Project Portfolio Management for Service Organizations

In the last couple of years, the enterprise resource planning (ERP) industry has changed the landscape of the project portfolio management (PPM) marketplace. ERP vendors, such as SAP, Oracle, and Microsoft, have recognized the value of developing and delivering services to professional services organizations (PSO). Faced with this new reality, the best-of-breed vendors that once dominated the PPM marketplace must either shift their focus or defend their market share from the ERP giants now entering the market. As a result, the PPM industry is divided into two major camps:

1. Vendors servicing PSOs
2. Vendors servicing internal information technology (IT) departments

This article will examine PPM for PSOs and the vendors that service this market segment.

The Operations Side of PPM

The PPM industry's mixed messages are due in large part to the idiosyncrasies that separate PSOs from internal IT departments. Although most PPM vendors offer functionality for both types of organizations, most PPM solutions do not address both sets of needs in their entirety. Consequently, a number of vendors competent in portfolio management and project management have repackaged themselves for internal IT departments, while numerous vendors that originated in the billing and financials software market have focused their efforts on the billable services sector, where they can provide ERP functionality to meet the unique needs of PSOs.

PSOs want complete PPM solutions that address their business as a whole. For service organizations, efficiently capturing time, billing, and expense data is a key component to bridging projects and operations. Thus, PSOs look to PPM vendors to provide either complete solutions or niche applications that will manage and distribute data across the entire organization. In fact, Peoplesoft (acquired by Oracle) and Epicor have adopted the label "enterprise services automation (ESA)" to more accurately describe the technological needs of PSOs. ESA focuses on the operational needs of billable services organizations and on the management of the internal and external resources that deliver service contracts.

PPM Components for Service Organizations

Beyond the core components of managing portfolios, projects, and resources, PPM solutions for PSOs have extended functionality to manage the bid-to-bill cycle, external resources, and client demands. Major ERP players entering this space are swapping their manufacturing and distribution components for portfolio and project management functionality in order to stake their place in the PPM market. In response, the niche players that continue to service this PPM market segment target small and medium businesses (SMB) by proposing more affordable PPM solutions that tightly integrate with an organization's existing IT infrastructure (ERP, customer relationship management [CRM], human resource [HR], and financials systems). In either case, PSOs demand the following core components.

* Portfolio management. This functionality allows service organizations to monitor the health and profitability of projects. For service firms, portfolio management is critical to maximizing revenue streams by leveraging the best resources for the most profitable projects. On the other hand, service organizations do not demand the same detailed level of analysis as internal IT departments, and can forego extensive risk management and earned value management capabilities.

* Project management. This is the engine that runs a PSO. Service firms are project-centric by nature. The successful delivery of services is dependent on the project management methodologies and tools adopted. Key project management features include project scheduling, task management, and budget management. Bi-directional integration with Microsoft (MS) Project is also highly recommended, since approximately 80 percent of the project management world still uses it as the standard tool of choice.

* Resource management. Resource management is another core component for services organizations. PSOs need to be able to manage internal resources and contractors across multiple projects and portfolios. Contractor management, recruitment management, and resource planning, scheduling, and utilization are key features of this component.

* Time and expense tracking. This bridges project management and operations. It ensures that an end user's work details, captured by the time and expense module, will update the status of work completed in projects, as well as the billing information in accounting. For many service organizations, the ability to remotely submit time and expense details (via the Web, off-line, and wireless devices) is critical for efficiently capturing and accurately tracking the delivery and execution of services.

* Project cost and billing. Service firms require flexible project cost and billing options. The tracking of billable and non-billable information, and the generation of customizable invoices are key features. Moreover, the integration of project costing and billing with accounting is necessary to provide the integrated solution that PSOs need.

* CRM. This is extensively employed by professional services firms. Service organizations require complete customer support, demand management, and pipeline and opportunity management capabilities to capture and analyze client and contract details prior to a project engagement. CRM functionality also allows organizations to prioritize opportunities and to forecast pipelines.

* Knowledge management. These capabilities serve as the hub of a PSO. Service firms demand collaboration and analysis of data by both internal parties (management and staff) and external parties (customers and partners). PSOs demand robust knowledge management capabilities that access all components of their business.

In addition to these core components, workflow capabilities and integration to back-office systems (HR and financials) are critical components of the complete PPM solution for PSOs.

Vendors: Best-of-breed versus Integrated Solutions

There are essentially two types of PPM vendor solutions for PSOs: best-of-breed solutions and integrated solutions (a more in-depth review of these solutions will be covered in future articles).

The majority of best-of-breed vendors offer hosted solutions to SMBs in the professional services sector. Small consulting firms can benefit from the quick deployment and affordable total cost of ownership proposed by these vendors. In addition, best-of-breed vendors provide strong out-of-the-box integrations with popular project management, accounting, HR, payroll, and CRM systems, thus easily adapting to an organization's current IT infrastructure. PSOs considering a best-of-breed solutions approach should bear in mind the PPM vendors below.

Compuware's Changepoint is a best-of-breed vendor that has competitive functionality for both professional services firms and internal IT departments. For service firms, Changepoint PSA offers a mature product that has been around since the early days of the professional services automation (PSA) market (referred to today as PPM). Since its acquisition by Compuware, Changepoint has shifted its focus to the IT governance market. Nevertheless, as a PPM vendor still catering to service firms, Changepoint provides a very mature best-of-breed solution with comprehensive CRM, engagement, and resource management features, as well as time, billing, expense, and invoice modules that tightly integrate with packages such as Great Plains, Oracle Financials, ADP Payroll, and MS Project.

