New tricks for the old economy
Aspen Technology wants to show "old-line" process manufacturers the value of e-Business
Sidney Hill Executive Editor -- Manufacturing Business Technology, 1/1/2001 12:00:00 AM
At times it seems as if the practice of e-Business is limited to high-tech industries. That's partly because a large percentage of new e-Business software applications have been designed specifically for high-tech companies.
The media also have contributed to the portrayal of e-Business as a strictly high-tech phenomenon with tales of the revolutionary business models adopted by companies such as Dell Computer Corp. and Cisco Systems. But at least one software supplier- Aspen Technology of Cambridge, Mass.-is out to prove that e-Business has a place in other industries as well.
Aspen Technology has a 20-year history of selling applications that help companies optimize processes for making old-fashioned products like oil and gas, pulp and paper, industrial chemicals and pharmaceuticals, as well as consumer goods such as food and beverages. Recently, Aspen Technology has expanded its mission to include helping these old-line companies make the transition to e-Business.
"Our current position is that we want to bring these so-called old-economy industries into the new economy," says David McQuillin, an Aspen Technology executive vice president. "We are providing the infrastructure and collaborative business processes that they need to compete in this new Internet-enabled world."
A marketplace solution
Aspen Technology's latest effort in that regard, announced last fall, is the Aspen Marketplace Solution, a platform for creating what are known as e-Business Hubs or trading exchanges. McQuillen says the platform's centerpiece is a commerce engine, which essentially is a business-to-business Web storefront application.
The commerce engine contains personalization technology that enables companies to present special screens and offer specific goods and services to individual customers or suppliers. It also contains a content-management application for displaying product information or other data that trading partners need to share.
The Aspen Marketplace Solution supports the building of both public and private exchanges. It also gives Aspen Technology a full complement of applications to support both the front-end and backend processes that are necessary to create and execute successful e-Business strategies.
McQuillin says Aspen's backend applications provide value in three specific functional areas: supply chain management, manufacturing, and engineering. He also believes that adding the Aspen Marketplace Solution to its product lineup positions Aspen Technology as "the leading provider of enterprise optimization solutions for the process industries."
Aspen Technology's competitors include i2 Technologies, Dallas, and Manugistics, Rockville, Md., in the supply chain space. In the manufacturing arena, it competes with Honeywell's industrial controls business, which is headquartered in Phoenix, and Herndon, Va.-based Invensys Software Systems division. But McQuillin argues that "no one matches us one-for-one across the broad spectrum of applications, and no competitor can match our depth of knowledge in the process industries."
Company evolution
Aspen Technology was formed in 1981 to commercialize technology developed by the Advanced System for Process Engineering (ASPEN) Project at the Massachusetts Institute of Technology. The company's first product, Aspen Plus, enabled engineers to build software models that simulated the results of combining different elements. By adjusting the makeup of the elements represented in the models, engineers were able to speed up-or optimize, as Aspen likes to say-the process of creating new products.
After going public in 1994, Aspen technology launched an acquisition spree that resulted in the purchase of more than 15 other companies and the melding of a host of new software applications into a broad-based software suite. "These acquisitions placed us squarely in the manufacturing and supply chain domains, while also helping to flush out our engineering offerings," McQuillin says.
Aspen's most significant acquisitions included the 1998 purchase of Chesapeake Decision Sciences, which offered a series of applications designed to optimize the planning and scheduling of production activities in process-oriented manufacturing environments.
Today, following several additional acquisitions and product enhancements, Aspen Technology markets a product line consisting of three separate software suites designed to optimize engineering, manufacturing, and supply chain processes.
It also has created the Aspen Framework, which McQuillin describes as a technology platform that can link all of Aspen's applications to form a single, comprehensive business system.
"The Aspen Framework is based on open industry standards," McQuillin explains. "That allows all of our applications to communicate and share data contained in their respective models. The framework also has a workflow engine that gives anyone with the proper security clearance access to all of these applications."
The applications, McQuillin points out, are designed to address the needs of process manufacturers. Those unique needs include the ability to engineer products that are comprised almost exclusively of chemicals or liquids as opposed to discrete components. The manufacturing and supply chain products also are equipped to optimize the movement of raw materials that must be mixed and blended in specific ways in order to consistently produce and deliver the right finished products at the right time.
Over the past year, McQuillin says, Aspen Technology has worked to make its applications capable of supporting e-Business. "The heart of e-Business is collaboration," McQullin says. "That means enterprises reaching out beyond their internal boundaries to communicate, in real-time, with customers, suppliers and other partners.
Ideal deployment
The operators of a public trading exchange known as e-Chemicals.com, Addison, Texas, are among a handful of organizations that deployed the Aspen Marketplace Solution before its official release. And McQuillin points to that implementation as an example of how Aspen Technology would like most of its customers to use the new platform.
In addition to providing a place for companies to either buy or sell products, e-Chemicals hosts a set of backend applications that its members can use to plan their own production schedules and coordinate the delivery of goods. Those backend applications also are provided by Aspen Technology.
Aspen Technology deviated from its practice of acquiring companies to build its marketplace solution, and instead chose to partner with vendors who specialize in providing e-Business functionality. The commerce engine is comprised of technology supplied by BroadVision, Redwood City, Calif. Moai Technologies, San Francisco, provided an application that allows companies to locate and negotiate with suppliers of strategic commodities. A product called WebSphere from IBM, Armonk, N.Y., serves as an integration platform, making it possible for companies that belong to an exchange to share information coming from their disparate business systems.
McQuillin says relying on e-commerce specialists to create the Marketplace Solution allowed Aspen Technology to quickly offer essential collaborative tools and still focus on its core expertise. Specifically, he says, that expertise is helping process manufacturers optimize their business processes by modeling, automating, and integrating them.
"Our heritage is proving to be a great asset in the world of e-Business," McQuillin says. "Because the true value of e-Business comes from first figuring out how to optimize business processes, and then having those optimized processes span the enterprise."
