Six persons staff the company's Information Systems (IS) Division, which is managed by a well-experienced computer engineer. The other five employees have mixed tasks, including operation and maintenance of the information systems, programming, and data entry. All divisions (at the company's own facilities) use PCs connected to a main server. Since 1994, the company was running a custom-developed ERP system and an off-the-shelf bookkeeping system, which were operating in isolation. The former was not fully exploited, in that neither all of its features and abilities were activated nor all business parts were being monitored.
In September 2000, market and business changes, such as increasing competition and shortening of products life cycle, led the company to the decision that they need to heavily invest in contemporary information technologies to both keep its status and gain competitive advantages. It was clear that such technologies would efficiently aid them to communicate, collaborate, and conduct business activities such as marketing, billing, and continuous customer service. In addition, on their way to embark on e-business, the company needed to exchange data with their trading partners, who may be using different platforms and a variety of data formats. For that, it was necessary to leverage their IT investments and integrate legacy data, residing in the existing applications.
To make their business transactions more efficient, the IS Division considered in detail two major issues: the technology that a system able to address the above changes should be based on, and the underlying business processes of the company (Froehlich et al., 1999). The system envisioned certainly had to fit the overall organizational context and be flexible enough to easily address arising opportunities. The global expansion of communication infrastructure should be also exploited, since it could provide the company with the potential of creating competitive advantages by electronically doing business with their trading partners, being their customers or suppliers. Obviously, the related transactions had to be efficiently structured and represented in the data flow and workflow of all partners involved.
To efficiently represent the information flow in an e-business-oriented enterprise system, the company had to consider whether its trading partners already use an enterprise system or even have any experience in doing any kind of business electronically. If not, applications delivering the required functionality via a standard browser over the Internet seemed to be the most appropriate solution. The justification was that such an application could always be kept up-to-date, while there would be no need for any installation at the partner's site (they would only need to establish a connection to an Internet Provider). In addition, a Web-based application could be accessible from anywhere, thus relieving the restriction of only using the user's regular desktop. Another argument was that, following such an approach, the company could maintain a closer communication with its partners, in that "all parties would become a part of each other's operations and activities." For instance, problems experienced by a customer could be immediately reported to the company, either directly or through the foreseen application's centralized database, thus avoiding unnecessary delays.
In case that one or more trading partners of the company already used an enterprise system, things were more complicated since these might run on different platforms and/or use different data formats. What needed was to think about a solution that could integrate legacy data, residing in the existing applications. The computer-to-computer transfer of business information, known as Electronic Data Interchange (EDI), was first considered. EDI is traditionally based on a collection of standard message formats and elements dictionary and has provided businesses with a way to exchange data via any electronic messaging service. However, the IS Division manager concluded that adoption of EDI implies certain tasks and limitations. First, they would have to conduct a thorough analysis to determine precisely how they are going to move their business data to and from the predefined EDI formats. At the same time, what they needed was flexibility in doctrinaire standards that do not fully meet their business needs. Moreover, the manager knew that companies should refrain from using different protocols to exchange data with their peers.
The exploitation of Internet technology and its standards was the next big issue, the argument being that "its wide and rapid adoption has reset the rules of how people interact, buy and sell, and exchange goods and services." Moreover, "contemporary ways of trading, allowing interaction between groups that could not so far economically afford to trade with each other, have been introduced." Being aware of the related technologies and standards, the IS Division manager knew that, whereas previously commercial data interchange involved mainly the transmission of data fields from one computer to another, the new model for Web-based business (the one introduced by the advent of the Internet) is greatly dependent on human interaction for the transaction to take place. That is, the new model should be principally based on the use of interactive selection of a set of options, and on the completion of electronic forms, to specify user profiles, queries, requirements, etc. Finally, the manager knew that in order to be fully interactive, the company needed to be able to understand the business concepts represented in the interchanged data, and apply business-specific rules to the interchanged data in order to both identify what classes of data it contains and, in the sequel, trigger the appropriate actions.