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Knowledge Management for E-Business

Dr. Larry Kerschberg, Co-Director E-Center for E-Business George Mason University http://eceb.gmu.edu/
ER Conference Tutorial, 30 November 2001
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Presentation Outline
Knowledge management concepts, tools and techniques. Enterprise data, information and knowledge resources, E-Business drivers, architectures and players, Role of XML (eXtensible Markup Language), E-Business Frameworks (B2C, B2B, Net Markets) Conclusions.

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Strategic Drivers for Knowledge Management


The management of organizational knowledge resources is crucial to maintaining competitive advantage. advantage Organizations need to motivate and enable their knowledge workers to be more productive through knowledge sharing and reuse. reuse The Internet and World Wide Web are revolutionizing the way an enterprise does business, science and engineering!

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Knowledge versus Information


Knowledge is about beliefs and commitment. commitment (Searle, Speech Acts, 1969). Knowledge, in contrast to information, is about acts and action. action Knowledge is intelligence put to work. work Knowledge is a dynamic human process of justifying personal belief toward the truth truth (Nonaka and Tekeuchi, 1995).

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Two Dimensions of Knowledge Creation


Ontological and Epistemological Dimensions Ontological Dimension

Individuals create knowledge while working within an organization that provides the context for knowledge development. development Organizational knowledge creation is a process that amplifies individual knowledge and crystallizes it as part of the organizations knowledge network. Knowledge creation process takes place in an expanding community of interaction, crossing intrainteraction and inter-organizational levels and boundaries.

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Epistemological Dimension of Knowledge Creation

Tacit Knowledge is personal, context-specific, difficult to formalize and explain.


Know-how, crafts and skills; Human beings create mental models, e.g., schemata, paradigms, perspectives, beliefs and viewpoints, of the world by making and manipulating analogies in their minds.

Explicit knowledge is codified knowledge and refers to knowledge that is transmittable in formal systematic language. (Polanyi, 1966).

Documents, reports, memos, messages, presentations, database schemas, blueprints, architectural designs, specifications, simulations.
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The Knowledge Creation Spiral


Dialogue

Socialization
Building Common Ground

Externalization
Linking Explicit Knowledge

Internalization

Combination

Learning by Doing

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Knowledge Contents
From\To Tacit knowledge Explicit knowledge Tacit knowledge Explicit knowledge
[Socialization] [Externalization]

Sympathized Knowledge
[Internalization]

Conceptual Knowledge
[Combination]

Operational Knowledge
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Systemic Knowledge

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Knowledge Contents
Sympathized knowledge includes shared mental models and technical skills. Conceptual knowledge created through metaphors, analogy and model creation. Systemic knowledge creates prototypes, new services, new methods, etc. Operational knowledge creates know-how regarding project management, production processes, new-product usage and feedback, etc.

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Enterprise Knowledge Resources

Internal Sources

Organizational tacit and explicit knowledge. Core competencies, expertise and experts. Patents, Best Practices Business Processes. Books, papers, patents, and technical reports. Research services, e.g., the Gartner Group & Forrester. External consultants. Best Practices in Case Tools, Oracle, SAP. Competitors products, services and people. The Web and Internet information sources.

External Sources

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Enterprise Data, Information and Knowledge

Modern enterprises are creating data at an unprecedented pace.


Information is data which has been processed to provided value-added insights. Knowledge is information that is compelling and can be used to take action in decision-making situations.

E-Business considerations require KM of business processes, partnerships, end-to-end relationship processes management, and protection of Intellectual management Property. Property IP over IP!

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Knowledge Management Architecture

Knowledge management requires several components:


Access to both internal and external information sources, Repositories that contain explicit knowledge, Processes to acquire, refine, store, retrieve, disseminate and present knowledge, Organizational incentives and management roles to support these activities, People who facilitate, curate, and disseminate knowledge within the organization. Information technology to provide automation support for many of the above activities,
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KM Architecture
Knowledge Presentation Layer
Knowledge Worker's View

Communication, Collaboration, and Sharing Knowledge Portal

Knowledge Worker's View

Knowledge Facilitators and Knowledge Engineers

Knowledge Management Layer Knowledge Management Processes


Acquisition Refinement

Knowledge Repository

Knowledge Curators

Storage/ Retrieval

Distribution

Presentation

Data Sources Layer


FTP

Enterprise Model

External Web E-mail Text Relational and Sources Repository Repository Repository OO Databases ER 2001 Tutorial 2001 Larry Kerschberg.

