MANAGEMENT PERSPECTIVE

Subject: September 2001 ECMgt.com: Evolving Infrastructure and Tools
ECMgt.com brought to you by ECnow.com
Your Link to Worldwide E-Commerce Developments
September 1, 2001 *4,200 subscribers* Volume 3, Issue 9
ECMgt.com Online: http://ECMgt.com
View this Issue Online: http://ecmgt.com/Sep2001
Print this Issue: http://ecmgt.com/Sep2001/full.issue.for.printing.htm

 

 

Evolving Infrastructure and Tools
Management Perspective
by Mitchell Levy, Author, E-Volve-or-Die.com

Many advances have been made toward the goal of integrating front office and back office systems, both within companies and between companies. Technologies that improve speed, collaboration or integration of processes will be a requirement for survival and growth in the future.

In addition to integrating front office and back office solutions, which create a more fluid E-Business infrastructure within an enterprise, Partner Relationship Management (PRM) and Collaborative Commerce solutions have recently synchronized front office and back office functions between enterprises, making them act as one unit to serve the needs of customers. We'll discuss the combination of front and back office solutions, and explore how the newer "inter-enterprise" world of PRM and collaborative commerce E-Business solutions, create internetworked and holistic E-Business architectures.

Front office solutions
The front office concept is a result of the increased focus on the customer, customer service, and added value. The basic purpose of a front office solution is to manage the customer interaction chain beginning from the sales lead, moving through the entire sales cycle, and then providing ongoing support and service for the customer.

Front-office integration and CRM are key investments for any E-Business, because the quality of a product and "selling facts" do not guarantee success in the 21st century. More and more a company's softer assets its ability to live up to the customers' image of a good company, and to satisfy ongoing needs, are required to ensure "life-time value".

One of the greatest challenges for a sales force today is a knowledgeable, involved, and critical buyer. Can a sophisticated ERP system display integrated "intelligence" to support the development of good customer relations? More important still is the ability to develop business processes with the capacity to establish, enhance, and even transform customer relationships. Can a firm develop and provide unique opportunities to create added value? The first step is to integrate flexible sales solutions that are deployable in an open ERP system. This especially includes the ability to integrate the company's engineering, manufacturing, distribution, maintenance, and financial management processes with processes for marketing, sales, and customer care. This starts the process of "front and back-office fusion".

Front-office solutions can collaborate and manage the interaction and information flow between customer, supplier, and partner channels at all stages from marketing, sales, to delivery to service and support. The front office and CRM systems of yesterday are becoming the PRM and collaborative applications of tomorrow. An interactive sales system, integrating Web, phone, face-to-face, and channel sales, ensures that the prospect and customer see just one face of the company, and the sales team knows the prospect from every point of contact.

Configurators
Interactive Web technology provides more than just a faster link between what the customer wants and what the supplier can produce. Web configurators allow the customer to choose, test, and re-test various alternatives. This interaction serves to build positive, long-term customer satisfaction, by allowing the prospect to the solution that best fits their needs, and have it built to order.Additionally, engineering stays up to date on changing customer needs.

Web enabled but not integrated
With information technology as the foundation for the global market, the way businesses buy is changing radically. In a global marketplace, anybody can buy from anywhere, choose how they pay for it, and have it delivered wherever they want. This virtual, global marketplace puts new demands on the front office and CRM strategy. The "Web enabled" customer expects your business to be as internetworked as their web experience - and it should be. But few web-enabled ERP systems exist, and even rarer are completely linked front and back office solutions. Worse still, the term "open architecture" usually implies "some assembly required". We will touch on "integration" issues later on.

Supporting mobile sales staff
For planning and tracking marketing activities, PDA access to the central database for customer contacts is essential. When sales activities occur or have been concluded, the companies' database must be instantly updated with all new facts for future customer contacts. These include a complete purchase history, current orders, and invoicing status. Sales managers must have similar access to customer contact data, from the first contact until the deal is closed.

Integrating the Back Office
It is becoming increasingly difficult to win customers on the basis of price and performance alone. While production is being streamlined, there is an ever-growing need for flexibility and creativity in dealing with customers. Well-functioning integration between front and back office makes it possible to achieve both enhanced efficiency and greater flexibility.

Timely, accurate information is everything. Sales representatives need access to complete information about product variations, options, delivery time alternatives, and price at delivery. Instead of being limited to standard products, sales agents and /or customers can often configure less-expensive custom solutions, with better performance and shorter delivery times. Seeing that customers' demands and wishes are balanced against what is possible, from the engineering perspective, or understanding the criteria for the order, facilitates more immediate scheduling and delivery.

