During the past two years, collaborative commerce, or “c-commerce,” has become a major focus for many organizations. C-commerce optimizes supply and distribution channels to make an organization more competitive and more profitable. Deploying c-commerce systems and related infrastructures helps companies collaborate up and down the supply chain. Collaboration for the common good must be the prime motivating factor in getting demonstrable value from a c-commerce initiative.
For example, Exostar Inc. is an electronic marketplace formed by the aerospace industry to optimize the time it takes to move parts and products. Member companies, which include Raytheon Co., Lockheed Martin Corp. and The Boeing Co., also generate improved customer satisfaction because they can use Exostar to trace product availability through the supply chain. A company acting alone could never accomplish this feat.
C-commerce is the next evolutionary step beyond the simple process of selling goods or services to customers over the Internet. It has emerged as a priority because the Internet has made high-speed widespread buying and selling possible – and necessary.
For example, if companies within your industry establish an electronic marketplace to attract buyers and you don’t participate, your market share could shrink. Similar risks arise when companies refuse to collaborate in distribution, software development or standards initiatives. With c-commerce becoming a necessity, executives should emphasize ways in which people and institutions can co-operate to reach common goals. A multi-pronged strategy should consider the following:
– positioning technology as an enabling capability and not the solution;
– emphasizing collaboration in every aspect of your e-commerce efforts; and,
– formalizing governance structures that build collaborative behaviour into the bylaws of jointly-created c-commerce organizations.
There is significant hype about the claims of software and integration vendors on c-commerce support. Vendor products facilitate everything from on-line meeting capabilities to inter-enterprise workflow management. These tools are important enabling factors in a c-commerce plan, but initiating and deploying a c-commerce effort depends more on the collaborative skills of people.
Companies need to co-operate to build common solutions to shared challenges. This may involve shifting to a more collaborative mind-set when working with business partners, suppliers, distributors, customers and competitors. In doing so, executives and employees must cast aside an “us vs. them” mentality, and focus on how they can work with other companies to better serve a common set of requirements.
As relationships form, their collaborative nature should be built into the governance structures used to formalize those relationships. Exostar is an independently incorporated enterprise formed to govern c-commerce activities among its members. Its stated mission is “to create an improved way of doing business through an Internet-enabled, secure marketplace that increases the efficiency of transactions and enhances collaboration across the supply chain and product life cycle.” The creation of a legal entity to govern c-commerce efforts allowed members to build collaboration into Exostar’s bylaws.
Numerous industries have launched other efforts to deploy shared software, sourcing services and e-commerce standards. For example, several companies, including IBM, formed Universal Description, Discovery and Integration (UDDI) to create a directory of services and to help accelerate the acceptance of B2B e-commerce. UDDI hasn’t formed a legal entity to institutionalize collaborative behaviour, and with no governing structure in place, relationships among members could become less cohesive and destabilize.
For c-commerce to truly succeed on a grand scale, companies may need to rethink how they view their business partners, customers and competitors. Past reluctance to collaborate with competitors could stymie c-commerce efforts. In this new landscape, everyone is your partner. Formalizing these relationships takes time and commitment, but they will benefit entire industries beyond what any one company could accomplish.
Ulrich is a management consultant and president of Tactical Strategy Group Inc. Contact him via www.systemtransformation.com.
