The multienterprise nature of transportation requires carriers and shippers to communicate bidirectionally. Oracle and E2open intend to address this by uniting Oracle Transportation Management (OTM) and E2open Logistics Network (ELN) business process network (BPN). The combined solution is promising, but the measure of success will be the quality of Oracle and E2open's collaboration and growth of a long-term community.

• Customers benefit from access to an end-to-end solution for multimodal transportation management that combines transport management system (TMS) software with packaged integration services, and delivers them as B2B integration outsourcing and a network of logistics service providers (LSPs).
• Oracle benefits because it can now supplement OTM with prebundled integration services.
• E2open gains a substantial channel through which to sell its BPN solutions.

• Companies seeking an end-to-end TMS solution that includes TMS software and rapid integration with their LSPs should evaluate ELN for your needs.
• Companies that have very small LSP communities (that is, fewer than 10 carriers), and have competent in-house B2B skills and infrastructures should weigh the benefits and total cost of ownership of prepackaged integration against the time and cost to implement the community on their own.
• Companies with small, stable LSP communities that do not change LSP partners often should consider alternatives like standard electronic data interchange (EDI) and OTM's carrier portal.
• Prospects considering ELN should ask themselves whether the E2open network already includes desired LSPs, and, if not, whether this will increase ELN implementation times (and fees, although E2open says it will waive these to help drive expansion of its LSP network).

Transportation management is a multienterprise business process where shippers, carriers, suppliers, customers and other LSPs collectively participate in various transportation activities (see Note 1). Oracle's and E2open's partnership specifically intends to address the need to supplement a robust TMS (OTM) with a preintegrated and preonboarded, vendor-maintained LSP network (ELN).

In the past, OTM customers had to build their own carrier networks during implementation. Although OTM established activity links such as tendering and processing in-route status messages, the customer had to establish actual carrier communication. This was not a problem if the customer had a pre-established EDI value-added network and if all its carriers were EDI-enabled. But establishing such a network was more difficult if the customer did not have EDI connections to carriers or made use of a number of non-EDI-enabled small carriers.

Oracle and E2open's partnership simplifies the carrier onboarding exercise because the connections are pre-established as the carrier network grows, and E2open will maintain the connections as part of the relationship. This announcement also means that OTM customers and prospects have more, and better, choices for integrating OTM with transportation and logistics providers. Customers can continue to manage connectivity on their own, or they can now use the partnership offering.

However, the success or failure of this partnership hinges on the quality of execution and durability of Oracle's and E2open's relationship, and their maintenance of the "community" around this. First, E2open needs to build enough of a network (hundreds of carriers preonboarded) so that the next company that purchases has access to their carriers and does not have to wait for LSP onboarding activities. Such onboarding typically also involves onboarding fees, but E2open says it is waiving such fees to help drive expansion of its LSP network. Second, while the initial value during implementation is meaningful, companies change carriers routinely. Thus, long-term value will accrue only if the partners maintain the network and if capabilities exist to allow companies to change carriers as necessary.

On 2 November 2009, Oracle and E2open announced that ELN is available as an integrated solution for OTM.

The companies will deliver a combination of OTM with E2open's BPN for e-logistics. BPNs are bundled multienterprise integration solutions that combine integration as a service, preconfigured adapters and maps for integration, and a preexisting community (in this case, LSPs) to link Oracle's TMS — which is available on-premises hosted by Oracle On Demand or hosted by Oracle BPO partners — to a networked LSP community.

ELN leverages Oracle's strength in applications and E2open's strength in integration services. OTM is a TMS market leader offering robust multimodal TMS functional depth, breadth and expertise. But OTM suffered by not having prebuilt integration with LSPs. E2open is a leader in integration services, offering a combination of B2B integration outsourcing often bundled within collaborative multienterprise BPNs for processes such as vendor managed inventory and, now, logistics tracking. While E2open's LSP BPN is relatively new and its LSP network is still incomplete, it will expand the network as part of its relationship with Oracle.

Shippers have longed for a commercially available, ubiquitous, public LSP network they can easily plug into to conduct their business with any or all LSPs. Software-as-a-service (SaaS) TMS providers have been building carrier networks on top of their multitenant TMS applications. Although their carrier populations have grown, these are primarily for over-the-road (trucking) carriers, and lack connectivity with other modes of transportation like ocean, air, parcel and rail — nor are they available outside North America. Although OTM is functionally rich, it lacked the carrier community that SaaS TMS providers use as their chief selling point. OTM customers had to build their LSP networks project by project. This partnership closes that gap. Oracle benefits because it can now supplement OTM with prebundled integration services for an end-to-end solution for multimodal transportation management, including carrier connectivity. At the same time, E2open gains a substantial channel through which to sell its BPN solutions.

This is further evidence that providers are offering more B2B integration services through channels and partnerships as BPNs, rather than as horizontal B2B integration outsourcing offerings. This is also further evidence that application megavendors like Oracle increasingly recognize that delivering their applications in conjunction with viable integration outsourcing and prebuilt networks helps customers more rapidly achieve their business objectives.

The announcement means that OTM customers and prospects have more, and better, choices for integrating OTM with their LSP partners. Until now, OTM users had to implement their own B2B integration projects, or partner with service providers on a case-by-case basis to implement custom B2B projects. BPNs like ELN can substantially simplify and accelerate B2B project implementations, and provide an outsourcing option for companies that must do B2B but don't wish to do so in-house. Furthermore, as companies change LSPs more often than other trading partners, the ability to adapt their networks is also important; having access to a network of potential new partners is beneficial.

Another benefit of this partnership is E2open's existing community and proven ability to implement complex B2B integration projects. But there are challenges to overcome. One is the need to expand E2open's network to include more LSPs. Another is the nascent nature of the ELN solution. Currently, there are few live examples, and experience in delivering the integrated solution is minimal. Although both firms offer strong individual offerings, only time will tell how successful the companies will be at delivering a collaborative effort.

Although the partnership offers many potential benefits, the relationship is in the early stages. The ELN network is immature, and E2open has yet to reach the scale of LSP some SaaS TMS providers already offer. But Gartner expects the network to grow as more clients purchase the combined solutions. One area of potential differentiation from the SaaS TMSs will be if and when ELN onboards other transportation modes like ocean, air and rail, as well as over-the-road carriers in other geographies. Given the global reach of OTM, this might take some years to mature. Oracle's large OTM clients will likely drive this onboarding exercise.

However, customers and prospects must understand that this is a two-party relationship where they will be licensing a solution from both Oracle and E2open. As such, the partners' long-term commitment to the relationship is critical and requires monitoring. The indications are that this is a strategic relationship, and that both parties are fully committed to the relationship. But as with every relationship, this needs watching. For contingency planning purposes, buyers should evaluate what it would take in resources and costs to build and maintain their own LSP integrations in case they need or decide to bring this back in-house.