Saturday, November 2, 2024

HISTORY AND PROSPECTS OF IT COMPANY MANHATTAN ASSOCIATES, INC.

In today’s dynamic world, where borders are blurred and information spreads incredibly fast, businesses of any scale and geographical coverage must adapt to new realities. Learn more at manhattan-future.

The success of any business is based on three fundamental factors: efficiency, cost-effectiveness and competitiveness. It is no longer essential to manually gather goods in warehouses and deliver them in monthly batches to suit the needs of customers.

Today, the world sets new requirements: improved capabilities, automated operations, instant response and a quick return on investment are the keys to success. Those who can adjust to these changes will come out on top.

In this context, Manhattan Associates, Inc. serves as a reliable partner, assisting companies of any scale and kind in optimizing their business operations, increasing profitability and gaining a competitive advantage.

Manhattan Associates, with its cutting-edge solutions and significant experience, assists organizations worldwide in transforming their warehouse and logistics operations, bringing them to a new level of efficiency and becoming industry leaders.

History of the company’s inception and development

In the early 1980s, the textile industry in the United States faced strong competition. Foreign manufacturers began offering items at dumping costs, forcing American enterprises out of the market. The rescue effort centered on discovering novel ways to boost efficiency and optimize manufacturing processes.

Photo source: https://www.loopnet.com/

Concerned about this issue, the entire industry has joined forces. In the middle of the decade, a large-scale project was launched to analyze and enhance the supply chain from production to end user. The initiative’s purpose was to lower production costs by optimizing logistics and other key aspects.

The result of joint work was the project Quick Response. The findings of research and development have formed the foundation of an integrated system aimed at increasing the competitiveness of American textile manufacturers.

The Quick Response system was built on innovative technologies, giving American textile manufacturers a significant competitive advantage. Implementing these technologies enabled the optimization of information flows amongst all supply chain participants, from the manufacturer to the end buyer.

Retailers were able to promptly inform manufacturers and distributors about market demands. As a result, manufacturers and distributors were able to optimize their manufacturing and logistics processes, guaranteeing steady replenishment of inventory on store shelves.

Reducing inventory has become critical to lowering the cost of production. This subsequently resulted in lower textile prices for the end user, indicating the success of the industry-wide initiative.

First managers of the company and their accomplishments

Manhattan Associates was founded on research undertaken by its four founders, directed by Alan J. Dabbiere. Dabbiere oversaw Manhattan Associates for the first ten years of its existence. In 1986, he joined Kurt Salmon Associates, a consulting company specializing in consumer goods production and retail management.

Photo source: https://itsupplychain.com/

At Kurt Salmon, Dabbiere was actively involved in the development of the Quick Response project, as well as its counterpart Efficient Consumer Response. These systems, which sought to improve the efficiency of the textile and food supply chains, were the foundation for the creation of Manhattan Associates.

Manhattan Associates was founded by Dabbiere and three technology-oriented executives from Infosys Technologies Limited. Infosys, an Indian software development company established in 1981, opened its first international branch in the United States in 1987. At that time, Deepak Raghavan, Deepak M. J. Rao and Ponnambalam Muthiah joined the team.

Before joining Manhattan Associates, Raghavan and Muthiah were senior software engineers at Infosys. They focused on the development and use of information systems for the clothing industry. Rao, who worked as an associate project manager at Infosys, specialized in the development and setup of information systems for the banking industry.

In 1990, at the start of a new decade, four like-minded individuals gathered in Manhattan, California. Combining their experience and skills, they set an ambitious goal: optimize the supply chain, with a focus on the “heart” of the process – inventory management.

They believed that distribution centers would be an excellent venue for demonstrating the effectiveness of IT solutions for increasing productivity. Thus, with this goal in mind, Manhattan Associates Software, L.L.C. was established in 1990.

Alan J. Dabbiere took over as president and CEO of the newly established firm. Deepak Raghavan took over as chief technology officer, Deepak M. J. Rao as vice president and Ponnambalam Mutia as development vice president.

PkMS, software that became a growth driver in the 90s

Manhattan Associates, a young company at the dawn of a new era, quickly established itself as a leader in its sector. The company’s first software solution assisted consumers in meeting the requirements for shipping labels set forth by retailers.

In 1991, Manhattan Associates secured their first contract with a client, ushering in a period of steady growth.

Photo source: https://www.freightwaves.com/

The main product of the company was the PkMS warehouse management system, developed by Manhattan Associates shortly after its founding. PkMS, a flexible modular software system that allowed for effective regulation of the transportation of goods throughout the supply chain, became the catalyst for the rapid growth of Manhattan Associates in the 1990s.

PkMS enabled the company to manage a wide range of tasks assigned to the distribution center. The system oversaw the collection of items, their placement, order picking, assessment of products, packaging and shipment, thereby optimizing the complex logistics of goods movement in the warehouse.

It benefited customers in the same ways it did the distribution center. Inventory turnover has increased, inventory accuracy has improved, order response time has decreased, productivity has grown and customer service has considerably improved. All of this has resulted in better operational efficiency, reduced expenses and greater profits for the company’s clients.

2002: Manhattan Associates extends beyond warehouse operations

Competition in supply chain management has increased. Manhattan Associates began to face competition in the warehouse software market from larger companies such as Manugistics Group Inc., I2 Technologies Inc. and SAP AG. These organizations offered a wide range of software solutions, positioning themselves as providers of comprehensive supply chain optimization solutions.

Eddie Capel, CEO of Manhattan Associates (as of May 2024). Photo source: https://www.forbes.com/

In response to this threat, Manhattan Associates CEO Richard Haddrill undertook a series of strategic efforts. In November 2002, the company merged with Logistics.com, Inc., a Burlington, Massachusetts-based corporation that specializes in planning and performing logistics operations. Logistics.com Inc. created software to help transportation companies (road and rail) optimize routing and logistics.

Their product portfolio included:

  • OptiManage – a comprehensive transportation management system designed for shippers
  • OptiBid – a procurement system for shippers
  • OptiYield – decision support and optimization tool for carriers.

The acquisition of Logistics.com marked a watershed moment for Manhattan Associates. Beyond warehouse software, the company has expanded the range of its transportation management services.

During this time, the company’s leadership changed. In May 2003, Alan J. Dabbiere, one of the founders and CEO of Manhattan Associates for 13 years, announced his retirement to spend more time with his family. In July 2004, Peter F. Sinisgalli was appointed as the company’s new CEO. 

Under Sinisgalli’s leadership, Manhattan Associates was expected to grow further in the supply chain management market. The company set an ambitious goal of becoming not only a warehouse software leader, but also a dominating player in the overall supply chain management sector.

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