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120 Part 1 Introduction

through this source. This usage of the term ‘extranet’, referring to electronic business-to-
business communications is most typical (see for example, Vlosky et al., 2000). Hannon
(1998) concurs, and also notes the relationship of extranets with intranets, describing an
extranet as
any network connected to another network for the purpose of sharing information and
data. An extranet is created when two businesses connect their respective intranets for
business communication and transactions.

Dell Premier is an example of a business customer extranet for a large corporation. You can
read how Dell positions the benefits in the mini case study. The system helps Dell encourage
customer loyalty to Dell since once integration occurs customers are less likely to change
suppliers due to switching costs. It is an example of ‘soft lock-in’ which we introduced in
Chapter 1. Dell also encourages consumers to make suggestions about new products through
its IdeaStorm (www.ideastorm.com) service for which customers have to be registered to add
comments, so could be considered as a form of extranet although Dell Premier is a better
example since it shows how a service can be provided continuously.

Mini Case Study 3.1 Dell Premier customer extranet provides e-business services

Dell provides Premier Dell.com (formerly Premier Pages) for its business customers. This is how Dell describes
the service to customers:
Premier.Dell.com is a secure, customizable procurement and support site designed to save your organization
time and money through all phases of I/T product ownership.
Easy Ordering – A custom online store ensures access to your products at your price.
Easy Tracking – View real-time order status, online invoices and purchase history details.
Easy Control – Custom access groups define what users can see and do within Premier.
It explains how Dell Premier can be used for e-procurement as follows:
Dell integrates a customized Premier catalog with your Enterprise Resource Planning (ERP) system to give
you more control over your purchasing process and to help ensure accurate and efficient transactions.
Aligning with your Procurement System – Dell can integrate with a variety of ERP applications, including:
Ariba, Commerce One, Lawson, Oracle Purchasing, SAP, SciQuest and more.

Dramatic Savings – E-Procurement integration can reduce purchasing overhead and order processing
time. Consolidating purchase records into one system streamlines administration, while electronic invoicing
and payment save employee processing time.
The Solution for You – Return your shopping contents to your ERP system electronically as Dell’s integrated
platform is designed to help improve efficiencies and order accuracy, while reducing product delivery times.
Source: http://premier.dell.com/

Vlosky et al. (2000) refer to these business benefits of an extranet:

1 Information sharing in secure environment. Information needed to support business
through a range of business partners can be shared using an extranet. Vlosky et al. (2000)
give the example of advertising agency Saatchi using an extranet to allow their advertisers
to access draft advertising material during a project. Information for suppliers is often
shared by providing a log-in to a database which shows demand for products.