The signs of technology-enabled transformation are not always clear at first. The British parliament scoffed at the invention of the telephone since the Britons already had enough messengers. In the 1940s, Thomas Watson, Chairman of IBM, turned down the offer to buy the patent rights to the electronic digital computer with his prediction, "I think there is a world market for maybe five computers." So much for predicting markets and business impact when disruptive technology first appears. Although the Internet enables a new era of commerce, electronic commerce, the signs of a business revolution are shrouded with the mist and fog of dawn. Some businesses have already recognized the start of a new era of business, the digital era, and have taken decisive action to change their business models. Competing against these transformed companies will become increasingly difficult, and those who wait for the full light of day before they act will find themselves at a distinct disadvantage.

According to the Association for Electronic Commerce, a simple definition of e-Commerce is "doing business electronically."² Sound fuzzy and ill-defined? It is. According to this definition, using the telephone to conduct business is e-Commerce. In large corporations e-Commerce is often equated to electronic data interchange (EDI) where structured messages representing standard business forms are exchanged over private networks.

Perhaps the most common context in which the term is used as of the writing of this book relates to the use of the Internet and more specifically the World Wide Web as the infrastructure for conducting commerce. In everyday usage the terms Internet commerce or I-commerce, Web-commerce and e-business are often interchanged with e-Commerce, some-times leading to academic arguments. In his article, "E-commerce? E-business? Who E-cares?" Walid Mougayar, the founding chairman of CommerceNet Canada explains, "In a nasty little intramural squabble, some analysts and online businesspeople have decided that E-business is infinitely superior as a moniker to E-commerce. That's misleading and distracts us from the business goals at hand. The effort to separate the E-commerce and E-business concepts appears to have been driven by marketing motives [circa 1996] and is dreadfully thin in substance. Here's the important thing: E-commerce, E-business or whatever else you may want to call it is a means to an end. The objectives, as with IT, are to improve or exploit unique business propositions -- with the focus now being the online world. Worrying about the definitions of those words, or about which is superior to the other, or about which is a subset of the other, is a silly little inside-the-beltway argument."³ So, depending on who is asked, e-Commerce will have a wide variety of definitions and even differing names. This is not bad since vague definitions and various names help to keep our thinking open.

To better capture the spirit of e-Commerce, we can turn to the definition proffered by the industry consortium, CommerceNet, "e-Commerce is the use of inter-networked computers to create and transform business relation-ships."⁴ CommerceNet elaborates, "It is most commonly associated with buying and selling information, products, and services via the Internet, but it is also used to transfer and share information within organizations through intranets to improve decision-making and eliminate duplication of effort. The new paradigm of e-Commerce is built not just on transactions but on building, sustaining and improving relationships, both existing and potential." Figure 2 - 1 provides a structural context for our e-Commerce definition.

Figure 2 - 1. Extending Inward-Focused Processes Outward

E-Commerce is an infrastructure for extending a company’s inward-focused, unique business processes to customers, trade partners, suppliers and distributors with new, outward-facing applications. These new applications are greater than the sum of a company’s internal computer applications added to the applications of its partners. The interconnections make it possible to do things in ways not previously possible by eliminating time and distance. Opportunities and challenges permeate the enterprise affecting R&D, engineering, manufacturing and production, supply chains, marketing, sales, and customer care. Because it reaches directly into these core business processes that are the lifeblood of the enterprise, e-Commerce is a mission-critical business issue. From this perspective it becomes clear that e-Commerce is not something a corporation can just go out and buy. Neither is it based on speculation, but rather on the experience of a handful of companies who already are using it to streamline their business processes, procure materials, sell their products, automate customer service and create new wealth. Electronic commerce is turning industries upside down and forcing enterprises to refocus their information systems from the inside out.

