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Jonas Construction Buyer Guide Sky



Date Posted: 1/7/2009

Manufacturing CFO’s Using SAP Look to SaaS Outsourced eCommerce B2B Websites

 
 
By Thomas R. Cutler

Increasingly manufacturing CFO’s are turning to Software as a Service (SaaS) solutions to reduce costs, increase efficiency, and improve operation productivity.  The initial and recurring costs of on-premise software applications top $10,000 per user, per year. With tight budgets these CFO’s are simply unwilling to let on-premise solutions drain resources.

CFO's utilizing SAP, are frequently looking to outsource the B2B (business to business) eCommerce website according to Sam Bayer, Founder and CEO of b2b2dot0.  “When CFO’s look at this strictly from a financial perspective, all of the financial benefits of the SaaS methodology make the decision quite simple; there is no hardware, software, or incremental staffing required.  The outsourced B2B eCommerce is a solution which can be expensed and no capital investments are required,” suggested Bayer.

The time to implement an outsourced eCommerce SaaS solution is short, (within 60 days), real value realized almost immediately.  ROI (return on investment) is measured in weeks and continues to operate in the black thereafter.  There are no risky up front consulting projects that can last six to twelve months before the first order is placed.  Given the upfront commitment these manufacturing CFO’s have made to SAP, there is particular satisfaction that an outsourced eCommerce solution leverages ALL existing investments in SAP. 

Bayer commented that, “No corporate sensitive data ever leaves the building.  We don't store product, pricing, order, delivery, financial, invoice, customer information whatsoever.”

These outsourced B2B eCommerce firms do the work of two to three employees within four months of a project’s start date and since firms “pay as they go”, these firms ultimately pay by the value being derived.  The more customers that use the system, the more value derived, the more one pays.

The Software-as-a-Service model is transforming the way organizations buy software. Bayer asserts that, “SaaS lets us stay focused on building features that deliver value for B2B buyers and sellers. Manufacturers outsourcing the IT infrastructure reduce project complexity, technical resources requirements, and lower the total cost of ownership.”

Traditional B2B projects require that CFO’s either purchase a product and heavily customize it or build a custom website from the ground up. Either way, the organization needs to manage the IT infrastructure associated with the project. Complexity and associated costs are eliminated by outsourcing the eCommerce solution in a SaaS format.

·          No web expertise required

·          No staff required to administer and support the application

·          No worries about backups, upgrades, security

·          No hardware or software licenses required

Real-time Data from SAP Users Proves Critical

Very few eCommerce solutions offer a Service-Oriented Architecture (SOA) which allows manufacturing CFO’s to extend the reach and value of the firm’s products and order data by providing secure, Web-based access to the SAP system.

Bayer noted that, “It is critical the eCommerce SaaS providers follow proven methods for connecting with SAP system to ensure forward compatibility when upgrading…using SAP recommended best practices such as web services and remote function calls (RFCs) is essential.”

The SAP data model and BAPIs (Business Application Programming Interface) were not designed with a friendly web user interface.  Users do not want to navigate to different places to see data that they believe belongs together.  Web-friendly RFCs ensure that the right data is available at the right step in the ordering process.

 

The outsourced eCommerce B2B website must be a smart, easy-to-use interface that enforces rules and anticipates actions. Bayer also noted the importance of security, commenting that, “The b2b2dot0 solution does not duplicate or permanently store any SAP data or rules. The SOA communicates with SAP via web services, in order to provide secure, real-time data for buyers.”  Whether the solution accesses the SAP system via a VPN or HTTPS, data and internal systems must be protected with best-in-class encryption and security measures.

"Real time" must be "real time", not simply valid since the last time the company performed a batch load of pricing, availability and payment information.  CFO’s are most satisfied when the outsourced eCommerce solution provides real-time access to SAP data and the data provided follows business rules for that user. 
 

 




Author Contact:
Thomas R. Cutler, CEO
TR Cutler, Inc
Email: trcutler@trcutlerinc.com
Website: www.trcutlerinc.com


About Author
Thomas R. Cutler is the President & CEO of Fort Lauderdale, Florida-based, TR Cutler, Inc, (www.trcutlerinc.com). Cutler is the founder of the Manufacturing Media Consortium of three thousand journalists and editors writing about trends in manufacturing. Cutler is a member of the Society of Professional Journalists, Online News Association, American Society of Business Publication Editors, Committee of Concerned Journalists, Society of American Business Editors and Writers, as well as author of more than 300 feature articles annually regarding the manufacturing sector. Cutler can be contacted at trcutler@trcutlerinc.com.

 


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