Despite its heavy reliance on technology as an enabler, e-business is largely about business, not technology. This fundamental distinction still hasn't soaked through many of our thick skulls. For instance, when we hear terms like "e-business integration," many of us immediately think of systems integration that is, the hard work that IT personnel do to integrate disparate information systems. The real goal of e-business integration, however, is to integrate business processes.
THE HURWITZ TAKE: Recent trends in e-business integration show it falling into three broad categories, each defined by the combination of business entities being integrated.
Business-to-enterprise (B2E). This involves the integration of internal business processes through information shared across departments and divisions. The information may have many topics of content such as financials, sales or operations. But, customer information has become a priority in many companies, because an integrated view of customers has a demonstrable return. B2E is typically the first category of e-business integration that a company tackles, often driven by a need for better understanding and service of customers. MBA programs teach budding CEOs that their primary mandate is to integrate business processes across an enterprise. In our research into IT purchasing patterns, Hurwitz Group has seen CEOs taking more active roles in the evaluation and selection of information systems, as e- business has proliferated. This is because many CEOs now recognize that IT- supported B2E e-business is a viable means of achieving the mandate for internal integration of business processes.
Business-to- consumer (B2C). E-commerce Web sites integrate the process of purchasing with that of selling. These processes originated in the physical world (e.g., retail stores, wholesalers, mail order, etc.) with tried-and-true integration mechanisms (many involving paper). But, the virtual world of e-business demands that the processes be integrated solely (or, at least, largely) via software. After completing transactions, many customers need to periodically return to the Web site and check the status of outstanding orders. Self-service information of this sort helps integrate the fulfillment process.
Business-to-business (B2B). This is about an even broader range of integration integration with partners' processes. Hence, an alternative term might be B2P, or business-to-partner. The supply chain is clearly a target for B2B integration, but most supply chains are vast and too complex to fully integrate today. As a sensible starting point, many companies are now focused on the purchasing links of the chain, as a first step in integrating their procurement processes with those of suppliers. Hurwitz Group notes that many emerging e-businesses tackle the integration categories in the order listed, starting internally, then integrating with customers and partners. Common focuses are customer understanding and procurement automation. Hurwitz Group recommends that companies facing e-business integration use the trends identified above as guidelines for making decisions about how to prioritize and where to start. In all planning stages, however, be sure to focus on e-business integration as the coming together of business processes, not mere technologies.
Note: For a related discussion, don't miss the keynote "e-Business Integration Strategies" given by Hurwitz Group's Philip Russom at the E-Business Integration Conference October 3, 2000, in San Francisco. For details, please visit http://www.brainstorm-group.com/bsgweb/index.asp? conf=2378515370.
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