34 of the Top 50 US Companies Have Made Strategic Investments in B2B Integration

For several years now there has been an ongoing debate in the industry about how strategic information technology is to businesses.  Some, such as Nicolas Carr, have argued that IT is now ubiquitous and no longer offers strategic advantages to businesses.  Working for an IT vendor, I have an inherent bias towards arguing that IT is highly strategic.  Gartner recently introduced a framework which divides IT systems into different categories – those which provide opportunity for differentiation and innovation and those which do not (systems of record).  While this framework is useful for customers it introduces a new debate as to which technologies fall into which categories.  Of course, every vendor will argue that their products provide opportunities for differentiation and innovation.

One measure that could be used to identify which technologies are most strategic is to examine investment levels by leading corporations.  Suppose that analysis revealed that across the Fortune 500 companies the top investment areas in terms of dollars are Oracle databases and EMC storage arrays.  Does that mean these are the most strategic?  Probably not.  So total spend is not necessarily indicative of the importance of the technology. 

Are there other types of investment levels that could be measured?  What about equity investments that the Fortune 500 have made in technology vendors?  What about investments that the Fortune 500 have made to build their own technology-based products?  Surely, these types of investments reflect a more strategic importance in technologies. 

But do the Fortune 500 really make these types of investments?  You may be surprised to learn that 34 of the Fortune 50 have made strategic investments in B2B integration technologies over the past 15 years.  These companies either:
a) Built their own B2B integration products such as FedEx has done with its EDI services
b) Purchased an equity stake in a B2B integration company such as Ford’s original investment in Covisint
c) Divested their interests in B2B integration products to another company

Here is the list of 34 companies in the Fortune 50 that qualify based upon the three categories above:

1.) Wal-Mart Stores  – was an investor in RetailersMarketXchange

3.) Chevron – was an investor in RetailersMarketXchange

4.) ConocoPhilips – was an investor in TradeRanger

6.) General Electric  – sold off its Global eXchange Services (GXS) division; also was an investor in GHX (Global Health Exchange)

8.) General Motors – was an investor in Covisint

9.) Bank of America  – recently sold off Paymode; also is a member/owner of SWIFT

10.) Ford – was an investor in Covisint

11.) Hewlett Packard – recently acquired a B2B Group via the EDS transaction

12.) AT&T  – recently spun off its investment in Sterling Commerce

13.) J.P. Morgan Chase & Co – acquired Xign, also is a member/owner of SWIFT

14.) Citigroup – recently spun off Interchange Brazil, also is a member/owner of SWIFT

15.) McKesson  – owns its Relay Health division, also was an investor in Health Nexis

16.) Verizon  –  former MCI group spun off its EDI division to nuBridges

18.) IBM – recently acquired Sterling Commerce after selling off its EDI network (Advantis) as G International; also was an investor in e2open

19.) Cardinal Health  – was an investor in Health Nexis (now owned by GHX)

21.) CVS Caremark – was an investor in the e-prescription network Surescripts and WWRE (World Wide Retail Exchange)

22.) UnitedHealth Group  – owns its Ingenix division which offers EDI-based services to the health care community

23.) Wells Fargo – is a member/owner SWIFT

25.) Kroger – was an investor in GNX

26.) Procter & Gamble  – was an investor in Transora

27.) AmerisourceBergen – equity investor in GHX

32.) Walgreen  – was an investor in WWRE (World Wide Retail Exchange)

33.) Target – was an investor in WWRE (World Wide Retail Exchange)

34.) Medco Health Solutions  – was an investor in Surescripts

36.) Boeing – was an investor in Exostar

38.) Microsoft – developed BizTalk Server, which offers B2B integration capabilities

40.) Johnson & Johnson – equity investor in GHX

41.) Dell – recently acquired Boomi

43.) PepsiCo – was an original investor in Transora

44.) United Technologies  – was an original investor in Cordeim

45.) Dow Chemical  – was an original investor in Elemica

47.) Best Buy – was an an original investor in WWRE (World Wide Retail Exchange)

48.) UPS  – has developed its own EDI services for corporate clients; also was an investor in nuBridges and the exchange Cordeim

49.) Kraft Foods – was an original investor in Transora

 

Can you name another technology sector that has received so many strategic investments from Fortune 500 companies as B2B integration has?