The second wave of e-Commerce is well under way, giving companies the capability to handle transactions electronically. Perceived and real obstacles had to be overcome before electronic transactions became a widespread means of buying and selling on the Internet. According to this same Forrester report mentioned above, only 5% of the Fortune 500 companies with a Web presence handled transactions on the Web in 1996. The major barriers included security on the Internet, lack of accepted standards for authentication and payments, nonrepudiation, and general fear and uncertainty by consumers. Fortunately, several standards and commercial offerings for handling transactions have appeared including SET for credit cards, Open Buying on the Internet (OBI), CyberCash and InternetBill.

Attracted by the dramatic cost savings of electronic transactions and the opportunity to exploit new revenue channels, companies have purchased stand-alone procurement packages to streamline purchasing and stand-alone storefront packages to begin selling on the Web. Most commercially available e-Commerce packages focus on either the buyer model or the seller model of doing business. As a result, e-Commerce applications are usually labeled as either "buy-side" or "sell-side," depending on whether the company hosting the application is buying or selling products or services. A third business model, the broker model, combines buy and sell-side functionality into one site and aggregates both buyers and sellers. These cybermediaries add value for the buyer by reducing the search space for appropriate suppliers, and for the seller by being found more easily by potential customers.

E-Commerce applications are further categorized by the markets they serve, business -to- business or business -to- consumer. The difference is largely that of buying behavior: shopping versus procurement. Consumers do a lot of browsing and price shopping, they are subject to the influence of advertising and merchandising, and many are prone to impulse buying. Purchasing agents, on the other hand, are time constrained to get their tasks done, cannot be distracted with glitzy advertising, do not buy on impulse, and generally order from catalogs where prices have been prenegotiated.

As shown in Figure 2 - 2, e-Commerce applications fall into four major

Figure 2 - 2. E-Commerce Application Categories

categories: Vendor Management, Extended Value/Supply Chain, I-Market and Customer Care. In the vendor management category, maintenance, repair and operations (MRO) procurement is the most common business-to-business e-Commerce application. MRO procurement is used to reduce costs in the purchasing of office supplies and other non-production materials needed by a business. As an example in the procurement category, GE bought $1 billion worth of supplies through its Trading Process Network (TPN) in 1997 and expects to be procuring over $5 billion over the Internet by 2000. Meanwhile, in the extended value/supply chain category, GE Aircraft Engines used its integrated logistics solution to reduce order cycle time by 15 to 30 days and reduced the cost of creating a purchase order from $100 to $5. To be successful, buy-side initiatives will have to deliver such breakthrough efficiencies and achieve dramatic cost reductions.

Catalog sales such as Amazon.com’s now famous book and music selling site is an example of an I-Market. McKesson, a $17 billion pharmaceutical wholesaler, has developed such a comprehensive customer relationship management system on the Web that it has transformed itself from a drug distribution company to a value-added provider in the healthcare industry. In-depth discussions of each of the four categories are available in chapters 3-6. To be successful, sell-side initiatives have to focus on revenue growth opportunities, holistic customer relationship management, engineering consumer processes that delight the user, and building communities-of-interest.

In addition, sell-side initiatives may need to cater to both business-to-business and business-to-consumer markets simultaneously. For example, Office Depot sells to large corporate accounts meeting their procurement needs with prearranged terms and custom catalogs while reaching the retail consumer market as well as those in-between, the small office, home office (SOHO) market-space. Designing their e-Commerce systems specifically for the unique requirements of each of these subtly different customers is absolutely essential for Office Depot.

Most companies, of course, engage in both roles of buyer and seller, sometimes simultaneously in a single commerce transaction. Thus extending a company’s existing business processes from the inside out must begin with a thorough analysis and understanding of customers’, suppliers’ and trading partners’ requirements, and designing e-Commerce systems from the outside in.

Whether developing e-Commerce applications in-house or pursuing the package route, a holistic view of e-Commerce initiatives is needed in order to avoid the many pitfalls that result from taking separate and isolated views. Some large corporations already have identified more than 70 e-Commerce initiatives, not just the two buying and selling thrusts. If various lines of business in these large enterprises rushed out to buy their individual point solutions, the compromises of packaged software would be revealed quickly. Trying to realize each of these initiatives individually would mean attempting to tie together and maintain a multitude of business processes and islands of data in the enterprise’s new and existing systems. Rather than weaving a tapestry, multiple stand-alone initiatives would tie their systems and their company in knots as illustrated in Figure 2 - 3.

