Magic Quadrant for Warehouse 2013

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Magic Quadrant for Warehouse ManagementSystemsPublished: 15 May 2013

Analyst(s): C. Dwight Klappich

WMS demand remains resilient and buyer sentiment is concrete. WMSapplications are mature and approaching parity, but vendor innovationcontinues.

Market Definition/DescriptionGartner defines a warehouse management system (WMS) as a software application that helpsmanage the operations of a warehouse or distribution center. WMS applications offer capabilitiessuch as receiving, put-away, stock locator, inventory management, cycle counting, taskinterleaving, wave planning, order allocation, order picking, replenishment, packing, shipping, labormanagement and automated material handling equipment interfaces (see "Apply an ArchitecturalFramework to Stratifying Warehouse Management Systems"). Radio frequency (RF) systems, whenused in conjunction with bar codes and possibly RFID, provide the foundation of a WMS, deliveringaccurate information in real time. Gartner includes integrated functionality such as voice picking,parcel manifesting, value-added services, light manufacturing/kitting and third-party logistics (3PL)billing as components of a WMS evaluation. This is because many buyers now demand thatthese components be included in a large number of WMS engagements.

The WMS market breaks down into four types of vendors, the first three of which are covered in thisresearch:

Application megasuite vendors: These vendors offer broad portfolios of applications acrossmost application categories (for example, front office, back office, supply chain management[SCM], logistics, CRM and product life cycle management). Infor, Oracle and SAP areconsidered megasuite vendors.

SCM/logistics suite vendors: These vendors offer a portfolio of applications focused primarilyon SCM or logistics, but not other areas. While these vendors might offer a variety of SCM orlogistics solutions, they do not necessarily offer an integrated platform (although some do).Vendors in this category include JDA Software and Manhattan Associates.

Specialist WMS: These vendors focus primarily on WMS, although they might offer someadditional capabilities.



WMS component vendors: Not covered in this research, these vendors focus on best-of-breed components that can be used to supplement a WMS for example, workforcemanagement, slotting optimization, yard management or dock/appointment scheduling.

Magic QuadrantFigure 1. Magic Quadrant for Warehouse Management Systems

Source: Gartner (May 2013)

Vendor Strengths and Cautions

@logistics Reply

@logistics Reply is part of the Reply group, a Europe-based company that provides a wide array ofIT services. Reply has revenue of around 400 million, with a primary focus on consulting, systemintegration, application management and business process outsourcing services. Reply offers itsservices to multiple industries, with more than half of its revenue in product-centric industries suchas manufacturing, telecommunications and high tech.

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@logistics Reply has been in business for 15 years, focusing on services and software applicationsin the area of supply chain execution (SCE) most notably, WMSs. It offers two WMS solutions:Click Reply and SideUp Reply. Click Reply is a Web-based solution that can be deployed on-premises or hosted, while SideUp Reply is a multitenant software as a service (SaaS) WMS.@logistics Reply claims to have 300 named WMS customers; a high percentage of them are in Italy,and most are in Europe.

Strengths

@logistics Reply has a notable market presence in Europe, but few customers in othergeographies.

The vendor has broad industry coverage in 3PL, automotive, grocery and food,pharmaceuticals, chemicals, telcos, and fashion. It is particularly strong in service partslogistics, with several notable customers.

The vendor offers WMS on-premises or hosted with Click Reply, and offers multitenant SaaSwith its SideUp Reply solution. While several WMS vendors have taken their on-premisesapplications and now host them as single instances in the cloud, @logistics Reply offers thiswith Click Reply but its SideUp solution was specifically engineered for multitenant SaaS.

Although @logistics Reply is a modest-size WMS provider, it is part of a much largerorganization with strong consulting and system integration capabilities so company viabilityand consulting capacity are better when compared with similar-size, stand-alone WMSproviders.

The company has notable customers with complex warehouse environments.

It offers capable, but not differentiated, core WMS capabilities.

Cautions

@logistics Reply is primarily focused in Europe, but has begun expansion into othergeographies.

WMSs and packaged business applications are not the core business of the parentorganization, Reply, which could result in long-term focus and commitment struggles.

The vendor is not as broad or proven in extended WMS capabilities as the Leaders are.

It is not pursuing a comprehensive SCE convergence strategy at this time.

Accellos

Accellos is a small but growing vendor of SCE products covering WMSs, transportation andelectronic data interchange (EDI). It offers two WMS solutions: AccellosOne WMS is focused on, butnot necessarily limited to, the small or midsize business (SMB) WMS market, and AccellosOneEnterprise 3PL Warehouse Management is focused on midsize to large logistics companies. Thevendor also offers AccellosOne Collect, a bar code data collection solution for Microsoft Dynamics.

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The company originally grew through acquisition, but since stabilizing its product portfolio, growthhas largely been organic. Accellos has added 750 new customers across its product lines since2009, including 75 new WMS customers in 2012. The vendor has approximately $35 million inannual revenue and 160 employees. It is headquartered in Colorado Springs, Colorado, with officesin the U.S., Canada, Europe and Australia. Gartner estimates that Accellos has more than 3,000total customers, with more than 750 WMS customers worldwide and integrations with several ERPapplications. Unlike many vendors that have added some 3PL capabilities to their base WMSs,AccellosOne Enterprise 3PL Warehouse Management was designed from the beginning to addressthe multitenant (customer) needs of 3PL, with specialized capabilities for things like service-levelagreements, customer profitability and billing. Accellos is one of the few vendors innovatingspecifically around the needs of SMB warehouse operations, and it has been dedicated toexploiting the current generation of Microsoft technologies to do so.

Strengths

Accellos focuses on the needs of SMB WMS users, with an emphasis on providing ease of use,minimized time to value and low total cost of ownership (TCO).

AccellosOne WMS was designed specifically with SMBs in mind it's not a solution designedfor the high end of the market, with just some functionality disabled.

AccellosOne Enterprise 3PL Warehouse Management offers a product designed specifically forthe needs of midsize to large 3PL providers, with significant concentrations in cold-storage andretail fulfillment.

Accellos has partnerships and integrations with popular SMB ERP solutions with prepackagedconnectors for Acumatica (new cloud ERP), Microsoft, NetSuite (cloud ERP/CRM), Sage andSAP Business One.

The vendor has one of the lowest TCOs, with price points for software and services starting wellbelow similar systems.

Accellos has an SCE convergence strategy, providing WMSs and other application areas, suchas transportation management and EDI, on a common technical platform called AccellosOnePlatform.

Accellos is very Microsoft-centric and takes advantage of contemporary Microsoft technologies.It is innovating in several areas, such as releasing two Windows 8 tablet solutions.

The vendor has an intriguing cloud strategy wherein the same product can be delivered on-premises, as private cloud and as multitenant SaaS, which provides customers withdeployment flexibility.

Cautions

Accellos is small and could be an acquisition target; however, it was purchased by Accel-KKRin 2012, and it is uncommon for vendors to be sold soon after an ownership change occurs.




Although it sells globally, the majority (90%) of its customers and resources are in NorthAmerica.

The vendor has limited sales capacity, but it continues to grow rapidly.

While it is growing its new customers rapidly, this could stress service capacity, which typicallyscales slower than sales.

Companies outside North America that are considering Accellos should evaluate resourceavailability as much as functionality. However, the company has more than 100 internationalcustomers and strategic partners in the U.K., South Africa, Latin America and Australia that arecapable of selling, implementing and supporting customers in those regions.

AccellosOne WMS is aimed at what Gartner refers to as Level 2 or lower warehouses, but it cansupport up to Level 3. Users with more sophisticated needs should rigorously test the vendor'sability to scale up.

AccellosOne WMS focuses principally on core WMS capabilities, with some extended WMScapabilities like dock scheduling, automation integration, event management and analytics.AccellosOne Enterprise 3PL Warehouse Management is only sold to 3PL providers, and isdesigned with specific capabilities for the 3PL marketplace.

