E-Business Enablers.

Dec 13, 1999

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MARKET DYNAMICS

Market dynamics will drive industries through the e-business continuum. These powerful, rather unpredictable forces will also be a major factor in how quickly online trade will develop within any given industry segment. The speed of e-business adoption will vary from one industry to another. Market space structural factors and available e-business technology adoptions will be the ultimate determining factors. For instance, industries that are more innovative yet agile will forge new ways to accommodate customer demands for online buying.

Table 10.1 describes some examples of industrial supply chains and their gradual adoptions of e-commerce solutions.

Table 10.1 Vertical markets with centralized needs


Industry	What's Included	What Moves to E-commerce
Computers and electronics	Semiconductors, manufacturing, wholesale and business retail of hardware, software products	Wholesale, business retail, and manufacturer supply chains
Motor vehicles	Auto components, manufacturing, distribution	Vehicle wholesale, subassembly supply chain, spare parts wholesale
Petrochemicals	Equipment, extraction and refining, manufacturing, distribution	Wholesale and distribution of petroleum, chemicals, and plastics
Utilities	Gas and electric industry equipment, exploration, production, distribution	Transmission and wholesale distribution of gas and electricity, equipment, spare parts
Paper and office products	Paper and furniture manufacturing and supplies, distribution	Distribution and replenishment, manufacturing supply chains
Shipping and warehousing	All modes of transport, warehousing, and logistics	Load tendering commitments, contract bids, dead-load auctions
Food and agriculture	Farm equipment and supplies, farm products, food processing, distribution	Equipment supply chains, grocery and farm supplies distribution, machinery spare parts
Consumer and goods	Manufacture and distribution of appliances, home electronics, leisure goods, furniture, and apparel	Consumer goods wholesale, manufacturing supply chains
Pharmaceutical and medical	R&D, manufacture and wholesale of pharmaceuticals, medical equipment, and supplies	Pharmaceutical distribution, supplies replenishment, medical manufacturing supply chains
Aerospace and defense	Manufacture and wholesale of aircraft, space vehicles, and defense materials	Commercial aircraft spare parts, military replenishment, some manufacturing supply chains
Construction	Logging, construction materials and machinery, fixtures, engineers, contractors, and architects	Project and subcontractor bidding, materials wholesale, replenishment
Heavy industries	Mining, minerals, steel production and wholesale, infrastructure construction	Raw materials and steel wholesale spot markets, construction bidding
Industrial equipment	Industrial machinery and equipment, manufacture and wholesale, industrial supplies	Spare parts and supplies, some wholesale and some supply chain
Source: Forrester Research, November 1998

The current trends in technology, telecommunications, and media markets highlight an increasing interest in e-commerce solutions by supply chain enterprises across many industrial segments. This growth is beginning to gather a great deal of momentum. In fact, some investment analysts believe that the success rate will reach high speeds during the next few years. There are several reasons for this somewhat rapid growth; it is a technologically-focused change. Continuous management of innovation and evolutionary change are also very fundamental to fostering the growth.

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