1. COVISINT EBIZ 504 e-Business Strategy Feb. 12, 2001
Marquita Alicia McKenney
Minho Cho
Dale Pudney

2. Contents Company overview - Alicia Business model - Minho
The objectives
The players
Business model Minho
Revenue model
Benefits / Value proposition
Issues & 6C Analysis Dale
Issues
6C analysis
Recommendations

3. Company Overview WEB FOUNDED TEMPORARY HQ EMPLOYEES VALUATION PARTNERS
COMPETITION
February 2000
Southfield, Michigan
200
$59 billion
General Motors, DaimlerChrysler,
Ford Motor Company, Renault,
Nissan, Commerce One, Oracle
(B2B) Ariba Networks, Freemarkets and others (suppliers, other automakers)

4. One Year Performance Sheet
Signed up
20 suppliers
Auctions
80 times
seven clients
Catalogs log up and running on servers
100s supplier

5. CO VIS INT CO-VIS-INT means… Connectivity,Collaboration,
Communication,Cooperation
VIS
INT
International visibility
on the Internet, vision
Integration, Internet,
International

6. The Objectives
The vision for Covisint is to build an online environment to achieve the following goals
Reduce development cycle from 40 to12-18 month
Compressed order-to-delivery cycles
Greater asset efficiency and utilization
Higher profitability with direct impact to the bottom line
More integrated supply chain planning
Reduced business process variability

7. The Players Founding Partners Business Partners Technology Partners
5 major automakers
Business Partners
Automotive suppliers (Potential 90,000 suppliers)
Technology Partners
Commerce One will provide the e-marketplace software,
while Oracle will provide e-business applications

8. Business Model - Purpose
Increase speed
Increase efficiency
Improve communications

9. Business Model - Services
Sourcing, or identifying new sources of supply
Negotiating
Transacting and payment
Supply chain management functions
Collaborative design and product life cycle work

10. Business Model - Changes
Traditional
COVISINT
Paper, Phone, FAX
, On-line
Competition
Collaboration
Time consuming
Speed
Uncertainty
Certainty

11. Revenue Model One-time licensing fees Flat transaction fees
Variable rate transaction fees

12. Benefits / Value Proposition
OEMs and suppliers.
Savings in procurement costs.
Better information flows between OEMs and suppliers.
Better product development front through to capacity decisions.
Improvements in inventory holding requirements.
End Customer.
Total estimated savings: about $1,188 per vehicle in North America.
about 80 % of that could be passed on to the consumer through price reductions.
Mission: TO BE THE AUTOMOTIVE EXCHANGE OF CHOICE.

13. Who Saves Most ? 66% $1,188 Dealer OEM Tier1 Tier2 Tier3 Tier4 Total
Source: Roland Berger
66%
$1,188
Dealer
OEM
Tier1
Tier2
Tier3
Tier4
Total
12%
48%
18%
13% 7% 2%

14. Issues Suppliers Competition Neutrality and anticompetitive practices
Concerned about price pressures
Not joining is economic suicide
Competition
1,000s of B2B exchanges
Other auto makers & suppliers forming independent exchanges
Neutrality and anticompetitive practices
Aggregate purchases
Always be within the competitive law

15. Issues Leadership Integration Competitors in bed together Over eager
Loan CEO, permanent leadership missing
Integration
Legacy and back-office systems
High cost
Competitors in bed together
Political infighting
Over eager
Unfulfilled capability claims

16.   6C Analysis 1 Context & Competition Suppliers acceptance
Par  1
Context & Competition
Suppliers acceptance
Standards for fragmented industry 2
Connectivity  3
Community
New platform for existing community
Easier communication fosters closer community

17. 6C Analysis 4 Communications
Par 4
Communications
Improved communication offers supply chain optimization 5
Content
Standards

18. Recommendations
Standards
Leadership
Emphasis on Value Add

19. ?