Big Businesses Continue Move To Online Procurement

Merck & Co. is the latest large corporation to move suppliesprocurement to the Internet. In January, the $23 billion pharmaceuticals maker will begin deploying the Operating Resource Management System application from Ariba Technologies Inc. for online procurement of nonproduction or indirect supplies, on which it spends about $2 billion annually.

Merck will be the fifth company among the 50 largest firms in the U.S. to adopt the Internet for procurement, joining Ford, General Electric, United Technologies, and another Ariba customer, Chevron. Merck declines to comment, but Ariba says Merck will begin with a two-month pilot with key suppliers prior to a rollout at all U.S. locations that integrates ORMS with its financial and accounting applications. Next month, Cypress Semiconductor Corp. will also begin using Ariba ORMS to automate part of its $75 million a year activity in indirect materials procurement.

Meanwhile, Ariba competitor Commerce One Inc. this week will unveil new versions of its BuySite online purchasing application and MarketSite online-catalog and order- processing module. MarketSite 2.0 includes a new pricing server for better compliance with supplier contract terms. BuySite 4.0 includes new search and filtering functions using Microsoft Index Server technology, and can now be accessed by Windows 3.11 and Windows 98 clients as well as Windows 95 and NT Workstation.