Analysis
of Manhattan Associates' New Partnership with CommercialWare
S. McVey - January 23rd, 2000
Event Summary
Supply chain execution vendor, Manhattan Associates recently took a big step
toward e-Business by partnering with CommercialWare, a 50 million transaction
developer of e-Commerce enabling solutions. Mozart, CommercialWare's flagship
offering, integrates customer order information across multiple channels, including
web, phone, fax, mail and kiosk. The alliance aims to integrate Manhattan's
back-end fulfillment capabilities with CommercialWare's Internet-based order
management technology.
Market
Impact
Initially, many startups and established companies fail to anticipate the challenges
of electronic customer fulfillment when erecting Internet storefronts. In order
for these challenges to be overcome, e-Commerce companies need to rethink and
upgrade their infrastructure to accommodate transactions that take place at
Internet speed (See TEC Technology Research Note: "Advanced
Planning and Scheduling: A Critical Part of E-Fulfillment" December 10th,
1999). With increasing frequency, these companies are turning to software vendors
of e-fulfillment solutions, a community that includes Manhattan Associates.
The recent partnership is a good move for Atlanta-based Manhattan, which has
lagged behind other SCM vendors in marketing itself as an e-fulfillment enabler.
Industri-Matematik launched VIVALDI, its e-commerce fulfillment and customer
service suite in May 1999. Other SCM vendors who have made inroads into e-business
include EXE Technologies, Logility,. and most recently Essentus (formerly Richter
Systems). Manhattan's experience in e-fulfillment actually dates back to the
mid-90s and includes solutions for Patagonia, International Cornerstone Group,
and J. Jill. In terms of financial viability, new alliances that further its
role as an e-fulfillment software provider provides Manhattan a means for reversing
a decline in licenses over the past two years (see Figure 1). Although growth
in maintenance revenues indicates Manhattan is staying close to its existing
customers, long term viability as a software company depends on revenues from
new clients.
User
Recommendations
The enthusiasm of corporate press announcements often obscures the actual market
readiness of the highlighted initiative, alliance, or product. While Manhattan
has taken a promising step toward raising its visibility in Internet fulfillment,
the alliance with CommercialWare is new and both parties will need to make significant
investments of time and money to marry the traditionally brick-and-mortar capabilities
of Manhattan with CommercialWare's electronic customer order management applications.