New York June 28, 2001 The e-commerce landscape is littered with faltering exchanges and consortia because of overly ambitious plans that failed to leverage the strengths of the sellers to provide value to the buyers, the head of a successful e-commerce enabler told attendees at the Conference Board's 2001 E-Commerce Conference today.
Leo Schlinkert, CEO of Communicator Inc, told a general session of the two-day conference that a major reason for recent B2B e-commerce shortcomings in many industries has been consortium models that are "too thick," thereby requiring too many resources and impeded by too many governance and economic obstacles to succeed.
"Many of these thick consortia efforts have borne more futility than productivity," Schlinkert, a veteran Wall Street trading executive, told the assembly gathered for the two-day annual conference at the Marriott World Trade Center Hotel.
In contrast, Schlinkert said successful collaborative e-commerce efforts generally:
- Focus on a specific industry problem or opportunity, leveraging industry expertise and existing solutions
- Create a flexible legal structure
- Allow content owners to govern
- Leverage simple economics, with low costs and fixed contracts
As an example, Schlinkert cited the success of SecuritiesHub LLC, a consortium of six leading Wall Street firms Goldman Sachs, J.P. Morgan Chase, Lehman Brothers, Merrill Lynch, Morgan Stanley Dean Witter and CitiGroup's Salomon Smith Barney. The consortium's "Bond.Hub and "SyndicateHub" services have attracted more than 10,000 institutional investors who are customers of two or more of the firms. The consortium members maintain complete control over their market content, while the customers leverage value through quick access to aggregated research, pricing information and other services from multiple dealers. Communicator Inc. developed and operates the SecuritiesHub consortium.
"In less than 18 months, we've grown SecuritiesHub into one of the most successful e-commerce enterprises in the world with quick and elegant development of its services while avoiding the imposition of onerous operational, legal, governance of economic requirements on any of the participants," Schlinkert said. "Naturally, this is raising interest in other industries, which see Thin Consortium Technology as a viable alternative."