Portals: The Gateway to E-Services
Acceptance of Portals doesn't mean there's a clear understanding of what they are.
It’s easy to see why portals are such a hot topic. They provide a single point of access for the mountains of data buried in different databases, enterprise applications, corporate intranets and so on – data that could be accessed previously only through different systems and interfaces. The case for portals has become so compelling that research firm and consultancy Ovum, in a recent report on portals, refers to "an increasing expectation that portals might replace the Microsoft Windows desktop as the standard interface for information access and delivery."
Portals are being embraced by businesses building electronic storefronts, companies looking to provide their employees and partners information from a variety of internal sources, and communities of buyers and sellers engaged in trade the means to deliver personalized information to their users. But, acceptance of portals doesn’t mean there’s a clear understanding of what they are. Sometimes, for example, they are equated with Web sites or URLs – but they are neither. In fact, a portal exists only when a URL viewed by a particular consumer, employee or business partner is customized for that person. In other words, a portal provides personalized access to specific information.
HP extends the definition to describe portals as proactive and predictive, as well as personalized, points out HP’s Jennie Grimes, a director of e-Intelligence and Portal Solutions. Take, for instance, a fictional example – Music.com. Music.com offers its company banner as the first view visitors see when they arrive at the site. The Music.com site obviously lacks the personalization required of portals. But, it does offer visitors titles of some suggested CDs, based on the kinds of CDs they bought on previous visits. Personalization is coming into play here, but it’s not very sophisticated. Music.com does not suggest a range of CDs, based on that visitor’s previous buying habits over time. Music.com faces another issue – it’s pushing out discount offers to visitors’ e-mail, not presenting these offers as visitors browse through the site.
Music.com has some work to do to make its Web site into a portal. First, it should offer users a customized screen when they log in – a screen personalized for the individual user. Next, Music.com’s software should interact with visitors as they click through the site by picking up on clues and making suggestions that jibe with a visitor’s musical tastes. If Music.com makes those changes, it will have a real portal, one that, in HP’s words, is personalized, proactive and predictive.
HP Focuses on Three Kinds of Portals
HP offers three kinds of portals, all of which provide business opportunities for its customers rather than simply a means of facilitating and sharing ideas. They are e-commerce portals, enterprise information portals (EIP) and trading communities.
An e-commerce portal enables tailored commerce through a storefront. "This type of portal is essentially transaction-based," Grimes explains, "because its function is to track business transactions – for example, what a user places in the shopping cart, what gets abandoned or taken out of the cart, what page the user clicks to, when the user exits the site, and what products the user buys at the same time."
HP offers e-commerce portal solutions primarily through its partnership with BroadVision. HP integrates its own and other partners’ technologies with BroadVision’s Enterprise Business Portal Solution (EBPS), an e-commerce solution that enables enterprises to deliver personalized transactions and one-to-one experiences, not only with customers, but also with partners and employees. In June, HP made what some considered to be a surprising move by entering into a partnership with a BroadVision rival, start-up Intershop Communications. HP is now in the process of integrating Intershop’s storefront engine into its e-commerce portal solutions.
The second type of portal offered by HP, EIPs, are sometimes called corporate portals, because most of the information accessed through them comes from within the corporation. Here the portal design is content-based, because the portal enables workflow or collaboration. EIPs allow users to access both unstructured and structured data – "scanned documents as well as spreadsheet data," Grimes explains. An EIP allows two employees engaged in salary planning, for instance, to access their company’s latest salary guidelines and to discover the salary allocated to a specific employee last year.
BroadVision also takes a partnership role in HP’s EIP solutions. In mid-July, HP extended another important relationship, a year-old alliance with Yahoo!, to deliver a new EIP solution – a Corporate Yahoo! customized, global EIP. The Corporate Yahoo! portal enables companies to offer their employees targeted Internet, intranet and extranet content through the widely used My Yahoo! interface.
The third type of portal, trading communities, is not, Grimes maintains, "an e-commerce portal on steroids." What she means by that is that trading communities exhibit distinct differences from e-commerce portals. In trading communities, relationships are many-to-many, rather than point-to-point, as in e-commerce portals. For that reason, trading communities are session-based, as many buyers and many sellers come together through an aggregator function.
HP’s strategy for trading communities is to partner with other vendors in launching independent companies that serve the needs of particular groups. In April, for example, HP allied with Cadence Design Systems and Flextronics International to launch SpinCircuit Inc., a business-to-business (B2B) e-commerce company, billed as an Internet gateway that bridges the gap between the design desktop and the electronics supply chain network. A month later, in May, HP and 11 partners – AMD, Compaq, Gateway, Hitachi, Infineon, NEC, Quantum, Samsung, SCI Systems, Solectron and Western Digital – unveiled the High Tech Industry Exchange, an independent company serving the high-tech supply chain community.
Although HP distinguishes among its portal solutions by grouping them into these three categories, it does not view the different portal types as independent silos. In fact, it expects customers to begin by launching one type of portal and then to add elements from the other types. Grimes uses as an example two companies in financial services – Fidelity and Schwab. Fidelity began by offering a portal that delivered to its customers personalized services centered on e-commerce – on making fast buys and sells. Schwab’s portal, on the other hand, was data-oriented, focusing on portfolio history, comparison among elements of a portfolio, track records, brokerage recommendations, etc. Before long, though, Fidelity realized it needed to provide more data to customers making buy and sell decisions, and Schwab decided it needed to go the other way by adding buy and sell capabilities. In other words, each company had to integrate components from other types of portal solutions to serve customers.
