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  • TradeAccess, Inc. ©2000 — Confidential
  • TradeAccess, Inc. ©2000 — Confidential
  • TradeAccess, Inc. ©2000 — Confidential -
  • TradeAccess, Inc. ©2000 — Confidential
  • TradeAccess, Inc. ©2000 — Confidential
  • TradeAccess, Inc. ©2000 — Confidential
  • TradeAccess, Inc. ©2000 — Confidential
  • TradeAccess, Inc. ©2000 — Confidential
  • TradeAccess, Inc. ©2000 — Confidential
  • TradeAccess, Inc. ©2000 — Confidential
  • TradeAccess, Inc. ©2000 — Confidential
  • TradeAccess, Inc. ©2000 — Confidential
  • Transcript

    • 1. Global B2B eCommerce Adoption: The Business Perspective Presentation to The Information Technologies Group at the Center for International Development Harvard University by Jeff Conklin Founder and CEO May 2, 2001
    • 2.
          • Context for global B2B eCommerce
          • What is driving adoption of global B2B eCommerce?
          • What companies are looking for in B2B
          • eCommerce solutions, and why?
          • Issues and forecasts for global adoption
      Introduction
    • 3.
          • B2B eCommerce is complex and contract based
          • B2B supply and distribution chains are international
          • Buy-side, or procurement focus in this presentation
      Context
    • 4. Complexity of Contract eCommerce Logistics Sell-side Requirements Sales Legal Engineering Manufacturing Management Finance Info Services Buy-side Requirements Procurement Finance Logistics Manufacturing Engineering Management Legal Info Services Business Rules Inter-enterprise Data Valid Commerce and Non-Repudiation International Trade Practices and System Requirements Inter-enterprise Requirements Banking Contract negotiations and transactions Financing Escrow Factoring Schedule, Delivery Terms, Returns Form, Fit, Function, Quality Credit, Payment Terms Ts & Cs Warranties, Schedule, Quality Service Level Agreements Contract Document Contract Document
    • 5. Complexity of Procurement Cycle Key Activities Forecasting Operations/ production planning New product design Supplier identification RFI, RFP, RFQ Vendor short list Vendor selection Terms negotiation (e.g., BOM, payment, delivery, T&Cs) Vendor selection Agreement renewal Respond to changes Journaling / archiving Purchasing / ordering Order management Physical delivery / Materials management Payment processing Financial settlement Reconciliation Fulfillment Negotiation Sourcing (RFx) Operations Planning Vendor Evaluation and Feedback
    • 6. Market Magnitude Total - $20 Trillion Contract-Based B2B - $13 Trillion Contract-based goods commerce represents approximately $13 trillion of business in the US, and $52 trillion globally - US Goods Commerce ($ Trillions) - Consumer B2B Spot Market ($3) B2B Under Contract ($13) Indirect Goods ($2) Direct Goods ($11) Sources: CAPS Procurement Survey Ratios, U.S. Department of Commerce data and Morgan Stanley analysis
    • 7. Company Spend Analysis Sources: CAPS Procurement Survey Ratios, Accenture and Ozro Analysis Communications & Hi Tech Industry Spending Benchmarks 0% 25% 50% 75% 100% Procurement Spend Contract-Based Procurement Percent of Company Revenues 67% Contract- Based 18% Spot Buying 85% 59% Direct 67% 8% Indirect
    • 8. Supply Chain Best Practices
          • Obtain Competitive
          • Purchase Price
          • Reduce Total Cost
          • of Ownership
          • Improve Supplier
          • Performance
          • Motivate Early
          • Supplier Involvement
      2 3 4 Tactical Solution Strategic Solution (1 time, per event ) 1 What Companies Want 1 st Generation, Reverse Auction 2 nd Generation, Effective Negotiation VS.
    • 9. Continuous Improvement Continuous Improvement
      • Inform Multiple Business Processes of Key Terms
      • Coordinate Internal Groups
      • Manage External Partners
      • Monitor/Report on:
      • Vendor Activity
      • Organizational Activity
      • Vendor/Customer Performance & Feedback
      • Compliance Reporting
      • Negotiate Lowest Total Cost Terms
      • Respond to Changes
      • Re-negotiate or Renew Agreements
      Inform Negotiate Monitor eCommerce Virtuous Circle
    • 10.
          • Companies spend 5% of revenues managing contracts
          • eCommerce software can cut this to 1% - 2.5%
          • eCommerce software can also reduce total purchase costs as much as 30%, and sourcing cycle times 50%
          • Direct materials savings flow through COGS; even small savings create significant impact on profitability
      Why Sources: Goldman Sachs estimates and Ozro Analysis
    • 11. Significant Savings
    • 12.
          • Internet access and infrastructure
          • IT infrastructure
          • Payment processing
          • Security concerns
          • Competitiveness
          • ‘ Red Herrings’
      Issues in Global Adoption
    • 13. International Timing, by Region
    • 14. Worldwide eCommerce Growth $ Billions Sources: Forrester Research, Inc.
    • 15.
          • Countries that have invested in competitiveness will lead global adoption
            • 86% of Singapore’s exports sold to computing and electronics industry/US supply chains
              • eCommerce hyper growth in 2002
            • .3% of Turkey’s exports tied to US supply chains
              • eCommerce ramps in 2006
          • ‘ Red Herrings’ stall supporting policies
              • Tax collection
              • Customs
              • Security
              • Financial controls
          • Money talks in B2B…
      Summary

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