Figure 2 - 3. Without Integration,
E-Commerce Could Tie a Company in Knots

Companies experienced with multiple e-Commerce applications have learned that they need a unified, incremental approach capable of supporting and sustaining multiple and continuously evolving e-Commerce initiatives -- they need strategies for e-Commerce integration.

Global 2000 companies have a tremendous asset base in their existing computer systems. These systems embody their unique business philosophy, policies, and processes. Smart companies will seek to adapt, not to obliterate, their legacy applications as they embrace e-Commerce initiatives. Much of the functionality needed to implement multiple and diverse e-Commerce applications is identical or similar and thus can be reused -- a key to e-Commerce integration. Core e-Commerce functionality includes user authentication and authorization, user profile management, workflow management, event notification, negotiation and collaboration, and data integration with enterprise data. These core e-Commerce components are illustrated in Figure 2 - 4. E-Commerce integration is the key to sustainable business strategy.

Figure 2 - 4. Untying E-Commerce Knots
with Core E-Commerce Application Components

Figure 2 - 5 summarizes the three waves of e-Commerce. The first wave was about HTML and brochureware. The second wave is about transactions using home grown or packaged software as point solutions for procurement and online catalog selling.

Figure 2 - 5. Three Waves of E-Commerce

For some forward thinking companies, however, a third wave of e-Commerce has begun. With experience as their teacher, these companies have come to realize that e-Commerce is neither just a buy-side nor sell-side package. The third wave companies have learned that mission-critical business opportunities abound. To them, e-Commerce is an infrastructure for a whole new way of doing business. They have learned that if they extend their business processes across company boundaries and integrate them with their suppliers’ and customers’ business processes something totally new starts to happen.

Figure 2 - 6. Inter-enterprise Business Processes

E-Commerce provides the business infrastructure for realizing Porter’s visions, and IPE provides the methods for competitive value-chain engineering. Customer-facing processes include cataloging, order entry, customer support and overall customer relationship management. Supplier-facing processes include MRO and supply chain procurement, travel and entertainment procurement and tracking, logistics, and collaborative supply and demand planning.

Figure 2 - 7 shows how clusters of inter-enterprise business processes result in the four major categories of e-Commerce applications. Companies will not attempt to build these applications all at once. Such an effort would overwhelm any enterprise. Instead, e-Commerce initiatives will be launched in the quadrants in an incremental and iterative manner.

Figure 2 - 7. Inter-enterprise Process Integration
with E-Commerce Applications

For example, key inter-enterprise business processes may be engineered and deployed in the vendor management quadrant. Functionality will be added to these processes iteratively, and additional processes will be engineered and deployed incrementally. It is possible to proceed with work in parallel, but resource restrictions and other constraints will prevent companies from attempting too much at one time. To maintain the cohesion needed in the ultimate digital business, each e-Commerce initiative must be based on a common business and technology architecture designed for inter-enterprise process engineering.

Inter-enterprise process engineering, however, does not result in an end state. It is an on-going process that enables virtual corporations to evolve in a continually changing business ecosystem. Organization form and function must be able to sense and respond to change. Agility is the byword of success -- an agile business empowered by agile information systems. No longer can software development be on the critical path for organizational and process change. With change being the constant variable, a new software development paradigm -- component-based development -- is essential to building agile, virtual corporations.

The results of good architecture will be a cost-effective use of legacy assets and commercially available components, and resilience to change. With good architecture business applications will be scalable and extensible. Architecture provides a decision framework for the difficult build or buy dilemma. The structural elements along with their interfaces that comprise the system allow design tradeoffs based on cost and technological constraints. Buy or build decisions and incorporation of new technology can be determined for the structural elements rather than the overall architecture. Likewise, companies can upgrade their applications over time while maintaining integrity and interoperability with other enterprise applications.

