(1) VENDOR RELATIONSHIP MANAGEMENT: Re-engineering the Business Process Through B2B Infrastructure...
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Transcript of (1) VENDOR RELATIONSHIP MANAGEMENT: Re-engineering the Business Process Through B2B Infrastructure...
(1)
VENDOR RELATIONSHIP MANAGEMENT:
Re-engineering the Business Process Through B2B
Infrastructure to Accelerate the Growth of Small
Businesses in Geographically Isolated Areas
William McDaniel AlbrittonCollaborative Software Development Lab
University of Hawaii
(2)
ParticipationCo-authored by
•Joy M. Agustin
Funding by•City Bank•UH New Economy Research Grant Program
Participants•Dr. Philip Johnson•City Bank•FedEx•Hilo Hattie•United States Postal Service (USPS)•University of Hawai’i•10 Local Businesses
(3)
Geographically Isolated Businesses
Issue•Small businesses limited to local market
Solution•Global marketplace of the Internet
Example: Village near Chincheros, Peru•1995 – village’s income = $300 US per month
•1996 – Internet connection •Online partnership with export company•Sell produce in New York
•1998 – village’s income = $1500 US per month
“Wiring the Pueblo”, Business 2.0David Batstone, 1998
(4)
Expanding Local Hawai’i Businesses
Virtual Merchant•(+) Ideal in early 90’s•(+) Direct control of inventory and information
•(-) Overhead of sales, marketing, and web site•(-) Problem of being noticed on the Internet
Metamediary/Virtual Mall•(+) Larger well-established company•(+) Has brand name recognition•(+) Takes care of sales, marketing, and web site
•(-) Maintaining inventory and information
(5)
Vendor Relationship Management (VRM)
PartnersMetamediary (Host)
•Sales, marketing, and website
Virtual Merchant (Vendor)•Maintain inventory and information
Financial Institution•Transaction processing and loans
Shipping Provider•Order tracking
(6)
Partner Services
Metamediary
VirtualMerchant
FinancialInstitutionShippin
g Provider
ProductShipping
OrderTracking
ProductInformation
OrderInformation
TransactionProcessing
TransactionProcessing
andLoans
(7)
Virtual Merchant/Metamediary
Metamediary
VirtualMerchant
FinancialInstitutionShippin
g Provider
ProductInformation
OrderInformation
VRM System
OrderInformation
ProductInformation
(8)
Shipping Provider
Metamediary
VirtualMerchant
FinancialInstitutionShippin
g Provider
ProductShipping
OrderTracking
VRM System
OrderTracking
OrderTracking
(9)
Financial Institution
Metamediary
VirtualMerchant
FinancialInstitutionShippin
g Provider
TransactionProcessing
TransactionProcessing
andLoans
VRM System
MerchantSales
(10)
VRM PrototypeWeb-based application
Designed with Microsoft Components•Microsoft Windows 2000•Active Server Pages (ASP)•Internet Information Server (IIS)•Open Database Connectivity (ODBC)•Microsoft Access
4 main interfaces•Metamediary (Host)•Virtual Merchant (Vendor)•Financial Institution•Shipping Provider
(11)
VRM PrototypeMetamediary Interface•Maintaincontactinfo.
•Createvendor
accounts•Sendorderstovendors
•View statusoforders
(12)
VRM PrototypeVendor Interface•Maintain contactinfo.
•Maintainproductinfo.
•View customerinfo.
•Receive orders
•View status oforders
(13)
VRM PrototypeFinancial Institution Interface•Maintain contactinfo.
•View vendorand hostcontactinfo.
