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Make the most of e-hubs

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The promise of e-marketplaces is real, but realizing it is proving difficult and expensive—the more so because there is no established road map to follow.

Our extensive work in the e-market arena indicates that the right strategy begins by asking three questions: Who needs to be in your trading partner ecosystem, what functionality and business rules do you need to work with these partners and how can you integrate with these partners cost effectively?

Answering these questions will lead many companies to develop strategies that build around private e-hubs. At its most basic, an e-hub is a logical—not physical—solu-tion to the integration issues that arise when a business seeks to connect with e-markets, partners and suppliers, as well as provide end-to-end connectivity to its own employees. It is a technology and process layer, constructed around core enterprise applications. Deploying such tools across trading partners and enterprises lowers the costs of connectivity.

An e-hub does not preclude participation in e-marketplaces. In fact, it creates the flexibility to link to these public arenas and to stand-alone partners. But technology integration clearly extends well beyond browser interactions. It must align strategy with organization, business processes and technology across multiple enterprises.

To move forward, consider five themes:

• Prioritize the ecosystem players, both customers and suppliers, that you need to execute your strategy. Do not only focus on ones you can find in an existing e-marketplace.

• Identify high-value interactions and tailor the related processes to the needs of these relation-ships. Assess partner impacts, too, not just your own.

• Assess to what extent the available e-marketplaces have already signed up and enabled collaboration with your comprehensive set of trading partners and processes. Connection to a partial set of partners reduces the benefit you can expect from any single e-marketplace.

• Evaluate the case for a private e-hub if no public e-marketplace offers a high number of targeted trading partners and processes.

• Build end-to-end visibility into your company’s information, applications and processes. Collaboration via private e-hubs and public e-marketplaces will require a faster sharing of a greater amount of information from your enterprise.

But typically, a central view into our own enterprise's knowledge is hindered by department and application silos. Companies that don't prepare to find, authorize and send information quickly will expose this flaw and impede participation.

Denis Mathias is technology supply chain operating solutions partner and Vivek Kapur is technology strategy partner at the Management Consulting Services practice of PricewaterhouseCoopers L.L.P.

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