Consafe Logistics

Consafe Logistics is a supply chain IT provider headquartered in Lund, Sweden. It is part of the JCEGroup, a privately owned international and diversified investment company headquartered inGothenburg, Sweden. The JCE Group's investment portfolio is divided into strategic and financialinvestments. All its long-term core holdings are classified as strategic investments and can bedivided into the following main business areas: industrial, logistics, offshore, renewables andtechnology. Consafe is the core logistics holding. The JCE Group employs more than 10,000 peopleacross 30 countries, with operations in Brazil, Chile, China, Denmark, Germany, Lithuania, Mexico,the Netherlands, Norway, Poland, Sweden, the U.K. and the U.S. Consafe Logistics has about 400employees, and its WMS offering, Astro WMS, represents about 50% of its business. Although ithas implementations in 30 countries, the vendor focuses primarily on Northern Europe (Benelux,Denmark, Norway, Poland and Sweden), with growing potential in Eastern Europe. The vendor hasbroad industry coverage in retail/consumer goods, industrial, wholesale, food and beverage, and3PL.

Strengths

Consafe Logistics has a local market presence in Northern European markets, withimplementation offices in Denmark, the Netherlands, Norway, Poland, Sweden and the U.K. Thevendor is expanding through acquisitions of distributors and service providers in EasternEurope.

Consafe Logistics has shown its dedication to thought leadership with the formation of itsLogistics Innovation Center. This is a structured and collaborative endeavor that involvesConsafe employees, customers, partners and academic institutions in the cycle of innovation.




The vendor offers its own warehouse control software for integrations with material handlingautomation.

The vendor's architecture is designed to provide a customization layer to reside outside thecore WMS application layer, which protects upgrades.

The vendor offers a unique adaptive task interleaving capability that self-adjusts work plansbased on changing conditions in the warehouse.

For its size, Consafe Logistics has some impressive customers in terms of company namerecognition, complexity and sophistication of warehouse operations.

The company offers an attractive and intuitive logistics dashboard for managing exceptions andmetrics/key performance indicators.

Consafe has commercialized emerging capabilities for mobility within and outside theenterprise.

Cautions

Consafe Logistics has limited implementation capabilities outside Northern and Eastern Europe.

This is a regionally focused vendor. Although its parent is large and global, there is minimalsynergy between the two.

The vendor has yet to establish a market presence outside of a few select geographies, and isnot well-known in the marketplace.

The vendor trails in delivering a cloud offering.

eBizNET Solutions

eBizNET Solutions, headquartered in Iselin, New Jersey, is a provider of a portfolio of supply chainsolutions, including WMSs; transportation management; port and cargo management; and reverselogistics, warranty and aftermarket solutions. Although the vendor sells direct, it is also the mostaggressive in pursuing a partnership model. It is developing an ecosystem of partners, such as withNetSuite, in which eBizNET is one of the integrated partner solutions available on the NetSuiteplatform, catering exclusively to NetSuite's customers. Although paper partnerships are not new inSCM, eBizNET has a well-formed Partner Enablement Program, in which it shares with partnersthings such as a common vision, resources, knowledge on the products through various trainingprograms, discussion forums and joint ventures. The vendor offers two levels of implementationservices, due to the price sensitivity of SMB customers: It can do implementations remotely, whichis less costly for customers, or on-site. The latter is a higher-price implementation that uses thevendor's U.S.-based team and partner ecosystem. Customers can choose the delivery optionbased on their budgets. The vendor has about 55 WMS customers split about 70% in NorthAmerica and 30% internationally.




Strengths

For its size, eBizNET is innovative in its products and go-to-market strategies.

Of the WMS specialists, it has the most robust strategy and track record in establishing andsupporting an ecosystem of partners, such as NetSuite, SPS Commerce and others.

Given its size, it has noteworthy global coverage, with close to one-third of its customersoutside North America and nearly 25% of its customers in Asia.

The vendor offers multiple pricing options, depending on the needs of the customer, or what itcalls "Pay as You Grow." There is a low starting price and very good TCO.

The company is capable at the low end of the market, with solutions such as NetSuite WMS,and scalable to Level 3 warehouse environments with its principal offering.

eBizNET primarily offers core WMS capabilities with some extended WMS capabilities, such asyard and order management.

Although it primarily provides SaaS solutions today, the vendor can offer the same solution on-premises.

It is particularly strong in aftermarket service logistics and has strong WMS capabilities,combined with its other offerings, such as reverse logistics.

Cautions

The vendor is small, with fewer than 100 people on staff and roughly 60 current customers.

Due, in part, to its ecosystem strategies, eBizNET is growing rapidly, which could stress itslimited resources. However, the vendor is expanding its partner ecosystem to deliverimplementation services.

Although eBizNET has an intriguing implementation model, where upward of 70% of theimplementation can be done remotely, this was identified as somewhat problematic for somereference customers, with timing and language barriers becoming issues.

Support and consulting trail the software applications in process maturity and customersatisfaction, although no customers said that this jeopardized their projects.

Although primarily a strength, the vendor's aggressive pricing model could be a financial strainif it is not managed properly.

HighJump Software

HighJump Software, headquartered in Bloomington, Minnesota, is a midsize vendor employingmore than 300 staff members and servicing more than 4,500 claimed customers worldwide, most ofwhich are direct store delivery and EDI users. The vendor's other solutions focus on warehousingand include WMSs (415 customers), data collection and lightweight manufacturing execution. Thevendor is owned by Battery Ventures, a private equity firm. The vendor has a history in SCE, starting




many years ago with automated data collection solutions, and later building a fully functional WMSin the early 1990s. However, the vendor generates more than 50% of its revenue from its WMScustomer base. Close to 80% of the vendor's business is in North America, with the remaindernearly equally divided among Europe, Latin America and Asia. HighJump primarily uses third-partypartners for sales and support outside North America. In 2012, the vendor signed a strategicpartnership agreement with BT Global, which was aimed at extending its global reach and scale inseveral international markets via BT's supply-chain-focused business unit, BT Global Trace. In2013, HighJump moves to the Challengers quadrant from the Visionaries quadrant. This was largelybecause it offers a solid and proven WMS; however, it trails vendors in the Leaders quadrant inseveral areas: It is not a thought leader or innovator, and it does not yet have a compelling strategyfor SCE convergence.

Strengths

HighJump continues to be recognized by customers and Gartner as the most intrinsicallycustomizable WMS product evaluated in this Magic Quadrant, and customers continue to citethis as the primary reason why they select the vendor.

While highly customizable, HighJump's architecture allows these changes to be held outsidethe base application in what it calls a separate "server," which protects the customer's upgradepath. So far, we have never spoken to customers that have said they were unable to upgradedue to their customizations.

There is a strong Microsoft orientation to the product from a technology and a business processplatform (BPP) perspective.

The vendor is pioneering a unique approach to packaging customer- and vendor-developedinnovation that it calls App Station. It is analogous to the Apple App Store. Customers onlyneed to take the features they want or need, and they are not burdened with the traditionalbloated applications of large suites.

HighJump was one of the first mainstream WMS vendors to offer its WMS as a private cloudservice.

Cautions

HighJump has not yet systematically integrated a process/workflow modeling tool with itsbusiness process composition tools, although it does offer disconnected process models inVisio as documentation. However, adding workflow modeling is on its future product road map.

The vendor's WMS offering is limited to the Microsoft operating system and tool deployments,but it can use the Oracle Database running Unix or Linux architecture.

The vendor's core WMS is competitive, but it lacks the depth and breadth of extended WMScapabilities compared with WMS Leaders.

Although Battery Ventures provides HighJump with access to capital to make additionalacquisitions, this also means that a change in ownership is likely in the next few years, eitherthrough an initial public offering or the company being acquired.




The vendor has and plans to continue growing through acquisition, which can divert attentionfrom core WMS capabilities.

The vendor does not have a compelling SCE convergence vision or strategy.

The vendor's WMS is primarily a North American solution, although it does have somecustomers in other geographies.

HighJump uses an indirect sales model for international sales and support.

