Beneath the Vortals
The Lowdown on XML-Based B2B Standards
By Michael Carroll
Using Internet procurement automation tools and techniques to buy operating resources can reduce costs, often achieving 300 percent return on investment (ROI) for the buying organization. Because of this, buyers and suppliers with different procurement and catalog systems must find ways to interoperate effectively. Three standards are emerging to try to solve this problem.
Operating resources are the goods and services needed to run a business, anything from pencils and paper to computers, software, and secretarial support and legal advice. According to a report by the Aberdeen Group, operating resource expenditures can be as high as 35 percent of the total operating budget for manufacturers, and more than 60 percent for service organizations.
So it's not surprising that many vertical portals ("vortals" -- see this issue's article by Tom Spitzer, "Vertical Horizon") have sprung up not only to provide content aggregation (industry news, career opportunities, legal information, and catalogs), but also to facilitate the procurement transaction process. A typical buying scenario goes like this:
- An employee in a buying organization selects products and services from supplier catalogs.
- Specialized software on the employee's desktop (such as Ariba's ORMS or Commerce One's BuySite) generates a purchase requisition and routes it via email for approval.
- Upon approval, the software generates a purchase order and submits it to the vortal through the Internet.
