GE Global eXchange Services Trends in Data Transactions

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GE Global eXchange Services Trends in
Data Transactions

• Steve Scala, VP of Marketing

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Four Large Trends We Are Watching

• Internet
• XML
• Work Flow / Process Framework
• Content

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How Will The Internet Impact EDI?

• The press and the analysts always frame the
  discussion as VAN vs. Internet?
• The Internet will enhance the growth of the Value
  Added Networks
• As of July gt 20 our EDI Mailboxes are now 100
  pure Internet related
• As of July 5 of our EDI volume is now 100
  pure internet related
• GXS offers AS/2, S/FTP, Web HTML, Web Services
  using XML, SOAP and WSDL
• Connectivity to the VAN will move away from SNA,
  Bisync, X Modem, ANSI Clear, Z.Modem, X.400, Etc
  and move towards IP
• The discussion should be rephrased Direct
  Connect vs. VAN?
• Direct Connect has been around before the
  introduction of the Internet
• Certificate Management
• Help Desk
• Enablement
• Protocol Independence (FTP, SMTP, AS/1, AS/2,
  SOAP, HTTP/S, Etc)
• Capacity Utilization when Scaling for Maximum
  Number of Concurrent Users
• Direct Connectivity is only economical for a
  small percentage of trading partner relationships

The Internet Will Accelerate EDI Adoption, and a
Trusted Intermediary Will Continue to be the
Preferred Economic Model For Delivery of the Data
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How Will XML Impact EC and EDI?

• XML is fragmenting In the same manner as early
  EDI
• XCBL, CXML, EBXML, CIDX, ROSETTANET, Etc
• Vertical or Vendor Based Initiatives
• No Document Schemas across Industry
• Many of the XML vendor owned schemas are in deep
  financial crisis
• Adoption rate for Inter-enterprise communication
  will be slow
• No ROI to convert existing EDI to XML
• New capital investment and skills required to
  implement XML
• Adoption rate for Intra-enterprise communications
  needs to succeed before Inter-Enterprise
• XML will drive more traffic to the VAN
• Outsourcing of the translation between EDI and
  XML
• 5 commercial clients

XMLs Usage for Inter-Enterprise Communications
Still Limited More Standards Work Required
Before it is a viable replacement for EDI
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WorkFlow and Process Frameworks The Problem
Duplicate PO
Qty Issues
Incorrect Pricing
Incorrect UPC
EDI syntax
Shipment Date
80 of Inbound Order Volume is Digitized Yet 80
of the Inbound Order Volume Requires Human
Intervention
EDI Syntax
Special Shipping
Incorrect Pricing
Shipment Date
Qty Issues
Incorrect SKU
50 of Inbound Order Volume is Digitized Yet 65
of the Inbound Order Volume Requires Human
Intervention
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WorkFlow and Process Frameworks The Definition

• Definitions for This Discussion
• Process
• The Sequence and Definition of Documents Flowing
  between two trading partners
• RosettaNet is a great Example
• They have X number of PIP (Partner Interface
  Processes)
• Many EDI Hubs define/dictate a process with their
  trading partners
• Examples
• Required 997 within 24 hours after executing the
  of sending the data
• Required 856 after receipt of 850
• To date most process definitions are not a
  standard
• Very little internal visibility / Makes
  supporting EDI to business owners difficult
• Workflow
• The routing and business rules applied to
  documents inside the Enterprise
• Very Customized to the Enterprise
• Handled in a variety of locations (ERP,
  Translators, Integration Brokers etc)
• Poor at handling Exception Management and
  Interfacing with People Processes

Workflow and Process Framework improvements are
Huge Opportunities to reduce cost within the
Enterprise and Improve Visibility into the
Transaction Process
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Content

• At any given time 30 of the information in
  catalogs is incorrect
• Information Week July 1, 2002
• 10 - 15 of the products arent available to
  consumers when they want them Information Week
  July 1, 2002
• If a customer makes a one digit error in the
  code for a product, they may repeatedly place
  orders for that product to be replenished and not
  receive it until they get on the phone, or we
  do, and straighten that out Milan Turk (Procter
  Gamble)
• Huge Issues exist with data synchronization

Content Synchronization is an area that needs to
be improved To Assist in the Accuracy of EDI
Related Information
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Statistical Trends

• Over 66 Million Line Items of Content Managed by
  GXS) (up double digit)
• Over 23,000 Users Registered to Access the
  Content (up double digit)
• EDI Renewal rates greater than 94
• EDI transaction volume (up double digit)
• Outsourced EDI volume (up double digit)
• Community size now numbers over 130,000 (up
  double digit)

New Forms of B2B E-commerce May Have Taken a
Beating but Reliable EDI is Still Growing Strong
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Summary

• XML is not going to eat EDI and the Internet is
  not going to eat EDI, EDI is just going to keep
  growing. Gartner (Electronic Commerce World May
  2002)
• Most of our key EDI based indicators show strong
  double digit growth
• Market based trends point to a market
  consolidation
• B2B Company valuations down
• Large number of EDI Firms on the block or
  recently traded (Inovis, GXS, Sterling, etc)
• Many EDI Firms not financially strong

Look for the environments with current liquidity
to leverage your future E-Commerce Needs,
history has shown that evolution not revolution
will be the path to E-Commerce Digitization