Distributed object computing is now recognized as the way forward in building enterprise information architectures that can operate in advanced client/server, intranet and Internet environments. In essence, using objects to build information systems is like building a simulation with business objects representing the people, places, things and events that are found in the business setting or domain. Business objects reflect the real world and thus greatly enhance understanding and communication among systems developers and business people. And business objects reduce complexity because programmers do not need to know how an object works internally. They only need to know what the object is and the services it provides. Object technology, however, does have some downsides including a steep learning curve. Business objects, though they represent things in the real world, become unwieldy when they are combined and recombined in large-scale commercial applications. What is needed are ensembles of business objects that provide major chunks of application functionality (e.g. preprogrammed workflow, transaction processing and user event notification) that can be snapped together to create complete business applications.

A component-based application architecture provides the business benefits of rapid applications development for quick time to market, enterprise-wide consistency of business rules and quick response to changing business requirements. And because major software vendors are committed to a component architecture, applications can mix and match best-of-breed solutions. In his 1986 landmark book, Object-Oriented Programming, Brad Cox forecast a software revolution that would result from taking an engineering approach to programming. Electrical engineers do not design and build hardware from scratch. Instead they create a continuing stream of new and ever more marvelous electronic devices using prefabricated ingredients, integrated chips (hardware ICs). Cox predicted that software factories would fabricate, customize, and assemble software from standard reusable parts -- Software ICs. After a decade of advances that took the theory and practice of object technology from a programming construct to a distributed computing infrastructure, Cox’s software revolution is now at full fervor.

New de facto and open standards have emerged to make it possible to develop large-scale distributed computing systems with "plug and play" components -- the Object Management Group’s CORBA 3 (CCM), Sun Microsystems’s Enterprise JavaBeans, and Microsoft’s COM+. The telephone is easy to use while telecommunications technology is very complex. Likewise, a browser is easy to use while Web technology is very complex. Industrial strength server-side components are needed to deal with the complexity of the underlying information systems and distributed computing infrastructures. With components, solution developers can "plug into" standard preprogrammed services such as user authentication, work-flow, data interchange, transaction processing, permanent storage of objects, and event handling services. Developers ask for the services without having to know the internal workings of the components that deliver them. The low level systems services call on the actual technology infra-structure that may consist of wrapped legacy systems as well as services provided by native objects. Components suppress the complexity of the underlying systems technology, meeting Chris Stone’s requirement for a clear separation of concerns: component construction versus component assembly. Plug-and-play business application components can be assembled or "glued together" rapidly to develop complex distributed applications needed for e-Com-merce.

How important is component-based development to large corporations? Research by the META Group revealed that "By 2001, most Global 2000 companies will use a "software factory" model to implement new application systems, requiring developers to move from a "craftsman" approach to a culture of assembly and reuse. These applications will be component-based, message-enabled, and event-driven, using an n-tier design that will leverage enterprises’ capacity-on-demand capability."

Today components are often thought of as being client-side technology, but the role of server-side component technology will be paramount as companies demand agile software in the face of accelerating business change. A logical architecture for component-based development of e-Commerce applications can be described in layers as shown in Figure 2 - 8.

Figure 2 - 8. E-Commerce Applications and Component Logical Architecture

The technology infrastructure consists of combinations of legacy applications that have been wrapped to appear and function as business objects, and services provided directly by a distributed object platform (persistence, transaction processing, event services and the like). Component-based development for e-Commerce applications is a process of assembly and refinement. The process begins with cross-application components that provide functionality common to most types of e-Commerce applications. Typical of such core components are user profile management, authentication, authorization, data management, workflow, negotiation, collaboration, and event notification. These cross-application components can be customized and extended to form application-specific components. For example, in a procurement application, a profiling component will contain attributes for identifying a user’s role and buying power.

