The latest buzz to hit the business-to-business (B2B) airwaves has been about a brave new term called “c-commerce.” Have you heard of it? If not, it stands for the welcome concept of “collaborative commerce.”
The idea behind collaborative commerce is to break the rigidity of traditional business processes and improve information exchange through systems integration and Internet-based communication. As a principle, collaborative commerce attempts to bring together employees, customers, and business partners in order to improve trust, share information, and eliminate any friction associated with business transactions.
Collaboration is not a new concept for business. However, advances in information technology (IT) and the Internet have infused new life into the term.
Although the focus for B2B e-commerce has been on expediting procurement processes, many companies are discovering that collaboration across all parties associated with the supply chain is as important as the cost savings associated with corporate purchasing.
Manufacturing companies have been early adopters of Internet-based collaboration. A recent survey by Forrester Research showed that more than 75 percent of respondents in manufacturing industries intend to employ Internet-based collaboration technology to accelerate product development or reduce errors in the manufacturing process.
Industrial Strength High-Tech Manufacturing
Suppliers are not the only beneficiaries of c-commerce. Companies like Taiwan Semiconductor Manufacturing Company (TSMC), a contract manufacturer of integrated circuits, are using the Internet to share data and design information with their customers.
Before implementing its collaboration solution, TSMC found that its methods of communicating with customer and suppliers were slow, time-consuming, and limited in terms of information and timeliness of delivery. Standalone Web sites, fax, email, FTP, and EDI were inefficient communication methods that created long delays in the supply chain.
Today, TSMC automates a wide range of shared business processes with its customers, including engineering, forecasting, order management, work-in-progress (WIP) updates, and shipment notifications. Not only is this information shared with TSMC customers, but also with TSMC’s own suppliers.
By linking its own internal processes with its suppliers and customers, TSMC has been able to reduce lead times up to 25 percent. The elimination of manual processes has resulted in reduced WIP carrying costs and improved capacity planning. Based on its initial estimates, TSMC predicts a 14-fold return on its investment over the first three years of operation.
State of the Collaboration Art
Most manufacturing companies have not deployed a highly advanced collaboration platform like TSMC’s. For most organizations, automating their own internal processes still remains the challenge. Moreover, many companies have only recently finished implementing enterprise systems.
Collaboration for many organizations still remains a promise, not a reality. However, as supply-chain technology continues to become a core element of the corporate IT landscape, collaboration will naturally become more widely adopted. The benefits are too obvious, and competitive forces will drive greater interaction of all supply-chain participants.
Expect the c-commerce buzz to continue this year and intensify as supply-chain management becomes central to businesses in every industry.
If you have any examples of how your organization is leveraging collaborative technologies to improve business relationships, processes, or customer satisfaction, please send them in.
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