XML Hits the Spot for Dell

  • Written By: D. Geller
  • Published: October 25 1999

Event Summary

Dell Computer Corporation (Nasdaq: DELL) has chosen privately held webMethods to supply the missing link in its e-Commerce technology. At present, a corporate buyer using Dell's website must re-enter all details of the transaction into the corporate financial systems. With the adoption of webMethods B2B XML-based middleware, it will be possible for Dell to transmit order and tracking information electronically. For Dell this represents a major step in the fulfillment of its "B2B Direct" strategy.

The service will be available to to Dell's largest customers, who will install a version of Dell's own B2B Direct that has been integrated with webMethods B2B. This will allow Dell to exchange data with legacy, ERP and Web-based purchasing systems.

Market Impact

Given that feature sets among competing manufacturers are comparable (See TEC News Analysis Article: "Dell Passes Compaq for U.S. PC Lead, or 'Houston, You Have Problem'", October 27th, 1999), client savings of time and money, estimated at $85-95 per purchase order, will create strong pressure to point corporate purchasing to Dell. This would not be strong enough to overcome strong price differentials, but Dell is already an extremely strong price competitor. . While larger corporations do not generally change their buying habits overnight, there are always some in the phase of re-evaluating their supplier relationships. Hence, this announcement will both bring new customers to Dell and cement its relationship with existing customers.

The announcement makes some ripples in the wider E-procurement space, by giving companies a way to deal directly with Dell rather than going through a purchasing marketplace. However, given the need for special software at the customer site and the fact that webMethods B2B promises to integrate with the major E-procurement software vendors, we don't predict any trend that E-procurement companies need worry about.

User Recommendations

If Dell products are among those you'd be willing to buy for features and cost, you will be waiting anxiously for a demonstration of how well B2B truly integrates with your purchasing software. Moving the purchasing of computers, supplies, accessories and software into the corporate purchasing system makes sense both financially and politically.

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