Perspectives of the e-marketplace by multiple stakeholders

Business-to-business (B2B) e-commerce has been the focus of media hype for the last five years. Like many other technologies in the e-commerce area, it has dropped from a media and Wall Street favorite in 1999 to one that is going through a market shakeout. In both the business-to-consumer (B2C) and B2B marketplaces, existing firms in the physical marketplace (bricks-and-mortar) are responding to threats from new entrants. In the B2C area, the physical stores have created their own online stores as well as an alternative selling channel in what is popularly known as the clicks-andmortar approach. A similar transformation is occurring in the B2B area. Firms from the physical marketplace, who were customers to the new electronic marketplaces (e-marketplace), have created their own versions of these marketplaces. The big three auto firms have developed their own exchange (Covisint) to link suppliers and buyers, thereby creating serious competition to new start-ups such as Free Markets. While it is relatively easy to create e-marketplaces with packaged software, it is more difficult to create the liquidity in the marketplace by enlisting an adequate number of buyers and sellers to participate in the marketplace. The current turmoil in the B2B area creates significant uncertainty for procurement and IT managers in the organization. Companies have been undergoing a major transformation in the procurement area in the last five years from various technologies and business practices including EDI, supply chain management (SCM), continuous replenishment schemes, efficient consumer response systems, and collaborative commerce systems. Organizations are interested in knowing if e-marketplaces are the next stage in the evolution of SCM or a passing fad. While these e-marketplaces have much to offer, there is a significant cost for restructuring existing business practices and supplier relationships. Business managers have to address many issues including: