Boeing extranet speeds ordering process for spare-parts buyers

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Web commerce has hit the skies. Boeing Co. has sold more than $25 million in spare-jet parts through an extranet it set up in November.

So far, about 260 of Boeing's 750 airline and aviation repair customers have registered for the password-protected site, and Boeing is adding about 10 customers a week, says Richard Schleh, Boeing's public relations manager.

Customers can order any of 410,000 different Boeing parts over the Web, with shipment guaranteed within 24 hours. Customers place the order, confirm it and track it through delivery. Billing is handled separately.

"In this industry, it's vitally important to get parts fast," says Mr. Schleh. "When customers need parts, something like this facilitates that fast service."

Win-win site situation

Blane Erwin, director of business trade and technology at Forrester Research, Cambridge, Mass, says Boeing can only benefit from this sort of service.

"I don't think they can lose with this. For the airlines that are purchasing these spare parts it's going to allow them to get the parts more quickly," he says.

Mr. Erwin says it's unlikely the Web site will help Boeing win new customers, but it will help them service their existing parts customers better.

"[This is] not going to be the single deciding factor for someone like Delta to decide to buy Boeing aircraft," Mr. Erwin says. "But it deepens the relationship with its customers and it significantly lowers the cost and speeds up of the delivery of ordering spare parts."

Seattle-based Alaska Airlines purchases all its Boeing parts over the Web page, said Chris Colom, manager of purchasing at Alaska Airlines.

"We are very satisfied with the Web page," Mr. Colom says. "The use of this technology has eliminated the need for us to phone/fax requirements for quoting, order placement and expediting. This frees up our staff, enabling them to manage other processes."

Ordering process

The ordering process can be tracked completely over the extranet.

Alaska Airlines, for example, first checks the Boeing site for pricing and availability. Once the order is approved internally, the airline can monitor the status of its order via the site, which includes a link to the United Parcel site. This can track the order all the way to delivery on its receiving dock.

An important feature of the site, Mr. Schleh says, is the order confirmation process. "We think it's a pretty good indicator of a business-to-business application of the Web. Everyone who tries it likes it and they wouldn't want to go back to the old way."

Spreading the word

Before Boeing launched the Web page last November, it tested it with Alaska Air; Tramco, an Everett, Wash.-based division of B.F. Goodrich Co.; and Vancouver-based Canadian Air International.

After the test was completed, Boeing advertised the site in Aviation Week and World Aviation Directory, a semiannual industry guide. The company also sent out mailings and touted it at industry events.

But Mr. Schleh said most of Boeing's parts customers were told directly over the phone. "We have a relatively small audience. They're in touch with us all the time to order the parts, so when they call in to order the parts we tell them about it."

Tom DiMarco, senior manager of spares systems, which manages the Web site, says the Web page accounts for about one-quarter of all transactions normally handled manually. Boeing has not designated a team to work on the site. Employees from different areas keep it running.

Mr. Schleh says more than 150,000 transactions have been generated on the Web site in the last six months. Boeing counts any information exchange, such as price quotes, as a transaction. Boeing expects to handle 500,000 such transactions by November '98, Mr. Schleh said.

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