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Defining The Business Value Of Technology
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January 22, 2001 |
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Chemicals Exchange Takes Fast Track To Launch
Industry-led Elemica taps ASP Corio to host its forthcoming e-marketplace
ou might think that Elemica Inc., an industry-led E-marketplace backed by 22 major companies, including Dow Chemical, DuPont, and Shell, needn't be in a hurry to go live. The exchange faces little competition--its would-be rival, the independently operated e-Chemicals, is struggling to stay afloat. But Elemica, which is trying to transform the supply chains of big chemical companies, plans to be up and running by midyear, and last week it sealed a deal with application service provider Corio Inc. to help meet that goal."Our decision to outsource to an ASP to host the exchange was important because we wanted to get to market as fast as we could," says Scott duFour, VP of technology for Elemica, which is operating with an IT staff of only five people. "To hire the technical resources needed to build the technology ourselves would take a tremendous amount of time." Buyers and suppliers don't want to wait that long to get efficiencies into their supply chains, or to link their enterprise resource planning systems, duFour says. By the third quarter, Elemica says, the exchange will support XML technology to let customers integrate their ERP systems.
But not everyone is convinced that the exchange will get that far that fast. "When marketplaces talk about linking systems, they're really talking about building one interface per buyer for sales orders, one interface per client for billing, and the list goes on. That's a lot of effort," says Dave Boulanger, AMR Research's research director. "These projects are extremely costly and can take anywhere from one to three years."
Elemica wouldn't disclose which technology platform it's using, but Corio hosts only Commerce One Inc. marketplace software. Cap Gemini Ernst & Young, which Elemica hired in November to help it make technology decisions, will provide application-deployment assistance to Corio.
The chemicals exchange isn't the first industry-led venture to turn to service providers for hosting expertise. ForestExpress, formed by members of the paper and forest-products industry, and Enporion Inc., an exchange launched by North American utility companies such as Allegheny Energy Inc. and Northern States Power, have also tapped Corio to host their ventures.
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