Automatic for the People Do you know what an eMarket is? If you plan to be a dotcom success, you'd better find out fast.
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Emarkets have been touted as the segment of the Internet withthe most growth potential, representing lucrative sales and highprofit margins. In fact, Forrester Research projectsbusiness-to-business sales to reach $843 billion this year.
For small businesses, eMarkets have the potential to completelyalter supply and distribution models. In addition, streamlinede-logistics and e-procurement, arising from the efficiency ofautomated supply chain processing, promise to downsize things likeinventory management from a 60-day cycle to a six-day cycle, allwhile lowering the cost of processing orders and expediting thedelivery of b2b goods and services. But there's a challengefacing eMarkets: They must not only automate the existing supplychain, but also be able to bring in new members on a global scale.Problem is, eMarkets have been heavily criticized for lacking astandard.
According to Forrester's April 2000 report, eMarketplaceHype, Apps Reality, the estimates of how much money b2bprocurement will save participating businesses is based on theassumption that all the needs of the procurement process will bemet. That includes collaborating with vendors on productspecifications, requesting quotes on products, confirming thatdelivery specifications are acceptable, negotiating prices andmore. That's an impossible task without a standard technologyor business transaction protocol in place.
RosettaNet, a nonprofit consortium established for standardizingand automating electronic business interfaces for the IT and ECsupply chains, began researching and developing a back-officestandard based on XML (Extensible Markup Language) in 1998."It came out of a need from the many IT distributors gettingdeluged with product catalog information, whether it was newproducts, updates to products or just having a really difficulttime getting the information into their servers. Productsweren't getting introduced, and it was causing a lot of excessinventory, with product life cycles being extended," says MarySchoonmaker of RosettaNet (www.rosettanet.org), which has beenapproached by both eMarkets and other industry consortiums in theirstandardization efforts.
RosettaNet has developed PIPs, or Partner Interface Processes,to facilitate the exchange of information within the IT and ECindustries. "The first thing we had to set up was transportrouting to get from server to server in an efficient and standardway," says Schoonmaker. "XML is the next level from HTML;it actually describes what is in the document." The dictionaryRosettaNet developed is based on Global Trade IdentificationNumbers, and protocol standards are based on best-of-breedpractices agreed on by its members. Other Consortiums, such asCompTIA and OAG, are developing standards in their respectiveindustries as well. And, as coalition partners within RosettaNet,they're also working on standards convergence and the issue ofinteroperability with each industry's standards.
In the case of eMarkets, standards must be developed withworldwide implementation in mind. According to Schoonmaker, arecent summit hosted by RosettaNet found that eMarkets for the ITand EC industries expected their exchanges to beRosettaNet-compliant to ensure they would be able to plug-and-playwithin different exchanges.
As dotcom start-ups will soon become the next generation ofeMarket members, how easy will their entry into standardizedexchanges be? It could be as simple as purchasing an XML server andhiring an IT resource to implement the appropriate standards andconnect to other XML servers. But don't run out and buy thatXML server just yet-standards are still just in the preliminarydevelopmental stages. Not even RosettaNet expects its XML (PIP)work to be completed before next summer.
