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NAPM/Forrester Research Announce Results Of First Report On eBusiness

Report Shows That Purchasers Are Just Beginning To Use The Internet

(TEMPE, Ariz. AND CAMBRIDGE, Mass.) January 22, 2001 — National Association of Purchasing Management (NAPM) and Forrester Research, Inc. (Nasdaq: FORR) announce the release of the NAPM/Forrester Research Report on eBusiness, a first-of-its-kind report that tracks online activity for both manufacturing and nonmanufacturing organizations. The report shows that companies are still in the early stages of Internet adoption, with firms just beginning to buy online and use the Internet for other parts of their procurement processes.

"NAPM and Forrester will be providing high-quality data that charts the progression of B2B eCommerce for our members and the business community with this quarterly report," said Edith Kelly-Green, NAPM chair of the NAPM/Forrester Research Report on eBusiness and vice president, Strategic Sourcing and Supply for Federal Express. "By doing so we can provide valuable information on online activities to business leaders, particularly those in the supply management function."

"There's a significant incoming wave of online B2B activities. Almost half of the corporate purchasers surveyed report being in the earliest stage of adopting the Net. At the same time, an overwhelming number of these respondents see the Net as an important part of their plans," said Bruce D. Temkin, group director at Forrester. "With this report, we'll be able to provide an ongoing tracking mechanism for this upcoming eBusiness surge."

The Report on eBusiness also revealed that during the past three months, 61% of organizations have bought indirect materials online and nearly 40% of manufacturers have purchased direct materials online. More than 15% of companies did some purchasing via an online auction, with manufacturers having used them more than twice as often as nonmanufacturers.

"Relationships with suppliers are changing. While organizations aren't yet buying a large portion of their goods online, there's significant momentum to use the Net for things like identifying new suppliers and collaborating with suppliers. But suppliers have a lot of work to do. For every purchaser that was pleased with the online capabilities of their suppliers, four others felt that these offerings weren't very good," added Temkin. "Comments made by respondents, such as 'deciding on appropriate initiative,' 'problems with implementation,' 'resistance to change,' and 'funding,' point out some of the issues facing organizations in implementing or deciding upon an eBusiness solution" added Kelly-Green.

For the Report On eBusiness, NAPM and Forrester Research received survey replies from 368 purchasing executives from both manufacturing and nonmanufacturing organizations. The median purchasing volume for the respondents was $75 million. To compare the adoption of different activities and to track the adoption of activities over time, NAPM and Forrester created the eBusiness Adoption Momentum index (eBAM).

The NAPM/Forrester Research Report on eBusiness, developed in fall 2000, measures the adoption of Internet-based procurement. NAPM and Forrester Research developed the survey jointly and will issue the report every three months in a manner similar to the monthly NAPM Report On Business®.

About NAPM

Founded in 1915, the National Association of Purchasing Management (NAPM) is one of the most respected educational organizations in the United States. NAPM is a communication link with more than 47,000 supply management professionals. NAPM is a progressive association with a mission to provide national and international leadership in supply management, particularly in the areas of education, research, and standards of excellence. Through various resources and a network of affiliated organizations, NAPM provides opportunities for expansion of professional skills and knowledge. A not-for-profit association, NAPM offers a wide range of educational products and programs.

NAPM has provided a rich history of economic data for over 67 years on the U.S. economy with its Manufacturing NAPM Report On Business® and the Purchasing Managers Index (PMI). Since June 1998, NAPM has also been publishing the Non-Manufacturing NAPM Report On Business®. Both surveys can be found at www.napm.org.

About Forrester Research

Forrester Research is a leading independent Internet research firm, analyzing technology change and its impact on business, consumers, and society. Forrester's "Whole View" of the Internet economy enables clients to weave together Internet commerce initiatives with eBusiness technology to satisfy customers' changing needs. Clients receive continuous research and analysis through Forrester eResearch™ Reports, an array of advisory services, assessment tools, and topical events. Established in 1983, Forrester is headquartered in Cambridge, Mass. Forrester's European Research Center is located in Amsterdam, Netherlands, its UK Research Centre is located in London, and its Research Center Deutschland is located in Frankfurt, Germany. Additional information about Forrester Research can be found at www.forrester.com.

Information concerning the quarterly release of the NAPM/Forrester Research Report on eBusiness may be obtained through the NAPM Web site at www.napm.org and the Forrester Research Web site at www.forrester.com.

The next release of the NAPM/Forrester Research Report on eBusiness will be in mid-April 2001.

©2001, NAPM and Forrester Research, Inc. Forrester and Forrester eResearch are trademarks of Forrester Research, Inc.

NAPM/Forrester Research Report on eBusiness

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