When applied to an I-Market application, the profiling component will be extended to hold information that can be used to track customer buying patterns. In addition to the tailored cross-application components, application-specific components will include best-of-breed search engines, shopping carts, catalogs or other elements required for the application. These may be built in-house or purchased. Cross-application components also can be extended to develop industry-specific components. For example, in a manufacturing industry a workflow component can be extended to handle work-in-progress and integrate workflows across enterprises to make "just-in-time" a reality. Additional best-of-breed industry-specific components are added to the framework to provide structure and behavior common to companies in a given industry: for example, cost accounting, warehousing and logistics in manufacturing industries.

The final step in the component-based development process is the configuration of the components to incorporate the organization’s unique business rules and user presentation and navigation. It is in this step that a company’s competitive advantage is built on top of best-of-breed cross-application, application-specific and industry-specific components, and embedded in its e-Commerce applications. The user may be a human in which case the presentation and navigation layer is browser centric. The user also may be another computer application, perhaps a supplier’s order entry application. In this case the presentation and navigation layer concerns program-to-program interactions and data -- a process known as web automation. In modern distributed computing architectures both users and applications can be distributed around the globe.

The position of e-Commerce application components within a distributed computing architecture is shown in Figure 2 - 9. Residing on state-of-the-art application servers, application components use standards-based middleware (e.g. CORBA, COM+, EJB) to integrate e-Commerce applications with legacy applications, existing databases, and ERP systems. The distributed component architecture allows the enterprise to leverage its unique business processes and policies embedded in these systems and refocus them from the inside, out.

Figure 2 - 9. A Distributed Component Architecture
for E-Commerce Applications

These brief paragraphs reveal a breakthrough that has been sought since the beginning of software development -- true software reuse! Notice that the common, cross-application components will be used throughout the growing portfolio of e-Commerce applications. The architecture is flexible and meant to evolve. Initially, of course, a company has no components.

As it proceeds to build its next generation systems it will make or, more likely, buy the components that will populate a growing repository. When necessary, the architecture allows developers to go directly to the underlying business objects that the components encapsulate or directly to the underlying technology infrastructure or legacy systems. Over time the architecture will accommodate robust and adaptive information systems that embrace rather than cringe at business change. Its overarching structure will allow companies to grow the software they need to compete for the future.

Joined electronically, third wave companies must share a common foundation for integrating their unique business processes and embrace the component paradigm as the way forward. Their core business processes are embedded in legacy, enterprise resource planning (ERP) and client/server systems. In order to retarget these internal systems outward, common inter-enterprise application functions are needed. As shown in Figure 2 - 10, information boundaries, workflow/process management, trading services, searching and information filtering, data/process integration, and event notification form the foundation for refocusing information systems from the inside out.

Figure 2 - 10. E-Commerce Common Application Functionality

The leading IT research firms confirm the approach. As shown in Figure 2 - 11, the Meta Group identifies seven fundamental components at the heart of their electronic process interchange model: information boundaries, business rules, messaging, workflow, event/process management, interchange protocols, and trading services.

Figure 2 - 11. Meta’s Electronic Process Interchange

As shown in Figure 2 - 12, Forrester Research reinforces the message as they advise companies to create object wrappers for their legacy applications and snap in new, outward-facing components to build Internet commerce applications. They advocate an outward-in replacement of legacy functionality over time.

The essence of e-Commerce applications is that they must define "the rules of engagement" needed for process and data integration with trading partners. These are expressed in business logic that is unique and specific to each organization and application scenario. However, what is not specific to each business are the core e-Commerce components underlying the business logic. These common, cross-application components form the foundation for inter-enterprise integration and implementing the third wave of e-Commerce.