HP Strategy and Tactics
HP’s basic strategy in the portal space is simple, Grimes claims. "Basically, we help our customers deliver business portals at Web speed. We provide fast deployment by offering both the technical ecosystems and the business ecosystems that have to go around them. That’s the strategy."
If that seems simple – and it is – it still takes some explaining. "Web speed," of course, means fast deployment, something HP has been emphasizing in any number of areas. In the portal space, "Web speed" translates into a proof-of-concept that is up and running in about 100 days. This effort to offer rapid deployment is especially significant because portals are fairly complex from an architectural perspective. "If you thought it was complicated to get just your cache server, your proxy server, and your content server up, wait till you see what happens with portals," Grimes says.
In using phrases like "technical ecosystem" and "business ecosystem," HP is further clarifying its strategy. HP builds a technical ecosystem by playing on a number of its strengths – always-on infrastructure, manageability, security, reliability and scalability. HP deals with the business ecosystem not by dealing with specific business processes, such as identifying where in the supply chain to optimize for inventory management from one site to another, but by mapping to business demands. That involves, for example, determining the kind of infrastructure to put in place and deciding how to enable and make business processes dynamic.
To enable dynamic change of business processes, HP makes use of Changengine, its workflow technology. Changengine plays in the EIP space, for example, by allowing companies to dynamically change hiring processes as the need arises. It performs a similar function for trading communities, for example, by shifting a business ordering process to allow two product designers to procure a needed part outside the traditional supply chain.
To drive its overall portal strategy, HP has adopted five tactics. First, it guarantees what it calls bulletproof solutions. Second, it precertifies the solutions, performing the integration and guaranteeing that the different products and solution work together. Third, it embraces solutions from both HP and its partners. In other words, HP integrates its own technology, like Changengine, with technology like BroadVision Enterprise Manager, which allows customers to manage their portals from an HP OpenView environment. HP’s fourth tactic is to invent portal-enabling technologies when necessary. HP has already developed e-speak and is now, Grimes hints, working on analytics technology that will be used in portal solutions. Fourth, HP is helping to build business ecosystems by providing tailored financing, consulting and support. An example is HP’s Discovery Workshop, created solely for portals. The offering allows customers to identify the precise portal solutions that meet their business needs. Finally, HP is making equity investments in partners. It has, for instance, taken an equity stake in Moai, a company that provides dynamic pricing capabilities for public or private auctions and trading exchanges. HP has also invested in Divine interVentures, an incubation company that provides Internet start-ups and corporate Internet spin-outs with financing, infrastructure and support services to build B2B companies.
Hitting the Bulls-Eye?
HP may be betting heavily on portals, but how is its strategy playing out in the marketplace? Why should customers adopt HP’s solutions rather than those from other vendors?
Let’s look first at an area where HP is receiving mixed reviews – its efforts to launch independent companies that provide blockbuster trading communities in distinct marketplaces. Speaking of the High Tech Industry Exchange, HP’s Grimes says, "I think we’ll see more collaboration hubs for supply chain collaboration and design collaboration ... I think the model we took with the High Tech Exchange is going to become increasingly frequent, where a hub is spun off as a separate company that has separate governance, has its own board, and makes its own decisions. This will be a service provider predicated space." Grimes also credits the Exchange with triggering additional opportunities that HP can spin off and offer as services, although she’s not yet ready to be specific.
Research firm International Data Corp. (IDC) provides a different view of the Exchange in a paper titled "Trying to Forget the Enemy: The High Tech Industry Exchange." Although IDC argues that reducing "the current level of confrontation through the creation of an independent entity to make technology and services decisions is an idea ‘worth pursuing’," the research firm argues that "the competitive nature of the IT industry guarantees conflict and delay." IDC further says that the Exchange "and the industry it addresses would best be served in the short term by a truly open and robust e-marketplace that does more to reach out to small and medium-sized businesses usually ignored in these supply chain initiatives." IDC also expresses doubts about the breadth of industry support for the High Tech Exchange.
In the EIP space, HP’s strategy seems to fit well with business needs and corporate trends. HP’s EIP solutions, for example, jibe with the overall strategy outlined by Ovum in a report on EIPS as well as meeting the requirements Ovum sets forth for EIPs. Ed Mueller, president and CEO of ShortCycles, a start-up that partners with HP, agrees. Mueller, who wants ShortCycles’ Sales and Marketing application to be part of HP’s Corporate My Yahoo initiative, has a vested interest in HP’s EIP strategy. Nevertheless, Mueller knows the marketplace, because he is pursuing partnerships with vendors in addition to HP.
"Overall, the strategy HP is implementing is definitely what the market as a whole is looking for," Mueller claims. "The same strategy we’re seeing followed by HP – offering a corporate portal that is generic in nature and offers employees a single access point – we see other companies pursuing. It makes a lot of sense."
When Mueller talks about "other vendors," he is not specific, but it’s no secret that HP has competitors in the portal space. One advantage HP has over its rivals seems to be its ability to combine fast deployment with customized solutions. IBM, for example, is more than competent to offer customized solutions but would have difficulty matching HP in rapid deployment. Sun, which CEO McNealy recently billed as the "plumbing supply house for service providers," focuses little on integration. That means that customers are left to integrate different components.
HP’s range of partnerships provides another advantage, giving it the ability to integrate different solutions for different customers. IBM seems to offer less flexibility, especially because of its commitment to DB2, while Sun focuses on specific solutions, primarily the Netscape Application Server. On the other hand, HP offers different products to meet the same needs, allowing customers to substitute one component for another or even to eliminate unneeded components.
In talking to customers, HP can also make the argument that it practices what it preaches by increasingly driving its own business through portals. That, says Grimes, shows "we have skin in the game – that we walk the walk."