Case Study: Exostar
By Tim Walter
What is Exostar?
Why would 5 competitors join together to
form a single company?
Aerospace and Defense Exchange
Bringing together
Buyers and Suppliers
Buyer Advantages of a Collaborative
Effort
• Reduce cost of goods purchased
• Reduce number of errors suppliers make in
fulfillment
• Reduce on hand inventory
• Learn from each other’s experiences to grow
their eProcurement processes
Supplier Advantages
• Paper based procurement mistakes removed
• EDI integration is expensive
• Only need a computer and access to the
internet
Business Model for Exostar
• Buyers pay quarterly for maintenance of the
system
• Buyers pay for any special customizations
• Suppliers pay a flat fee for first year to join
• For the 2nd year on, suppliers pay based on
number of transactions
Competition
2003
•Air France
•American Airlines
•BFGoodrich
•British Airways
•Continental Air
•Delta Airlines
•Honeywell International
•Iberia Air
•United Airlines
•UPS
•United Technologies
Current Competition
There are no current exchanges dedicated to aerospace and defense.
Collocation
Exostar
ServerVault
ServerVault hosts both a test and production environment for Exostar.
Organizational Structure
Analyze and Design
Project Managers
Developers , Quality Assurance
and Technical Operations
The entire
project
lifecycle
Customer Support
eProcurement
What is eProcurement?
• A web-based buyer and supplier exchange for
B2B, B2C, and B2G
• eProcurement attempts to make supply chain
management completely electronic
• Elements of eProcurement:
– Planning and Forecasting, Inventory Management,
Purchase Orders, Shipping Notices and
Invoicing…to name a few.
Supply Chain Process
Forecast
Commit to Forecast
Purchase Order
Order Response
Buyer
Ship Notice
Goods Receipt
Invoice
Invoice Response
Supplier
SupplyPass
• Exostar chose CommerceOne’s SupplyPass
product to customize to meet the needs of the
exchange.
• Advantages:
– Able to quickly deploy the exchange
– Already had a user appropriate, web-based UI
– Proven track record of connecting buyers and
suppliers
• Disadvantages???
How to connect a buyer’s backend
system with SupplyPass?
Sends EDI
Buyer
<OrderNumber>
<BuyerOrderNumber>PO1
</BuyerOrderNumber>
</OrderNumber>
Web Methods Trading Network
Forwards xCBL to SupplyPass
SupplyPass Available
2001 Exostar released the first version
of SupplyPass
15000
Registered
Suppliers
10000
5000
Active
Suppliers
0
Nov-01
Rolls-Royce Commits to Use
SupplyPass
Exostar adds in Forecasting, Goods Receipts, and Invoice Response to
SupplyPass.
Rolls-Royce begins trading with 300 suppliers
15000
Registered
Suppliers
10000
5000
Active Suppliers
0
11/01 03/02
What is wrong with this graph?
Why were the buyers not using the
exchange??
The buyers wanted a faster and more user appropriate UI
The buyers required a guaranteed delivery or transactions
Exostar went back to work to build
SupplyPass to meet the buyer’s expectations
SupplyPass version 5.0
March 2003
All 5 buyers begin trading on the exchange.
15000
Registered
Suppliers
10000
5000
Active Suppliers
0
11/01 03/02 03/03
Profit
The fourth quarter
of 2003 was the first
profitable month for
Exostar.
They were also cash
positive for the
same period.
Exostar realized they were
risking adding and new
potential buyers and suppliers
Trouble ahead?
Transactions Per Month
800000
600000
400000
Transactions Per
Month
200000
0
01/04
04/05
Suppliers
30000
20000
Suppliers
10000
0
11/01
04/05
e2Open To the Rescue
October 2005
Proven track record with large
customer base.
Exostar chose e2open in October of 2005. they had a platform that could grow to
meet the customers needs and it also offered new document workflows that
could further enhance the eProcurement Process
Data Migration
Because the data stored in SupplyPass were legally binding, these needed
to be migrated to the new SCP
Supply Chain
Platform (SCP)
SupplyPass
13 Million Documents
2 Terabytes of Data
30,735 Organizations
45,219 Users
8 months of planning with partners,
developers, quality assurance and
training
5 waves of migration over a period of 4
months without interrupting either the
new SCP or the old SupplyPass
Rebuild Legacy SupplyPass System
Exostar had tasked e2Open with building the
Supply Chain Platform to have the same
functionality and same user interface as existed
in SupplyPass.
Rebuilding a legacy system and trying to retrofit the functionality into a new system is
something that should not be done.
Some of these decisions would be deemed as
mistakes in the future as they inhibited the
flexibility of SCP.
Supply Chain Platform
In July of 2007 the new Supply Chain Platform was released.
Transactions Per Month
15000000
10000000
Transactions Per
Month
5000000
0
01/04
04/05
07/07
12/08
Suppliers
60000
40000
Suppliers
20000
0
11/01
04/05
07/07
12/08
How did the system support such
growth?
Apache Web Servers and
IIS for load balancing the
average 14,000 users at
Oracle DB for storage and
peak
LDAP for authentication
32 and 64 bit Linux
and Windows Servers
Security and Privacy
Digital Certificates
Database Encryption of
Sensitive Data
Comprehensive privacy policy
to protect users and Exostar
Previous Decisions
Retro-fit decision
Limits scalability of the product
Increases deployment time
Increases cost of making changes
Exostar is currently redesigning the SCP to make it closer to the e2Open base platform.