Magic Quadrant for Multi-Enterprise Supply Chain Business Networks

Gartner recently issued the second iteration of its Magic Quadrant for Multi-Enterprise Supply Chain Business Networks (MESCBNs). (Catchy acronym, huh?)  While, there’s no perfect definition of a Multi-Enterprise Supply Chain Business Network, Gartner’s report highlights a run-on sentence that is good as any:

Multienterprise supply chain business networks support a community of trading partners — of any tier and type within an industry-leading network — that need to work and communicate/collaborate on business processes that extend across multiple enterprises, with an end-to-end and shared focus.

IDC, a rival firm, also analyzes this market.  IDC calls these companies “Worldwide Multi-Enterprise Supply Chain Commerce Networks (MESCCNs).  (Much catchier, right?)  IDC defines MESCCNs as:

any platform that faciliates the exchange of information and/or transactions among disparate parties pertaining to the supply chain or to supply chain processes.

Both reports contain roughly the same companies. And when you see the companies you will get it, but I would add one snarky comment.  Where I come from, “a community of trading partners that needs to execute supply chain processes across multiple enterprises” is called an “industry”.  Most of these companies, as you will see, are inherently vertical.

Gartner Magic Quadrant for Multi-Enterprise Supply Chain Business Networks

Here’s the “money shot” taken from the Gartner report.  (The full Gartner report is available on the Bamboo Rose website here).

The Leader Quadrant

The leader quadrant includes the Multi-Enterprise Supply Chain Business Networks Gartner presumably believes cut across the most verticals.

• E2Open began as a highly vertical MESCBN in electronics.  Through at least nine acquisitions (see here), E2Open has expanded well beyond that starting point.  One might argue, however, that E2Open is now a supply chain software company generally.  It would be interesting to know, for instance, how many E2Open customers use the network versus point solutions.
• Infor bought GTNexus which had, in turn, bought Tradecard (among other companies).  As a result,  GTNexus has a payment and financing offering most other MESCBNs do not.  Historically, GT Nexus focused on the cross-border retail world.   But as part of Infor, a mid-market ERP company, GTNexus is either moving across industries or dying a slow death.  Does anyone know which it is?
• One Network Enterprises is run by Greg Brady who was CEO of i2 back in the day.  He certainly knows the supply chain. But I do not know a lot about the company.
• SupplyOn started as a vertical consortium in auto supply.  The company is still owned by four European tier 1 auto suppliers:  Bosch, Continental, Schaeffler, and ZF.  SupplyOn serves a few other closely aligned discrete manufacturing industries beyond auto.  Still, I was surprised SupplyOn was considered a leader, rather than a niche player.

The Challenger Quadrant

The challenger quadrant contains the EDI giants IBM (Sterling) and OpenText (GXS) and TrueCommerce, as well as an Italian company, TesiSquare, which I was not familiar with.  Maybe this should have been called the EDI quadrant?!

Visionary Quadrant

Alone in the Visionary Quadrant is MPO.  I don’t know anything about MPO either, but that rarely stops me from commenting. I suspect MPO may be considered “visionary” because its tagline is “customer chain control”, rather than “supply chain control’. MPO says:

“The secret sauce of MPO is Customer Chain Control. For every individual Customer order, the MPO platform enables an optimized micro supply Chain through continuous, real-time Control over service levels, inventory, transportation, and costs.”

MPO emphasizes inbound, outbound, and reverse logistics flows (returns).

The Niche Quadrant

The Niche Quadrant is the one that I am most familiar with. I am on the board of Bamboo Rose, which is a specialist in the retail private label food and non-food supply chain.  Bamboo Rose offers core functionality that most of these other players do (e.g. global trade management, order management, financing, logistics, etc.), but also has functionality quite specific to food formulation, PLM for non-food, and a marketplace for virtual trade missions.

I have also watched Elemica, another niche quadrant player, grow since the early 2000s. Elemica offers functionality very specific to process industries and bulk commodities.  In fact, I suspect that almost every company on this page has:

• unique functionality geared to (and useful to) a handful of industries
• a “graph” of pre-existing connections to players in those industries that is now a large part of their value proposition

Summary

My point is that you would be hard-pressed to find an industry that does not have a least one MESCBN at this point.  Industries are increasingly being knit together by vertical players. I don’t think the companies in the leader quadrant are really competing with the companies in the niche quadrant and vice versa.  The winners are likely to be “niche” players, where a “niche” is defined as an entire industry’s supply chain!