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Enterprises Should Push Supplier Networks To Deliver Interoperability

The Plethora Of Discrete Networks Detracts From ePurchasing's Value

July 30, 2009

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Why Read This Report

Enterprises use supplier networks to trade electronically with their suppliers, but they find that insufficient cooperation between rivals limits potential progress. Chief purchasing officers (CPOs) and their ePurchasing program managers struggle to get full adoption because suppliers are reluctant to use all the multiple networks and single-buyer portals that their various customers specify. Network interoperability is technologically straightforward, but real barriers exist, such as the lack of a commercial model and large vendors' reluctance to help smaller competitors. Once consolidation starts, the natural imperative of scale in the technology business will transform the market into one in which a few large, successful, interoperating networks enable buyers to reach all their suppliers, however small or physically remote. CPOs can support and encourage this process by ditching their buyer-centric approach, providing suppliers with choices, and insisting their network providers interoperate with their peers.

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Table of Contents

  • The Supplier Network Market's Fragmentation Hinders Its Growth
  • A Few Interoperating Networks Will Dominate The Enterprise Market
  • RECOMMENDATIONS

  • CPOs Can Help Drive Supplier Network Interoperability
  • WHAT IT MEANS

  • Clients Of Small Networks Should Consider Switching
  • Supplemental Material
  • Related Research Documents

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