Internet purchasing vendor Ariba announced a strategic alliance with Descartes
Systems Group, a provider of Internet logistics solutions in which Ariba
will deliver a suite of Internet hosted services through its Commerce
Services Network (CSN). The new offerings, tentatively dubbed "Ariba Logistics
and Fulfillment Services - Powered by Descartes" are intended to give
buyers, suppliers, and B2B trading networks access to the logistics services
needed to complete the order cycle, that is, deliver the goods.
the planned services are global visibility of order status, exception-based
performance monitoring, total shipment cost calculation, delivery optimization,
and Internet-based transportation management. Ariba expects to offer its
services to users on a subscription and/or transaction fee basis. Descartes'
B2B Internet logistics infrastructure will also be linked to Ariba CSN
to connect buyers, suppliers, B2B marketplaces and logistics providers.
Few would doubt the benefits achieved by marrying Descartes' network of
logistics providers with Ariba's online purchasing communities. The belief
that e-commerce can work only when supported by sound backend fulfillment
operations is widespread among practitioners and is continually reinforced
by the press and analyst community.
fact remains that a seamless rapport between Web-based ordering and the
delivery of goods that truly optimizes each of the intervening operations
has yet to be achieved by any application. Thus far, most companies have
been content to simply have a web presence that allows them to reach the
buying public and take orders. The new alliance between Ariba and Descartes
has strong potential to accomplish the next phase in e-commerce execution,
that of fulfillment.
the myriad potential candidates that Ariba could have chosen for logistics
fulfillment, Descartes is probably the best. Over the past three years,
Descartes has assembled a comprehensive, componentized logistics planning
and optimization suite and has considerable experience in deploying its
logistics capabilities to clients over the Internet. In fact, more than
80% of Descartes' revenues are derived from Web-based application deployment.
addition, the new alliance falls into line with Descartes' strategy of
providing the tools necessary for Internet fulfillment, but not building
and branding its own marketplaces. Ariba's position as a purveyor of Internet
portals for e-commerce fits well in this strategy and neatly avoids conflicts
in business direction with Descartes, the "fulfillment arms dealer to
For companies who sell to consumers via Internet B2C sites, Ariba should
now figure more prominently in selections. Because the Internet dissolves
physical distances, companies are faced with the sobering fact that competitive
sites lie a mere mouse-click away from their own. Web businesses that
fail to deliver goods promptly risk losing customers to companies with
superior fulfillment capability. Potential clients should be wary, however,
since these alliances lead to integrated solutions only after considerable
investments in time and money on the part of the partners. Often, the
result falls far short of the hype, but is often a strong step toward
future functionality and architectural enhancements that ultimately may
deliver on the promises.