Host-to-Web Creates Bridge for VWR
To do business on the World Wide Web, companies can start from scratch with new applications, or find a way to leverage their existing programs. Neither approach is easy. But leveraging existing mainframe applications can be far more productive than many companies expect.
VWR Scientific Products is a case in point. In May 1998, the West Chester, Pa., company debuted an enhanced Web site (www.VWRSP.com) for online ordering over the Web. Customers had been able to place online orders since 1996, but features were limited.
"Today, we have rich content data — product photos, descriptions and specifications — along with real-time inventory updates and custom pricing information," says Barry Carney, manager of Web development for VWR. "Those are all things we just couldn’t accomplish without Web access to the mainframe."
What customers see and interact with is an enhanced Web page, developed with the ViewMax host-to-Web integration tool from MODCOMP. But behind the scene at VWR, the transactions are automatically being entered into their ordering application that resides on their IBM ES9000 in California.
Bridging the two systems required only a month — a fraction of the time that would have been required for in-house development. Adam Bauman, Director of Emerging Technology for VWR, recalls working at a motion picture studio that was connecting a Windows NT environment to a legacy system written in COBOL. "It was a painful process that took three months and about 100 people," he says. "Here, the team was three people from VWR, and an outside agency of less than 10 to build the catalog front-end and a two-man team from MODCOMP to provide the mainframe integration."
Unique Challenges: 250,000 SKUs
What made the Web-to-mainframe integration especially challenging in VWR’s case is the nature of VWR’s business. VWR provides lab and clean room supplies, chemicals and equipment to the scientific marketplace to over 100,000 customers. It operates as a one-stop shopping center for such products, serving educational institutions and industries ranging from pharmaceuticals and biotechnology to semiconductors. Its product list includes more than 250,000 different items representing 2,000 suppliers.
"Distribution is our core competency," Carney explains. "We don’t manufacture anything, but we fulfill more than 93 percent of orders by the next day shipped complete from a single distribution warehouse. Our value proposition to customers is that we will deliver what they need in a day, so they don’t have to maintain a huge inventory."
VWR works closely with customers to get a thorough understanding of the items they need, and when and where they need them. As a result, Carney says VWR can save some customers 70 percent in inventory and procurement costs.
Because customers turn to VWR for so many different items, they negotiate their own contracts. Each customer has its own custom pricing profile. And therein lies the challenge for any order system, whether it’s a traditional mainframe application or a new Web-based system.
"In the past, our online ordering application was showing people the list price, and we told them, ‘your pricing will be applied when the order is processed,’" Carney explains. "But they wanted to see their pricing. And not seeing it was enough of a barrier to affect their purchasing decisions."
"They also wanted to know if the item they wanted was in stock. But since it was a batch ordering system, the online application couldn’t tell them."
Today’s legacy-integrated Web site provides what the previous version could not: current information on inventory and, most important, each customer’s contact pricing. So when a scientist from ABC company logs in, he sees his prices, and when other companies log in, they see their own contracted set of prices.
Here’s how it works: the customer logs into the Web site and builds an online order using a screen from the site. In the background ViewMax, which resides on the Web server, seamlessly logs onto the company’s mainframe, enters the customer ID number and product numbers, retrieves the appropriate pricing, and embeds that data in the HTML page. All of this occurs in a matter of seconds, without the customer experiencing any degradation in performance. When the order is complete, it is billed to a purchase order or credit card.
The Web system allows VWR to personalize its service in other ways, too. For example, a customer’s profile may include a list of the items ordered in the past. When the customer goes to the order screen, there is a list of items he or she is most likely to order again — a "favorites" list. Of course, customers can also browse the catalog to look for new items, or use the built-in search engine.
Also, based on a customer’s past purchases, VWR can "push" information about new products that might be of interest. When a beaker manufacturer comes out with a new size or variation on its established product line, VWR can send product information to beaker customers via e-mail, or through a bulletin on its Web page that only pops up for selected buyers.
Web ordering also lends itself to promotions and bundling. Traditionally, a rebate offer would be promoted through direct mail. Then the customer would buy the product, fill out a rebate form and send it in. VWR would have to process the rebate form to issue the rebate. Now, the Web server can automatically examine each customer’s order and, before concluding a transaction, alert customers to special offers. The Web page might advise the customer they’re eligible for a rebate, or a "buy two, get one free" offer.
