World Trade Targets Exostar — and Supply Chain "Collabration"

One of the worst words of all in the enterprise software English lexicon is "collaboration". It has to be the most clichéd, hackneyed, and downright meaningless term in existence. Every day I see it used to describe capabilities in everything from IT management tools to RFX engines to design and engineering applications. Given how much it has worked its way into our software vocabulary, I worry that we'll never get rid of it in favor of more descriptive terms.

Enough of my rant. After all, there is a reason behind it. And that is an article in World Trade this month which examined the current B2B exchange marketplace and Exostar in particular. Of course the concept of "collaboration" factors heavily into the piece -- which sent me off on this rant in the first place. The magazine notes that exchange platforms like A&D marketplace Exostar are now "built on the principle that collaboration—whether standardizing and streamlining shipping, trading, design and procurement—results in real-world gains in productivity, efficiency and cost savings."

Now, I'm not going to argue with the business logic -- and benefits -- that the article describes. It's cool stuff indeed. What Exostar and others are doing to set industry standards, facilitate content exchange and transactions, and create a critical multi-enterprise security layer is remarkable -- and valuable -- indeed. But I wonder if there's a better way to more specifically describe the concept than just "collaboration".

Later in the article is a good quick introduction to a movement within A&D that I suspect will weave its way into other areas of the manufacturing (and possibly even the process) worlds. And it matters for procurement and operations -- in a major way. This is the concept of moving from purchasing physical material assets to purchasing their availability (think of it as a much more complex type of lease arrangement). The multi-tier sourcing and service implications of this are a huge shift. According to the article, the United States "Department of Defense (DoD) [is moving from] purchasing intact products to contracting third parties to build and then maintain their assets ...[this is called] performance-based logistics or contracting ... [and] it's one of the most significant supply chain developments taking place right now."

The article later quotes an AMR A&D expert noting that "On the defense side we're seeing the transition from companies like Lockheed, Boeing and Grumman selling just assets—which is more of a service-level agreement—to where they now are being asked to ensure that the asset is available and running at a high level ... It's now the contractor's responsibility to provide proper training, maintenance and other services." And for A&D suppliers, this will bring with it a whole slew of new sourcing and procurement implications, from better understanding lifecycle cost drivers of individual components to identifying substitute technology or materials which more broadly meet a specific need rather than just narrowly targeted exacting design specifications. See, when you drill into some of these concepts, "collaboration" does not begin to describe what's actually going on. It's far more complicated than a phrase that comes up in Google nearly two hundred million times.

Jason Busch

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