Boeing, UPS push marketplace links to ease procurement

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July 30, 2001 (Computerworld) -- Aircraft giant The Boeing Co. has begun the gritty detail work of building links to its chosen online public marketplaces and is pushing to make sure that this is an IT job it doesn't have to do more than once.

Efforts to create links among various marketplaces are under way and could lead to expanded usage of online procurement sites by corporations worldwide.

Seattle-based Boeing is nine months into a two-and-a-half-year integration project with online marketplace Exostar LLC in Herndon, Va. While it undertakes that work, Exostar is building links to other marketplaces such as Enporion Inc., a gas and energy exchange, and the regional markets operated by Deutsche Telekom AG and British Telecom PLC.

"That was a major criterion for selection for us," said Kristina Erickson, Boeing's director of venture relations. "It might not be something we can take advantage of immediately, but we fully expect to take advantage of a global network once we've got all our functionality in place."

"That's the win," said Gene Marshall, procurement group manager at UPS Air Cargo in Louisville, Ky. "You want to have one integration point rather than multiple integration points. Trying to build too many of these relationships would be a nightmare."

According to Erickson, Boeing has had to build a method of accessing 18 procurement systems in order to do business with Exostar.

Boeing has a polyglot of legacy procurement systems built by Baan Co., Oracle Corp. and WDS Technologies SA, in addition to some homegrown systems. Erickson explained that the data from all 18 systems must be converted to XCBL terminology (a variant of XML created by Commerce One Inc.) and then pumped through the corporate firewall to Exostar.

Exostar currently performs the XCBL conversions for incoming messages, but Erickson said Boeing will eventually assume that responsibility.

Boeing started with a no-frills messaging gateway when it first connected to Exostar last fall. Now it has formed a "basic transportation" gateway to broker the messaging. The company plans to replicate that basic gateway twice more to create a "managed high-performance fleet" capable of handling procurement from the entire enterprise.

In addition, the business units in 54 locations that use the 18 procurement systems are being asked to change their rules and processes to route their procurement efforts through Exostar.

"That's what makes this a whole lot harder," Erickson said. "If this was just installing technology, it would be a whole lot easier."

"It turns out, it's more difficult to do this than people expected," said Kevin Zhu, assistant professor of IT at the Graduate School of Management at the University of California, Irvine.

He said a translation layer such as the one Boeing is developing is "a worthwhile investment because you can't retire your legacy systems in most cases." Yet he said the real key for IT shops is identifying a core technology and set of standards that will be leveraged throughout a marketplace integration project.

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