Back Office Services

  • As a standalone module, back office solutions provide a range of accounting services to a business.
  • Bill payment
  • Customer invoicing and cash application
  • Time and billing reporting
  • Expense report maintenance
  • Payables and receivables detail
  • General ledger maintenance
  • File and record maintenance

Back Office Solutions for E-Business
Strategic advantages through better management of sales data seamlessly integrated into financial, project accounting, manufacturing, human resources, and service management requires front and back office links. Employees in accounting, human resources/payroll, sales teams, and from all areas of the organization including executives, budget, and operational managers are now routinely accessing business management information on a real-time basis. The biggest challenges and goals in managing and understanding cross-functional business data are:

  • Determining product costs, margins, and return on investment
  • Collaborative planning, production, forecasting, and replenishment
  • Managing the quality, timeliness, and relevance of sales and financial information
  • Maintenance and access to updated technology and engineering documents
  • Ability to service real and projected peaks and valleys of business demands
  • Accurately managing limited and costly facility space, especially for manufacturing
  • Improving confidence of investors, directors, and public relations aspects of the business

Key vertical markets are already using integrated front and back office technologies, and serve varied product and service niches. Businesses and organizations in the following industries are typical of this growing trend:

  • Software and other technology companies
  • Healthcare and medicine
  • Transportation and logistics
  • Retail and distribution
  • Banking, financial and insurance services

Best practices for integrating front and back office solutions from these vertical markets include the following:managing semiconductor manufacturing of discrete and high value components; integrating heath care point -of- service patient contact with automated patient billing; process flow tools as used by UPS for combining supply chain and shipping data; better coordination of vendor managed inventory for retail and food; and customized product offerings for high value clients in banking, insurance and financial services industries.

Partner Relationship Management
Partner Relationship Management (PRM) is an E-Business strategy which uses shared extranet applications to streamline sales and marketing business processes and achieve speed-to-market through partners. PRM applications enable real-time collaboration among vendors and their partners for developing, launching, tracking and refining partner programs and operations. Examples of indirect channel activities accelerated and streamlined by PRM are:

  • Partner acquisition
  • Lead distribution and management
  • MDF and Co-operative Administration
  • Partner profiling
  • Channel program management
  • Extended team selling
  • Channel forecasting and reporting

Today, indirect channels account for the majority of sales in a number of industries; more than half of all high-tech sales come from indirect channels. Working with indirect sales partners is challenging, and involves more than completing a sale. It includes building business processes and channels of communication for vendors and their partners. Speed is always a critical focus in channel sales, including the logistics of a complex sale, delivery, and after-sale support. Internet-based PRM solutions fully enable the indirect model by tightly integrating companies with their partners. An automated, comprehensive set of PRM applications helps to overcome the complex challenges involved in acquiring, communicating, and supporting partners, as well as facilitating collaboration among multiple partners. PRM isn't just a critical component of an overall E-Business strategy; implementing a PRM solution can provide significant competitive advantage to a channel-focused company, including front and back office functionality.

Collaborative Commerce
Most current E-Business products focus primarily on cross-enterprise transaction exchanges. While transactional exchange is important, the real power of E-Business lies in fostering collaborative relationships between business partners. A true E-Business solution must include capabilities for information exchange and collaboration with "any-to-any" integration capability enabling companies to collaborate with multiple suppliers, customers and other valued business partners by linking their enterprise E-Business systems and applications. The goal is to break down barriers between various proprietary enterprise systems - a technology constraint that has hindered open, transparent collaboration among businesses.

Enterprise solutions for "dynamic collaboration" within and among businesses, called collaborative commerce, are an emerging business and technology trend, and are rapidly becoming a requirement for competitive advantage in an internetworked economy. Collaborative Commerce, also called c-commerce, allows rapid response to market opportunities with greater value and efficiency, according to leading industry analysts. Gartner Group predicts that c-commerce systems will become the predominant business-to-business application model by 2004.

The new era of collaborative commerce will allow companies all along the supply and value chain to communicate dynamically, anticipate and fulfill their customers' needs precisely and efficiently, and automatically respond in real-time to demand or supply changes. Collaborative applications that make this scenario possible eliminate the barriers posed by incompatible systems, and allows companies to focus their efforts on business instead of on their IT systems.