Infor

Infor has a wide product portfolio composed of multiple ERP products, some stand-alone productsand some domain-focused suite products largely amassed through numerous acquisitions over thepast several years. Infor has a very large customer base across all its products, and it can become aforce in WMS just by selling to its existing customers; however, it is now gaining traction, especiallyin emerging markets, by selling WMSs to net new customers. The vendor had made severalacquisitions that included WMS solutions, either directly or as part of broader product offerings. Asa result, it has multiple WMS offerings one that it actively sells, and others that it sellsopportunistically or no longer sells. In this year's Magic Quadrant, we only look at the primary WMSthat Infor actively markets today: Infor Supply Chain Execution (Infor SCE formerly Infor WM 9).Infor SCE is the next-generation WMS product, built on a contemporary service-orientedarchitecture (SOA), that leverages Infor's cross-product technology platform for Web user interface(UI), business intelligence (BI), mobility, middleware and event management. Infor SCE includesmore than just a WMS for example, transportation, workforce management, mobility, eventmanagement and other SCE components. Infor has been strong selling WMSs within and outsideNorth America, with 59% of its total WMS deals international 35% in Asia/Pacific and 24% inEMEA.

Strengths

Infor has a very large customer base across all its product lines, and Infor SCE is a viablealternative to specialist WMS offerings for many of these users. Infor SCE is an option for mostof the company's ERP customers that are looking for a reasonable WMS provided by a singlevendor with global support capabilities. However, Infor is not limited to its ERP customers around half of its new customers are stand-alone WMS buyers.

Compared with WMS specialists, Infor has a higher percentage of new deals outside NorthAmerica, with a strong global presence of direct and indirect sales and support. It has an edgein many emerging-market deals, which can be helpful in global rollouts.

The vendor has delivered on a platform strategy for Infor SCE, and is pursuing an SCEconvergence strategy by moving capabilities (such as transportation, management, mobility andevent management) onto a common technical platform.

Infor SCE exploits Infor's significant investment in its technology platform, which includesmobile applications, in-context BI and out-of-the-box integrations with Infor ERP systems usingits purpose-built middleware called Infor Intelligent Open Network (ION). While not limited to its




installed ERP users, this investment will benefit Infor's ERP users who are looking for a newWMS.

Infor is well-positioned to exploit growth in emerging markets, and it is taking advantage of thistrend through its own resources as well as partner resources.

Customers report that they are happy with the support and maintenance they receive.

Cautions

Infor primarily sells Infor SCE to its ERP installed base in mature markets, although it is gainingsome traction selling the WMS as a stand-alone offering to non-Infor customers in thesemarkets. However, Infor is quite successfully selling Infor SCE as a stand-alone offering inemerging markets, as well as serving its customer base.

Many of the vendor's legacy WMS users, primarily in grocery, are quite complex andsophisticated and have heavily customized these products. While some Infor legacy WMScustomers have successfully migrated to Infor SCE, these complex customers should considera change to Infor SCE to be a new implementation, not a migration. These customers shouldscrutinize the basic functionality while developing strategies for how best to address any of thecompany's previous customizations that might remain important.

Infor SCE lacks the overall breadth and depth of WMS market Leaders. It is a nondifferentiatedproduct in complex Level 4 warehouse environments.

While Infor's WMS capabilities have a pedigree in best-of-breed WMSs, Infor's marketing hasyet to establish visibility and a reputation in the WMS market.

Infor has yet to establish a strong global partner ecosystem that is similar in scope andcapability to the other megasuite vendors. However, the vendor does have a large and growingecosystem of regional partners that can sell and service Infor SCE customers. For globaldeployments, users should thoroughly scrutinize Infor's global deployment capabilities andmethodologies.

The vendor has indicated that it has enabled alternative deployment models, such as privatecloud or managed services, but no customers have yet adopted this approach.

The vendor has yet to deliver consistent and demonstrable strategies for exploiting its globalreach to become a force within the global WMS marketplace, although it is making progress indoing so.

JDA Software (Dispatcher WMS)

JDA Dispatcher WMS, formerly RedPrairie Warehouse Management Dispatcher, is not the vendor'sstrategic go-forward WMS. Future go-to-market strategies for this solution are restricted, comparedwith the main WMS offering. Because this solution will be sold to a select few vertical industries andgeographies, it fits the definition of a niche solution, which is largely why its position moved fromthe Challengers quadrant to the Niche Players quadrant. As JDA looks to rationalize products, as ithas done in previous acquisitions, this product is also most likely to be moved into legacy status.




However, the vendor has a strong track record of continuing to support products for the long term,while also allowing customers migration paths to newer offerings.

Strengths

JDA Dispatcher WMS is a functionally solid and stable product for moderately complexwarehouses.

Prior to the merger, the vendor continued to moderately enhance its functional footprint to meetsome of the vertical needs of 3PL providers and the geographic needs of European companies,most notably U.K. domiciled companies.

JDA Dispatcher WMS has a stable European presence, in addition to sales, implementation andsupport, with local product development for Europe.

JDA Dispatcher WMS has a reasonable presence among 3PL providers and logistics serviceproviders (LSPs) in Europe.

Cautions

JDA Dispatcher WMS is redundant to the vendor's flagship JDA Warehouse Managementproduct. It's not likely to represent the strategic WMS future for the company.

JDA Dispatcher WMS is primarily sold in Europe notably in the U.K. while JDA WarehouseManagement is more pervasive in other geographies.

Although JDA continues to invest in this product, it will not be positioned as the strategicfoundation for JDA's future. The merger will result in future solution rationalization challenges.

JDA Software (Warehouse Management)

On 1 November 2012, supply chain software and service providers RedPrairie and JDA Softwareannounced that New Mountain Capital (owner of RedPrairie) had offered to acquire all outstandingshares of JDA. The merger compiles an expanded product portfolio and increased global scale.However, the business value that the new entity can deliver to its customers will increasingly comefrom how well it can integrate and rationalize the discrete parts of its expansive product portfolioand multiple architectures, which will affect its strategies. Acquiring numerous companies over theyears has resulted in both companies having broad, minimally integrated portfolios of products thatcurrently do not fully share a common technology platform within their respective domains. The newentity will argue that enterprises want application suites (not necessarily a single one, but a few).However, the time, effort and cost to move toward a common platform across execution andplanning will be sizable, and will take several years. However, some RedPrairie solutions will benefitfrom the cloud hosting strategy that JDA has launched.

The combined entity has synergy in its customer base and main target markets, retail and consumergoods. Significant retail footprints will provide the new entity with an opportunity to eventuallycreate an integrated planning and execution suite for large retailers and manufacturers.




Multichannel retailing could be a significant opportunity for the new company, assuming anappropriate platform and supporting strategy is executed.

Prior to the merger, RedPrairie was a long-tenured provider of WMSs and related supply chain andretail solutions. The company's roots in warehouse management go back more than three decades.RedPrairie had multiple WMS offerings, several of which are now legacy products. There are twoWMSs actively marketed today, but they overlap somewhat: JDA Dispatcher WMS (formerlyRedPrairie Warehouse Management Dispatcher) and JDA Warehouse Management (formerlyRedPrairie Warehouse Management, which also itself was formerly named WM/D, or DiscreteWMS). Prior to the merger, RedPrairie, in its own right, offered a broad collection of disparateapplications, including WMSs as well as transportation management, workforce management andretail management. Over the past several years, RedPrairie and JDA have primarily boughtinnovation through numerous acquisitions, enhancing their positions in areas such astransportation, retail workforce management, store operations, multichannel commerce and supplychain planning (SCP). RedPrairie had previously acquired an early pioneer in cloud-based WMSs,SmartTurn, but this offering has not been included or considered in this research.

Strengths

JDA Warehouse Management is in the Leaders quadrant because it offers industry-leadingdepth and breadth of core WMS and extended WMS capabilities.

RedPrairie had a long track record of delivering WMS solutions for some of the most complexwarehouse operations, combining strong WMS products and services to support the needs ofdemanding clients especially in the consumer goods and food manufacturing anddistribution vertical industries.

The vendor offers strong delivery of related products, such as workforce management,traceability and performance management.

This solution provides some support for lightweight manufacturing execution activities, withcapabilities such as performing complex multiline production scheduling, tracking component-level inventory attributes in a multilevel bill of materials, streamlining line setup and execution,and managing raw materials, including backflush and scrap.

The merger potentially expands the vendor's global sales infrastructure.

Cautions

Customer references continue to say that the vendor has some service and support challenges,and consulting capacity constraints.

