B2B Exchanges - Softcover

Sculley, Arthur B.; Woods, W.William A.

Softcover

ISBN 10: 0066621089 ISBN 13: 9780066621081

Publisher: HarperCollins, 2001

Identifies four trading situations that have evolved with the advent of e-commerce--trading hubs, post and browse markets, auction markets, and fully automated exchanges--and explains how to maximize the effectiveness of each situation.

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Review:

Much of the philosophical underpinning of the modern business world is based on the claimed superiority of the free market and its supposed ability to provide the best solutions. It in turn is based on the purely theoretical economic concept of "perfect competition". The trouble is that the idea of perfect competition translates poorly into reality because it makes implausible assumptions like perfect knowledge and information and zero transaction costs. All of which was wishful thinking--until the Internet.

This the starting point of Arthur Sculley and W William A Woods' B2B Exchanges. B2B, if you have been in a coma for the past two years, means "business to business". And the thesis of the book is that the Internet is revolutionising the business of "business to business" more than any other sector of human endeavour. The sale of products and services by business to business over the Internet will be worth $1.5 trillion within four years according to estimates and the principal fora in which this will occur will be B2B exchanges. "The unique feature of the B2B exchange is that it brings multiple buyers and sellers together (in a virtual sense) in one central market space and enables them to buy and sell from each other at a dynamic price which is determined in accordance with the rules of the exchange", write Sculley and Woods.

The book analyses the key issues in building a successful and effective exchange and lists seven secrets for success with B2B exchanges: stay specialised; dominate swiftly; maintain commercial neutrality; ensure transparency and integrity; add value by building a virtual community; make the right strategic partnerships and operate as a virtual corporation.

Sculley spent 25 years with JP Morgan before branching out into e-commerce. He has been chairman of the Bermuda Stock Exchange since 1996. Woods is a lawyer and consultant on the design and development of securities exchanges around the world. Their book makes an exciting read for those interested in business to business, and is a must read for CEOs and anyone concerned with the realities of doing business online. --Alex Benady

Synopsis:

By 2004, the value of B2B transactions conducted online will reach $1.5 trillion - $600 billion of that will be generated in the United States alone. This groundbreaking book analyses the nature of the revolution that is occurring in B2B transactions, showing how most corporations will have to re-invent themselves over the next five years to remain competitive in the New Economy. They reveal the tectonic shift occurring in the way businesses buy and sell from each other, as well as the once-in-a-lifetime shift of power from the seller to the buyer. Using practical and real-life examples, the authors describe the anatomy of a model B2B exchange, analyse the key issues in building a successful, credible and effective exchange, and show why these exchanges are crucial to competing in the Internet Revolution.

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