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Time to Get Serious About e-Commerce

 

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It should be obvious.  e-Commerce is more than selling over the Internet.  

 

Effective e-Commerce is a spectrum of activities that potentially touch every one of your core business processes: marketing and sales, resource and capacity planning, inventory replenishment, billing and accounting, procurement, engineering and supplier collaboration, etc.  The way you do business tomorrow - for better or for worse - will be e-Commerce.  

 

Here are some common sense pointers for making your e-Commerce efforts pay off:  

 

Worry about delivery infrastructures now - not later

Those who reap the rewards of e-selling will be those who thought about delivering first.  

 

Sharing is not for sissies

The foundation of e-Commerce is c-Commerce, collaborating up, down and across the value-chain.  Those who get serious about collaboration with their distribution channels, with their suppliers and engineering partners, with all the members of their extended supply chain, will reap the benefits of competitive advantage.  Those that don't risk falling further and further behind.  

 

Planning is not old-fashioned

Inventory doesn't make itself, and resources don't appear out of thin air.  We're all for visual factories - even visual supply chains.  But linked processes and synchronized production only work when there is material available to pull through the chain, and when there is sufficient capacity to make the volume required.  Make sure you have functioning planning processes like: 

 

Supply Chain Sales and Operations Planning

Appropriate capacity planning techniques like Rough Cut Capacity Planning

Master Scheduling at key points in the supply chain

Effective material planning techniques, either in detail or in aggregate depending on your processes.  

Supplier Scheduling 

 

Focus e-Procurement on relationships not auctions

The big payoff in purchasing is in direct materials - which for most of our clients averages 40 to 80% of product cost - a lot of which are either high cost or high volume, and typically not commodities.  If the focus of your purchasing efforts is buying office supplies and MRO materials more efficiently, you are missing the boat.  The coming wave of e-Procurement, specifically focused on direct materials, committed relationships, and supplier scheduling and releasing, will be private enterprise exchanges, and you need to find out about them now, not later.  

 

Bring The Highest Value Functions Online First

You have limited resources.  The same is true of your value-chain partners.  Bring on the functions that give you the "biggest bang for the buck" first and fastest.  

 

If you aren't getting the results you'd like from your e-Commerce or resource planning efforts, ask yourself: 

  • Are we really willing to do what is necessary to make e-Commerce work - even if it means focusing on internal processes first? 

  • Are we willing to make an investment in people and relationships at least equal to any possible software investment?  

  • Are we willing to put time into equipping our people to really run the business in a different way? 

  • Are we willing to invest executive time in understanding what kinds of transformations we can reasonably make?  

If you are willing to do these things, we'd like to hear from you.  If you are convinced you need some new directions but need help understanding your choices, call us.  We have some proven techniques for getting started:  

 

Chris Gray 1 603 778-9211

  cgr...@grayresearch.com

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If you have specific questions about this article or want to discuss it with the author, call Chris Gray at 1 603 778-9211.

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