E-business cannot operate in isolation

While many South African businesses now acknowledge the need to develop an e-business strategy and transition to the Internet business model, many remain confused by all the hype.

The main ingredients for a successful new age strategy are a solid IT enterprise foundation on which to build, access to relevant e-business skills and applications, and an environment, or marketplace, in which to trade.

Many start-up dot-coms failed dismally as in their haste to get to market they ignored the need for an integrated IT infrastructure. There have been some spectacular - and expensive - failures, as several high-flying companies ignored basic best practices.

"Like traditional business, e-business requires a solid, integrated platform, best provided by an enterprise system," says Simon Carpenter, general manager at SAP Africa responsible for the mySAP.com Internet components. "A leading-edge enterprise resource management system (ERM) that is closely aligned with the company's business processes is essential for effective operation in the networked economy. The rapid adoption of best practices as represented in leading ERP systems can help a company position itself effectively."

E-business cannot operate in isolation. The New Economy requires companies to develop and deploy a number of business relationships and application components, as well as heterogeneous technologies and multiple standards.

The level of co-operation necessary among businesses and across solutions suppliers is unprecedented, and no single vendor can hope to develop everything that business customers will need.

"Vendors that promise a complete e-business solution should be viewed with cynicism," says Carpenter. "Many have not lived up to their promises."

Well-known in the enterprise market arena, SAP has impressed analysts and customers by moving at great speed to launch new solutions in the e-commerce market space. The company also works closely with a number of leading partners to ensure that it offers truly comprehensive solutions.

"SAP has quickly emerged as an Internet solutions leader over the past year, delivering mature e-business products under the mySAP.com umbrella," says David Alschuler, vice president of e-business and enterprise applications at research house Aberdeen Group.

The company "is uniquely positioned to provide a complete range of e-business applications that integrate customer-facing processes, supply chains, order fulfilment and business intelligence to create an integrated chain of commerce," he adds.

"Being able to deliver (mySAP.com) to one million users in less than a year is an impressive achievement," says analyst Josh Greenbaum, principal of Enterprise Applications Consulting. He fully expects this momentum to continue.

Among SAP's key e-business partners is Commerce One, a leader in global e-commerce solutions. The two companies recently launched the first of their next-generation e-business marketplaces for the Internet economy.

Commerce One provides the marketplace infrastructure that enables companies to establish and develop trading portals, while SAP provides functionality in the areas of supply chain management, product life-cycle management, customer relationship management and business intelligence.

Through the alliance, both companies have extended their global footprints and have allocated 4000 skilled professionals working to bring joint products to market. The first of these, MarketSet and EnterpriseBuyer, became available in mid-September.

"Being able to ship an architecturally unified product within several months of conception is truly impressive," says Greenbaum. "With this development, the partnership ... has moved from theory to reality."

The delivery of this first joint solution shows that SAP and Commerce One are successfully teaming to produce the next generation of e-business software. The result is a joint e-marketplace and e-procurement solution of unparalleled scope and depth.

Apart from the launch of its first solutions, the alliance has already concluded two high profile marketplace deals. These are the global mining and metals procurement marketplace and Enporion, a global e-marketplace for the energy and utility industry.

The mining, metals and minerals marketplace, which expects to begin processing transactions during the fourth quarter of 2000, comprises a consortium of 15 mining and metals groups aimed at automating the procurement of products and services used in the exploitation and processing of metals and minerals. Members include Anglo American plc; De Beers Consolidated Mines Ltd, The Broken Hill Proprietary Company Limited (BHP) and Alcan Aluminium.

The five founders of the Enporion global utility exchange are Allegheny Energy Inc., New Century Energies, Minnesota Power, Northern States Power, and PPL Corporation. Enporion plans to be open for commercial operation by the end of the year 2000. Cap Gemini Ernst & Young LLC is the business advisor for the marketplace. Energy companies globally are looking to reduce costs and better serve customers.

Through the Enporion marketplace, it is envisaged that suppliers will enjoy seamless interfaces with buyers, exposure to new markets and more standardised processes. Buyers will gain access to new suppliers and enjoy a streamlined supply chain process and lower operating costs.

Analysts view these developments between SAP and Commerce One as a clear sign that SAP is genuinely an Internet-centric company, responding quickly and flexibly to market needs.

SAP has also established the ec4ec (e-commerce for engineered components) marketplace, a joint venture with Babcock Borsig AG and MG Technologies AG. The companies plan to develop and operate a global online marketplace for plant engineering and mechanical engineering companies encompassing a worldwide market volume of more than $ 800 billion.

SAP, together with Commerce One and a number of other key SAP partners, will demonstrate their New Economy solutions at Sapphire 2000 South Africa, a conference and exhibition hosted by SAP Africa, and held in conjunction with Comdex 2000.

The SAP Village will take up a quarter of the floor space at Comdex. Delegates to the SAPPHIRE 2000 South Africa conference will have the opportunity to hear cutting-edge ideas from New Economy experts.

Keynote speakers include Tito Mboweni, Governor of SA Reserve Bank; Peter Zencke, Board Member - SAP AG; Dan Currie- VP, WorldWide Systems Engineering - Commerce One; John Saw - Regional Marketing Manager - HP; Andreas Bertoldi - Senior Analyst: Internet and e-Commerce division - BMI-TechKnowledge Group; Andy Kitchner, CEO and Founder - Shopcreator Developments LTD (UK), and Alex Zwiegelaar, CIO of Sasol.