Insights from the Gartner Warehouse Management System Magic Quadrant
The analysts at Gartner, led by Dwight Klappich, have released the 2014 version of the "Magic Quadrant" for Warehouse Management Systems (WMS), as always providing a lot of insight into what is happening in the WMS market.
The Magic Quadrants have been around for many years, efforts that in the end position technology vendors in many different categories (software, hardware, and services) along two dimensions: "completeness of vision" and "ability to executive." With high and low for each dimension, the result is a box with four quadrants, into which vendors in a given area are positioned with a dot. The "leaders" quadrant contains vendors which are high in both vision and ability to execute.
Shippers and especially vendors are primarily interested in just where those dots are placed, and over the years there have been some epic slugfests between Gartner and certain vendors over that positioning. Where the dots are placed is a combination of the subjective and the objective. Gartner analysts score vendors on a variety of criteria, specific to each category, based on a detailed questionnaire, demos, customer references, etc. Gartner software then takes those ranks and develops an objective relative positioning scheme in terms of which vendor dots go where.
Unfortunately, we cannot publish the WMS Magic Quadrant itself, as that is reserved for Gartner clients. If your company subscribes to Gartner, you can acquire a copy at no charge. Alternatively, if you know or work with any particular WMS vendor, you can likely receive a copy that way. Companies in the leadership quadrant often pay a fee to be able to publish the document as well, which a web search will easily turn up.
That said, SCDigest finds the commentary that goes along with the Quadrant itself often more interesting and informative than the dot placements, and this year's WMS Magic Q is no exception, which we will summarize below.
Gartner and Klappich identify several key WMS market trends:
Supply Chain Execution Convergence: Gartner say supply chain convergence is one of the most important WMS market trends, and refers to the need for supply chain organizations to better orchestrate and synchronize execution processes across functional execution domains.
"Warehousing and transportation are notable points of convergence, but they're not the only ones," Gartner says. "True SCE convergence is when a vendor has developed multiple SCE and related functions on a common technical architecture that shares a UI, data model and business logic, and this is only obtainable from a small number of WMS vendors today."
Due to the increase in the need for building SCE convergence, a vendor's ability to deliver such capabilities made that a central factor in this year's WMS market evaluation, Gartner says.
Deployment Models: Gartner says that in the past, whether a WMS vendor was focused on traditional, on-premise deployments or Cloud/SaaS delivery was an important point of differentiation. However, with just about all on-premise providers now also offering some form of on-demand solution, that demarcation no longer is that significant.
However, Gartner said it does distinguish between those vendors offering pure "multi-tenant SaaS WMS [many customer "instances" of the WMS running on a server farm] and those offering dedicated Cloud WMS (a single instance of the WMS hosted in the Cloud supporting an individual company).
It notes that "While there are differences between the two approaches to Cloud, Gartner's discussions with clients find they do not have a strong bias one way or the other. If anything, we find a bias to dedicated cloud, especially if the customer wants or expects to need customization."
The takeaway from this is that while you can now get an "on-demand" WMS from almost all vendors today, the specifics about how they provide that solution vary, and need to be well understood across WMS contenders.
Global Go-to-Market: The bottom line - a WMS vendor's ability to support a company across the globe is an increasingly important variable.
"Gartner finds that large organizations with multiple warehouses around the world are looking to standardize on a common global WMS, whereas in the past they might have had a variety of regional solutions," the report notes. "Second, Gartner also finds WMS demand growth internationally, both in the established economies of North America and Western Europe, but more importantly in the emerging geographies of Asia, Latin America, the Middle East and Eastern Europe. We found vendor abilities to enable widespread regional and global product rollouts supported by globally available customer service ranked highly on a vendor's ability to execute."
Warehouse Environment: While many companies need top tier WMS functionality, many distribution facilities don't require all that WMS horsepower, especially in emerging geographies where their process maturity might only require a basic set of WMS capabilities. Gartner says.
Many companies are trending towards using the WMS of their ERP provider in these less complex DCs, Gartner adds.
All told, despite being a very mature market space, "WMS innovation hasn't stopped," Gartner notes. "Leading WMS vendors continue to enhance and extend core capabilities, as well as expand the breadth of their application footprints. They now provide more value-added capabilities surrounding the core WMS, or what Gartner calls 'extended WMS.'"
Source: SC Digest