Figure 2 - 12. Forrester’s Outward-In Replacement Model

Their prescriptions were not based on magic, they were based on the enabling role of information technology. Herein lies the wisdom of their message. They recast the way a company must think about technology. They assert that a company that equates technology with automation cannot reengineer. A company that looks at and seeks to automate what they are doing cannot innovate, they simply reinforce and speed up old ways of doing things. Hammer and Champy rephrased the technology question: "How can we use technology to allow us to do things we are not already doing?" The reengineering revolution was underway. The focus of the business reengineering revolution was internal, on how the company must reorganize and streamline work. As the ‘90s draw to a close it is once again time to ask, "What if you could do something that has never before been possible? What if that something fundamentally alters what it is you do?" The result would be a paradigm shift. The Internet makes it possible to do things that were never before possible. The Internet’s distinguishing characteristic is ubiquity (existing or apparently existing everywhere at the same time), an attribute that can transform the very fabric of society and commerce. Déjà vu -- it’s reengineering all over again, only this time it’s on steroids. The Internet calls to us to reengineer not just our business, but to reengineer complete industries. It calls to us to extend our internal business processes to the world outside the corporation: customers, suppliers, and trading partners. And it turns the producer-consumer relationship upside down, placing the consumer in control. It calls to us to reengineer our corporation and shift the focus of business engineering from the inside, out.

Today’s forward thinking business leaders recognize the challenge of e-Commerce as a strategic business issue, not just one more technical issue to be delegated to the IS department, perhaps the existing EDI group. They already have looked below the surface of the daily press hype about the Internet. What they have seen is nothing short of a business revolution. They recognize the Net not as just another technology, information medium or distribution channel, but as the infrastructure that will cause profound change in the way companies organize work and conduct business, and ultimately in the structure of the economy itself. It’s the death of distance and the eradication of time between participants in markets. Pioneers are making mistakes. They are chalking up wins and losses, but they recognize that the winners and losers of the future will be determined by those who are able to capitalize on the Net’s capability to internetwork suppliers, customers and trading partners in a way never before possible -- in real-time.

Although a company may already have reengineered its internal business processes and perhaps painfully installed an enterprise resource planning (ERP) system to bring efficiencies to the back office, e-Commerce is about engineering outward-facing processes -- inter-enterprise process engineering versus business process reengineering (IPE vs. BPR). It’s about redefining industry boundaries, inventing new industries, repositioning, disintermediation (cannibalizing distribution channels), and reintermediation (establishing portals to the Web). It’s about 1-to-1 marketing, segmenting the needs of a single customer instead of segmenting mass markets. Its about outsourcing customer service to the customers themselves. It’s about relationship marketing and building communities. It’s about honoring the customer not as king, but as dictator who is but one mouse click away from turning his back on you. This is the stuff with which CEOs, not just programmers, must grapple.

In their classic BPR book, Improving Performance, Rummler and Brache use "managing the white space on the organization chart" as the book’s subtitle and metaphor for this process. Just as the BPR movement eradicated duplicate processes, ineffective hand-offs and disconnects between departments within a company, the new, real-time interconnections enabled by e-Commerce allows a business to tear down process barriers between its customers, suppliers and trading partners. While BPR crosses departmental boundaries, IPE crosses enterprise boundaries and is about "managing the white space in the value-chain."

Boeing provides a world class example of third wave value-chain management. Boeing designed its 777 in cyberspace by bringing together engineers, customers, maintenance people, project managers, and component suppliers electronically. No physical model. No paper blueprints. The result is the slogan that "the 777 is a bunch of parts flying together in close formation."

The key components of a business architecture are organization, processes and technology. The arrangement and connections of these components make up the business architecture. When a business is simple and small, its architecture is implicit. Without explicit business architecture, however, large complex organizations would move rapidly to a state of chaos. The profound and discontinuous change that is being wrought by the emergence of e-Commerce demands a fresh approach to business design.

No longer can a company sit comfortably in its niche in its industry and carry out business planning by extrapolating yesterday’s assumptions. And it cannot plan alone since forging new electronic relationships with suppliers, distributors, partners and customers requires direct participation by these stakeholders. A new approach is needed to design a sustainable, changeable business architecture and to build the essential components that must cross company and industry boundaries, forming a new business ecosystem.

An effective approach to business architecture must include an integrated and seamless method of business engineering and software development. What is needed are end-to-end, strategy-to-code methods for designing and deploying e-Commerce initiatives as illustrated in Figure 2 - 13.

