'N Syncra

Ariba's partnership with Syncra indicative of business evolution

March 2, 2001 -- Earlier this week, Ariba unveiled new products, strategic relationships and a strategic roadmap to deliver what they are calling Value Chain Management (VCM) solutions.

As Ariba defines VCM, it consists of a three-pronged approach: A network that provides a point of integration with trading partners and hosted services; a foundational platform consisting of shared components to support application interoperability and a business process integration layer integrating Ariba solutions with legacy applications and the Ariba Commerce Services Network; and what Ariba calls best-of-breed, networked placations, both from Ariba and through strategic alliances with suppliers, which address a specific set of inter-enterprise processes challenges. (I've stumped several dictionaries and dictionary Web sites when it comes to the word placations and whether or not it's a valid term, but English is a flexible language, and nobody knew what a modem was not so many years ago, so I'll give them the benefit of the doubt.)

The placations are the most interesting aspect of Ariba's announcement, considering that they include an agreement to sell Syncra's integrated product suite, which enables collaborative supply chain planning and inventory management. Such services are not unlike what Ariba's partner i2 Technologies provides. So is this placation a sign of continued stress of the i2/Ariba/IBM alliance?

Not necessarily. The announcement is likely another step in the evolution of the New Economy, one in which partnerships of convenience will arise or die without the fanfare they do now. Greg Runyan, senior analyst at The Yankee Group, explains that i2 and Ariba will work together where it's convenient to do so, but again, the dynamics of the marketplace have changed, and it's not always convenient to do so in all instances. So they need to hedge their bets with regards to who they're also going to be establishing relationships with.

Runyan explains that one mistake the companies have made was in marketing the alliance when it was first announced. As he puts it, That has basically come back to haunt them. The good news is that this isn't preventing the companies from pursuing their goals. It's not distracting them from moving forward at all. It's distracting the press, and distracting the perception. But from their perspectives, they're moving forward. They'll move forward with each other, they'll move forward without each other. It's a high-stakes, cutthroat world out there, and they're not going to get caught up or tied up in games like this.