When we talk about the Internet, we often treat it as if it is a single thing — what we see when we “surf the Net” through the World Wide Web via our browsers. The Internet, however, is a multifaceted communications tool that can be used for many different purposes depending on our needs.
Just as every company needs a telephone and business cards to do business, every company today needs a presence on the World Wide Web, if only to provide basic information to stakeholders, such as employees, vendors, customers and investors. But not every company needs to conduct a buyer’s auction, process credit card payments or enable live chats with customer service representatives through its Web site. Nor should every company change the way it does business for the sake of a new, gee-whiz Web technology, unless there is a demonstrable benefit.
An essential step in understanding business processes is evaluating the systems that support those processes. These systems include back-office systems that handle order management, production scheduling, inventory control, purchasing, logistics and accounting. Whether you call your back-office system MRP, ERP, SCM, DRP or something else, if you can’t efficiently fill orders, send accurate invoices and quickly process payments, the Internet won’t help you. It will only aggravate your problems.
Once you understand the processes that define your business, you can determine which ones can be performed more efficiently via the Internet.
There are four approaches a company can take to using the Internet, depending on its structure, products and partners. These approaches are: B2U, Extended B2U, B2B and B2C.
An Extended B2U brings more than gains in the efficiency with which a business can process transactions. Depending on the company, switching from dial-up modem access in a remote client/server environment to using the Web to enter transactions and access the main server could rather quickly save enough time and money to justify the cost of setting up the Intranet.
B2B is particularly effective when supply-chain integration is vital, such as when a company shares information with partners to expedite the exchange of goods and money. An Extranet can provide partners with any information you let them access, like current inventories, pricing information and internal databases. Vendors can access Request for Proposals and submit quotes through an Extranet. A distributor can put a link on its Web site directly to your online product catalog. Customers can track their shipments themselves, reducing call traffic to your customer-service center.
Who is in control of the relationship governs how an Extranet is used. If you’re a small company that sells taillight lenses exclusively to Ford, you’re probably going to need to connect to Ford’s Extranet instead of operating your own. On the other hand, if you buy large quantities of sheet metal from a variety of small suppliers strictly on the basis of price and delivery time, or if you supply aftermarket auto parts to thousands of repair shops nationwide, it makes sense to provide these partners with a connection to your Extranet and treat them like branch offices.
Any company preparing to do e-business should make sure that its back-office systems handle incoming orders with equal efficiency and accuracy, regardless of how they arrive.
Not all back-office systems that claim to be e-business-enabled offer the same flexibility when it comes to extending your business processes to the Internet. Successfully moving your business processes to the Internet requires systems that are inherently Web Native and Open. A Web Native system has these attributes:
If a system is Web Native, it is much easier for a company to run its business on both an Intranet and Extranet. There may be little more to do than to set some display and security parameters and push a button to generate a Web version of essential business information such as Stock Status Inquiry. A Web Native back-office system eliminates development and implementation delays and substantially lowers maintenance and operating costs compared to one that is not.
Web Native also means that you can outsource some of your business processes, perhaps logistics or customer service, to a strategic partner or application service provider, which will significantly reduce your investment in hardware and software.
A system is Open if its developer has published its application-programming interface (API), the method to be used to interact with that system. Using a system’s API, a programmer can write short programs that can enable that system to readily share information and functions with other systems.
In an Open system:
With a closed system, these capabilities are much more difficult to provide in any reasonable, cost-effective and timely way.
After you have analyzed your business processes and needs and evaluated your back-office systems, the next step is to develop a plan to move onto the Web. You might start with an Intranet B2U connection for your own personnel, moving outward to provide some of those capabilities to business partners (B2B). Eventually, if you have something to sell to consumers, you can move to a full-service, public B2C site.
To do this well means selecting a system that is Web-capable at its core, inherently built that way from the ground up, so that you can have your choice of a GUI or browser as you see fit. To make it easily connect with whomever you choose, it needs to be open, so that you can link it to other Web sites and systems and fully exploit the potential inherent in the World Wide Web to handle your business more efficiently and increase your revenues and profits.
For more information on e-business, contact Dr. Allen Pinkus at 2200 Georgetowne Dr., Sewickley, PA 15143; phone 724-933-1300; fax 724-933-1379; e-mail email@example.com; or visit www.adonix.com.