The European e-Business Report The European e ... - empirica

The European E-Business Report 2005
Germany. The new ERP system (implemented in late 2004) proved to support this objective, as it
helps CDI to better anticipate short term and long term deliveries.
e-Collaboration and business networks
For SMEs in particular, collaboration in business networks can be an important strategy to counteract
advantages of large firms due to economies of scale. ICT play an important role as a 'glue' for such
networks, for instance for shared marketing or procurement activities. Business networks can also
enable SMEs to have access to ICT resources which would otherwise not be accessible for them.
Associations and business support organisations appear to play an important role as enablers of such
networking initiatives.
In 2000, the Dutch Ford car dealer association (NFDA) initiated a project to improve the exchange of
spare parts between the associated car dealers. This was motivated by the ever rising costs of spare
part inventories and the increasing pressure on net margins. The online exchange opens up spare
part inventories of all connected dealers to each other. The impact of the project on the management
of spare part inventories turned out to be significant; cost savings are realised by improved purchasing
policies, and, in particular, by facilitating the dealer-to-dealer reselling of old and often rare spare
parts.
However, not only small firms benefit from cooperation. Pharma-mall (DE) is an integration hub
initiated by a joint venture of the pharmaceutical companies Boehringer Ingelheim, GlaxoSmithKline,
Merck, Novartis and Schering. The collaboration of research-based pharmaceutical companies in noncore
business areas is not unusual. In order to manage the high risk involved in developing new
products, for example, R&D co-operation is common in this sector. In addition, producers of
pharmaceuticals are also collaborating in sales logistics. Today, pharma-mall provides an integration
hub that interconnects the sales systems of associated pharmaceutical companies with the manifold
ERP or procurement systems of hospitals and pharmacies. By integrating the various backend
systems, pharma-mall supports the entire supply process, including ordering, confirmation and
accounting.
Improving supply chain management and logistics
Supply chains in almost every industry tend to be complex and fragmented. Production processes
normally involve various networks among suppliers, third parties and customers. They consist of a
number of discrete activities. ICT can help to organise these relationships as integrated production
networks. Integration can be both horizontal and vertical.
A notable example from the printing industry is the integrated workflow system "Prinect", which is used
by the Finnish print company Finepress Oy. The solution allows Finepress to link electronically all the
steps within its production chain (including prepress, press and post-press phases), and to connect
those with the management information system. Through process integration, the company was able
to reduce operator input, which resulted in a marked reduction in the fixed cost of processes.
Integrating business processes through ERP
Enterprise Resource Planning (ERP) systems typically link manufacturing, logistics, distribution,
inventory, shipping, invoicing, and accounting processes in a company. Thus, ERPs are crossfunctional
and enterprise wide. They constitute an important control system and backbone for many
business activities, including sales, delivery, billing, production, inventory management, and human
resources.
Palfinger (AT) is a leading international manufacturer of hydraulic lifting, loading and handling
systems. Palfinger considers information and communication technologies (ICT) mainly as a means
for business process innovation. The company uses e-business for various purposes, including e-
procurement and e-sales, and – probably most important – internal processes. In 2003/04, Palfinger
implemented a new SAP system in the distribution, production, and logistics divisions. The aim was to
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