Media Repository

Domain Repository

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Knowledge Management Process Model.


Acquisition Refinement Acquisition Refinement
Expertise

Storage/ Storage/ Retrieval Retrieval

Distribution Presentation Distribution Presentation


Intranet & Internet Knowledge Portals XML Active Subscriptions Discussion Groups. Digital Rights Management User Profiles for dynamic tailoring links. Knowledge creation, update annotation, and storage in Knowledge Repository. Collaboration Environments

Data Cleansing Storage and indexing of Domain Model Indexing Knowledge Business Rules Metadata ConceptTagging Ownership; based Concept Federation Retrieval Agreements, Formulation Data Sources Retrieval by Information Author, External Integration Content, Sources and Ontology & Threads, etc. Formats. Taxonomy Wrappers Knowledge Knowledge Security. Politics of data Curation.
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Knowledge Management System


Knowledge Presentation & Creation Layer Knowledge Portal & Search Services Collaboration and Messaging Service VideoConferencing Service Discussion Group Services Knowledge Creation Services

Knowledge Management Layer

Data Mining Services

Metadata Tagging Services

Ontology & Taxonomy Services

Knowledge Curation Services

Workflow Management Services

Digital Rights Management

Information Integration Services Data Warehouse Federation Services Agent Services Mediation Services Security Services

Knowledge Repository

Data Sources Layer


FTP

Enterprise Model

External Sources

Web Repository

Text E-mail Repository Repository

Relational & OO Databases

Media Repository

Domain Repository

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KM Application:Interactive Knowledge Sharing.


Organizational learning through experience sharing, case studies and know-how discussion threads. Technical forums allow participants to share knowledge on problem-domain solutions. Curators and facilitators continually monitor forums to identify important threads, encourage participation, and support user training. Buckman Laboratories.

http://www.knowledge-nurture.com/

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KM Application: Electronic Publishing


Value-added knowledge dissemination of Market Research Reports, Memoranda, Newsletters. Repository consisting of Executive Summaries, Abstracts, Authors, Graphics, Tables, Charts, Text. Metatags for syntactic and content indexing. Organized and indexed for concept retrieval, keyword retrieval, etc. Standard formats for document publishing and delivery Lotus Notes, PDF, and XML.

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KM Application: Integration and Classification.

Knowledge creation and classification in near real-time for data push scenarios,

Need for a domain model of relevant objects, relationships, constraints, processes, etc. Need for near real-time concept formation, indexing and processing of massive amounts of data from multiple sources. Massive indicates terabytes of data per day! Intelligence Analysis Earth Observing System and Intelligence Analysis.

Examples:

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Buckman Laboratories
Global enterprise with about $300 million dollars in sales. Associates work closely with customers to solve chemical problems and to sell Buckman products. Buckman wanted to move the company from a productdriven to a customer-drivenenterprise. customer-driven Knowledge-driven, service-oriented approach with the Knowledge-driven commodities being the chemicals produced by Buckman Labs.

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Knowledge in Action
If you cant maximize the power of the individual, you havent done anything. If you expand the ability of individual members of the organization, you expand the ability of the organization. (Bob Buckman) Buckman Approach: Perform problem solving for customers by using both tacit knowledge and explicit knowledge. Goal is to harness the unconscious knowledge of the organization. organization

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KNetix The Buckman Knowledge Network.


The Knowledge Transfer Department is responsible for KNetix. Enables Knowledge-Sharing via TechForums Forum Leaders actively moderate, facilitate, seek knowledge, and identify discussion threads. Awards:

The Arthur Andersen 1996 Enterprise Awards for Best Business Practices - Category, Sharing Knowledge in the Organization. Computer World-Smithsonian Award

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KNetix Knowledge Process


Listen To Customer Identify Gap

Present to Customer Add New Knowledge Techforum Case History Knowledge Base

K'Netix Flow
Formulate Response

Current Information Techforum KTD-KIC E-Mail Knowledge Base Case History MSDS Product Data Sheet Technical Library Personal Files CD-ROM

Information Search

Explicate Knowledge Table/Graph (Excel) Diagram (Visio) Documentation (Word) Presentation (Powerpoint)

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KNetix Access Menu


Associates Worldwide Share Knowledge via Forums

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Buckman Knowledge Culture


Knowledge is object, knowledge is process, and knowledge object process is power. power Knowledge sharing

rewarded within the organization, and based on trust and long-lived relationships among associates. performed by Technical Forum leaders; weekly they index discussions via keywords, write abstracts, prepare discussion summaries, and post them to the Forum.

