|At a Glance: Omaha Steaks Inc. |
The company: Omaha Steaks is a privately held manufacturer, marketer, and distributor of premium meats and other gourmet foods through direct mail, e-commerce, and a chain of retail stores. The family-owned Omaha, Neb., firm claims 1.5 million customers worldwide and 1,800 employees.
The problem: As part of an overhaul of its e-commerce site, Omaha Steaks wanted to tie Web pages directly to a production database in order to provide the latest product offerings, pricing, and promotions to its customers. Additionally, the company wanted more efficient ways of working with other e-tailers that sold its products.
The solution: XML was used in conjunction with an e-commerce platform that would provide a format-neutral approach to data.
The IT infrastructure: Five Dell Corp. dual 866MHz Pentiums, Linux, Cisco Local Director for load balancing, jCommerce product from eOneGroup LLC, DB2 running on an AS/400 production machine, IBM Corp.'s HTTP Server, and XHTML (a combination of XML and HTML) for Web its pages.
"I wanted to use an AS/400 [for e-commerce hosting] because I'm an AS/400 bigot," Carter says, but that lead to a financial issue. The company would have needed to invest three quarters of a million dollars for a large enough version to handle its needs.
After testing various platforms, Omaha Steaks settled on five dual 866MHz Pentiums from Dell Computer Corp., each running Linux and jCommerce. "I found out I could scale these servers much more cost effectively than we could buying a big enough AS/400, or multiple AS/400s, to handle the workload," says Carter, adding that each server costs about $8,000. At only $40,000 for the entire Dell server farm, hardware and software included, Carter can add horsepower as he likes without breaking the budget. The production database continues to be IBM's DB2, hosted on an AS/400.
In addition to the production and monetary benefits, Omaha Steaks also built an XML order receiver application to improve the process of taking orders--whether online or via telephone--from resellers of the company's products. "A company like Cooking.com takes orders, then transmits data to us in [an] XML format. Then we pass shipping information back to them," explains Carter. "And we've built an XML validator page so a vendor can come and run their file through to see if it passes our XML test." Common Ground Definitions
It is the ability XML gives companies to devise custom tags for more complex data forms--ranging from customer contact names and inventory on hand to publishing concepts like headlines and illustrations--that makes the standard so powerful. But for companies to effectively communicate, they must agree on the definition of the tags. Omaha Steaks has been able to set the definitions that its customers need to follow. In other cases, this simply isn't possible.
Still, communication is a cornerstone. BASF Corp., the Mt. Olive, N.J.-based North American division of the German chemical giant, has used XML to communicate among internal applications for a while, according to Joel Johnson, director of electronic commerce. Now the corporation looks to the standard to help provide cross-company cooperation. The result is supply chain cost savings. "We fully anticipate that XML will play an important role in our ERP integration plans with e-marketplaces and trading partners," Johnson says.
In such a competitive industry, though, a company like BASF cannot readily dictate standards for communicating, because vendors, suppliers, and customers alike will insist on the ability to work with its competitors as well. The worst situation is if each major industry player went its own way.
"We're starting now to see demand from data partners that want to do direct ERP integration with us," Johnson says of the integration many of BASF's business partners want between their ERP systems and its own. "If we don't adopt some sort of standard within a very short period of time, there will be a variety of data formats and transport protocols throughout the industry." While there are movements in many industries, adopting XML is not a single event that can be done for all industries at the same time.
BASF is uninterested in a proliferation of formats because of the implementation and maintenance difficulties inherent in supporting them all. That is why the company finds itself collaborating with rivals The Dow Chemical Company and E.I. du Pont de Nemours and Company, taking their collective experience and developing priorities on the types of transactions, such as invoices or purchase orders, that would be most valuable if made standard.