From: FatButterfly@lists.dynapolis.com on behalf of Andrew White [awhite2@ix.netcom.com] Sent: Wednesday, October 03, 2001 10:20 AM To: Fat Butterfly DTE Forum Subject: RE: [FB] Ariba buyer problem Debbie, Thank you for the reply. As usual it was spot on and to the point. My last little missive on Collaborative Commerce seemed to have been reasonably well received, but this post was not - thus far. I may have been overly optimistic in my enthusiasm. I was not actually trying to "attack" RFP and RFQ and all that jazz. I was merely trying to develop the game-type rationale behind those business transactions, in light of an "agreed" definition of Collaborative Commerce. I do think that RFP/RFQ type processes that lead to a bidding process is a cantankerous, confrontational model. I think that they have their place in life - and they are often ways in which the best relationships are formed (and re-formed). Relationships do go in cycles (see my paper, Return on Relationship versus ROI) and in fact companies have very, very few trusted partnerships that last forever. Whatever 'forever' means. Look at Ford and Firestone. About all we can trust is that companies (all of them in this context) will seek to do what is in their best interested. When two or more fish are swimming in the same direction, it is possible (not always likely) that they can work together for mutual gain (what I refer to as true collaboration) or they can co-operate (nothing to do with collaboration, as the output will not be greater than the sum of the parts) and so on. In some way I was looking to sequence business processes in terms of evolutionary value. Did anyone see that Maslow break down that US Banc Corp did this last week? http://www.gotoanalysts.com/piperpublic/goto/assets/pdfs/b2b/b2b28sep01. pdf. Remember the hierarchy of needs? Well they applied that to B2B and what appeared as "low" hanging fruit was the systems stuff (hardware, security, integration) and at the top was the revenue enhancing stuff that included to some degree collaborative commerce. Competition is as natural as night follows day. I am a firm believer in competition. However, I was again trying to draw out the natural extension of what happens when Collaborative commerce is achieved. I did a session at CLM this week talking about "n-tier CPFR" which really takes us back to the conglomerates of the 70s (read vertically integrated value chain) and what Mohanbir Sawhney (http://www.mohansawhney.com/) refers to as "virtually integrated value chains" (versus the older, rigid "vertically integrated") where we talked about what might the "emergent" properties that evolve as a result. When water goes down a sink hole, the little flurry that turns into an eddy and then twists violently (that children watch with avid excitement for the first twenty times) is an emergent property. It only occurs when there is sufficient volume of water in the sink. In value chain, what will happen when that critical mass of vertical partners decide to swim in the right direction for long enough? What will emerge? Is it possible? Did Dell happen? Can a Dell-like dominant value chain happen again? Can the automotive big three happen in other industries? I guess all we can assume is that companies will selfishly look after their own best interests. And what is wrong with that? Let's not go down the road of talking about not-for profit here; unless we want to open up a new thread. I am talking about the regular publicly held red blooded company. I think that it is real hard for fish to swim in the same direction for any reasonable period of time. So multi-tiered collaboration will be real tough. But I think that those companies with genes in their DNA that drive them to dominant positions will seek this model. The network affect that so many have been waiting for should drive some emergent properties that will, for a time, down play the need and use for cantankerous processes such as RFP/RFQ and the like. It does not mean that they are bad. They have a place; I just don't think that place is as important as others. I think that it is important to distinguish between direct and indirect. Who cares about indirect? Let the bean counters count what they will; I can afford to mess with the supplier of toilet paper (not sure that this is always the best example) but I sure as hack can't afford to mess with my core materials and services. This is the same as when Geoffrey Moore (www.chasmgroup.com) talks about core versus context: Core business processes are those that directly impact competitive advantage. Contextual processes are those that do not directly impact. Taking an extreme position, you should maintain a low investment in the contextual stuff (even outsource it to someone else who makes that context stuff their core business) and focus on investing in core. Direct materials are what feeds the body - keeps the organization working so that it can achieve its main task (replication - but that’s another story) whereas indirect materials are those extra calorie heavy cakes that we always eat that we should not. Our evolutionary history is hurting us because we confuse the difference. Sugar was good for the wandering nomad as he/she did not know where the next meal was coming from. Now we know is Publix. And there are no more saber tooth tigers hanging about. I am not sure that I have furthered the argument. I have been out of town for three days at CLM where 3,000+ logistics managers and directors have been contemplating their business future. True Collaborative Commerce was talked about a little. There was a lot of hot air that is for sure. A lot of the web companies here last year are no longer here. After writing the C-C response that Sunday night, I may have jumped too far with this item. The good news was that so many people still came to this event. The flights were busy. We need to get moving again. As usual Debbie you bring some refreshing reality to the discussion and ask some poignant questions. I