Seeing Green and Red
Although not entirely sprouted from commercialism, extranets have deep and wide roots in the Internet's early hyperbolic promise to make everyone who used it filthy, stinkin' rich. Laying aside their complex architectural technology, extranets are Web sites formed for multiple entities to exchange information securely and easily.
"[An extranet] is usually part of a company's information network that is not sealed behind their firewall," explained Jeff Senne, founder and CEO of the Senne Group, a firm specializing in sales, Internet and leadership consulting. "It is quite common for a company that has developed an intranet to manage its information exchange to also create an extranet that will allow customers, business partners, and suppliers to have access to pertinent information they need and want. You need a password and user ID to have access to most extranets."
As part of their MBA fulfillment at Vanderbilt University, Donald Bullock, Douglas Heilig, Paige Henke, Michael Stricker and Oh Suwansaranyu wrote "The Emergence of the Extranet in the Era of E-commerce". This work takes the definition of an extranet a step further than Senne did.
In its simplest form, an extranet is an extension of the corporate intranet set up on the same IP (Internet Protocol) network. Unlike intranets, which are most commonly internal, open only to company employees, extranets operate outside the company, connecting suppliers, distributors and customers to that same internal corporate information. By making this connection among the various players in the channels of goods and services, extranets aim to improve the process of information transfer to maintain and improve ongoing business relationships and ultimately lower the cost of production for the channel.
Extra Benefits
Within the definitions that Senne and the authors of "The Emergence of the Extranet in the Era of E-commerce" provided are the extranet traits that are so appealing to federal and local government agencies seeking to streamline operations through Web technology. These include connecting vendors in the channels of goods and services, improving information transfer, maintaining and improving ongoing business relationships, and ultimately lowering operation costs.
Nahum Goldmann of Array Development, a Canadian firm that specializes in Web development, affirmed that the ability of extranets to leverage Web technology is the key to its ability to deliver cost and time economies of scale.
"An extranet service uses existing Internet interactive infrastructure, including standard servers, e-mail clients and Web browsers," Goldmann wrote in the 1997 paper, "Extranet: The Third Wave in Internet Electronic Commerce". He added, "This makes extranets far more economical than the creation and maintenance of a proprietary network."
However, Goldmann emphasized that the value of extranets is not necessarily weighed by the operational economies they afford. He said that the extranet is a technology-enabler for developing the "third wave" -- with the Internet being the first and intranets the second -- in large-scale electronic business communities. This third wave, as Goldmann defined it, is the core of a reengineering effort needed to advance traditional organizations into "knowledge factories" -- the only way for an enterprise to survive and prosper with the ongoing change of the new knowledge economy.
"For such an enterprise -- whether a widget manufacturer, a government agency, a bank or
a catalog store -- knowledge engineering has to be its core competence, the principal strength that keeps it in business," Goldmann wrote. "No government can efficiently operate now or in the future without reorganizing themselves as extranet business communities. As far as [the general] population is concerned, local government's business is in transactional delivery of administrative services."
Federal and local governments know this to be true. Consider that as part of the Global Framework
for Electronic Commerce, President Clinton in 1997 issued a mandate challenging federal agencies to employ e-commerce activities wherever appropriate and possible. Federal entities that have taken on this challenge, even before the president's mandate, include NASA, which employs multiple e-commerce applications, the General Services Administration, the Bureau of Prisons, the National Institutes of Health and all branches of the military. According to Senne, contractors such as Lockheed Martin frequently use Net technology in aerospace work with the Department of Defense. At the state level, California focuses on building secure transaction systems incorporating digital signatures.
Close to Home
Locally, counties are quickly realizing the value of being knowledge factories. Florida's Orange County runs an extranet application with criminal ties. Through a secure county Web site
In Montgomery County, Md., Donald Evans, the county's chief information officer, plans to expand a current procurement-system extranet into a large-scale online information exchange for the county's constituents. He said Montgomery County's current procurement-centric extranet is one integral part of the locality's efforts to make government available to private citizens and businesses.
In his paper, Goldmann noted similar views. "It is not in collecting garbage or paving roads because private industry can do it much better if subcontracted by the local government. But practical local governance is in ongoing dealing with clients (population) and vendors (suppliers, subcontractors) according to the specified policy, and that's what government extranet is all about."
"We want to create an effective government whereby efficiency and effectiveness are realized in terms of accessible government -- hassle-free government," Evans said. "Technology is a great way to accomplish this. Extranets are a way of taking governments to the people."
With its procurement extranet, Evans said, Montgomery County has seen real reduction in the time needed to process procurements, and has seen an associated reduction in costs. More important is the county's increased ability to establish efficient and effective partnerships with various vendors.
"The bandwidth of productivity is increased," said Evans. Montgomery County's extranet reduces a vendor's procurement costs in trying to sell to the locality, and fosters an amicable relationship between entities. "This extranet is a vehicle that, used with an enterprising view, can attract the quality partners that one is always looking for," Evans said.
Montgomery County went live with its extranet about a year ago. A natural extension of its intranet, the county's extranet continues to challenge its staff to keep it up to date. Evans said the biggest technological challenge is that, in effect, Montgomery County has become an Internet service provider (ISP).
"Maintaining bandwidth capacity -- speed, memory, the electronic media -- having that in place is a challenge. In a smaller fashion, I'm like an ISP, I'm a UUNet or AOL, because I've got this big community depending on me. We also have to keep up with the demands of bandwidth because we have to provide a quality of service that's expected."
A recipient of the National Association of Counties 1998 Achievement Award for its Y2K compliance program, Montgomery County carefully considered the implications of the turn-of-the-century conformity in Web-based deployment.
"We have a good handle on it. We have some work to do, but we're also jump-starting a lot of other entities and localities -- states around the country -- with the efforts that we've done here."
Evans said the county is developing an extranet system that will enable local building contractors to process their permits online and allow inspectors to perform preliminary functions before traveling to construction sites.
"We are in the process of upgrading our entire permitting system," he said. "The permitting system is already online, but we're moving to a completely distributed architecture for our permitting
system that will include all the features of an extranet. Our inspectors will be equipped with GPS and GIS interfaces."
With so much demand in Montgomery County for fast, good, constant service, Evans said, the county is optimistic about being a knowledge factory and is willing to take on the formidable tasks inherent in developing one.
"The Internet is not yet a stable platform," he said. "But the world has become electronic in this knowledge-worker age. That's the challenge."
For more information, contact Donald Evans, CIO of Montgomery County, Md., Nahum Goldmann or Jeff Senne.
Myrna Dingle-Gold is a Galt, Calif.-based writer.
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