Figure 2 - 13. E-Commerce Development Method

This envisioning process centers on asking the right questions. What are our customers’ Internet expectations? How does the Internet allow us to change our value proposition for our customers? How does the Internet as a communication medium affect our value-chain? Should we cannibalize our supply chain? If we do not, who will? If we do, what will happen to our existing supply chain relationships? Which business model do we use to reintermediate: aggregator, open market, or value-chain integrator? How can our internal business processes be remapped and integrated with our business partners, customers, and suppliers? What is their readiness for process integration? How does the Internet blur the boundaries of our existing industry? What new goods and services can we aggregate to more fully serve our customers? If we do cross industry boundaries, what is the competitive landscape and how will we differentiate our offerings? If we use the Internet to reach global markets, how do we internationalize our logistics, language and legal frameworks?

The business strategy phase of e-Commerce development identifies "what" to do. The business process engineering phase addresses the "how." The task at hand is the mapping and engineering of the inter-enterprise business processes. Work activities, steps and hand-offs are redesigned using the methods and tools of business process reengineering, only this time the mappings are inter-enterprise. Inter-organizational processes may be loosely coupled as in the case of open markets where pass-throughs are made from the I-Market to individual organizations. Or they may be tightly coupled as in the case of a supply chain where process hand-offs are made electronically.

Process engineering is a model-based approach to problem-solving. As functional requirements are passed through to the process engineering phase, a repository of previously developed models can be searched for processes that match the requirements. A shared repository of the artifacts produced by business and systems modeling serves as a reference architecture. The repository also contains a standard representation of requirements, use cases. Use cases not only serve as a way of capturing the requirements of a system, they also trigger later development steps from analysis through design, implementation and testing. Each step provides further elaboration of previous steps. The use cases bind the steps together providing traceability and thus permit the management of inevitable change. Use cases are a part of the Unified Modeling Language (UML) which has become the standard for modeling business systems. UML is designed to model components and guide in their construction, assembly and reuse. New and existing components are held in the component repository for reuse.

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In summary, a strategy-to-code method of developing e-Commerce systems fuses business architecture with technology architecture. Business strategy involves domain experts who define the initiatives to be pursued based on an analysis of the company’s strengths, weaknesses, opportunities and threats. Business strategy determines what problem is to be solved, generating requirements, goals and constraints. Inter-enterprise process engineering defines how the requirements are to be satisfied through new or modified organizations, processes and data shared among the company’s partners, suppliers and customers. Component-based applications implement the newly designed business processes, leveraging the technology infrastructure. The entire process is guided by an architectural approach that enables rapid development of business solutions through reuse of all elements in a growing repository of models and software components.

Formulating e-Commerce strategy should be at the top of management’s priorities. Today’s successful businesses have developed their unique style, form and ways of doing business. Their legacy assets are the basis of their success and should be leveraged, not obliterated, in the process of developing e-Commerce strategy. A firm’s competitive advantage is embedded in its unique business processes and its communal knowledge. By leveraging existing mission-critical processes and extending them to its customers, suppliers and partners, a corporation can build bridges to the digital economy.

Something new happens when a company extends its inward facing business processes outward. New value-chains can be created and customer processes can be integrated with the company’s internal processes. Like-wise with suppliers and trading partners. It is the engineering of these inter-organizational processes that allows costs to be cut, revenues to be increased, time to market to be decreased, and supply chains to be converted to dynamic supply grids -- a whole new level of business engineering for competitive advantage. A new class of holistic computer applications emerge that are greater than the sum of the parts of the participants’ individual business processes. This new class of computer applications, e-Commerce applications, enables not only the next level of efficiency but also a whole new realm of possibility for the corporation to make something where once there was nothing. Management’s ultimate challenge is organizational design that not only aligns technology with the business, but fuses the two with inductive, out-of-the-box thinking. Moving forward, e-Commerce should be the centerpiece not only of technical strategy, but, first and foremost, of business strategy. For in the third wave of e-Commerce, the business is its system.

References