Commerce One is moving out from under SAP AG's shadow with a new
plan to attack the strategic sourcing market.
The company has rolled out a new suite of collaborative solutions
called Commerce One 5.0, designed to fully automate the entire
strategic sourcing and procurement process while also enabling deep
integration between an enterprise and its trading partners.
The suite combines Commerce One Buy and Commerce One Source with
the Commerce One Collaborative Platform - a workflow and business
process management platform designed to link applications to
support business processes within and across enterprises. With the
new suite, the company is moving away from its previous focus on
marketing private marketplaces, said Mark Hoffman, Commerce One's
chairman and chief executive.
To date, the idea of private marketplaces has not resonated with
Commerce One's targeted market. Hoffman said: "[Businesses are]
saying, 'I have a problem sourcing. I have a problem buying. I have
a problem communicating with my suppliers.'"
Commerce One now plans to lead with their applications when selling
to enterprises, he said. "[Enterprises] understand that they can
create a short-term return on investment simply around the
applications."
Hoffman also unveiled the company's Web services architecture,
which the company plans to roll out in the middle of this year.
Commerce One will be building a "componentised platform" that will
support Web services for sourcing and buying.
"We will change all of our applications into Web service
applications that can plug into this environment," he said. "I want
to turn it into a platform that enhances our applications."
The company's Web services strategy will be narrowly focused on
supporting Web services for sourcing and procurement, he
added.
Louis Columbus, an analyst at AMR Research, said Commerce One was
forced to "bang the drum loudly" over its new suite to show they
can make it without partner SAP.
"Paradoxically, the relationship with SAP, so supportive
financially over time, may limit the adoption of 5.0 for Commerce
One," Columbus said.
Although the suite provides much-needed business process management
for the e-sourcing marketplace, the joint SAP/Commerce One
marketplace product positioning is now superseded with the stronger
push for 5.0, Columbus said. This may cause confusion in the
market, he said, adding that the new suite is missing direct
materials sourcing and optimisation-based bidding analysis.
In addition, the company, which is trying to transform itself from
a company that focuses on more strategic direct procurement, faces
a "tough row to hoe," said John Moore, an analyst at ARC Advisory
Group.
"Their claim to fame was in indirect procurement," he said. "When
you get into strategic sourcing you're dealing with fewer suppliers
and much larger contracts. There isn't the need to minimise the
purchase order."