It's the supply chain, stupid
Proving ROI will be key for both public marketplaces trying to attract members, and for vendors trying to sell the private Net market concept to corporate customers. As a result, vendors and Net markets will focus on two things in the near term: analytics and inventory control.
"I'm very interested in trading partners and analytics," says Frank Campagnoni, CTO and VP at GE Global eXchange (GXS). "It turns out the interactions have huge value if you can map those and data-mine them." Campagnoni envisions analytics as a value-added service for users of GXS or other exchanges.
That may help Net markets prove their worth to participants and is certainly part of the reason Ariba hooked up with See Commerce, a maker of supply-chain performance management and improvement tools, for its value-chain initiative unveiled in February. "We see huge enthusiasm from systems integrators because this is the first software that they can embed to show a customer the impact of what they do," says Paul Albright, president and CEO at SeeCommerce. "We provide a similar type of value for the marketplaces."
Like the latest collaborative tools, these so-called e-analytic, or real-time analytic tools, are designed to work in an extended supply chain. The tools are aimed at culling information from multiple sources and partners, analysing it in real time, and giving access to the results to users at disparate locations.
Datasweep for example, aims its Advantage software suite at industries that employ a lot of contract manufacturers; Flextronics, an electronics manufacturing services giant, is a customer. Another vendor, Spotfire, maker of DecisionSite, has gone after the process industry, signing on pharmaceutical supplier Eli Lilly, which has extensive extranets, and ProcessCity, a chemicals industry exchange.
The goal is a more efficient supply chain, which is what most private Net markets are looking for. "Once you move into the private arena, it's really about supply-chain demand reengineering," says Aberdeen's Brandel. Corporations mulling over their next B2B move in a down economy, he adds, will focus on inventory control as a way to cut costs.
That has raised the profile of supply-chain management software makers such as i2 Technologies, which was working with Ariba until last month when it announced plans to acquire RightWorks. RightWorks software provides the procurement and sourcing functionality that i2, which focuses on demand planning and forecasting, needed to start competing head-to-head with Ariba and Commerce One.