This WMS is not a model-driven application that supports user customization. Although the JDAWarehouse Management technical architecture is acceptable and mature today, given JDA'snumber of acquisitions and the breadth of its product portfolio, users must monitor the vendor'sability to modernize its applications.




JDA's evolving platform vision and strategy are unproven and will take several years tocomplete. Prior to the merger, RedPrairie had planned to take as much as five years to matureits platform strategy, and now the merger will impact the strategy, which will likely change.

Although the vendor sells WMSs into multiple industries, its primary overall business focus andextended solution strategies are principally targeted at consumer goods and retail. This willlikely be further solidified with the merger, which could impact prospects and customers innonstrategic vertical industries.

The vendor's approach to vertical industries has now changed, and users in noncore industriesshould monitor JDA's strategies, processes and commitments to serve those industries.

While Gartner recommends that users set a goal for a zero-modification implementation, thereare valid instances in which customization is necessary. RedPrairie had long provided theseservices, but under the combined organization, strategies for addressing customization havechanged, so customers and prospects need to monitor them.

The vendor has a very large, although not fully integrated, portfolio of products, and it canbundle multiple components to sweeten a deal. If users will utilize these components in areasonable time frame, then this is acceptable; however, users must be cautious not tooverbuy, thereby making what appears to be a good deal not as favorable because of excessiveshelfware.

LogFire

Based in Atlanta, Georgia, and with staffed operations in Latin America and Asia/Pacific, LogFire isa vendor of multitenant, cloud-based SaaS WMSs. The founders and team have deep roots inWMSs, having come from long stints with perennial WMS Leaders. Because of the managementteam's past experience, LogFire is strongest in multichannel consumer goods, retail, apparel and3PL warehouse environments, although it is not limited to these markets. The vendor was initiallyfounded to offer warehouse and SCM consulting, and this expertise continues to benefit clientsafter LogFire brought to market a packaged SaaS WMS. However, the vendor's growth now comesfrom its SaaS offerings. The vendor has about 50 customers slightly more than 60% are in NorthAmerica, and the rest are international (most being in Latin America).

Strengths

Customer references called out strong customer intimacy, due to the vendor's WMS expertiseand services.

LogFire's experienced leadership has long tenure in the WMS marketplace.

LogFire is one of the few vendors that is strongly committed to Latin America with a direct localpresence in multiple countries, where it has numerous live implementations. It also hasimplementations in North America.




The vendor provides a strong offering for multichannel retail, apparel and consumer goods,which require strong, value-added service capabilities. However, the solution is not limited tothese markets.

The vendor provides a robust, scalable, and adaptable technical architecture and cloudinfrastructure used by companies globally, and in automated facilities.

For its size, LogFire offers its clients a well-defined and comprehensive portfolio of solutionsand professional services.

The vendor is pursuing an SCE convergence strategy, partially through organic development ofits own solutions as well as by partnering with other providers of SaaS solutions (such asdemand planning).

Cautions

LogFire remains one of the smallest WMS vendors included in this year's Magic Quadrant, interms of its number of customers and gross annual revenue.

Sales and implementations are predominantly in Latin America and North America, while Asia/Pacific and Europe are being pursued opportunistically.

Although the vendor's SaaS pricing model offers an advantageous cost of ownership, theinherently gradual ramp-up of recurring subscription revenue could impact LogFire's valuation,unless it rapidly grows new customers and top-line revenue.

As LogFire continues to grow, resources could become constrained.

The vendor only offers a cloud WMS, principally multitenant SaaS, and is not viable on-premises.

Manhattan Associates (SCALE)

Supply Chain Architected for Logistics Execution (SCALE) is a less expensive, as well as anintentionally less functionally broad and deep, offering compared with Warehouse Managementfor Open Systems (WMOS). SCALE focuses on simple to moderately complex facilities and LSPenvironments. It is a mature, stable and proven solution the hallmarks of an offering in theChallengers quadrant, where Ability to Execute is paramount that benefits from the vendor'sbroader SCE visions and strategies. Manhattan targets SCALE for independent Level 1 throughLevel 3 warehouse environments, where usability, ease of use, implementation and support combined with lower cost of ownership are critical criteria (see "Apply an ArchitecturalFramework to Stratifying Warehouse Management Systems").

Strengths

SCALE is focused on the needs of SMBs and emerging geographies, although it is not limitedto either one.

Sales volume for this solution continued to grow in 2012.




The vendor has a robust implementation methodology and consistent implementation support.

This WMS offering leverages Microsoft's technology stack for ease of deployment and ease ofuse.

This product offers certified integration with Microsoft Dynamics AX.

SCALE is more broadly sold and implemented across vertical markets.

Cautions

The vendor uses direct and indirect sales channels, and uses partners for sales andimplementations in smaller geographies. Prospective users in these markets must validatepartner capabilities and product considerations during evaluation.

This solution is purpose-built for midsize or smaller warehouse operations. Although thefunctionality is solid and can handle moderately complex warehouse operations, the product isnot designed or intended for highly complex facilities.

SCALE is built on the Microsoft .NET platform and focused on logistics execution. Companiesinterested in broad SCE convergence should look to the company's WMOS solution, which ispart of the Manhattan SCOPE application portfolio.

This product is well-suited for SMB-type logistics operations, while many of the vendor's otherofferings are targeted at sophisticated and complex environments.

Manhattan Associates (Warehouse Management for IBM i)

Strengths

Manhattan Associates' Warehouse Management for IBM i is a very mature, stable and provenproduct, with more than 20 years on the market.

Warehouse Management for IBM i is a functionally robust and proven WMS application, with anotable group of long-tenured and quite complex WMS customers.

Although the product is mature, the vendor continues to invest dedicated R&D in this version.Manhattan has built integrations to its other SCE offerings, such as labor management, slotting,transportation management and SCP.

Customer references note the stability and scalability of the solution.

It's the most robust and well-supported RPG/IBM i WMS available. It's primarily sold to retail,with a particular strength in apparel.

There is a very loyal IBM i community, and Manhattan is one of the few vendors still committedto supporting robust offerings in the space, which helps these users extend their IBM iinvestments.




Cautions

Manhattan Associates' Warehouse Management for IBM i offering is developed in RPG/IBM i,and RPG expertise is becoming increasingly difficult to secure.

For intraproduct integration (for example, WMS to transportation management system [TMS]),the vendor leverages a variety of data communication methods that are chosen based on aspecific client's needs for a given size of data payload or functionality, which is then enabled byManhattan's integration layer.

Warehouse Management for IBM i lacks the strategic emphasis of Manhattan's WMOS.

The traditional green-screen UI is becoming less acceptable to users who are used to Windowsand Web-based UIs.

This is not the strategic direction for the vendor.

Manhattan Associates (WMOS)

Headquartered in Atlanta, Georgia, Manhattan Associates offers a broad suite of SCM solutions thatincludes WMSs, transportation, distributed order management, SCP, supplier enablement andothers. The vendor has very deep roots in WMS that go back almost 25 years. It offers three distinctWMS offerings, each targeted at different markets: Warehouse Management for IBM i, which catersto customers that prefer the reliability and ease of operation of the IBM i platform; SCALE(previously Manhattan's WM for Windows), which is based on a Microsoft technical platform, andcaters to the SMB and LSP WMS markets in emerging geographies; and WMOS, which caters tosophisticated warehouse environments. WMOS is the vendor's flagship WMS offering and is builton the SCOPE technical platform, which includes Manhattan's other supply chain solutions, such astransportation, distributed order management, replenishment and planning. Although the companyhas global operations, the majority of its business continues to come from North America andWestern Europe. SCALE, however, continues to gain traction in emerging markets.

Manhattan is inclined to drive innovation in-house, unlike many other WMS vendors that innovateand grow through acquisition. Manhattan is not an acquisitive company that tends to focus onorganic innovation. It has made few acquisitions the most recent being more than seven yearsago but they tend to be early-stage offerings that are more easily redeveloped and integratedwithin Manhattan's solution portfolio.

