Web-based supply chains lose steam as economy slows

While interest in Web-based supply chains remains steady, attendees at the Supply Chain World conference in New Orleans last week said they're rethinking their business-to-business strategies due to the softening economy.

Frank Campagnoni, chief technology officer at General Electric Co.'s Global eXchange Services in Gaithersburg, Md., said too many companies believed that they could make money quickly by throwing up an e-business site without bothering with things such as connecting online storefronts to back-end systems.

But, he added, the slowing economy and continuing losses at B2B exchanges have sparked doubt about how to succeed at e-business.

Internet-based supply-chain applications can reduce procurement costs and improve collaboration between manufacturers and their suppliers, Campagnoni said.

"But ultimately, it's a lot of hard work, and you have to roll up your sleeves and work with partners," he said.

"The market is dazed and confused," said Jay Stephens, a consultant at Chicago-based Accenture, who spoke at the conference, which was sponsored by the Pittsburgh-based Supply Chain Council Inc.

Despite the proliferation of supply-chain tools, many companies have neglected to think about the real business value that they're likely to get by using the software, he said.

For example, too many users invested money in business- to-business marketplaces in response to peer pressure and still have nothing to show for their troubles.

Now, however, many companies "are skeptical," said Stephens. "They're saying, 'Show me the money.' "

» posted by ITworld staff

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