STUDY: B2B SUPPLY CHAINS FACE ENABLEMENT BOTTLENECKS
A recent study found that transportation companies are taking an average of half a year to set up an electronic trading process with their online partners and that online transactions represent a mere fraction of their overall business.
The study, conducted by Edifecs of about 400 electronic commerce managers and transportation providers, found that ramping up a single electronic trading process takes an average of 5.8 months.
“The single biggest bottleneck to widespread adoption of B2B e-commerce is enablement — the process of preparing a company, its internal systems and its trading partners to being conducting online transactions,” Edifecs said. These functions are largely conducted manually — 'faxing, telephoning, e-mailing and visual checking and re-checking of details — many of which must be repeated each time a company sets up a new electronic process with a trading partner.
The survey found that 46 percent of transportation companies conduct B2B operations with less than one-fourth of their trading partners. Seventy-seven percent conduct fewer than 15 processes electronically with their partners, while 46 percent exchange fewer than 5,000 electronic transactions a month.
Despite this bottleneck, the expectations are high. Nearly 70 percent of the survey's respondents expect to trade electronically with more than three-fourths of their partner base in the coming years. Nearly 40 percent plan to conduct more than 25 processes electronically and 58 percent expect to execute more than 50,000 transactions each month, Edifecs said.
The solution for these companies will be to automate their manual enablement problem, Edifecs said.
The survey warns, however, that extensible markup language, or XML, is not the perfect key to enablement, as many perceive it to be. Just over half of the companies in the survey that have used XML said it had either no impact on their enablement activities or actually made the process more difficult.