative e-business laggards, will increase e-business spending by 89% over the next three years, according to a survey of 150 insurance companies by PricewaterhouseCoopers. Interestingly, more than two-thirds of insurance companies surveyed said their companies lacked e-business savvy and leadership, especially at the highest levels of their organizations.

    Today, according to the survey, just 7 percent of agents and brokers and 17 percent of insurance carriers have Web-enabled the back-end processing of policy applications. In three years, those numbers are expected to rise to 93 percent and 71 percent respectively, according to PWC.

  • Interesting, but not surprising, findings in an Accenture (formerly Andersen Consulting) study released today: as bad, and costly, as b-to-c marketing campaigns have been, b-to-b efforts are receiving almost no marketing support at all. This is a fairly touch-feely area, but the main takeaway is this: a strong, reputable brand is the single most important buyer preference by a wide margin, followed by service, price and variety.

    What does this mean for e-businesses? Focus on moving your existing brand and relationships online; e-business doesn't have to mean NEW business. And like the doctor's oath says: above all, do no harm (to thy brand or thy customers).

  • We wrote about progress (The Standards Shuffle) in e-business standards, including ebXML, back in March. Today, the ebXML initiative is holding its final meetings offering proof-of-concept demos and the first showcase of the spec's new security features.

    Major standards bodies (OAG, RosettaNet, EDI X12 and others) as well as 28 vendors are expected to ratify the standard this week, and start working on the next phase of development.

    This is great news for e-business. ebXML has managed to gain broad support, which means very basic e-business processes--such as how a purchase order gets turned into a request for credit that is then followed up with an invoice and an advanced ship notice--can get built using some basic, standard XML expressions.

    Much work needs to be done applying ebXML to specific business processes, supply chains and industries, but an approved standard is a strong first step.

  WEDNESDAY

  Quick Hits
  • You've heard of CEO, COO, CFO, CIO, CTO even CPO (Chief Privacy Officer). But here's a new one: CRO. B2BWorks, an advertising network for b-to-b Web sites, named former MSN/Microsoft exec Ed Berry as its Chief Revenue Officer today. Looks to be something like a glorified VP-Sales. And we thought every "C" was responsible for revenues.

  • We're on a linguistic kick today: you've heard of e-commerce and e-business, but how about "e-bolt." Industrial giant Ingersoll-Rand today launched the E-Bolt Key Management system, which uses programmable deadbolts in combination with electronic keys. It all gets controlled from a PC running electronic signature technology capable of generating more 3 billion key combinations. The technology, popular (but without the deadbolts) in hotels, is being aimed by Ingersoll at apartment buildings and other commercial buildings.

  • ChemConnect continues to impress. While so many e-marketplaces falter, the exchange for bulk oil and chemicals moved more than 500,000 metric tons in April, with an average transaction of more than $1.3 million. Not bad.

  • Land's End today reported earnings, with a strong kick from its e-commerce operations. Internet sales for the quarter rose to $54 million from $39 million the previous year, an increase of 40%.

  TUESDAY

  Quick Hits
  • Bluelight.com, the Kmart b-to-c spin-off, is fine-tuning its B2B supplier strategy. Bluelight said today it has completed a vendor-direct supply chain network, combining its own proprietary data translation platform and ASP services from vendor CommerceHub.

    Bluelight noted CommerceHub's support for drop-ship fulfillment--in which vendors handle delivery to consumers--will help it expand its product line without adding to its inventory risk.

    Bluelight has developed a unique, hybrid business model which relies on its own fulfillment, the facilities of parent Kmart and now the capabilities of its vendors via CommerceHub.

    CommerceHub already provides similar capabilities to QVC, one of the world's largest direct-to-consumer retailers.

  • An Aberdeen Group white paper contends there's still plenty of savings yet to be gained in e-procurement. Benefits yet to be gained: a 25 to 30 percent shortening of sourcing cycle times and 5 to 20 percent unit price reductions.

  • Not sure how useful this massively generalized data is, but here you go: b-to-c Web sites are averaging 54,000 visitors per week, 12% of which make a purchase, according to a new report from ActivMedia Research.

  MONDAY

  M-Commerce's Slow Start

  Seems that nobody is itching to buy books--or really anything--using their cell phone. WSJ.com today reports Amazon is bailing out of m-commerce. The e-tailer's "Amazon Anywhere" team has reportedly been scaled back from 30 to three engineers. eCompany now tells a similar tale, detailing how Amazon is no longer an anchor tenant on Sprint PCS's Wireless Web browser. Several weeks ago we detailed Barnesandnoble.com's own mixed results with mobile commerce.

  Looks like wireless e-commerce still has a way to go.

  Quick Hits

  Lots of interesting e-business developments today...

  • Hershey Foods suffered one of the most notorious ERP meltdowns in the fall of 1999, watching helplessly after its SAP platform died right before the holiday selling season. Today, Hershey said it has rolled out new warehouse and distribution systems from McHugh Software that continues to repair those earlier problems. The new systems are part of a redesigned distribution network that includes a new 1.2 million square foot eastern distribution center in Palmyra, Penn. The McHugh software handles functions such as receiving goods from production, picking selected goods to fulfill retailer orders, staging orders for shipment, managing transportation and more.

  • Ingram Micro's logistics division today said it has opened a new distribution center, its first to handle so-called reverse logistics. The center, in Harrisburg, Penn., collects, processes and recycles returned products and product parts. More effectively managing reverse logistics is growing in importance in well-oiled supply chains. The new Ingram program reflects the trend toward outsourcing reverse logistics management, previously a function that manufacturers were forced to struggle with in-house. Outsourcing such an information-rich, complex procedure requires an almost unparalleled degree of supply chain coordination.

  • Staples said today it is launching a CPFR--collaborative planning, forecasting and replenishment--pilot with several suppliers to improve its cycle times and reduce its inventory backlogs. Staples tapped vendor Logility for platforms to enable the CPFR trials. CPFR is an industry-standard method for managing collaboration and forecasting between retailers and their suppliers.

  • MiTac International today became the first joint customer using FreeMarkets sourcing and procurement marketplace in conjunction with collaborative tools from Adexa, which FreeMarkets acquired earlier this year. The Taiwanese computer maker will use FreeMarket's sourcing tools to acquire supplies and the Adexa platform to enter them into and track them throughout the supply chain.

  • Ford Motor Co. extended its virtual manufacturing initiative today, tapping vendor Tecnomatix Technologies to provide an "e-manufacturing server" to store and manage manufacturing data in a collaborative, Web-based environment. The tool keeps everyone working on a car design up to date on the latest designs and product data and ensures engineers adhere to Ford-mandated design best practices.

  • Samsung Electronics tapped webMethods today for integration technology for its private semiconductor marketplace. The e-market links global semiconductor makers with Samsung, using i2's TradeMatrix platform running RosettaNet standards. i2 and webMethods recently inked a co-marketing deal.

  Let us know what you think about the latest Transformation Weblog items.