don't think that we are on opposite sides here. But my opening comments may have set that stage poorly. There was a TV series I loved called "House of Cards". It’s a political satire (from a book) that predated the fall of Margaret Thatcher. It described how a back-room guy would get the top job (of British Prime Minister) upon the demise of Thatcher, as the minions fought over the remains of her legacy. I would recommend the video tape. He talks to the camera throughout the show, about "Maddie" - his "consort". He Talks about how he can and cannot trust her. He is a politician seeking power and she is a reporter following the unfolding events, unaware that he is the guy pulling the strings. He says he can trust her. He can in fact trust her to be human and that is as far as he can trust her. In other words, he can trust only so far as her selfish interests work in alignment with his own. Game theory: collaboration works well over the long haul when the fish are swimming in the same direction, and mutual trust can be fostered to the mutual gain. If it is a one-off transaction, the motivation to cheat is greatest. Time to go. Try to make a buck or two. I bet I get a warning over taking up too much email space! The problem with such a long and convoluted response is that I probably make so many mistakes I will get shot at from many quarters. O well. What's new? All the best, Andrew -----Original Message----- From: FatButterfly@lists.dynapolis.com [mailto:FatButterfly@lists.dynapolis.com] On Behalf Of Debbie Wilson Sent: Tuesday, October 02, 2001 1:49 AM To: Fat Butterfly DTE Forum Subject: Re: [FB] Ariba buyer problem Dear Andrew; And so what about RFQs? Are they appropriate? If you think auctions are inappropriate, you probably don't believe you should make your supplier compete for their business. And perhaps they shouldn't---if no one else can do what they are capable of. Does it really matter if the things you are quoting out are direct or indirect materials or goods or services? If you look at the numbers FreeMarkets, eBreviate, Covisint and now PurchasePro are putting out--the vast majority of $$ is for direct materials. I can tell you that many suppliers have howled loud and hard when I've bid out their business. Generally, the louder they howled, the higher I found their original prices to be over market. Does bidding out, of any mode, lower suppliers margins? Absolutely yes. But as I looked at it, its a free world. I don't force a supplier to lower their prices. They do it willingly. IMHO isn't this what a free economy is all about? If no one is willing to pay a reasonable margin for your goods or services, maybe you shouldn't be in that business. Sincerely, Debbie Wilson www.purchasingautomation.com Andrew White wrote: > Anyone see this story about auctions? > > Here is the article from Jim Ericson at Line56: > >http://www.line >56.com/articles/default.asp?NewsID=2962 > > Seems like Mike Hogan at POET has had some fun in the last week > discussing pro and con of auctions (and their derivatives). Seems > like the logical, rational thing is to assume that auctions would > "appear" good for one party (the buyer in the general sense) or other > (the seller in the case of a reverse auction). So what I say. Why > not get rid of the auction process - period? Can we? Does it serve > a useful function? Sure does. In some cases. > > Is it tied to RFP/RFQ etc? Maybe. Sometimes. Not always. > > Is "auction" a "best practice" for a dominant supply chain? No way. > Never. > > Does "auction" service the needs for indirect as well as direct > materials? Not cleanly in the case of direct. So why has it taken > folk this long to "get it"? > > Since this is an argumentative email, why not attack the heart of > the > catalog why were are at it. Do we think that "catalog" is a critical > function? Does "catalog" improve, or bypass "auction". Do they > overlap? Is "catalog" as important for direct as well as indirect > materials? I have an opinion, of course. > > Anyone care to joust? > > Dark Lord > > -----Original Message----- > From: FatButterfly@lists.dynapolis.com > [mailto:FatButterfly@lists.dynapolis.com] On Behalf Of P Ghosh > Sent: Friday, September 28, 2001 11:18 PM > To: Fat Butterfly DTE Forum > Subject: Re: [FB] Ariba buyer problem > > If Ariba is using plugins, depending what version of IE you're > using, > you may have problems.... IE 5.5 SP2 and above (i.e. IE 6.0) does not > support Netscape style plugins. This was a deliberate decision made > by Microsoft. If this is the case, Ariba needs to make the necessary > modifications to make sure its application works with IE. > > Partho Ghosh > President & CEO > Knowledge Industries, Inc. > 304 Newbury Street > Boston, MA 02115 > Tel: (617) 266 8076 > Fax: (617) 266 4009 > permanent email: pghosh@alum.mit.edu > > Jose Antonio Sanz wrote: > > >Hi, > > > I have some problems using SSL security with Internet Explorer > Browser to login into Enterprise Manager ( Ariba Buyer tool ). Ariba > answer is that I must use Netscape in any case. Really I don´t see > this defect in Ariba Documentation. > > Can any one provide information about it? > > -------------------------- > This discussion forum is sponsored by Dynapolis Internet Services > . > > Web-based archives are at: http://forums.nmm.com > To unsubscribe, send an email to: > fatbutterfly-off@lists.dynapolis.com > Questions: listmaster@dynapolis.com > -------------------------- -------------------------- This discussion forum is sponsored by Dynapolis Internet Services . Web-based archives are at: http://forums.nmm.com To unsubscribe, send an email to: fatbutterfly-off@lists.dynapolis.com Questions: listmaster@dynapolis.com -------------------------- -------------------------- This discussion forum is sponsored by Dynapolis Internet Services . Web-based archives are at: http://forums.nmm.com To unsubscribe, send an email to: fatbutterfly-off@lists.dynapolis.com Questions: listmaster@dynapolis.com --------------------------