Knowledge curation

Code of Ethics guides associate interactions.

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Buckman Results and Vision

Measures of success: success


In 1995, 65% of associates sold to customers, versus 16% in 1979. 33% of sales from products less than 5 years old, versus 22% before KNetix. 72% of associates are college graduates compared to 39% in 1979.

Learning Center introduced to allow associates to enhance their knowledge; uses Learning Space from Lotus. Strategic focus on intimate customer relationships to provided knowledge-based services, thus gaining strategic advantage.

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The E-Enterprise Framework


Customers CRM Human Resources Financial Customers Enterprise Resource Planning

Portals Vendors & Partners

Enterprise Application Integration

Inter-Enterprise Transactions Vendors & Partners

Employees Databases Legacy Applications Mainframe Marketplaces & Exchanges 26

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Enterprise Knowledge Creation and Distribution


Acquire data and information from multiple, possibly heterogeneous sources, Integration of information, tagging of information with semantic tags, Create intellectual property (IP) with valued-added processing, Protect IP products, processes and resources, Share knowledge with partners, Distribute IP products to customers and partners.

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E-Business Knowledge Creation


KM XML 0101010101 0101010101

Capture Information:
Federated Databases Web Searching Intelligent Agents Knowledge Rovers XML Messages Email Messages

Generate Information Information Integration Indexing (XML Meta Tags)

Process & Manage Information


Knowledge Management
KM

Extract New Information:


Data Mining Decision Support AI Data Warehousing

Materialize

Convert To Knowledge Risk Management


XML

Publish & Share

Public Domain & WWW

Knowledge Base

Push Publishing?
XML

Security Concerns?

RosettaNet SOAP WIDL ebXML

Customers
XML

Web Services

XML XML Role

Suppliers & Business Partners

KM Knowledge Management Role

E-Business Data Acquisition and Knowledge Creation with XML as the Enabler ER 2001 Tutorial 2001 Larry Kerschberg.

Courtesy of Mr. Gus Jabbour

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Metadata in Knowledge Management

Metadata is data-about-data and is used to describe the attributes of a resource.


Metadata is used in several KM activities: search, discovery, documentation, refinement, and dissemination. These activities may be carried out by human end-users or their (human or automated) agents.

Metadata is needed in the Internet context to enhance precision of information retrieval. Metadata may be embedded within a document (metatags) or they may be external to the document.

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Metadata Standards Initiatives


Dublin Core Metadata Initiative for Digital Libraries, Dublin Core is an international initiative hosted by OCLC XML (eXtensible Markup Language) W3C - RDF, (WWW Consortium) Resource Description Framework W3C - Semantic Web, DAML+OIL. Web Services A metadata bibliography is available at:

http://www.ukoln.ac.uk/metadata/desire/overview/.

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Content Indexing and Tagging of Information Resources


Research in automatic classification at OCLC includes the Scorpion Project for Dewey Decimal Classification. Commercial products from Autonomy and Convera:

Use Bayesian Networks and Neural Networks to formulate concepts automatically, not just keyword extraction. Use text mining to correlate related concepts found in heterogeneous documents.

Automatic tagging will help analysts to create knowledge and link back to original sources. DARPA Agent Markup Language (DAML) program is creating a tool set for markup of Semantic Web ontologies and services.

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Dublin Core (DC) Metadata Initiative


Simplicity the DC is intended to be usable by noncatalogers as well as resource description specialists. Semantic Interoperability diverse description models hinder sharing and understanding across disciplines. International Consensus participants are from all over the world. Extensibility may be extended to include more specialized structure and semantics. Metadata Modularity on the Web brings Digital Library perspective to encoding metadata on the WWW.

