Morgan Stanley will choose its technology vendor next month from among several finalists. The decision will be closely watched in the highly competitive Web-procurement software and services industry. "We'll be the benchmark for online buying in financial services," says Gerry Fitzmaurice, Morgan Stanley's director of national purchasing.

After selecting a vendor, Morgan Stanley plans a 60-day pilot beginning in June with 150 employees buying online from 12 supplier catalogs. If the pilot is successful, a limited national rollout will begin in August with 5,000 users and 30 to 40 catalogs. Suppliers include W.W. Grainger & Co. and GE Lighting.

Morgan Stanley plans to complete U.S. deployment before its year 2000 moratorium on new applications begins at the end of October. The procurement system is slated to handle supply purchasing by all three business units: Morgan Stanley investment banking, Morgan Stanley Dean Witter brokerage, and Discover Card financial services.

Morgan Stanley retained Deloitte Consulting's DRT Systems unit to validate vendor claims about their systems' capabilities. Fitzmaurice says Web procurement products and services are still in their infancy. "We found that vendors had a lot of technology expertise, but often didn't know much about purchasing," he says.

Another financial firm, T.Rowe Price Inc., last week began the first phase of its Web procurement initiative using American Tech Inc.'s PurchasingNet SQL appli- cation and CatalogJunction middleware. T.Rowe Price will test the system with 200 IT employees buying IT products and plans a full-scale rollout to 4,000 users buying all supplies by August.