THE WEB WITHIN

DENISE ZIMMERMAN

The desire to provide on-demand access to information wherever it resides via a common user interface has retailers and wholesalers uttering a new word: intranet.

It's only a whisper now, but information systems executives told SN they are anxious to explore the networking strategy that makes use of Internet-developed applications, such as the World Wide Web, for internal use.

"The browsers are so user-friendly these days that it's going to allow people easier access to information; intranets are graphic, user-friendly and cheap," said David Hayes, director of information services at Associated Grocers of New England, Manchester, N.H.

Intranets are corporate networks based on Internet technologies such as transfer control protocol/Internet protocol, or TCP/IP. Staff can venture out into the Internet, but firewalls protect intranets from unauthorized access.

Experience gained through consumer-oriented Internet projects, such as home pages on the web, clearly have whetted retailers' and wholesalers' appetites for more applications.

"We've done some work on the Internet, and because of that we see the value of having an intranet server for our own internal purposes," said Gary Butler, director of information technology at Randalls Food Markets, Houston.

Like many retailers beginning to investigate intranets, Randalls has not set its strategy in stone: "Most of my discussions on the subject have come in the last 30 days. Only recently has activity started surfacing concerning intranets," Butler said.

Randalls, Associated Grocers and Raley's, West Sacramento, Calif., are among those now looking to bring the technology in-house to allow employees to click their way to information on an "as-needed" basis and to more easily connect staff with one another for collaborative efforts.

The wide range of applications retailers and wholesalers are considering for future intranets include:

Exploiting graphics capabilities:

An internal company web page facilitates sharing of visual information not possible on conventional local area networks.

Store-level staff could access color photos of shelf sets for planogramming purposes and bakery products for decorating ideas, for example, while buyers could view promotional and merchandising presentations with audio and full-motion video clips.

Eliminating paper:

Corporate telephone and E-mail directories, price books, annual reports and company newsletters are some of the documents companies would like to put on-line, where they can be accessed by many disparate users, updated instantly and distributed far less expensively than print.

New information sharing pipeline:

Companies can grant trade partners limited access to their internal servers.

"We've done some recent [research] work that suggests over 50% of large businesses are letting partners onto their intranets," said Tom Pincince, senior analyst for network strategy service at Forrester Research, Cambridge, Mass.

"If you could streamline the relationship between the retailer and their suppliers without going through the cumbersome methodology of things like electronic data interchange, that becomes a cost savings as well as a relationship-building effort," he said.

Pincince suggested that smaller suppliers unable to invest in an EDI infrastructure could more easily exchange information electronically using Internet applications.

An EDI Communications task force was recently established by the Uniform Code Council, Dayton, Ohio, to explore a standard electronic messaging protocol for EDI and the group is looking closely at Internet opportunities.

"There's two key issues there: One is security and the other is reliability, and from an EDI standpoint, I see reliability as the bigger issue," said Greg Zwanziger, EDI manager at Supervalu, Minneapolis.

Security issues are being worked out, Zwanziger said, but the Internet's ability to handle ever-increasing data traffic and move EDI documents to their destinations in a timely manner is a little dicey now.

"I think the reliability issue is what will push people away from the Internet to an intranet for information they view as mission critical," he said.

Zwanziger foresees more companies developing their own intranets but also envisions the large public network players and value-added networks building secure intranets that two partners can jointly access in a reliable environment.

The growing interest in intranets is evident in that companies are developing internal web pages at a slightly more rapid rate than publicly accessible Internet web pages.

In a survey of 1,030 management information systems directors and webmasters at large companies, including food distributors, 37% indicated they had at least one internal web site and 35% said they had a least one external web site. The report, "Conducting Business on the Internet," was released last month by O'Reilly & Associates, Sebastopol, Calif.

Perhaps even more telling, Zona Research, Redwood City, Calif., projects sales in intranet server software will reach $8 billion in 1998, dwarfing the estimated $2 billion that will be spent on Internet server software.

Joanne Donley, vice president of information services at Raley's, said the company's Internet committee is exploring a wide range of projects, and developing an intranet is one of them. "We are looking at that right now, in fact. We're pretty excited about that as an opportunity," she said.

"There's a whole variety of things that could be done with it. For example, let's say our bakeries want to decorate a cake in a certain way. Now we have photographs of that cake going out in the mail, but with our internal web, we can have that available in the store, just to be called up and viewed [on computer] and printed in the store," she said.

Raley's is also thinking about posting company job listings on its internal web and setting up a platform for two-way management-workforce communications.

"Human resources is another area we've very excited about" for intranet applications, she added.

At Tyson Foods, Springdale, Ark., which launched an intranet earlier this year, staff can access the phone data base and information about credit union services. Soon each department will host its own web page.

Associated Grocers of New England is giving serious consideration to developing an intranet that would give salesmen in the field remote access to the mainframe.

"We have 25 salesmen on the road and have need to give them immediate access to product status, whether it is in stock or not. We don't have an easy way to doing that now," Hayes said.

"This is fairly new and it's only in the last few months that we've begun to talk about it," he said.

Ideally, Hayes envisions salesmen using notebook computers to dial into an Internet provider to access Associated's web site. "They would be able to put in an order and do all of the things you could do if you were sitting here" at headquarters, he said.

Another company looking to intranets to deliver information more effectively is Whole Foods Market, Austin, Texas, which has stores scattered across the country.

"For us, communication is a big issue. It's hard to keep regions linked together well and we think distributing information via an intranet is a good mechanism for doing that," said Carl Morris, chief information officer.

The company is currently using IBM Lotus Notes for document sharing but thinks developing an intranet may also be viable.

Though some industry observers view intranets as a less expensive alternative to groupware like Lotus Notes, Morris contends that the two can coexist: "I think they have slightly different niches," he said.

Richard Lester, vice president of information services at Associated Grocers, Seattle, and a vocal champion of Lotus Notes, agreed. "Intranets can bring network connection to a lot of people who wouldn't normally have access, but at the same time the new version of Lotus has Internet connections built right into them.

"We'll wait and see. It certainly isn't beyond the realm of possibility that within the next year or two we will take a look at using intranet capabilities along with Lotus Notes."

Lester, like many retailers and wholesalers, emphasized that intranets are a relatively new networking animal, especially in the food industry. The wise information systems executives will investigate new options but move forward with caution.

"We've invested a lot of money over the years building our own networks, and I don't imagine you'll see too many people throwing all that investment and expertise away to leap hog wild into something brand new. But [intranets are] certainly intriguing. We'll keep our toe in the water."