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Dublin Core Metadata Types


Content Title Subject Description Type Source Relation Coverage
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Intellectual Property Creator Publisher Contributor Rights

Instantiation Date Format Identifier Language

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Dublin Core Metadata Elements


From ISO/IEC 11179 standard: Name - The label assigned to the data element. Identifier - The unique identifier assigned to the data element Version - The version of the data element (DC: 1.1). Registration Authority - The entity authorized to register the data element (DC: Dublin Core Metadata Initiative). Language - The language in which the data element is specified (DC: en). Definition - A statement that clearly represents the concept and essential nature of the data element. Obligation - Indicates if the data element is required to always or sometimes be present (contain a value) (DC: Optional). Datatype - Indicates the type of data that can be represented in the value of the data element (DC: Character String). Maximum Occurrence - Indicates any limit to the repeatability of the data element (DC: Unlimited). Comment - A remark concerning the application of the data element.

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Knowledge Management in E-Business

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e-Enterprise Providers

End-to-End Solution Providers

Methodologies should provide: Enterprise Data Modeling, Process provide Modeling, Workflow Modeling, Toolset Neutrality. Product attributes: Reliability, scalability, security, extensibility, interattributes enterprise process collaboration, content management, transaction management, adherence to standards. Provide services: Marketplace creation, community of buyers and services sellers, auctions, dynamic and/or fixed pricing.

Infrastructure Providers

Net Market Makers. Makers

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Ideal B2Bi Framework

An ideal methodology or framework should include the following capabilities:


Inter-Enterprise Process Integration, Business service and product definition, Business and service discovery, Globally unique identifiers for item tracking throughout the virtual enterprise, Security (SSL, HTTPS, PKI, Digital Certificates), XML-based object and information exchange, Message format translation, Internet Protocol support (HTTP, HTTPS, SOAP, UDDI)

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E-Business Concepts

E-Business denotes the use of the Internet and the World Wide Web (Web) to conduct business transactions:

Business to Consumers (B2C) Business to Business (B2B) Net Marketplaces Integrate business processes Integrate applications, data and knowledge; Foster the virtual enterprise via the composition of web services.

Major goal is to create a digital domain by which to:


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The E-Enterprise Framework


Customers CRM Human Resources Financial Customers Enterprise Resource Planning

Portals Vendors & Partners

Enterprise Application Integration

Inter-Enterprise Transactions Vendors & Partners

Employees Databases Legacy Applications Mainframe Marketplaces & Exchanges 39

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Broadvisions View

Leader in personalization and Customer Relationship Management, BV 1-to-1 supports:


Buy

Inform Market Maker (Exchange Environment)

Sell

Content Management, Profiles, Business Rules, and Transaction Processing,

Procurement (Supply Chain)

Financials, text Billing

Commerce (B2B, B2C, G2G)

Strategic partners include Autonomy, Verity, i2 Technologies, webMethods. Customers include US Postal Service and GSA Advantage.

Information Exchange Portal

Broadvision 1-to-1 Enterprise


(Content Management, Profiles, Business Rules, and Transaction Processing)

Procurement Database

Sales Database

Imagery Database

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Oracles Hub and Spoke


Customer
Customer Order Order Confirmation

E-Tailers' Web Portal

Multiple E-Tailers Multiple Suppliers Oracles Hub contains knowledge regarding:


Oracle Hub and Spoke Integration Architecture


Transformation Engine

Oracle Gateway

Non-Oracle Database

XML Order Document XML Response from Supplier Process Model Storage

workflow, XML documents, business rules, transformations and e-business processes.

W orkflow Engine Transformation and Rules Database LDAP

Business Rules Engine

XML Order Document XML Supplier Confirmation

Configure Global Data

Non-Oracle Database

Oracle Gateway

Suppliers' Extranet Portal

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Key Players in the B2B Space


Broadvision CRM, personalization, intra- and extranets. i2 Purchase order processing and supply chain management. Commerce One and Ariba Procurement. Vertical Net E-Marketplaces and exchanges. Oracle data-driven solutions to e-business via huband-spoke architecture. webMethods strong on XML for B2B information integration, EAI, and workflow.

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What is a Net Market?


An Internet-based marketplace that creates new market efficiencies and associated value-added services, such as information, trading, infrastructure and trust A net market has the following characteristics:

Creates new revenue models Has multiple buyers and sellers Can be vertical or horizontal, leveraging domains of knowledge Enables dynamic pricing Needs a strong community to be successful Developed by start-ups or spin-offs of global 2000 companies

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Why are Net Markets Important?