Summary:
From the simple concept of integrating front and back office systems for greater process continuity across an enterprise, comes the much more difficult task of integrating these applications with existing ERP systems. Additionally, no business is a standalone entity in an internetworked economy, so partner relationship management functions become a requirement. As we broaden the vision further, the quest to integrate strategic goals, tactical relationships, and business processes brings a new concept to bear: collaborative commerce. In this new era, companies respond flexibly to sales opportunities, and manage the back office logistics fluidly.

Definitions and reference sites:

CRM and Vendors:

CRM (customer relationship management) is an information industry term for methodologies, software, and usually Internet capabilities that help an enterprise manage customer relationships in an organized way. For example, an enterprise might build a database about its customers that described relationships in sufficient detail so that management, salespeople, people providing service, and perhaps even the customer directly, could access information. Users of CRM and sales automation systems can match customer needs with product plans and offerings, know what other products a customer had purchased and remind customers of service requirements.

http://searchcrm.techtarget.com/

PRM and Vendors:

Partner relationship management (PRM) is a business strategy for improving communication between companies and their channel partners. Web-based PRM software applications enable companies to customize and streamline administrative tasks by making shipping schedules and other real-time information available to all the partners over the Internet. Several CRM providers have incorporated PRM features, such as Web-enabled spreadsheets shared through an extranet, in their software applications. PRM is often compared to customer relationship management (CRM), and there is some argument over whether the complex relationships of channel partnerships makes it necessary for PRM to be discussed as a separate entity, or merely as a component of CRM.

http://whatis.com/

Collaborative Commerce and Vendors:

Collaborative Commerce (C-Commerce) is the name given to commercial relationships carried out over a collaborative framework to integrate business processes of enterprises, share their customer relationships, and manage knowledge across enterprise boundaries. The ultimate aims of C-Commerce initiatives are to maximize return on intellectual capital investment, business agility and the quality of the customer experience. C-Commerce is far more crucial than basic B2B e-commerce that is designed to construct a virtual link for a pre-defined community of trading partners to buy or sell goods and services.

http://www.webservicesarchitect.com/

About Mitchell Levy
Mitchell Levy, is President and CEO of ECnow.com (http://ecnow.com), a training business service provider helping companies transition its employees, partners and customers to the Internet age through off-the-shelf and customized on-line and on-ground training. He is the author of E-Volve-or-Die.com, Executive Producer of ECMgt.com, an on-line E-Commerce Management (ECM) e-zine, Chair of comdex.biz at Comdex Fall and Chicago and the Founder and Program Coordinator of the premier San Jose State E-Commerce Management Certificate Program (http://ecmtraining.com/sjsu). Mitchell is a popular speaker, lecturing on ECM issues throughout the U.S. and around the world.

I hope you enjoy this eZine.
See you in cyberspace,

Mitchell Levy
Executive Producer, ECMgt.com <http://ECMgt.com>
President, ECnow.com <http://ecnow.com>
Founder and Coordinator, SJSU-PD ECM Certificate Program <http://ecmtraining.com/sjsu>

  • ECMgt.com is the premier monthly ECM e-zine.
  • ECnow.com is an e-commerce strategy, e-marketing and training firm. helping start-up, medium and large corporations change their business to harness the power of the Internet.
  • E-Volve-or-Die.com is a book one must read to help them figure out how to e-volve-or-die
  • San Jose State University, Professional Development, Electronic Commerce Management (ECM) is a Certificate Program for e-commerce professionals <http://ecmtraining.com/sjsu>.

To subscribe to ECMgt.com, please visit http://www.ECMgt.com or send e-mail to VMS3.Subscribe@ecnow.com?subject=ecmgt.Sep2001+subscribe

 

Back to the main ECMgt.com Page (http://ECMgt.com)
Back to this issue: (http://ECMgt.com/Sep2001)

 

 

 

 

 

Home | Express Your View | eZine Signup | About ECMgt.com 
E-Commerce Resources | E-Commerce Examples | Internet Marketing

 

 

 

 

ECMgt.com is produced by ECnow.com (http://ecnow.com)
Copyright © 1999-2009 by ECnow.com, Inc., All rights reserved
21265 Stevens Creek Blvd., Suite 205
Cupertino, CA 95014, 408-257-3000 (Tel), 603-843-0769 (eFax)
E-mail: General (VMS3.Executive.Producer@ecnow.com)
Webmaster (webmaster@ecnow.com)