InformationWeek: The Business Value of Technology

InformationWeek: The Business Value of Technology
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January 3, 2000

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Getting Personal
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    Experienced users can go straight to the online catalog of products to compare features. Or, they can use the Cozone Notebook Advisor, which conducts a mini-interview, asking customers how the system will be used and what features are important, and helping them compare the available products.

    The third path is for customers who want to learn more about notebook computer technology to see if it might fit their needs. "We're trying to move away from techno-jargon to make notebook computer purchases a more comfortable experience," Jeon says.

    Cozone.com has also incorporated BroadVision Inc.'s E-commerce platform, but hasn't leveraged all of the personalization features in that product. "It's been no small feat to launch this site, and now we want to integrate our Notebook Advisor with other marketing systems, including the BroadVision platform, and take better advantage of the personalization features available to us," he says.

    Even more-traditional data-analysis software suppliers are helping to give online buyers a more personal touch. Owens & Minor Inc. is the largest distributor of branded medical and surgical supplies in the United States, with $3.1 billion in revenue and more than 4,000 customers. The Richmond, Va., company has embraced E-business to serve the needs of its customers and medical suppliers. "We wanted to create transactional systems that are tied to the company's existing legacy systems and data warehouse, and make all of those systems easy to access by new and existing customers," says Don Stoller, director of information management.

    Owens & Minor's supply-chain extranet has created a personalized decision-support system for customers and suppliers. "We serve thousands of hospitals, health-care networks, and group-purchasing organizations, and wanted to give those customers easy access to detailed and timely information concerning sales, inventory, and accounts receivables," Stoller says.

    The company made this information available to customers and suppliers via an online system called Wisdom (WebIntelligence Supporting Decisions from Owens & Minor) built on WebIntelligence, the business-intelligence tool from Business Objects SA.

    Customers access Wisdom using a standard Web browser and modem. The information is personalized to each user, using security functions to restrict information to specific user IDs, Stoller says. Users interact with the application through a customized interface that protects them from the complexity of the data warehouse and lets them point and click to form queries.

    Owens & Minor's overall E-business strategy is attracting new customers and retaining existing ones. Stoller says the company has won at least $40 million in new contracts that cited the extranet as a contributing factor. The Wisdom system was expected to help increase sales by at least 10% last year and give up to 400 customers the medical-supplies data they need.

    Still, E-businesses face some hefty challenges implementing personalization packages. One obstacle is the complexity of implementing and integrating online analytical processing software, especially when tying it into legacy transaction-processing systems.

    "Access to complete and up-to-date customer information is still the exception, not the norm," says Philip Russom, director of the business-intelligence knowledge center at the Hurwitz Group, an analysis firm. "Many E-businesses are struggling to integrate customer data housed in diverse IT systems, such as those for help desk, order entry, billing, and shipping because the integration can help them be more effective at up-selling, cross-selling, and customer retention."

    That's where Russom and a group of software developers hope the new Customer Profile Exchange standard will make a difference by defining a unified customer view that can be applied within an enterprise and across multiple enterprises. CPEX is a group of business software developers that's designing a uniform standard for customer-centric software programs to "talk" to one another and share customer profiles.

    But some analysts are still skeptical, saying much of the personalization software available still isn't scalable enough, nor can it integrate with other key marketing systems already in place in many companies. "The industry recognizes a lack of clarity when it comes to implementing personalization software, and that may deep-six the movement," says Yankee Group analyst Paul Scarpa.

    Another problem: The price tag for personalization can cause sticker shock. net.Genesis' net.Analysis platform starts at $150,000 and, depending on the development time needed to set up the software, the price can go far higher, especially when a business must build links to legacy systems. BuyItNow.com's Wilcox says she has had six highly paid programmers generating reports, but hasn't calculated that cost into her personalization investment.

    However, Wilcox says, "you must compare the price with the percent-age increase in sales that can occur when you make products easier to find and keep good customers happy."

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