So far, the company is the only one that has staked its future on providing a single, commontechnical platform SCOPE which seamlessly integrates multiple SCM components, such asWMS, TMS, SCP, supplier enablement and distributed order management. In the Magic Quadrantevaluation model, weightings for certain characteristics, such as innovation, market understandingand vision, relate primarily to a vendor, not just a product. For vendors with multiple WMS offerings,like Manhattan, we weight some Completeness of Vision characteristics heaviest for the vendor'sstrategic WMS. However, this does not mean that these characteristics are any less meaningful forthe vendor's other products.




Strengths

The SCOPE technical platform seamlessly integrates WMOS with all the other newer SCMsolutions that the vendor offers, such as transportation, SCP, returns management, flow anddistributed order management. Going forward, this provides the vendor with the best platformin the market to address SCE convergence.

WMOS offers industry-leading depth and breadth of core WMS and extended WMScapabilities.

Manhattan has demonstrated a continued ability to bring innovation to its core WMS solutions.This augments the WMSs and extends SCE processes, such as adding returns management,distributed order management, mobile warehouse management and landed cost management.

Manhattan's WMOS is broadly used in WMS environments, from moderately complex toextremely complex, sophisticated and high-volume warehouse operations.

The vendor is stable, and has conservative financial operations with reasonable earnings andcash reserves.

It has a distinctively high win ratio in complex WMS deals in which it competes.

Manhattan is focused on organic, self-directed innovation. It continues to bring to market self-developed and complementary components, such as returns, flow, cost to serve, distributedorder management and Store Commerce Activation.

The company has a compelling vision for a next-generation SCE platform. Furthermore, thevendor has a team of math and science experts that is investigating innovative ways to exploitemerging technologies and decision-making enhancements through the use of embeddedanalytics across the SCE platform.

Manhattan has established strategic relationships with select customers that have committed toits SCOPE platform. This is atypical of best-of-breed software vendors that lack the C-level-executive clout of large-scale suite vendors.

The vendor is gaining customer traction with its platform strategy, with more than 50 customersnow committing to the platform.

Manhattan is one of the few vendors that can address multichannel commerce on a singleplatform, with competitive offerings in logistics and distributed order management, where manyother vendors are strong in one area or weak in others or have solutions on different platforms.

Cautions

Few existing WMOS customers that were live prior to the release of the 2010 version havemigrated to this version, so most references are new customers with less long-term experiencewith the solution. Prospective customers should talk to older and newer customers.

The vendor continues to be heavily dependent on service revenue, and the amount and cost ofcustomization continue to be disproportionately high.




Manhattan originally developed SCOPE tools for customers to use to make changes, but thevendor now advises customers to work with it to ensure that changes are done safely andresponsibly.

Manhattan lacks a broad or compelling vertical industry strategy beyond its historical strengthsin retail, apparel, consumer goods, wholesale distribution and 3PL.

The majority of its revenue (currently more than 75%) comes from North America.

So far, the vendor has not strategically committed to offering alternative deployment models,such as cloud or SaaS.

The vendor lacks an established ecosystem of implementation, system integration and servicepartners. Warehouse management remains Manhattan's predominant business. Compared withthe number of WMS users, the adoption of other SCOPE-based applications remains low,although user demand and implementation are growing. Furthermore, outside North America,there is inconsistent support for non-WMS, SCOPE-based applications, such as SCP ortransportation.

Oracle

Oracle provides an expansive portfolio of business applications in addition to its deep roots inoperating technologies, such as database management systems. The company offers WMScapabilities in several of its solutions, such as Oracle's JD Edwards EnterpriseOne and Oracle Retail(formerly Retek). Oracle also offers a fully functional WMS as part of the Oracle E-Business Suite(EBS). Oracle EBS WMS is the solution evaluated herein. Oracle Warehouse Management is amature yet continually evolving offering with well over 1,000 WMS customers worldwide, Gartnerestimates. Oracle EBS WMS is deployed across multiple vertical industries, and is also extensivelysold and deployed globally (Gartner estimates that more than one-third of its customers areinternational). The solution now offers a choice in deployment approach. It can be provided as aseamlessly integrated extension to Oracle's EBS for customers seeking an integrated ERP andWMS, or it can be deployed stand-alone in a distributed WMS environment. Although not part ofthis research, Oracle's other WMS offerings might be viable alternatives for customers seekingreasonable WMS capabilities integrated with a strong midmarket ERP system or a suite of retailapplications.

Strengths

The company's WMS offering can be deployed and seamlessly integrated with EBS, or it can bedeployed as a stand-alone WMS. This tight integration provides notable examples of SCEconvergence, in which processes can span from one area of EBS into warehouse managementprocesses.

Oracle is one of the faster-growing WMS providers. Gartner estimates that it has added severalhundred new WMS customers in the past 12 months.

The vendor's WMS is installed in a wide variety of industries. It is particularly well-representedin sectors not targeted aggressively by WMS leaders, such as aerospace and defense,




industrial manufacturing, high tech, communications, and life sciences, which, Gartnerestimates, compose more than 50% of Oracle's customer base.

Oracle continues to increase the breadth and depth of WMS functionality. There wereconsistent references from moderately complex warehouse environments, with the vendor nowservicing an increasing number of Level-4-complexity warehouses.

Oracle also offers a mobility solution it calls Oracle Mobile Supply Chain Applications (MSCA),which provides simplified RF/mobile-device-based transaction capabilities, such as receiving orpicking. MSCA is not a full-blown WMS, but it can automate key functions in areas where aholistic WMS is not needed (for example, Level 1 warehouse environments).

There is a strong use of current-generation Oracle technology, such as rule engines andflexfields, to simplify use. The combination of the Oracle Warehouse Management workflow andits rule engine makes the solution user-customizable and tailorable, thus approaching Gartner'sdefinition of a model-driven and zero-customization WMS.

Oracle has a global reach, and its WMS is more deployable around the world than comparablespecialist WMSs.

The vendor has compelling visions for SCE convergence with process integration, and fororchestration with transportation, manufacturing and product aftermarket service, such asdepot repair.

Oracle has a growing ecosystem of implementation partners.

Oracle Business Accelerators are available; they guide Q&A and expedite implementations.

Cautions

Oracle is developing a next-generation product line, Oracle Fusion Applications, but it is unclearhow this will impact the future direction of Oracle EBS, including Oracle WarehouseManagement. However, any impact on the WMS from Oracle Fusion Applications' evolution willhappen several years in the future.

The vendor is not yet a market Leader in WMS functional depth or breadth, but it continues toadd functionality to its WMS.

Although Oracle's core WMS capabilities are nearing those of WMS market Leaders, thevendor's value-added, extended WMS components are not yet extensive or mature. Itcontinues to add and enhance core functionality, as well as deliver some extended WMScapabilities. This product was not a common alternative for non-Oracle EBS users, since a keybenefit of Oracle Warehouse Management was its seamless integration with ERP. However, thevendor can now offer WMS stand-alone on a separate instance from Oracle EBS.

SAP

SAP continues to offer two distinct WMS solutions, but its principle focus going forward is on SCMExtended Warehouse Management (EWM), its latest WMS offering and the solution evaluated here.




SAP ERP Warehouse Management (ERP WM) is a very mature and extensively implemented WMS Gartner estimates it has more than 5,000 customers but it is not the vendor's strategic WMSplatform. ERP WM was covered in previous Magic Quadrants, but because SAP now focuses newcustomer engagements primarily on SCM EWM, it is no longer covered.

From its inception on SAP NetWeaver, SCM EWM was built to take advantage of SOA and a model-driven architecture common to many of SAP's newest solutions. SCM EWM broadens and deepensthe vendor's WMS functionality. Furthermore, SCM EWM is not a new application, since it has beencommercially available for more than seven years now. Initially, demand and live implementationswere limited, but for the past four years, SAP has been more aggressive in selling and implementingSCM EWM, as well as in growing its ecosystem of partners. SAP has strong momentum in the WMSmarketplace, annually adding more new and live customers than most other WMS specialistvendors. It now has more than 600 total customers, 350 named live customers, 450 productivedeployments and more than 200 implementations in progress. We estimate that the vendorcurrently has more than 60% of SCM EWM implementations in geographies other than NorthAmerica, with just under 20% of its customers in Brazil, Russia, India and China.

Strengths

SCM EWM represents the strategic direction of SAP's WMS vision and functionality.

