E-Business today and tomorrow (page 2 of 2)

We're seeing huge long chains of business processes being automated so everything flows automatically into everything else, smoothly, quickly and accurately. A customer places an order on the web site, it transfers automatically into the order entry system, into accounts for invoicing and into the warehouse management system for fulfilment. At this point it can be published on the company's external e-marketplace for suppliers to view along with other orders in the pipeline and plan their inventory accordingly, it may be put up for auction for suppliers to bid to supply components or for partners to take on the service contract. If it is a custom product, the company can collaborate with suppliers on the e-marketplace to design it using an internet-enabled CADD application.

Supply Chain Collaboration
The idea of the e-marketplace as a hub for collaboration in the extended enterprise has come under a lot of media fire recently, but at Oracle we are actually seeing our Exchange customers enjoying great success. In the Netherlands, for example, there's an e-marketplace called Proclare that was initially set up as an internal site for employees of the leading telecoms operator KPN to source office supplies. Now Proclare is a separate, profitable company with several large corporates using the site to buy everything from pens to furniture to contract IT staff. Proclare turns over EUR1.5bn annually, and in the process it saves its customers around 15% on procurement costs by offering them a complete service that manages the whole procurement process from sourcing to payment. The key to success here is total integration - a single, integrated, internet-enabled software system that manages every aspect of the procurement process. The fewer disparate components that comprise such a system, the sooner it is going to be up and running, and the better it is going to work. That's not rocket science, just common sense.

Software Outsourcing - The Final Model of Computing
While the basic tenets of e-business - automated processes, business transparency, centralised operations, single instances of software - will remain, the benefits will increase with further technological developments. For example, wireless access to existing e-business applications and e-marketplaces will further increase productivity, timeliness and efficiency. The real benefits, though, will come with the delivery of software as an online service. Why go through the pain and expense of buying, installing and managing hardware and software in-house, when you can pay a company a monthly fee to manage it for you? For your monthly fee you always have the latest software version, it is managed and supported by the best professionals in the business, and it's stored on top-class servers in a secure data centre. Your employees access the same e-business applications through the same browser - it's just that the software is no longer actually on your premises. And the cost of installing and managing it is no longer on your books. I believe that once the natural human resistance to change is overcome, hosting will become the new paradigm of business computing.

In short, e-business is a holistic approach, involving not just everyone within the enterprise, but also everyone who is involved with it at any point. Turning your extended enterprise into a lean, efficient, transparent business machine, before the competition does, should be the goal of any e-business strategy. That's not something that you're going to achieve by buying some company's e-commerce storefront and trying to stick it on to some other company's supply chain management software and someone else's order management system. That's horribly complex computing, Frankenstein computing. At Oracle, driving out the complexity in our IT systems helped us save $1bn in a single year. How much you save will be up to you.