Supply Chain Platforms Vs. MESCBNs: Beyond the Magic Quadrant

In response, the last five years has seen an encouraging rise in the number of supply chain software solutions (mostly for logistics).

This rise in the number of solutions has in turn prompted the highly respected business analysts at Gartner to analyze, classify and rate the technology solutions using their justifiably famous Magic Quadrant format.

What is a Magic Quadrant?

Briefly, a Magic Quadrant chart shows the solution providers in one of four sections of a quartered chart: leaders, challengers, visionaries and niche players.

If you’re a technology solution, naturally you want to be in that upper right “leaders” quadrant. Solutions are rated in terms of “ability to execute” (along the y axis) and “completeness of vision” (along the x axis). The chart is supported by a report on the strengths and weaknesses of each solution.

Gartner has many types of Magic Quadrants, and it’s a big win if a company can make a case for the creation of a whole new quadrant related to their type of solution.

But what if there’s a problem with the name Gartner that applies to a solution category? In this article, we’d like to talk about why we think Gartner’s approach to naming isn’t helping supply chain platforms improve.

Gartner’s Problematic Term For Supply Chain Management

The analysts at Gartner have clearly put a lot of thought into the very precise name they’ve chosen for the type of technology that our team is building:

Multienterprise supply chain business networks (MESCBNs)

While we appreciate the academic precision of that nomenclature, we prefer to reference our function in more simple, accessible terms.

Why not just say, “supply chain platforms”?

Inspired by Occam’s razor, we believe that if something simple accomplishes the task, why add complexity?

There are several reasons why “MESCBN” doesn’t work.

1. Supply Chains Are Inherently Multienterprise

It’s easy to understand why Gartner has included the word “multienterprise” in their category name. It highlights the fact that these platforms connect businesses together, rather than focusing on an organization’s internal operations.

But we contend that myopic systems like that aren’t supply chain platforms at all. If a technology does not connect businesses, it does not manage supply chain.

To understand that, we have to use a valid definition of supply chain platforms.

What is Supply Chain Management?

Supply chain management involves overseeing the process of producing a product or service, from the initial raw materials to the final delivery.

Over the decades, what we now know as supply chain has gone by many names. In the sixties it used to be “operations”. Even today, people in the field use terms like “logistics” and “supply chain” interchangeably, or use the term “supply chain” to refer to procurement.

Daniel Stanton, respected educator and author of Supply Chain Management for Dummies, gives us the following definition:

“Supply chain management is the planning and coordination of all the people, processes, and technology involved in creating value for a company.”

This includes the many tiers of external suppliers that go into providing an organization with raw materials or component parts for their products. It also includes disposition buyers who purchase business assets we no longer use, thereby perpetuating the circular economy and promoting better sustainability.

If a technology is not connecting them all, then it’s not a supply chain platform.

2. Simplicity Encourages Understanding and Growth

As mentioned, supply chain management is complex. Why make it harder to improve a business function with complex names that take a lot of effort to parse and understand?

We want more businesses to choose a technology that works, and reap the benefits it offers. If they need to work to learn what an MESCBN is, that reduces the chance they’ll invest in the work of choosing a system, cleaning up their data, and giving it a try.

We want to reduce anxiety for those practitioners who might be open to new, more effective ways to manage their work.

Spencer Fung, CEO of Li & Fung, said that the greatest barrier to digital transformation is resistance from the people who would see the most benefit. He commented, “I’ve noticed that the process of digitization is not about building or buying the next generation of technology. It’s about convincing people to actually use it.”

While Gartner is trying to show they’ve put thought and rigor into their choice of name, they aren’t helping the supply chain practitioners of the world, who are already behind the curve when it comes to digital transformation.

This yet another blaring reason why the name supply chain platform is more than enough.

The Impact on Real People

Why is the digital transformation of supply chain so important? We all know it gives businesses and edge, and theoretically, businesses that are slow to digitalize will just be out-competed and will disappear.

It’s not that simple. As we have all realized since the disruptions from COVID-19, our entire civilization is highly dependent on global supply chains. Food, medicine, and all the essentials of life come to us through these networks.

As supply chain investor Brian Aoaeh pointed out to us, the costs of broken and inefficient supply chains end up getting passed on to the end user. If that consumer is going without food or medicine because they’re too expensive or simply not available, the consequences can be tragic.

Growing up in rural Ghana, Aoaeh and his family struggled to afford medications that relieved his grandfather’s rheumatoid arthritis.

“Years later,” said Aoaeh, “I read an article for the Swiss pharmaceutical company Roche, and they were making a statement to the effect that because supply chains in Nigeria are so broken, they end up being marked up between 40% and 700%. That got me thinking that the medications I used to pick up for my grandfather could have been marked up because of these broken supply chains.”

With supply chain platforms being so critical to promoting the circularity. of resources, like medicine. This yet another reason why we need to make things simple for supply chain professionals and just use the name supply chain platform.

3. The Name Does a Disservice to Gartner Itself

Most people at the management level in the B2B world have heard of the “Magic Quadrant” reports. They’re a good idea, and the catchy name has helped the idea spread.

Respectfully, however, I question how quickly the term “multienterprise supply chain business networks” will catch on, even with people who are already using these technologies.

Even the acronym “MESCBN” is too awkward for everyday use. This will not help the idea gain the adoption that will promote Gartner as a thought leader.

For something to catch on, it has to be easy to use, even if it’s a phrase. Gartner will do itself a favour if it starts using the term people in the industry are already using: supply chain platforms.

Supply Chain Management Platforms Are Here to Stay

There’s a reason the phrase “supply chain platforms” have become a part of everyday business language, even for people who don’t use them yet. It’s a phrase that people understand instantly, and they are starting to understand that there are more of these systems out there now, and that they have options beyond ERPs. This opens the door to future experimentation, adoption, and business growth.

And the clock is definitely ticking on the adopt-or-die window. Very soon, it will become imperative that businesses start using a supply chain platform, no matter what platform they choose.

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Requis is a supply chain management platform on mission to make managing assets, and procurement easier for supply chain professionals. Schedule a procurement software demo today.