SAP has a compelling platform strategy for addressing SCE convergence. This product offersstrong integration with SAP Business Suite and other components, such as transportationmanagement, trade compliance, and environmental, health and safety.

SAP has noteworthy market momentum with growth in new sales and implementations (morethan 600 total customers and 350 live customers), and notable numbers of new customersadded year over year. This momentum has largely come during the past four years as it focusedmore attention on SCM EWM.

SAP has a substantial global presence, as well as go-to-market and deployment capabilities.Currently, it has customers in 20 different countries, and 60% of its business is outside NorthAmerica.

The vendor offers a native material handling control system (MHCS) called Material FlowSystem (MFS) that allows SCM EWM to directly connect to programmable logic controllers.

SAP has a large and growing ecosystem of implementation and consulting partners across theglobe.

The offering was designed to provide functionality for complex warehouses and increasinglybroad capabilities, such as yard management, slotting and rearrangement, material flowsolutions, and engineered labor standards.

SAP has been addressing implementation and TCO issues by delivering three EWM RapidDeployment Solutions (RDSs) over the past three years. It has one for installing and gettingEWM ready; one for migrating from SAP ERP WM to EWM; and one specifically for deployingEWM in retail industry warehouses.




SAP has enhanced EWM customization by having several hundred enhancement spots (that is,user exits) where users can create modifications outside the base code to protect support andupgrades.

Cautions

For complex deployments, the TCO is higher than equivalent best-of-breed WMSs, largely dueto implementation costs. For less complex deployments, the vendor addresses this throughRDSs, which are fixed-price, fixed-scope and fixed-timeline service offerings. However, theseare not typically appropriate for complex implementations where TCO remains high.

Although the product's core WMS capabilities are nearing those of the market Leaders, thevendor continues to trail in functional depth, experience and implementation of extended WMScapabilities.

SCM EWM was originally oriented toward finished goods distribution, not manufacturingwarehouses; however, the company has added capabilities to address this to bring SCM EWMin line with what SAP ERP WM offered.

While SAP has a very large installed base for ERP WM, SCM EWM is a completely differentproduct, and companies that are considering moving to it should consider this to be a possiblereimplementation. However, the vendor and several partners now offer RDSs for migration fromERP WM to SCM EWM.

There have been many improvements in design over ERP WM, but SCM EWM is still a complexproduct. Although customization is enhanced by having several hundred enhancement spots(that is, user exits), they need to be used judiciously.

Softeon

In business for just over 10 years, Softeon, which is headquartered in Reston, Virginia, is a small,privately owned vendor of SCE solutions. It has a compelling value proposition that combinesleading-edge SOA technology with rich WMS functionality. It also has a rapid developmentenvironment that allows the company to add new capabilities at a faster pace than many of itslarger competitors. While its roots are in WMSs, the vendor has a compelling SCE convergencevision and portfolio today. Softeon is one of the more innovative, partner-oriented vendors in thismarket, as evidenced by the work it did to adapt warehouse management concepts and its WMS tothe unique needs of digital media (for example, music, video) distribution for one of its customers.The vendor has around 40 customers, some of which have very large WMS implementations.

Strengths

Softeon offers a broad and deep suite of SCE capabilities centered on its strength in WMSs,including core WMS and extended WMS capabilities, as well as functional areas like distributedorder management, returns management, SCP and direct store delivery.




The vendor's WMS is built on a strong and flexible SOA that has allowed it to rapidly introducenew capabilities.

Although the product is not yet a truly zero-modification environment, the company offers tools,such as a strong rule engine, that allow for user tailoring without modification.

For its size, Softeon has some impressive customers in complex warehouse environments.

The vendor has strong offshore development organizations with more than 350 engineers.

It continues to exhibit agility as it pursues some unique opportunities in digital SCM (that is, thedelivery of digital products).

Softeon has taken a unique approach to cloud by having a unified data model/foundation for itsWMS cloud offering for SMBs and its Enterprise version. This unified data model/foundationeliminates expensive data migration and facilitates the incorporation of additional complexfunctionality as business growth demands.

Softeon is one of only a few vendors that offers an SCM platform that spans planning andexecution on a common technology stack. It is pursuing a somewhat unique SCE convergencestrategy, moving areas such as vendor-managed inventory, distributed order management andSCP onto the same platform as WMS.

Customers were complimentary of the vendor and its solutions and services.

For its size, it has a strong and well-documented solution delivery methodology, which it callsIterative Solution Realization.

Cautions

Since the vendor is small, and considering the strength of its product, it could be a takeovercandidate.

Softeon's strength is in engineering and product development, and it has yet to establish itselfas a prominent contender in WMSs and SCE, which constrain its growth.

Softeon is focused primarily on North America from a sales and marketing perspective,although it is expanding into other geographies. Its large clients, however, are taking itssolutions international. As a result, it has several international implementations live or inprogress.

The vendor has limited sales and marketing resources, which could tax its growth.

Softeon's sales and marketing investment had been low, thereby limiting its market presence.However, the company recognizes that this will be an important area of investment over thenext several years.

Synergy Logistics

Snapfulfil is a recent offering in the U.S. from established U.K. WMS vendor Synergy Logistics.Formed in 1972, Synergy Logistics is a software company with a North American office, Synergy




North America, which is based in Charleston, South Carolina. Synergy focuses on WMSs, withclients ranging from global organizations to SMBs. Synergy took more than 30 years of WMSexperience and, in 2006, rebuilt its WMS offering, Snapfulfil, from the ground up, using the latest inWeb-native technologies and deployment methodologies. Snapfulfil has been implemented by morethan 30 customers in less than three years, and was launched in North America in early 2010.

Synergy's Snapfulfil has the most unique business model of the vendors in this year's MagicQuadrant. While it would be considered an on-demand WMS, although not multitenant SaaS, thedelivery model is more of a comprehensive managed service, and not simply a softwaredeployment. Synergy's staff actually performs the complete turnkey implementation for itscustomers, and includes the RF hardware and implementation costs in the subscription fees. Thecustomer doesn't pay anything until the software goes live (today, the average time acrosscustomers is eight business weeks). Synergy wants the customer to get the system to valuerealization as quickly as possible, and is committed to a no-capital-expenditure delivery. Synergystrives for satisfied customers that are eager to renew, since the annual renewable contract value isat the core of the vendor's business value proposition.

Strengths

Unlike other pure multitenant SaaS WMSs, Synergy is a mature WMS provider that specificallyarchitected its newest offering, Snapfulfil, to support the SaaS business model.

Snapfulfil offers an adaptable architecture with a robust rule engine and high levels ofconfigurability to support customers' specific requirements, and to enable the vendor's uniquerapid implementation methodology. Currently, the vendor does all the rule configuration for thecustomer as part of the subscription.

The managed service and turnkey delivery model reduces implementation risk.

Synergy is a mature WMS provider in the U.K. and Europe with a long tenure. It has a small butgrowing presence in North America.

Hardware and implementation services are built into the subscription price.

Synergy offers rapid implementation.

Cautions

Customers are dependent on the vendor for configuration and rule changes. This places apremium on consulting and support resources, which could be taxed if the vendor grows toorapidly. However, this is not currently an issue expressed by customer references.

There are a small number of employees around 40.

The vendor is just now establishing a presence in North America, and remains strongest in theU.K. and Europe. It currently has no intention to expand into other geographies.

Resources are potentially scarcest in North America until this business expands.




Snapfulfil is not a true multitenant SaaS WMS. It offers an on-demand, single-instance-per-tenant cloud delivery model.

Synergy is strongest for core WMS capabilities, with some extended WMS capabilities.

The vendor has not articulated an SCE convergence vision or strategy, or an inclination to movein this direction.

Tecsys

Headquartered in Montreal, Tecsys is a modest-size vendor of WMSs and related SCE capabilities.It offers a broad portfolio of SCE capabilities. It has been in business for 30 years and has a largenumber of clients. For most of its history, it focused on selling modest deals to Canadian SMBs.Over the past several years, however, it adapted and formalized its strategy to pursue morestrategic initiatives with larger and more complex customers. The vendor has targeted several areasof extreme verticalization (see "Consider 10 Criteria When Evaluating WMSs"). Tecsys now offershighly differentiated solutions for healthcare and hospital integrated delivery networks, as well asindustrial and equipment dealers, and it is increasingly focused on government and education. Thevendor is also growing its business more rapidly in terms of the number of new deals and the sizesof the customers it works with and their WMS deals. Although a Canada-based company, Tecsys'revenue is split about 50% Canada and 50% U.S., with U.S. revenue growth accelerating. Thevendor also has a mix of SMB customers and large customers, with 49% categorized as midsize tolarge organizations.

