There are three very important steps that anyone planning to implement a business-to-business (B2B) solution should take before any others according to implementers, analysts and B2B companies. They are: planning, planning, and — surprise! — planning.
Deciding primarily what the goal of the site is, whether it is a point-to-point B2B or a dot-com, whether or not to involve partne — these are all considerations that must be taken into account.
“What B2B basically allows a company to do is to execute business processes on-line with or without user interaction,” said Michael Roach, director of business services for Toronto-based Clockwork, a business framework consulting company. “So you can execute business processes automatically over the Web without having to subscribe to traditional VAN(value-added network) services.”
There are a lot of point-to-point B2B solutions — when two partners execute business processes over the Web — being implemented Roach explained. They define a proprietary implementation plan and proprietary message formats, where “it turns more into a traditional EDI-type of relationship.”
Matthew Sanders is an associate analyst with the e-business trade team at Cambridge, Mass.-based Forrester Research Inc. He said, “B2B exists where something is taken out of the ground and when it’s finally manufactured before it gets to the end consumer…so it’s pre-retail. B2B includes the sale of a product to a retail store, but does not include the interface between the retailer and the end consumer.”
Roach explained that people considering implementation should realize it’s not enough to just want to go the Web.
“There’s really three things that you need: a vision; the existence of some sort of market requirement; and the technology infrastructure that has to be put into place…There has to be some sort of value in collaborative business processes, and collaborative business relationship with your business partners. There has to be a clear direction form your market from a technology point of view: is there any existence of portals? Do the trading partners share the same vision? You can pound the B2B commerce drum all you want, but if your partners are stuck…you’re lost.”
Sanders agreed, and said, “E-business is fundamentally a shift – it’s not just an overlay of a new process, it’s not just plugging in a new technology. It’s a technology that will fundamentally shift your business practices, processes and relationships. And so you need to prepare and orient your strategy around this very new, very disruptive technology.”
Toronto-based itenders.com is a B2B for companies looking for business services such as accounting and janitorial. Bids can be placed on the different jobs and services through a pre-set form, ensuring all the information required is made available. The use of this site is a time-saver for users, according to itenders.com president and CEO Peter Cusimano, and he said that should be one of the first considerations in the planning stages – who are the users, and what are their needs and wants?
“When you’re implementing a solution, such as itenders.com, it requires a system that is easier to use and represents a better way of doing business, from an end user perspective,” he said.
A study released in December 1999 by Forrester revealed that 30 B2B sites tested for user experience by Forrester analysts failed, and most lacked value and reliability.
The user experience is more important than time to market, according to the report. A high number of tested sites scored poorly by not providing users with necessary information to complete transactions; some sites made information difficult to find by having too many screens users were forced to click through; and not one of the thirty reviewed sites incorporated tailored content based on knowledge about users – all things to consider in the planning stages.
Cusimano said, “Where itenders is positioned, we’re really almost essentially a B2B marketplace. We’re like the exchange. We actually aggregate purchasers and sellers. Our model is essentially to facilitate more B2B commerce, even though by doing that, we ourselves are engaged in B2B.”
He explained that companies should define for themselves exactly what B2B means for them, which involves looking at what short and long-term plans involve, and what the existing business model is and how that ties in with a digital economy. That is where a lot of companies are struggling, he said, especially with a digital economy that is always shifting. Companies may in fact have to revise their business models, he pointed out.
Cusimano and his partners launched itenders.com on their own, so they were able take part in the entire process. One of the partners had experience in Web site design, and had the technical expertise necessary to implement the solution, and Cusimano had the business expertise in the project.
“I think that’s somewhat unique – what I think a lot of companies are going to have to do is…to focus in on their particular skill set that relates to their particular industry, and outsource the areas that they don’t know. A lot of times that comes in the area of technology,” he said.
Forrester’s Sanders advised that B2Bs should consider where they are going before they choose what types of technologies they are going to use, through their business and strategies, as well as business model. Once they get that right, he said, they will be set.
He noted that another important consideration when dealing with B2B and e-business is that it is not only about transactions, but also about all the other services wrapped around transactions – something to keep in mind when implementing applications and software.
“Logistics, finance, credit,” he offered. “There are also things that can be done on-line that aid firms in workflows, managing processes and so in addition to all the transactions that take place on-line, the ‘net also offers new flexible advanced tools to really manage your business and support the transactions that are taking place in a much more streamlined way.”
So what happens next? After defining the business process, and finding all of the benefits, Roach said a backoffice application is essential in order to continue on with the implementation.
“You need a backoffice that is open. You can try to fake your way through linked developments…but eventually that’s going to limit your opportunities in B2B. So you need some sort of foundation for the actual business process, backoffice integration – things like an ERP package, or best-of-breed package which is open to integration with any of the business-to-business toolkits,” he said.
Without a backoffice, implementation could prove to be very challenging, he added.
The process for itenders.com proved to be a fairly problem-free process for Cusimano, who explained that the idea for the site was conceived in May 1999, and the development of the first generation site began in July. From there, the second generation site was created, and was launched in February 2000.
The company tested its first site with a core group and used the results to revise its site model – something that Cusimano recommends to ensure acceptance of the site and success.
Conception of idea to implementation can take as little as four to six weeks, according to Clockwork’s Roach. But in general, he said one to three months is a reasonable time to expect, depending on the definition of the business process and the partners’ ability to participate.
And Canadian B2B companies that make it to the Web have a bright future, according to research from Forrester.
“In Canada, our projection for business-to-business e-commerce by 2004 [is that it] will reach $218 billion – that’s huge compared to on-line retail,” Sanders said.
