Benevolent entanglement." The phrase might be a mouthful, but the concept is what building an extended enterprise network ought to be all about, says Brandon Lackey, portal program manager at energy industry giant Halliburton Co. In other words, involve customers and suppliers in a business ecosystem that provides such high value, so simply, few would leave it. "We want our customers to be so enamored with our simple processes, ease of use [and value provided through the portal] that they would never switch from Halliburton based on marginal price differences," Lackey says.
That's the vision Lackey followed as he oversaw the initial development of the myHalliburton.com customer portal, and that guides him as he conjures up new ideas for how to extend the portal's usefulness. Halliburton has now invested approximately US$5.3 million in myHalliburton.com and has earmarked US$2.4 million annually for ongoing development of the portal, already rich with interactive tools, collaborative applications and e-commerce capabilities that draw on the company's back-end ERP system.
MyHalliburton.com, commercially launched in January 2002, has become the destination of oil company technical specialists and procurement and accounts payable managers when they need something - virtually anything - from Halliburton. It also has become an open door for employees and suppliers, as Halliburton quickly turned myHalliburton.com from a dedicated customer portal to an extended business ecosystem serving all three contingents. Collaboration among the groups is a focus.
The portal, powered by Plumtree Software Inc.'s Corporate Portal 4.5 software, serves about 4,100 customers, 1,700 suppliers and 10,000 employees, says Shawn LeBlanc, the company's director of emerging applications. As of late 2002, daily hits reached about 92,000, says Jim Schmitzer, development manager in emerging applications.
A point of differentiation between myHalliburton. com and many other portals is how tightly it integrates with a back-end ERP system - in this case, SAP's R/3. Plumtree Gadget Web Services, special Web services components, pull data from the SAP application to give portal users the ability to check account status, submit invoices and conduct other business transactions.
Lackey says he feels myHalliburton.com gives the company a competitive advantage because of its technical and business process support. It is one of the bigger payoffs from a previous, five-year ERP deployment. "You really begin to understand the benefits of putting in an integrated SAP system when you start presenting information to customers, employees and suppliers through a portal like this. It becomes evident why you went through all the pain," he says.
Halliburton wins our 2003 Extended Enterprise Innovator Award for developing an extensive collaborative portal that relies on integrated ERP functions to serve customers, suppliers and employees. In its first year, the portal influenced $120 million in sales, according to customer surveys; improved corporate efficiencies to the tune of about $500,000 by enabling better access to technical documents; and led to reduced payment cycles.
Using explosive apps
Halliburton is one of the world's largest providers of products and services to the oil and gas industries, employing more than 85,000 people in 100 countries. The company's extensive customer list includes giants such as Exxon Mobil, Chevron and Conoco, which turn to it for products and services running the gamut from drill bits to subsea engineering. With complexity marking the relationship between Halliburton and its customers, Lackey knew any broad customer-related project he undertook would need to be exceedingly thorough to be successful.
So after Lackey and his business development team dreamed up the portal concept in November 2000, they spent the next three months fleshing it out. Then, guided by Microsoft Solutions Framework Process Model for IT projects, developers worked on the portal from March to August 2001, and ran stabilization and pilot tests till the end of September. Feedback came from the highest corporate levels, with the vice president of business development providing approvals as project sponsor. The site was available to select customers in October 2001, and to all by the following January.
Developers focused first on how to provide customer techies - the geologists, geophysicists and production engineers working for major oil companies, for example - access to technical information on the "thousands and thousands" of products and services Halliburton offers from a user-friendly, personalized environment, Lackey says. White papers, datasheets, case studies, best practices - these were all givens, but so was the need for interactivity. Developers understood that technologists would highly value 3-D simulators, unit conversion calculators, custom-tool builders and other interactive tools, so made those must-haves from the get-go, too.
"This is not your typical sales and marketing brochure ware site," Schmitzer says. He tells of simulators that let engineers see how explosives would fire off in a borehole or how a perforation might affect an operation, for example.
Among all the features and functions found in the technical portion of myHalliburton.com, Lackey names these 3-D tool simulators and the way in which they're embedded in datasheets as what he is most proud of about the portal. "This leverages all the value of the Web in my mind. Now we have truly interactive technical content," he says.
Such interactivity can make a world of difference in how oil company engineers do their jobs. "We've seen situations where customers having issues with particular drilling tools have isolated problems really fast using simulators. In some cases, using the simulators, customers have even realized that problems they're encountering are because of the well, not the drilling tools," Lackey says.
