New Manugistics Debuts eBusiness Products
S. McVey - February 2nd, 2000
At its press analyst day on Tuesday, Manugistics announced new tools and applications
for Internet B2B collaboration intended to put the ailing supply chain management
vendor back in the game. Distancing its applications from what it termed "traditional
eBusiness" solutions, Manugistics hailed the new offerings as the next evolutionary
step in online trading networks, communities of businesses that buy and sell
over the web. Bstreamz.com, its new trading exchange, comes in two varieties:
sponsored and powered. Sponsored exchanges carry Manugistics branding or co-branding
and allow open membership in return for a registration fee. Exchanges "powered
by" Manugistics allow trading networks to be built using WebWORKS, an XML-based
architecture. Its hosted application platform for mid markets, bnetworks.com,
provides access to Manugistics's NetWORKS supply chain management suite. Manugistics
operates the software but the client owns the processes. ASP partnerships should
follow in the coming months provided the applications find marketplace acceptance.
Manugistics's claims of making the next evolutionary step in eBusiness are an
exaggeration, but its B2B trading exchange applications do offer some attractive
features. Foremost of these is the incorporation of business rules to govern
transactions. Users can specify rules that classify and rank candidate transactions
in order to maximize revenue, minimize cost, and give priority to meeting commit
times (among others). As an example, carrier bids on a posted shipment request
are qualified by how well overall goals would be supported if the bid is accepted.
The feature is similar to some search engine results that give percentages indicating
degree of relevance for each item found. Other features are patterned after
earlier products from vendors such as SAP and i2. The browser interface can
be personalized in a variety of ways. Alerts inform users when a commit date
falls through or a new order is received. The requisite world map displays the
user's supplier network. Though much of the functionality could be seen as derivative,
the new products are a bold leap for Manugistics and could revive its image.
So far Manugistics has found three clients for its exchanges, including FreightWise
and Canadian Tire Corporation. Clearly, the products are still largely untried.
For high profile companies considering an online trading exchange, Manugistics
might be willing to offer a bargain in return for the exposure. All companies
should consider a few questions:
Will a vendor that has sold traditional licenses for many years be prepared
to handle the very different demands of running hosted applications (including
support through ASP partners)?
Has Manugistics worked out the details and understood implications of exchange
dynamics? For instance, after a manufacturer has accepted a bid from a carrier
to ship a part, can it back out if its customer cancels the order that required
the part? Will the effect of penalties be accounted for?
3. How well do these marketplaces work with competitive offerings like mySAP.com,
i2's TradeMatrix, or Logility's i-Community? (The last of these is not an online
marketplace at all, but a forum for CPFR.)
Will your suppliers need to be Manugistics clients in order to gain full benefits
of the applications? If so, can you convince your trading partners to enlist
(a feat not unlike signing up friends and family for a long distance calling
How will fees charged for the exchanges? Will clients be inundated with charges
with every mouse click to a different supplier's exchange (as with ATMs)? If
subscriptions are offered, will they be flat rate or per transaction? If transaction-based,
will fees be greater for higher dollar value transactions?.