InformationWeek

Businesses haven't yet approached the Zen-like state in which suppliers and customers interact unconsciously in an infinite, virtuous cycle, where customer feedback ripples back organically through the supply chain. But a rare few companies have set their sites on something approaching that. One is Quaker Chemical Co. Last year, the $267 million chemical supplier to the steel and auto industries implemented a flexible information-sharing network that CIO Irving Tyler envisions as the basis for a loop connecting employees, customers, and suppliers. It's the kind of broad effort at collaborative business that draws from and blurs traditional technology disciplines from knowledge management to ERP to CRM.

The Conshohocken, Pa., company's business-intelligence network, which operates over a frame relay WAN powered in part by software from Intraspect Software Inc., lets employees and business partners throughout the world share product data, research, and other information in almost any format. The first push for Quaker is collaborating internally. The multinational company is using its network to more efficiently solve problems and take advantage of its global research network. "Our associates in China can tackle a problem so that it's solved by the time our people in Europe get to work in the morning," Tyler says. With that backbone in place, Quaker is trying to develop fully collaborative networks internally and across its supply chain and customer base--and ultimately link them all together. If Quaker can connect the loop from suppliers to customers, Tyler sees ways to make the entire process more efficient.

For instance, some of the chemicals that Quaker sells contain an anticorrosion agent because that's how the base ingredient comes from the supplier. That's fine for the steel mills, but the automakers who buy that steel have to remove the agent and apply their own, more specialized formula. If Quaker knew its chemicals would be used on steel bound for the auto industry, it could use different ingredients. "If we can push that information through the development chain, we could speed up our development cycles and create some new opportunities," Tyler says.

Though increasing sales is the most common goal for collaboration, companies are also collaborating to cut costs. More than half of respondents to the InformationWeek Research survey view collaboration as a means to squeeze expense out of their supply chain and target other pockets of inefficiency. Briggs & Stratton last year built a collaborative extranet--BriggsNetwork.com--for partners and suppliers. Among other things, the Wauwatosa, Wis., company's eight-language site lets suppliers and manufacturing customers log in and check manufacturing specifications, view upcoming sales promotions, and receive parts and warranty information. Distributors can set up their own Web site to highlight information of particular interest to their customers using the Briggs & Stratton extranet. "The cost of getting information out is greatly reduced," says Erik Aspelin, Briggs & Stratton's VP of E-commerce, noting that the company uses more than 35,000 distributors worldwide.

People see different data on the site depending on whether they're a manufacturing customer, a dealer, or a distributor. The offerings include a searchable library that contains all product brochures and marketing material; an interactive engine-replacement application that helps dealers select the correct replacement engine for a customer; a library of two- and three-dimensional engine drawings; and an online calendar that lets dealers schedule training classes with their distributors. Briggs & Stratton regional managers can also publish information unique to their regions, so a dealer in the South can still get lawn-mower information, while a counterpart in the North has moved on to emergency generators.

The company says more than one-fifth of its 35,000 dealers have used the site since it launched last June; it expects many more to log on this year. Aspelin says the extranet delivers an indirect benefit to consumers. "It translates into more accurate service for the end consumer, because the [equipment makers] and distributors have information that's more up to date," he says.

Briggs & Stratton is looking to bring consumers directly into the loop. The company is extending much of the information posted by suppliers out to customers via its consumer Web site, BriggsandStratton.com. From that URL, consumers can access sales catalogs of equipment powered by Briggs & Stratton, use an "Ask The Expert" feature to match products with their needs, find a merchant that carries the product, and even access personalized content once they register. In addition to Home Depot, shoppers on the site might also be directed to Lowe's, Sears, or a smaller retailer. Extending the concept of collaboration to services, Briggs & Stratton even hosts E-commerce sites--via Digex--for small retailers that lack their own Web presence.

In addition to saving money, companies are creating collaborative environments to help build customer loyalty. During the past two years, diesel-engine manufacturer Cummins Inc. has been constructing an extranet that customers such as Peterbilt Motors Co. and Kenworth Truck Co. can access for updates on their engine orders.

"To the extent that we're easier to deal with, they'll design their products to use our engines," says Brad Lontz, director of the E-business office at the $7 billion Columbus, Ind., company. Cummins competes primarily with Caterpillar Inc. and Detroit Diesel Corp. in the market for large diesel engines. At present, truckmakers can log into the site and view early prototypes for Cummins' 2003 line of engines--and ask for modifications if they see a problem.

Next up for Cummins is adding real-time design-collaboration tools so its engineers can work with their counterparts at a customer site anytime they want without having to board a plane. "That could save us a lot of money," Lontz says.