The present popular conception of electronic commerce is too narrow and should really also include business-to-business e-commerce, according to Sun Whye Mun, regional director, e-commerce, Sterling Commerce Asia.
E-commerce plays a vital role in a business organization, without which the organization is likely to experience higher costs and inefficient supply chains, Sun said.
"When a business is not involved in e-commerce, from a business-to-business point, it incurs an inability to manage an efficient supply chain that would make an organization leaner from an inventory perspective," he explained.
"The common problem many businesses face today is how much inventory they should have, and their aim is typically, to reduce inventory cost." Sun also said Sterling Commerce Inc. has about 300 clients in Asia, most of whom it helped to establish business-to-business e-commerce.
Establishing an e-commerce link with partners within the organization's supply chain will not only bring down transaction and inventory costs, it will improve delivery process, and thus make the organizations more efficient, he added.
"Also, e-commerce is all about reinventing the business, about strategic changes and business transformation," he said, pointing out that Dell Computer Corp. was one example of an organization that "reinvented" its business and revolutionized online PC purchasing.
It is not enough for an organization to say it is e-commerce-enabled simply because it has established a link to its consumers, but neglects to address business links with its partners, he elaborated.
Sun said he would "challenge" a typical industry prediction that business-to-consumer e-commerce is heading for a boom period in the near future and will grow beyond the business-to-business e-commerce market.
He argued that business-to-business e-commerce will prevail as the stronger of the two because the return on investment (ROI) is higher. Sun added that the tapping directly into vast worldwide pool of online consumers may be attractive, but businesses are typically driven to ensure they can provide what consumers want, and that will lead the way back again to making their businesses more productive.
"Consumers would want their goods delivered on time, and businesses would want to reduce costs. An efficient and well-managed supply chain addresses these issues," Sun said.
Sterling Commerce, earlier this year, acquired iCommerce and shortly after that purchase, bought the Network Integration Systems (NIS) Group, in a bid to spur e-commerce in this region. iCommerce was formerly a NIS Group subsidiary.
Sterling is currently looking to consolidate the companies into a single office by year-end. Future plans include the setting up of a research and development lab to roll out new products first for the Asian market and later to the global market, according to Ruth Connolly, managing director, Sterling Commerce Asia.
"We've just flown in the director of the R&D lab in our United States office. He has already begun looking at roping in both experienced programmers and fresh graduates to join our team here," said Connolly, adding that the local Singapore laboratory will integrate future core product developments with its counterpart in the U.S.
The laboratory's main focus is to establish the ability for an organization to engage in e-commerce, and bring core products from America and develop them so they meet the needs of the relevant local markets, she said.
Sterling is also looking to establish a support center here that will then be hooked up to similar centers in Amsterdam and the U.S., Connolly said. Likely to be implemented by the second quarter of next year, these support centers will provide 24x7 service.