JDA acquires i2

On August 11 of this year, JDA Software announced the acquisition of i2 Technologies. In April of 2006 JDA acquired long-time i2 rival Manugistics, which has arguably been the core of the JDA product suite since the acquisition. While the i2 acquisition might make financial sense, I’m particularly interested in the product roadmap that JDA will need to deliver crisply in order to keep current sales cycles from stalling completely. It has been a month since the announcement, and I have received many questions from current JDA clients about what it means to them.

Of particular interest to me are the plans for the i2 TMS with regards to the Manugistics TMS. Historically, these applications have been fiercely competitive in the marketplace. Over the years, each has found their niche – i2 in discrete manufacturing, high-tech, and 3PL markets, Manugistics in consumer packaged goods and retail. The retail niche for the TMS and core SCPO planning applications from Manugistics made good sense for JDA, which was then a purely retail shop. However, i2 brings additional industry reach to JDA that it couldn’t reach from a sales & marketing standpoint.

A recent question from the boards asked – ‘Which TMS will Reign Supreme – i2 or Manu?’ – and I made an off-hand comment about how they would probably both be kept separate because that would cost the most money from a code development and support standpoint. However, this might be closer to the truth than I initially thought. Perhaps the i2 acquisition will serve JDA by improving access to previously closed industry verticals like high-tech, industrial, and service-based markets. Perhaps there will be no plans to integrate functionality of the products, which are already enormously robust applications by themselves in their specific niches. This is what most of my sources are saying – finally, after a month of letting this news settle.

These questions still remain unanswered by JDA and will be a critical next step in the execution of the i2 purchase. The core Manugistics products are already under scrutiny by many buyers due to the large shift away from client-server technology into web-based architecture. This change forces JDA to get existing clients into new versions using technology that requires a substantially different infrastructure – before new clients will sign up for unproven technologies. Keeping the i2 code base separate from the core Manu products will probably be the safest bet until adoption picks up.

Regardless of how this all shakes out, it is still a very interesting move from JDA – and will be interesting to see if they move into other functional markets (Supply Chain Execution for example) in the future. I also have high hopes for the integration of the i2 sales force, which has had remarkable success in selling software (especially the TMS) – which has never been Manu/JDA’s best attribute.

About Brad Forester