Net Markets will capture 37% of global online B2B transactions, or $2.7T out of $7.3T by 2004 (Gartner Group) Third party marketplaces will transact 15-20% of B2B e-commerce, generating revenue of $400-500B by 2003 (Merrill Lynch)

Market capitalization of $800B -- $1.5T by 2003

Net Markets will grow from 18% of total B2B transactions in 1998 to 29% in 2003, totaling $438B out of $1.5T (Bear Stearns)

Market capitalization of $228B by 2002

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Net Markets Advantages

Improve overall market efficiency


Reduce transactional costs by integrating sourcing, purchasing, and billing, More choices for buyer & selling trading partners, Centralizes access to information Pricing better reflects supply & demand, improves allocation and utilization

Attractive business model for Net Market makers once critical mass is achieved

Network effects

Barriers to competition, high switching costs, good margins Low incremental costs to increase membership & sales

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Key to Net Markets: Price Discovery

Static pricing

Sell products at fixed prices, typically from catalogs single vendor or aggregated (multi-vendor) Discount pricing rules or schedules for preferred customers (pre-negotiated) or volume purchases Increases market efficiency, welfare of buyers and sellers Reduces lost revenue (buyers willing to pay more) and failures to transact (sellers would accept less to make sale) Works particularly well when limited or unstable supply or demand creates price uncertainty and volatility Prices typically vary over time and across transactions Factors other than price and quantity can affect deals

Dynamic pricing

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Dynamic Pricing Models


Seller initiated, driving competitive bidding from buyers Various formats and rules Buyers & sellers post positions on commodities, automatically cleared Presupposes sufficient liquidity for quick matching of realistic positions Requires highest reliability and performance

Many Buyers

Forward Auction

Exchange

One Buyer
Most complex trade, requiring sophisticated transaction engine Best suited for dealing with many attributes, not just price and quantity, Mirrors manual processes

Negotiation
One Seller

Reverse Auction
Many Sellers
Buyer initiated, driving competitive bidding from sellers, as in RFPs/RFQs Same variations as in forward auctions

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Summary of Pricing Models

Dynamic Pricing

Negotiation

Auction

Reverse Auction

Exchange

Hybrids

Fixed Pricing

No-Price Negotiation

Catalogs

Aggregated Catalog Hubs

One to One
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One to Many to Many One


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Many to Many
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Net Markets Design Issues


Market size, transaction volumes & deal sizes Volatility of supply & demand Fragmentation of buyers, sellers, intermediaries Relative market shares (and power) of players Relative cost of sales & distribution -- pain points Commodity vs. complex/custom Existing price setting models Importance of branding & relationships to price Industry adoption of technology Competition How to make money - who pays what and when

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Conceptual Architecture for Net Markets


Enroll and Register Qualify New Members Manage Member Entitlements & Access Control Manage Content Provide Community Services Access & Contribute Content Access Community Services

Specify or Locate Items to Sell & Buy Browse Market Establish Price for Goods and Services Establish Transaction Terms &Conditions

Net Market

Publish Supply & Demand Connect Buyers To Sellers Enable Price Discovery Vet Buyers at Point of Sale Commit Transactions Finalize & Generate Order Track & Manage Orders Support Members Report Market Metrics Enable Decision Support Ensure Market Trust & Satisfaction

Ship and Receive Goods Check Order Status Make & Receive Payment

Enable Logistics

Manage Credit & Risk

Value-Added Service Providers


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Enable Payment

Provide Content

Net Market Maker

Members

Technology Map for Net Markets


Market Participants Participant Info. Systems Market Member Access:

User & System Proxies (Future)

Application Service Components

Administration

Platform

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Net Market Value-Added Services


Credit/Risk Processing Financial Processing Logistics/ Delivery Order Manageme nt Content Providers Info Access /Exchange Workflow
Enables on-line verification of buyer credit worthiness and management of aggregate risk exposure through automated rule-based workflows. Enables automated, on-line settlement of transactions cleared through the market, via integration with member back-office systems and banking payment networks. Enables the on-line provisioning of transportation services (and buyer statuschecking) to accomplish the transfer of physical goods from the seller to the buyer. Provides interfaces to inventory, manufacturing, distribution, shipping, and customer support systems to support end-to-end order tracking. Incorporates active data feeds and time-sensitive news, events, analyst reports from individual media outlets or third party aggregators/syndicators of such content. Establishes the on-line integration interfaces with market member business systems to automatically populate catalogs, update inventories, and execute transactions. Specifies, triggers, and manages the sequencing of automated information exchanges that comprise the business process interfaces between market makers and members. 2001 Larry Kerschberg. 52

