Delivering B2B Supply Chain Flexibility
The stakes continue to rise in the online business-to-business world. Despite the still rapid entry of new dot.com players—1,000 new sites since the beginning of the year—Forrester Research predicts that within three years, less than 200 will remain.
While there are many reasons for the falloff, the main reason is that many sites do not deliver real value or profit. Their reach may be too narrow or they are not able to connect to the viable players. Or, they may use inappropriate or inadequate technology that suits, for instance, a limited ERP world but doesn't cut it in the ever more complex Internet arena.
It is a pleasure to review a new dot.com company that seems to have taken the measure of the market, done its homework, and come out of the gate with integrated, advanced technology and a deep understanding of the inner workings of the supply chain. Consolidated Commerce Inc., Chicago, Ill., was founded in 1998 and is growing rapidly.
Mike Soenen, the company's co-founder, CEO and president, is the former co-founder and partner of Waterstone Consulting. His team is working from a 20-year exposure to the elements and strategies of the supply chain, particularly concentrating on Fortune 500 companies.
"We identified a gaping hole in the market that was largely the result of a fragmented industry," Soenen says. "There were no technology companies providing the kind of advanced supply chain solutions for large companies that we had been building at Waterstone for years.
"We had to find a way to get around the financial constraints, business process standards constraints, and technology standards. We had to find a way to deliver the capability in a different way," Soenen says. "That's how Consolidated Commerce was born."
The Consolidated Commerce offering uses XML and XSL/T technology. "In XSL/T, the T means the web server, as opposed to the client side browser, controls how the information is displayed," Soenen explains. "Specifically, XSL/T formats the XML data for display using a style sheet. The XML tags the data and XSL/T decides how to communicate that data band. Every device that can display data has an XSL style sheet. For example, there is a style sheet for every variety of cell phone. XSL becomes the translation mechanism."
What does Soenen see as Consolidated Commerce's core advantage in the B2B supply chain market?
"Our primary advantage is our supply chain capability, and I mean this in the truest sense of the terminology," he says. "That comes through the people who have built the product, who have helped implement the product, and who have helped integrate the product. It is embodied in the platform.
"We did things differently than the typical West Coast software approach," Soenen explains. "We spent two years of hard-core R&D building a platform. We already had the strategic knowledge of what that platform should do. We saw that the old-fashioned, linear supply chain was migrating to a hub-and-spoke collaborative model. Because we saw that coming early, we built a platform to serve that model."
"Our second main advantage is our technology architecture," he says. "By using XML, XSL and a Java base, this system is flexible, easy to integrate, and more scalable than the typical competitor on the street."
The Consolidated Commerce platform integrates easily into other systems, such as G-Log, which are able to calculate total landed cost for multi-modal transportation and the global supply chain. That capability is synergistic with what Consolidated Commerce offers.
"We integrated our customer MesoMas with G-Log in two days," says Soenen. "We both speak XML and we know what we are doing. In two days, we had tied in with the G-Log system to give MesoMas total landed cost at the time of Request for Quote or purchase orders. We shoot over the web the XML we pick from G-Log servers, and bring back the data. The user never knows that he left our system."
Another distinguishing difference Consolidated Commerce offers is that it addresses the fundamental tenants of business. Before the market crashed, these tenants were being ignored, Soenen says."Supply chain technology companies were calling on prospective customers with their option technology, or some semblance of option technology. They said they would insert themselves as an intermediary and would beat the suppliers down on price and everybody would be happy," he says.
"But, Business 101 tells you that if you are going to be an intermediary you must serve both sides of the channel. Consolidated Commerce, on the other hand, serves the buyers and the suppliers, but also the third-party logistics providers and financial institutions. We make all the players in the collaborative solution much happier," Soenen says.