Strengths

Tecsys has a very broad suite of SCE capabilities, including core WMS and extended WMScapabilities, as well as many complementary capabilities.

The vendor offers very differentiated capabilities, domain expertise and customer experience inhealthcare provider SCM.

It has differentiated capabilities for equipment dealers, including capabilities beyond WMSs,such as support for point-of-sale capabilities to handle customer walk-up orders.

The vendor is an innovator and does a commendable job of commercializing its innovationsintrinsically across its products as well as specifically to its target vertical industries.

Tecsys has a differentiated vision, architecture and solution; these allow users to exploit visualinformation to improve process execution. The vendor's Visual Logistics solution goes wellbeyond just adding pictures to textual data it allows users to control, through rules, wherevisual information will add value, what visual information will improve the process, and forwhom and when visual information is needed to make processes work more effectively.

The vendor has a unique and flexible approach to visibility, iTopia, which allows users to pulldata from multiple sources within Tecsys' applications as well as from outside data sources.Users can then assemble this data to create real-time personalized views, filtering andorganizing the data as needed.




The company has a stable and mature consulting staff that offers specialized domain expertisein the markets where Tecsys is strongest. The vendor goes beyond standard WMSimplementation, providing business consulting on how to exploit its offerings in the emerginghealthcare supply chain.

For its size, Tecsys has developed a very well thought out and documented implementationmethodology using its Supply Chain Modeling and Reference Tools (SMART), which are notonly a methodology, but also best-practice blueprints for its major vertical industries, and also aknowledgebase for learning.

Cautions

Although Tecsys has a large number of clients, the bulk of them are small Canadian distributors.However, during the past several years, the vendor has begun to successfully pursue larger,more strategic deals.

Tecsys is a small public company, which makes it a candidate for change of ownership.However, with the Brereton family's ownership of more than 48% of the outstanding commonshares, this makes a hostile takeover unlikely.

The vendor historically sold exclusively in North America; however, it is expandinginternationally mostly through partnerships.

The vendor lacks international deployment resources, so users considering large, complexglobal deployments should pay particular attention to the implementation strategy.

The company is growing, and, given its size, it could have resource constraints in consultingand R&D.

The vendor has not articulated a compelling cloud deployment strategy.

Vendors Added or Dropped

We review and adjust our inclusion criteria for Magic Quadrants and MarketScopes as marketschange. As a result of these adjustments, the mix of vendors in any Magic Quadrant orMarketScope may change over time. A vendor appearing in a Magic Quadrant or MarketScope oneyear and not the next does not necessarily indicate that we have changed our opinion of thatvendor. This may be a reflection of a change in the market and, therefore, changed evaluationcriteria, or a change of focus by a vendor.

Added

Notable Mentions

Several vendors with reasonably capable and, in some cases, strong WMSs did not qualify for thisMagic Quadrant, but this does not mean that these solutions might not be viable alternatives forsome customers. To ensure that this research is consumable and understandable by our clients, we




limit participation in this Magic Quadrant to vendors that demonstrate current strength in the marketin several dimensions, including market momentum, geographical coverage, and product breadthand depth. If Gartner were to include all vendors that offered a reasonable WMS, but had limitationsin certain areas, then the Niche Players quadrant would be overpopulated, which would make itdifficult for our clients to exploit this research.

There are several reasons why a vendor might not have qualified. As stated in the qualificationcriteria outlined below, a vendor might not have the sales momentum, growth in revenue orinternational coverage necessary to qualify for this research. While this might affect viability, thisreason alone should not prohibit users from considering these vendors if, for example, they arestrong in principally one geography and if that criterion fits the needs of a given user.Furthermore, one of these vendors may have characteristics that makes it more appealing thanother vendors in the Magic Quadrant because of its strengths regardless of the characteristicsthat might have excluded it from this research. For example, companies in Germany seeking a verystrong presence in Germany, as well as company maturity, might favor Ehrhardt + Partner, while aU.S.-based company seeking a strong SaaS WMS might favor Deposco.

Apptricity: Based in Irving, Texas, Apptricity was founded in 1999, intending to exploitexpertise in SOA to build a suite of solutions across procurement, financial management, assetmanagement and SCM. A WMS is part of its suite of offerings, but it is differentiated in that it iswell-positioned in asset management, defense and related government logistics environments(although it is not limited to these). Apptricity's WMS covers core WMS capabilities with someextended WMS capabilities. The vendor has notable customers in the military, government andlarge enterprise markets. It has a rapid implementation approach, and can be deployed on-premises or as a cloud offering. Apptricity is a suite provider; the WMS is not its sole focus, butit sells primarily in the U.S.

Apriso: This vendor is a manufacturing software provider that offers a suite of capabilities calledFlexNet. Its primary focus is on manufacturing execution systems, but it has added warehousemanagement capabilities to address the unique challenges of manufacturing warehouses. Whilemost WMSs focus primarily on customer order fulfillment, and manufacturing is an afterthought,Apriso focuses on synchronizing its WMS with the inbound and outbound material flowsrequired in manufacturing. Fulfillment-centric WMSs have often struggled with how to bestmanage the flow of materials from the receiving dock to the plant floor, with the back-and-forthmovements from storage and the plant floor, and with the change in state as materials areconverted from raw materials to intermediates to finished goods. While Apriso's WMScapabilities are not as broad or deep as WMS Leaders, its focus is on addressing the abovechallenges. Apriso serves around 200 customers, not all of which use the WMS, in more than 45countries across the Americas, Europe, Africa and Asia.

Deposco: Based in Atlanta, Georgia, Deposco is a provider of cloud-based SaaS SCMsolutions, with WMSs as its flagship offering. Deposco is a small, innovative vendor with amoderate, but growing, number of North American WMS customers. It works with retailers,distributors and 3PL providers, and has some intriguing implementations in direct-to-consumerand omnichannel environments. It offers low TCO due to its cloud deployment tools, which aidimplementation, and its adaptable architecture. Deposco's core WMS capabilities best suitminimally complex warehouse environments (that is, Level 2). They're also well-suited for e-




commerce and omnichannel fulfillment centers. Deposco did not qualify for this year's MagicQuadrant because all its customers today are in North America only.

Ehrhardt + Partner (E+P): Based in Germany, E+P is a well-established WMS provider thatwas founded as a family company in 1987. It has about 200 employees operating in sixlocations, with most of its business historically in Europe (principally Germany), but morerecently, it has expanded internationally into areas like Dubai and Latin America. The vendor hasabout 400 customers, more than 300 of which are in Europe (and most in Germany). E+P offersa strong, deep and mature WMS, with most implementations to date on the IBM i platform. Thevendor's WMS covers core and extended capabilities, with some differentiated capabilities inresource planning, and it has a native material handling control capability. The vendor also hasthe intriguing Institute for Applied Warehouse Logistics, which is a fully equipped mockupwarehouse where it trains, demonstrates and tests all facets of a warehouse operation, fromsoftware to hardware to business processes. E+P lacks the visibility and momentum of leadingWMS solutions outside its core market.

Generix Group: Headquartered in France, Generix provides a portfolio of SCM solutions, suchas transportation management and replenishment management, in addition to WMSs theonly offering covered in this research. It has several hundred WMS customers, the majority ofwhich are in Europe (and mostly in France). However, despite its strong European presence,Generix is not well-positioned internationally notably in North America, which remains amajor WMS marketplace.

Dropped

Several vendors were not included in the main research this year because they did not meet ourinclusion criteria notably, in sales and new customer growth, or selling internationally. This doesnot mean that there was a notable change in the vendors' offerings year over year:

Deposco: We did not include Deposco because it did not meet our criteria for internationalsales and deployments.

Generix: We did not include Generix because it did not meet our criteria for international salesand deployments.

