BY JAMES COOKE, EDITOR AT LARGE
techwatch
Don’t count the big guys out
DON’T COUNT THE BIG SOFTWARE GUYS OUT JUST YET.
That’s the word from Gartner analyst C. Dwight Klappich with regard
to the supply chain software market.
The “big software guys” in question are the giant megasuite vendors
like SAP, Oracle, and Infor that offer enterprise resource planning
(ERP) systems along with vast suites of add-on modules. While they
have long competed in niche markets like warehouse management
systems (WMS), these “Big Three” vendors have yet to make the kind
of headway here you might expect. Right now, for example, the WMS
market is split among three types of players: the megasuite vendors,
some small upstarts, and large “best-of-breed” players that specialize
in feature-rich supply chain execution systems. For the past decade,
two of these best-of-breed players, RedPrairie and
Manhattan Associates, have dominated the WMS
space, according to Klappich.
But now, it appears the Big Three are poised to
give RedPrairie and Manhattan a run for their
money, says Klappich. All three are adding “bells
and whistles” to their WMS packages to make them
more competitive with the best-of-breed offerings,
he notes. Klappich is pretty confident they’ll succeed in their quest. “I believe within the next five
years, they [the megasuite vendors] will have
upward of 50 percent market share in terms of
[WMS] customers, though not dollars,” he says.
Why is Klappich so bullish on the megasuite vendors? There are a number of reasons, but they
mostly boil down to advantages that arise from the
breadth, scope, and scale of their operations.
First off, there’s the ability to parlay advances in other areas of software development to improvements to their warehouse offerings.
Klappich cites the example of already-developed mobile frameworks,
which the vendors can simply extend to their warehouse software.
This would allow them to offer customers the option of receiving
alerts and performance reports on their tablets instead of relying on
their desktop computers. Likewise, the large vendors can build on
work they’ve done in the area of decision support to provide
“smarter” WMS solutions. A WMS enhanced with decision-support
functionality can offer such extras as recommendations for ways to
get more productivity out of a facility’s labor and equipment.
Another advantage enjoyed by the megasuite vendors is that their
applications are expressly designed to work with one another. Since
vendors like SAP and Oracle often provide the information technol-
ogy backbone for the entire company, integrating
their warehouse management solutions with
other company systems is a snap. “Because it can
be integrated right out of the box, it’s a winning
combination for them,” says Klappich.