•View vendorsales
(14)
VRM PrototypeShipping Provider Interface - pending
•Provide .gif shipping labels
(15)
Ordering a Product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
(16)
Ordering a Product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
Order
(17)
Ordering a Product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
Order
Order
(18)
Ordering a Product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
Order
Order
Notification and Shipping Label
(19)
Ordering a Product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
Order
Order
Notification and Shipping LabelProduct
(20)
Ordering a Product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
Order
Order
Notification and Shipping LabelProduct
Product
Shipping Information
(21)
Ordering a Product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
Order
Order
Notification and Shipping LabelProduct
Product
Shipping Information
Confirmation Number
(22)
Ordering a Product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
Order
Order
Notification and Shipping LabelProduct
Product
Shipping Information
Confirmation Number
Confirmation Number
(23)
Ordering a ProductBenefits of VRM BPM
•Customer -only sees metamediary
•Metamediary-no product inventory-no shipping
•Virtual Merchants-no advertising-no web maintenance
(24)
Returning a product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
(25)
Returning a product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
ReturnReques
t
ReturnRequest
(26)
Returning a product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
ReturnReques
t
ReturnRequest
ShippingLabel
ShippingLabel
(27)
Returning a product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
ReturnReques
t
ReturnRequest
ShippingLabel
ShippingLabel
Product
(28)
Returning a product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
ReturnReques
t
ReturnRequest
ShippingLabel
ShippingLabel
Product
Product
ShippingInformation
ReturnNotification
(29)
Returning a product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
ReturnReques
t
ReturnRequest
ShippingLabel
ShippingLabel
Product
Product
ShippingInformation
ReturnNotification Received
Notification
(30)
Returning a product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
ReturnReques
t
ReturnRequest
ShippingLabel
ShippingLabel
Product
Product
ShippingInformation
ReturnNotification Received
Notification ReceivedNotification
(31)
Returning a product
VirtualMerchant
Customer
Metamediary
Shipping Provider
VRM System
ReturnReques
t
ReturnRequest
ShippingLabel
ShippingLabel
Product
Product
ShippingInformation
ReturnNotification Received
Notification ReceivedNotification
Refund
(32)
Returning a productBenefits of VRM BPM
•Customer -only sees metamediary
•Metamediary-no product inventory-no shipping
•Virtual Merchants-no advertising-no web maintenance
(33)
VRM PrototypePortability
•Windows NT/2000Reliability
•Microsoft products seem to attract viruses•Access database
-Typically 10 to 20 users-One megabyte of data
Scalability•Need to change to SQL Server
Security •Secure Socket Layer (SSL)•Cannot load pages unless go through Login page
•Other general security concerns
(34)
Survey of 10 Local Businesses
Vendor interviews•E-commerce issues and solutions•30-45 minutes interview
Topics•Degree of technological sophistication•Use of Internet for sales and marketing•Desires for and barriers to growth•Present and future financial services
(35)
Survey ResultsBusiness Size•Staff of 1-2 (7 businesses)•Staff of 5-25 (3 businesses)
E-commerce•9 businesses on the Internet•8 individual websites
-Trouble getting site noticed (4)-Product not easily sold online (2)-No problems (2)
•Percent of business from Internet-95%+ (3)-30-95% (0)-10-30% (2)-<10%(3)
(36)
Survey ResultsFuture Business Direction
•Keep growing (3)•Eventually sell business (3)•Have brick & mortar store (1)•Outsource web site (1)•Survive/continue at same pace (2)
Advantages of Using a Metamediary/Virtual Mall•9 companies gave positive comments
-High visibility-Wider customer base-Increase traffic -Less hassles-No maintenance of websites
(37)
Survey ResultsDisadvantages of Using a Metamediary/Virtual Mall •7 companies gave negative comments
-Concerns over setup with metamediary-Insufficient time to keep up with production-Possible competition with other products-Loss of control over advertising-Slower payment process-Increase number of small orders
•3 companies currently use a metamediary
Metamediary/Virtual Mall Product Preferences•Wholesale (6)•Drop-ship (2)•Commission (1)
(38)
Survey ResultsFinancial Services
•Present-Credit card transactions (8)-Merchant account (3)
•Future-Loans (2)-Other banking services (2)-No loans (2)-Not interested in additional services (4)
(39)
Expert CritiquesParticipants
•Business Owners (2) •Bank Employees (3)
Topics•Advantages•Disadvantages•Suggested Improvements
(40)
Expert CritiquesAdvantages
•Easy for inexperienced small vendors-Banking-Advertising-Ordering-Shipping details
•Eliminate paper traveling between partners•Vendors can get paid immediately by metamediary
•Metamediary does not need to store inventory
(41)
Expert CritiquesDisadvantages
•Vendor packs orders themselves•Not geared toward vendors that do not “produce” their own product
•Metamediary immediately pays vendors •Competition between metamediary and vendor
•Competition between vendors on web site
(42)
Expert CritiquesSuggested Improvements
•Include contract negotiations in business process-Metamediary and shipping company-Metamediary and vendors-Financial institution and other 3 partners
•Add information on individual product sales•Add user log•Investigate third party shipping software•Add fulfillment center as a fifth partner
(43)
What’s Next?
1. Is this a viable approach?
2. Under what conditions?
3. When should we think about proceeding?