Inclusion and Exclusion CriteriaTo be included in this Magic Quadrant, an offering must have a credible WMS product thatfundamentally supports core WMS capabilities, and also supports some extended capabilities. Thevendor must also exhibit a WMS vision in at least moderately complex warehouse environments.Additionally, vendors must show strategies and capabilities to sell and deploy their WMSsinternationally, as well as have a strong focus specifically on WMSs. Solutions must meet at leastone or more of the following criteria for inclusion:

Significant WMS market presence: The vendor must have WMS-only license revenue of atleast $20 million, or at least $10 million per year in SaaS WMS subscription revenue, with a




combined WMS license and service revenue of greater than $30 million, or subscription andservice revenue of greater than $15 million for the previous fiscal year (only license/subscriptionand services associated with packaged WMS implementations).

Current WMS market momentum: In the previous 12 months, the vendor must have sold andimplemented at least 10 "new named" customers on the WMS version evaluated in thisresearch.

Live customers: The vendor must have at least 10 live customer references holistically usingthe version of the WMS solution that's being evaluated.

Global presence: The vendor must have operations and WMS customer references in at leasttwo of the following geographic regions: North America, Latin America, Western Europe,Eastern Europe, the Middle East and Africa, Asia/Pacific and Japan.

Cross-industry presence: The vendor must have new and existing WMS customers in at leastthree industries (for example, consumer goods and retail, wholesale distribution, high tech, oiland gas, aerospace and defense, automotive, chemicals, life sciences/medical devices,healthcare, industrial products, 3PL and so on).

We have not included stand-alone specialist component providers of yard management, slotting,labor management, parcel manifesting, RF, voice, RFID or warehouse automation (see "SupplyChain Management Market and Vendor Guide, 2011"). We also do not cover material handling andengineering firms that focus primarily on building complex, customized and automated warehouses regardless of whether they offer a packaged WMS application because these firms do nottypically offer their WMSs to the market independent of their material handling solutions.Furthermore, we do not evaluate specialized warehouse control systems or MHCSs that are themiddleware between the WMS business application and the material handling equipment (however,we do consider a WMS vendor if it offers a native warehouse control system as part of its WMSoffering). In addition, because they are not relevant as stand-alone WMSs, we also do not evaluateevery ERP or suite vendor's WMS capabilities, even though these might be well-suited to aparticular customer's WMS needs (see "Apply an Architectural Framework to Stratifying WarehouseManagement Systems").

Evaluation Criteria

Ability to Execute

The WMS market is mature and remains highly competitive. Because of the intense transactionalnature of warehousing systems, Gartner places high value on an offering's depth and breadth offunctionality. We evaluate the WMS products across a range of criteria, including technicalarchitecture and product functionality. We consider functionality such as receiving, put-away,picking, shipping, replenishment, quality assurance (including value-added services and lightmanufacturing), workforce management, reporting, automation interfaces and voice technology,labeling and retail compliance, multitenant and multisite functionality, and returns management. Fortechnical architecture, we consider many factors related to usability, adaptability and flexibility (see"10 Technology Best Practices When Evaluating Warehouse Management Systems").




Although customer service and operations were important in previous Magic Quadrants forWarehouse Management Systems, they played an even stronger role this year. In talking withcustomers, Gartner found that a vendor's ability to provide the services and support necessary toeffectively implement and exploit the WMS is not only increasingly important, but also a notabledifferentiator between various WMS providers. Service and support contribute to implementationsuccess and impact TCO. While WMS vendors have historically provided the majority ofimplementation services, certain (but not all) vendors are developing an ecosystem ofimplementation partners that can supplement or replace the WMS vendors' service capabilities.

There is considerable disparity in vendor size and ability to deliver solutions on an ongoing basis.For this reason, Gartner places high importance on the overall viability of the business and theproduct. Considering the complex nature of a WMS, we give a high rating to customer experience.Because the most demanding users typically have extreme levels of process complexity, elevatedprocessing volumes and a need for high throughput to enable peak productivity, Gartner placesimportance on a vendor's ability and experience in supporting complex warehouse environments.We don't fully believe that a vendor has functionality and it is usable until it is demonstrated toGartner and until users can verify that the functionality is usable in the real world and of highdesign quality. Market responsiveness and track record also serves as a good indicator of thevendor's ability to deliver value to users.

Sales execution/pricing, although important to a company's performance, doesn't represent thesame indicator of the Ability to Execute as it might in other markets. Therefore, this factor has beengiven a modest weighting. Vendor pricing in the WMS market is inconsistent across deals and, to alarge degree, arbitrary, based on the specific circumstances of an individual initiative. This situationhas been exacerbated with the growth of SaaS-based WMSs, where subscription-based pricingmodels dominate. Even though vendors might have inconsistent pricing methodologies, and initialprices may vary significantly across deals, we do find some consistency across offerings in finalnegotiated prices.

Marketing execution has a modest weighting because of the relatively marginal effect it has onvendor performance. Customer experience, which includes client satisfaction, vendor experience incomplex environments and vendor customer growth, is critical and, thus, has been given a highweighting. Operations are important and differentiated across offerings in the WMS market, so ithas been given a high rating (see Table 1).




Table 1. Ability to Execute Evaluation Criteria

Evaluation Criteria Weighting

Product/Service High

Overall Viability (Business Unit, Financial, Strategy, Organization) High

Sales Execution/Pricing Standard

Market Responsiveness and Track Record Standard

Marketing Execution Standard

Customer Experience High

Operations High

Source: Gartner (May 2013)

Completeness of Vision

Although the WMS market is mature, we anticipate considerable changes related to the technology,usability, breadth of functionality and enhanced decision support capabilities in areas such asperformance management, event management, and work planning and optimization. The dramaticchanges embodied in these market shifts will require considerable skills from vendors. Therefore, inthe market evaluation, we place our highest emphasis on the vendors' understanding of thesemarket dynamics, and on their product strategies to support these offerings. Exhibiting andarticulating a vision for where WMSs will be in the future, and exhibiting an innovative culture,remain distinguishing characteristics between vendors. Furthermore, since WMSs are just oneimportant part of integrated logistics, or what Gartner refers to as "SCE convergence," vendors arealso evaluated on how well they understand this emerging concept, and on what strategies theyhave to move in this direction.

Vertical/industry strategy remains a relevant factor in determining how well an offering is alignedwith where the market is going, and how well-suited a solution is for particular industryrequirements. This is because the industry is moving toward requiring more vertical-specificfunctionality, such as capabilities for apparel distribution for hung goods, expanded multitenantcapabilities for 3PL providers, and forward and reverse logistics that are particular to retail, high-tech and service parts supply chains. Geographic strategy is also increasingly important formaintaining a strong presence throughout the global market, especially since market growth isexpected to be greater in emerging international markets.

Innovation is a critically important factor in the WMS industry, even though core warehousing bestpractices have been well-established. Innovation and thought leadership continue to play strongrole in this year's evaluations. Leading vendors continue to enhance core WMS capabilities withmore investment in extended WMS capabilities, where a greater emphasis is placed on improvingwarehouse performance through decision support, analytics and optimization. Gartner continues to




evaluate innovations in these practices. However, we also evaluate how a vendor is innovating withrespect to SCE convergence, especially regarding the expanded roles of integration and processorchestration with yard management, dock scheduling, TMSs and mobile assets, as well as vendorextensions into other SCE or SCP functional areas. Innovation is not exclusive to productfunctionality, and go-to-market and delivery originality are also notable sources of solutiondifferentiation.

Historically, most WMS vendors had similar direct sales strategies. However, how vendors intend toaddress international expansion and pursue growth in the lower end of the WMS market is animportant consideration. New deployment models, indirect sales strategies, and unique delivery andpricing approaches are now more important considerations. Therefore, we have rated sales strategyas standard, although there are strategic differences (see Table 2).

Table 2. Completeness of Vision Evaluation Criteria

Evaluation Criteria Weighting

Market Understanding High

Marketing Strategy Standard

Sales Strategy Standard

Offering (Product) Strategy High

Business Model Standard

Vertical/Industry Strategy Standard

Innovation High

Geographic Strategy Hig

Documents

Magic Quadrant for Warehouse 2013