Slow-moving inventory can be promoted on a special sale page. "We looked at what retailer’s like Lands’ End, and decided they had a great idea for selling slow and dead stock. We’ve had great success with this approach, and we didn’t have to print $2 million worth of coupons to do it." says Bauman.
Selecting, Implementing a Solution
Carney says VWR was convinced that the Internet could be a gold mine, but wanted a solution that would leverage a legacy system built on 30 years of customer transactions and experience.
"The Web is a great equalizer. You can have a UNIX workstation or a Macintosh or an old PC. It doesn’t matter, as long as you can run a Web browser," he continues. "When I was involved in multi-media development, we always had to be worried about what kind of computer was available, how much RAM did it have, did it have color capabilities and a sound card, etc. The list went on and on. With the Web, requirements are minimal and most of our customers are already Web capable."
VWR purposely avoided solutions that involved JAVA applets, huge 7 Mb plug-ins, or supported PC clients, but not Mac or UNIX users. The company wanted universal access and minimal programming. When VWR representatives met with MODCOMP officials at Electronic Commerce World’s trade show in Philadelphia in September 1997, they realized they had found their solution. "We chose ViewMax because it let us use our legacy environment without revising any of the mainframe code," says Carney.
Implementing ViewMax involved using its application programmer interface (API) to create a datastream handler for the customer order. The Web site was already designed to pull the list price from an Oracle database, so the datastream handler simply pulled the contracted customer pricing from the mainframe.
When the process was complete, VWR "stress tested" the new Web-based ordering application. "We simulated load by opening 150 new simultaneous sessions per second, so we’re confident that it supports the type of Web traffic we have today and foresee in the near future," says Bauman.
Mark Robillard, VWR’s Vice President for Commerce, says a Web presence offers important advantages over traditional EDI systems. "EDI had some interest for customers, but never really caught on in our marketplace," he explains. "EDI is a store-and-forward technology. The customer takes your electronic catalog, puts it in their own environment, and sends orders in."
The logistics of that process are inappropriate for VWR’s transaction-intensive business, he says. R&D is centered on occasional purchases, few of which are repetitive. Customers didn’t want the extensive VWR catalog clogging up their computer systems; but without it, they didn’t really know what was available.
With its Web solution, VWR maintains responsibility for the online catalog. That’s a major responsibility, since the catalog database has 50 additions, deletions or changes a day. It includes both what VWR has printed in book form in the past, which accounts for over 55,000 SKUs, as well as another 200,000 SKUs that don’t make print edition. "The Web catalog is four times bigger than our print catalog," Robillard says.
Customers can log into the Web page, view the catalog, get the information they need, and either place an order or leave. That points out another advantage of the Web solution: giving "window shoppers" a place to browse without tying up live customer service representatives. Today VWR has approximately 450 customer service reps who answer questions and take orders by phone. It estimates the Web site will handle one-and-a-half times that volume at a fraction of the cost.
Today, Robillard says, Web ordering accounts for less than 2 percent of the company’s sales volume. Within five years, he expects electronic commerce (including other systems, such as automated telephony) to account for 40 to 50 percent of VWR’s business.
Web ordering has taken off fastest in the office supply market. There, Robillard says, users have the technology at the desktop and are inclined to use it. Since scientists are often away from their desks, that market lags behind. "Right now, the market is in its infancy," Robillard says. "But as more Web-accustomed scientists come out of school and continue to add enhancements, that will change."
Future: Continuing to Meet Changing Customer Demands
Customer feedback about the site has been encouraging. A chemist, having retrieved Material Safety Data Sheets (MSDSs) from the Web site, left a message that he had just saved three days time. One major company said it was targeting 70 percent of its orders to be placed with VWR over the Internet in 1998.
Robillard says the company will continue to emphasize a customized experience. "We’re using our Web site to supply not just the products that our customers need, but also the information they need to decide whether a product is suitable," he says. "Increasingly, we’re going to be in the product information business, as well as the product distribution business."
As with all Web sites, the initial push to launch the site and its online ordering capabilities is just the tip of the iceberg. Maintaining the site will mean not simply updating the catalog, but adding or changing features based on customer responses. Carney says 80 percent of what’s available on the Web site is based on customer feedback. There is a full-time customer service representative devoted to handling Internet requests and e-mail.
"If we’re doing our job right, the Web site will never be more than 95 percent complete," he says. "We’re always going to be making changes and improvements."
ABOUT THE AUTHOR:
Greg Rice is an Indiana-based writer/photographer who frequently writes on topics in the high-tech field.