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Net Market Application Services


Trading Engine
Provides the core dynamic price formation feature of a Net Market, encompassing a variety of models including Auctions, Reverse Auctions, Exchanges, Negotiations and hybrid (multiple stage price discovery processes). Dynamically customizes the presentation of a market Web site to members through mapping rules that match appearance and content against profiles that reflect member identities, registered characteristics and preferences, and prior interactions with the site. Supports the life cycle of value-added information to be made available to market members, covering content specification, authoring or collection, editing, approving, categorizing, publishing, aging, renewal, and retiring. Provides non-transactional benefits to market members through value-added information and communication channels promoting interactions and relationships between members such as discussion groups, on-line chat, and aggregation of member-supplied content. Assembles and maintains an up-to-date catalog of goods and services available in the market through a uniform representation that facilitates buyer search and identification of desired products. This often involves integration with seller-side back-end systems. Augments catalog management with capabilities for buyers to define, manage, and search markets for specifications of highly customized products or complex combinations of products in terms of product, delivery, and service attributes. Extracting market postings and transactions to data marts for off-line decision support analysis. Market makers can generate market price and trend reports, and offer query capabilities to members, producing important recurring revenues from subscriptions.

Personalization Content Management

Community

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Selected Net Market Component Vendors


Trading Engines: Trading Dynamics (Ariba), Tradeum (VertNet), Net Exchange, Intell.l, Moai, CommerceBid Commerce Engines: CommerceOne, BV, ATG, MSCommerce Server, Rightworks.Aribia Personalization: ATG, BV, Asera, Future Tense (Open Market), NetPerceptions Content Management: Interwoven, Inso, Allaire (Spectra), Vignette, BV Community: PlumTree, Autonomy, Well Engaged, IBM/Lotus Community Catalog Management: CardoNet, Mergent, Hologix, Cohera, Saqqara, Asera, VerticalNet/Isadra, Management Workflow: Extricity, Vitria, Tibco (InConcert), HP (Change Engine) MQ Workflow, STC (SeeBeyond) Workflow Information Access & Exchange: PC Docs/Fulcrum, Verity, Extricty, WebMethods, Bowstreet, OnDisplay, STC Exchange Product Configuration: Selectica, Trilogy Software, Calico Commerce, i2, Configuration Data Warehouse/DSS: Red Brick, Oracle, DB2, Cognos, Business Objects, MicroStrategy, Brio, Actuate Warehouse/DSS System Management: Tivoli, BMC, Computer Associates, HP Management Value Added Services: eCredit, HP/Verifone, CyberCash, ClearCommerce, Cybersource, PaymentTech, HNC Fraud
Detection, Transportation Exchange, CarrierPoint, eGain

Market Maker Business Systems: SAP, Oracle, Baan, Peoplesoft, Lawson, Great Plains, J.D. Edwards, Seibel Security Management: Axxent, RSA, Verisign, etc. Application Servers: IBM/ WebSphere BEA/Web Logic, ATG, Netscape (Iplanet), ORACLE Servers Hardware: Dell, Compaq, Intel, Sun, HP, IBM, Cisco Software: MS Windows, Sun Solaris, HP-UX, IBM AIX, Linux... Software Network Protocols: TCP/IP, HTTP, HTTPS, UDP Multicast, Protocols Middleware: webMethods, SeeBeyond, IBM (MQSeries), BEA/WebLogic TIBCO, Vitria Middleware Standards: HTML, XML, Enterprise Java Beans, DCOM/COM+, CORBA, LDAP Standards

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Conclusions
Research is indicated in the areas of knowledge/data management systems architectures; E-Business frameworks use knowledge about processes, products, partners, and customers to enable knowledge creation and sharing among net communities. Intelligent services are needed to assist users in search, ontology building, knowledge indexing, knowledge creation, retrieval and dissemination. dissemination The goal is to manage Intellectual Property over the Internet Protocol (IP over IP).

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