The Bloor Perspective: Globalisation, Novell and smart supply chains

IDC has just published a white paper, sponsored by eTranslate, that suggests globalisation is going to be a major issue for future web implementations. Globalisation is the ability to move away from the expectation of technology driven by the needs of local or US economies and to provide support for the needs of every citizen - especially through different languages.

We all know that a web presence opens up worldwide markets but it is very easy to assume the information we need will be available in the language of our choice. The US dominance of the internet has made things easy for the English speaking nations of the world but, perhaps, we should look at the other side of the coin. How likely is it that we would buy a product if the sites offering it were available only in Spanish, Japanese or German? It is important to consider, therefore, the needs of markets such as China, Southern Europe and Asia if an organisation really wants to make the most of the web.

The IDC paper does some basic mathematics for us. It takes existing web usage statistics and then extends them out to 2003. The take up of internet technologies is already relatively high in the USA, Northern Europe and Scandinavia - all pretty good at speaking English. However, by 2003, IDC anticipates the proportion of all web users based in the US will fall from just fewer than 50 per cent to around 30 per cent. At the same time, areas such as Japan, Asia-Pacific and Western Europe will emerge as much more important players. User preferences for a language other than English will be as high as 84 per cent in Japan, 75 per cent in Latin America and 52 per cent in Western Europe.

The easiest solution to this problem is to have a separate website for each area, presented in the local language and using terminology and phrases that make sense to local users. However, this does not address the user's tendency to just use the ".com" suffix to find the chosen pages. The suggestion is that users need to be able to select their language from the pages (visit http://www.etranslate.com for an impressive example). At the same time, it should be possible to pay in any currency. Organisations that do not adopt a truly global viewpoint are missing opportunities.

For a full look at issues surrounding globalisation and ebusiness visit silicon.com's latest special report at http://www.silicon.com/global .

*Novell down*

Novell has just announced its fourth quarter and full year earnings for fiscal year 2000. The results showed reduced revenues and profitability but were in line with expectations. The company is not predicting much of an upturn in the next fiscal year so what can be done to halt its continuing decline?

Novell has set out its stall as a net services provider for ebusiness. Its aim is to link internet-based activities with traditional business processes through the delivery of infrastructure features such as security, authentication and management tools. It has also released its DirXML product for linking to popular business applications.

All of this is powered by the underlying NDS directory, which is central to all of its major products. While demand for these products is increasing slowly (up 4 per cent in 2000), the drop off in NetWare (24 per cent) massively outweighs this. The restructuring, including shedding 900 employees - is expected to free up about $45m each quarter. Something like $20 million of this is earmarked for sales and marketing initiatives to build up brand awareness and to promote the net services strategy.

It is strange to hear Novell talking of a need to raise brand awareness. It is as if it has to start all over. The market seems to have lost sight of its historical achievements and is treating Novell like a newcomer - even though it has masses of experience in the management of network infrastructure. Thus far, NetWare revenues have sustained the company but, with the arrival of Windows 2000, these have plummeted and we must expect this situation to worsen - especially since there was little in the announcement of NetWare 6 to attract new customers.

With its sales channels in a state of confusion and products out of favour, it is difficult to see anything other than a long uphill climb for Novell.

*Supply chain evolution*

With the ever-increasing movement towards online business, all of the talk is about CRM and B2B interaction. One aspect of this is the ability to optimise the supply chain so greater speed and efficiency can be achieved. The technologists would like your business to leap straight into an all-singing, all-dancing trading exchange but the indications are that much better results can be achieved a little closer to home.

Work carried out by AMR Research indicates that the implementation of supply chain automation and optimisation tools will provide ROI figures of between 30 and 300 per cent, depending upon the complexity of the solution. It also suggests that the majority of projects will achieve payback within the same year - always a useful factor when seeking financial justification.

There is almost certainly an assumption here that supporting systems such as ERP/MRP are already in place. If this is so, then the costs of supply chain management and optimisation products are low in comparison and such ROI figures will be feasible.

Technically, this is not a difficult problem. However, it is the automation of individual processes and the ability to change ways of working that can reap the greatest benefits. An example would be to invert the procurement process so suppliers can see when new supplies are needed. With automation, it is much easier to implement a just-in-time approach to delivery. It may even be possible to develop a more efficient business model by using lateral thinking. Retail outlets, for instance, have no need to own the items on their shelves. In fact, they could change to service organisations that simply rent out shelf space - some already do this - and pass the problem of stock down the supply chain.

These types of change demand that a business is willing to share its data with its partner organisations. This requires a shared architecture with easy access and adequate security controls - an extranet. Overcome these issues and the supply chain ceases to be a chain. It becomes possible to develop parallelism where suppliers, manufacturers, logistics, warehouses and retail outlets can all interact independently. The end-to-end chain becomes a network and, eventually, you end up with the trading exchange that the technologists tried to sell you in the first place.