And when oil field engineers need to make tough on-the-job decisions, they can rely on real-time visualization of well sites now available through the portal. Schmitzer explains: At a well site, Halliburton often has 30 to 40 networked trucks loaded with equipment for data acquisition, computer-aided manufacturing capabilities and an Ethernet connection into a main computer. Halliburton processes the data locally and uploads it to an operations center in Houston over satellite links. Halliburton analyzes the data to make recommendations to customers, who in turn use the visualizations for confirmation on pumping decisions. "These are $1 million jobs, so customers want to make decisions quickly," he says.
Getting the bills paid
With such online technical tools advanced since January, Halliburton in July moved into the second phase of portal development. The object of this phase, mostly completed by December, was to open Halliburton's internal workflow processes, via ERP functions, to customers, Lackey says. Customer procurement officers and accounts payable managers can now access and act on invoices, field tickets, job schedules, job resources and proposals stored in Halliburton's ERP system.
"Plumtree gadgets let us take applications from diverse back-end systems and present them through the portal in a uniform and easy-to-use fashion," LeBlanc says, noting that myHalliburton.com attaches to more than 200 applications.
Anecdotal evidence suggests that letting portal users tap into back-end ERP functions helps customers pay their bills faster. Halliburton's onsite support personnel report reviewing invoices online with customer account managers rather than waiting for the arrival of mailed copies. Online reconciliation means payment days earlier, Lackey says. With Halliburton's high-end products, "reducing even just one day in outstanding sales will deliver significant value," he adds. (Lackey says purchases run in the hundreds of thousands-to-millions range.)
Halliburton hopes to reap even greater benefits by extending the procurement workflow cycle to all customers. Ideally, any customer would be able to handle any aspect of the procurement process, from issuing a request for proposal to paying the bill, through the portal, Lackey says. Halliburton conforms to the American Petroleum Institute's XML-based electronic data standards for the procurement of configurable products and services, such as those available through the portal. As such, Halliburton also can conduct business transactions with customers that comply with the standards. "We can send a quote, and they can send us purchase orders that we can turn into sales orders," Schmitzer says. Missing is the ability to let customers that don't comply with these new standards participate fully in the process. Those customers cannot use the portal's custom tool configuration feature or a pricing tool, he explains.
Customers and suppliers together
Collaboration, supported via Plumtree's Collaboration Server, is among the most critical features for both technical and business users. From myHalliburton.com, customers and Halliburton employees can share documents securely, participate in threaded discussions and access calendars for coordinating project logistics. These functions, too, are delivered via the gadget services.
Opening that collaboration between employees and customers to suppliers is a likely target for third-phase development, Lackey says. "There is a lot of future in 24-hour expert access and third-party collaboration," he says. True supply-chain interaction is the goal, made possible by the merger of the supplier and employee portals into myHalliburton.com, he adds.
LeBlanc agrees that increased collaborative capabilities are a natural for the portal. "Employees, vendors, customers - it's all related workflow. We provide such unique engineering, that it sometimes is helpful for the customer, supplier and us to participate in discussions," she says.
Opening the architecture
While Lackey is spending the first quarter of 2003 researching and plotting his next moves for the portal, LeBlanc and Schmitzer are continuing to work on software and hardware changes needed to support the increasingly sizable portal environment. About 70 Windows servers handle the portal workload, with the Plumtree portal software integrating data from Microsoft databases and Web content servers, and from BEA Systems' application servers.
All servers currently reside in Houston, where the company is headquartered. But the developers are investigating the feasibility of adding servers in Latin America, Europe and the Pacific Rim to improve portal performance for those who have less-than-optimal bandwidth connections, LeBlanc says. An upcoming version of the Plumtree software will enable Halliburton to push content to local servers while maintaining the files centrally.
LeBlanc also envisions moving to a much more open architecture than the Microsoft-centric one of today. "An open architecture inherently provides a better way of attaching to our disparate systems. It makes sense for us," she says.
While Linux-powered servers is a probable direction, LeBlanc says her focus for this year is on migrating application development from the Microsoft world of Active Server Pages to Java programming. "The portal environment is getting so large it's becoming difficult to make dramatic changes. We have to think of the cost benefits [of open source]," she says.
According to Lackey, Halliburton already has spent $5.3 million on the portal. It invested $2.9 million in the portal project's first year for software and hardware expenditures, and had a $2.4 million project budget for 2002, he says. Spending for this year will remain at that level, he adds.
Every dollar spent toward entangling customers with benevolence is well spent, Lackey says. "This is something all companies should do."
Join the CIO New Zealand group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.