Enterprises embarking on collaborative commerce expect to replace the traditional business relationships of old with new, more transient alliances designed to position them to seize new trading opportunities. To work, however, e-collaboration requires a degree of IT strength from every link in the chain and/or the help of a strong IT provider at the top of the chain. One emerging solution to helping SMEs take advantage of c-commerce has come with the rise of ASPs that can stand in the market with the applications that big companies can afford but small companies can't. Small companies can simply log onto that application through the Internet without even having to install their own demand planning systems. For the model to succeed, experts say, participants must determine a common set of standards across the board and stick to them.
Vinod Parmar, implementation manager e-commerce solutions with Connect.com.au, points out that in the history of packaged applications the usual scenario is that it cost $X to buy application software/hardware and $2X to implement them. "This $2X is the catch," Parmar says. "That is, to play in this game and gain the similar benefits to large counterparts, a company still has to invest a lot on implementation and business processes change. One can argue that a small player does not have the complexities of a major player, but relative costs are still significant for a smaller player with no clear benefits in sight." Parmar cites the example of a supplier with a large customer that has committed to a B2B marketplace. The customer will approach you with a simple request to participle in this marketplace (mostly for free) to continue trading, saying all you have to do is to log on to "www.marketx.com.au" and register yourself, provide your e-mail/EDI address and upload your product catalogue. Simple!, the large customer says.
"Now, if you are a supplier, then you probably have more than one customer and expect similar requests from them soon," Parmar points out. "You have to digitise and customise your content (for example, Catalogue with UNSPC product classification, price reflecting contract, unit of measure, description, SLA, terms, and so on) for each of the requesters with no guarantee of success and liquidity of marketplace business for yourself. You have no integration with your systems and you will have ongoing content maintenance problem. "What would you do?," Parmar asks. "Wait," he says. "In the scenario above even when the marketplace is a hosted solution, there are significant impacts on trading partners."
Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.