Business Technology: A New Breed Of Standards Makers - InformationWeek

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Business & Finance
Commentary
6/13/2003
06:50 PM
Bob Evans
Bob Evans
Commentary
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Business Technology: A New Breed Of Standards Makers

RISC versus Intel, Linux versus Windows Server 2003, XML versus J2EE, Oracle versus DB2, PC versus Mac, etc., etc., etc. We have grown fully accustomed to competing vendors promoting their own versions of what they would like us to believe are standards--or at least should be standards. (And didn't a group of several PC vendors long ago band together to offer EISA, a "standard" bus alternative to IBM's offering?) Since competition for consumer choice is an intensely powerful motivator, this has generally been a very good thing for business-technology customers and for the IT vendors vying to set and control those desperately sought-after standards.

And while it's probably safe to say that such vendor-driven competition will continue to be hot and heavy for quite some time to come, I also think we're at point where a new set of standards will be driven not by the companies that make the stuff but rather by the companies that buy it. I don't mean accepted, tolerated, put up with, or adopted--I mean driven by, established by, set by, and enforced by. And to start with, I mean Wal-Mart.

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Long ago, Wal-Mart rattled a lot of cages when its internal commitment to EDI was extended outward to suppliers: If you want to do business with us, then you will comply with our supply-chain technology standards. If you don't want to comply with our standards, that's OK--but you won't do business with us. Fairly simple, perfectly clear: The choice is yours. For some small companies, that presented a tough challenge: How am I going to afford this new technology? And even if I could afford it, I still wouldn't have any clue about what it is or what it does. But can I afford to stop doing business with the largest retailer in the world? Will this investment in something called EDI perhaps help me run my small business more effectively? Does all the benefit of this investment accrue to Wal-Mart, or will some of it come back to me?

They weren't talking about IBM or Microsoft or Intel or Sun or Oracle; they were talking about Wal-Mart's technology requirements. And it seems to me that the same things are happening again today, but in a way that's more profound and sweeping. It's not just about orders and shipments anymore. It's about real-time connections to customers and markets, it's about rapid shifts in product design to accommodate emerging tastes, it's about inventory management and cost control and greater collaboration with suppliers and suppliers' suppliers and much more, and it ultimately leads back to the fundamental questions: Will this investment in technology make my business stronger, more competitive, more profitable, more opportunistic?

Heck, there's even a supply-chain execution company in Atlanta, called Manhattan Associates, that offers a set of products and services that it guarantees will make your company 100% technology-compliant with Wal-Mart. Not compliant with a mainframe or an operating system or a network or an enterprise application, but with Wal-Mart. Is this going to become the new model for what is or isn't a standard? Are we moving to a new model in which the technology standards that most managers care about are not so much those that are internal to the IT industry but instead are the ones specified by these enormous hubs of commerce--Wal-Mart, General Motors, the Department of Defense, Procter & Gamble, McKesson, Eli Lilly, and a handful of others?

I think the answer is yes, and that doesn't in any way diminish the impact and significance of IT vendors or the standards they promote. Rather, it just places those in the context they were always meant to be in: customer-driven choices about which alternative will make my business more competitive, more successful, and more profitable. Because those are standards we all support.

Bob Evans
Editor in Chief
[email protected]


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