Aiming to outfit manufacturers with greater visibility into supply chains that stretch around the world, Manhattan Associates and IBM yesterday announced an expansion of their strategic partnership in the supply chain management space.
The partnership, which builds on the vendors' 15-year relationship, will combine a joint go-to-market effort to gain new business in geographies including Asia-Pacific, Europe, Latin America, and the Middle East in core vertical industries with supply chain products based on open standards and a service-oriented architecture (SOA), company officials said.
"Supply chain executives' primary challenge is global outsourcing," said Jeff Cashman, senior vice president of strategy and marketing at Manhattan Associates, in an interview. "While different parts of their operations are moving to lower-cost geographies, their customers' demands have not changed. There is still the need to deliver their company's products at a particular price, and at the right costs," he said.
Manhattan Associates and IBM aim to mitigate the risk inherent in elongated, global supply chains by offering Web-based software applications that increase visibility into a supply chain and are easy to connect to existing systems, Cashman said.
The vendors' joint solutions will consist primarily of Manhattan Associates supply chain software built on top of IBM's middleware framework, which includes the DB2 and WebSphere platforms, all backed by IBM's server hardware. The joint sales and marketing effort also will use the IBM Global Services organization for consulting and implementation services.
The partners are aiming to gain a foothold to compete against vendors that offer supply chain technology based on proprietary standards, including enterprise software giants SAP and Oracle Corp., company officials said.
"Supply chain applications based on open standards are easier to install and integrate with other applications," Cashman claimed. "Oracle's and SAP's proprietary approach takes longer to install, and customers would have to rip and replace their existing infrastructure."
Manhattan Associates' two supply chain suites are "100% SOA based, and can work with any operating system or server technology," Cashman added. The vendor's Integrated Planning Solutions (IPS) suite includes forecast, planning, and replenishment modules, while the Integrated Logistics Solutions (ILS) suite consists of transportation management, warehousing, labor, and distribution modules, among others.
Manhattan Associates and IBM have approximately 1,000 joint customers, including CPG manufacturer Georgia-Pacific and retailers Williams-Sonoma, Federated Department Stores, and Kohl's. Other industries the partners are targeting include those with particularly complex supply chains, such as discrete manufacturing aftermarkets and those that incorporate third-party logistics providers, Cashman said.
A significant part of the expanded partnership will focus on ramping up the companies' joint sales efforts across emerging international markets, including Asia-Pacific, Europe, Latin America, and the Middle East. The large majority of Manhattan Associates' revenue comes from business in North America.
"We believe [the Asia-Pacific] markets will be attractive long-term supply chain management markets for us," Manhattan Associates CEO Pete Sinisgalli said on a conference call last fall, in reference to the company's push to recognize increased revenue from international sales over the next several years.
"The ability to execute in these markets is really what's going to create a significant difference against competitors like SAP and Oracle," said Cashman, noting that the IBM partnership will support these efforts. "Manhattan expects a nice uptick in international business based on our relationship with IBM."