Autotask provides a hosted option to SMB service organizations. Marketing itself as a PSA platform, it offers a modular solution that can be turned on and off according to an organization's business requirements. Specifically targeted to small organizations, Autotask provides a complete PPM solution including CRM, resource management, project management, and time and billing functionality for smaller organizations, along with basic integration with Quickbooks accounting.

Openair also provides a hosted solution. However, it positions itself as a middle-office (i.e., the group of employees in a company that manages risk, calculates profits and losses, and is generally in charge of IT) application that integrates front-office CRM with back-office functionalities. Currently, Openair offers out-of-the-box integrations with Salesforce.com and Quickbooks. Openair is a strong contender for small firms that demand wireless capabilities to remotely access data. The hosted option also ensures a quick deployment for smaller organizations with limited IT infrastructures.

Tenrox PPM solution for services organizations is built on Microsoft .NET technology. Targeting primarily the SMB sector, Tenrox offers complete time and billing functionality, and has developed solid out-of-the box integrations with Microsoft solutions, such as MS Project, MS Great Plains, and Sharepoint. In addition, Tenrox supports integrations with SAP, ACCPAC, and Quickbooks. For smaller service firms that do not necessarily want to host a solution, Tenrox also offers middle-office functionality supporting multiple databases and applications.

QuickArrow offers a hosted, on-demand PPM model specifically designed for billable services organizations. Positioned as a middle-office solution, QuickArrow provides out-of-the-box integration with Salesforce.com, MS Great Plains, and Quickbooks. QuickArrow delivers project planning, resource allocation, time tracking, and expense reporting functionalities, as well as billing functionality for multiple industry verticals offering billable services.

Unanet Technologies has carved out a niche in the government contractor sector. Unanet offers bi-directional integration with MS Project, as well as resource management, time and expense reporting, and workforce collaboration functionalities. Unanet also provides additional functionality for regulatory compliance. The areas of compliance covered include Defense Contracting Audit Agency (DCAA), Sarbanes-Oxley Act (SOX), Federal Deposit Insurance Corporation (FDIC), and Federal Drug Administration (FDA).

When it comes to integrated PPM solutions, many of them have emerged from the ERP space, providing the complete back-office systems (financials, HR, procurement, etc.) that many mid-sized and large PSOs prefer. PSOs looking at the integrated solution approach should consider the vendors below.

SAP provides PPM functionality to service firms through its xRPM offering, which supplies resource and portfolio management to large PSOs. Powered by SAP Netweaver, xRPM works with both SAP and non-SAP infrastructures. It provides time and billing, project costing, collaboration, and resource planning capabilities. xRPM is currently used by SAP's system integrators for time, billing, and collaboration.

Oracle offers a PPM solution that adheres to its "fusion" strategy, integrating PeopleSoft, JD Edwards, and Oracle Projects (all of which are currently under the Oracle banner). Oracle's Fusion middleware provides standards and protocols to ensure that its applications are seamlessly integrated. The Oracle Project suite of applications was originally adopted, and continues to be adopted, by large, project-centric organizations and departments that require project-intensive capabilities in project management, resource planning, CRM, and financials. With the acquisition of PeopleSoft, Oracle's stated application strategy is three-fold, as follows.

1. To protect customers' current investments in all Oracle and PeopleSoft products by offering support through to at least 2013 or for life, if they choose the lifetime support policy

2. To extend the customer value of these applications by continuing to release new product enhancements, such as Oracle Projects Family Pack M, which was released in May 2005, PeopleSoft ESA 8.9, which was released in August 2005, and JD Edwards version 8.11, released in October 2004. Work on the next versions of these products (Oracle release 12, PeopleSoft 9.0, and JD Edwards 8.12) continues.

3. To evolve the "best-of" functionality of all product lines into a new generation of business applications called Fusion

Oracle will continue to focus on key industries and market segments, including professional services, the public sector, engineering and construction, and internal IT.


SOURCE:
http://www.technologyevaluation.com/research/articles/project-portfolio-management-for-service-organizations-bridging-the-gap-between-project-management-and-operations-18340/

How Supply Chain Management Helps Today's Engineer-to-order Companies

How Supply Chain Management Helps Today's Engineer-to-order Companies
David Bourque

In today's dynamic manufacturing industry, companies are feeling the squeeze of fierce competition, as goods are being produced more cheaply in developing countries. Because of this, global sourcing for parts is a huge factor in cost reduction.

In the project-based nature of the engineer-to-order (ETO) world's manufacturing processes, specific parts are needed at precise times. As well, because ETO manufacturing must meet stringent milestones and deadlines, it is critical that firms obtain parts on time. Otherwise, project costs go up, timelines are extended, and budgets are blown.

How can these manufacturers mitigate the pressures of this competitive landscape? Supply chain management (SCM) can play a vital role in an ETO manufacturing environment, enabling milestones to be met and parts to arrive on time so that production can continue on schedule.

This article details how SCM helps firms that manufacture ETO goods, as well as how SCM integrates with ETO to improve business processes.

The Role of SCM in ETO Firms

The ETO environment is a very detailed type of manufacturing because it involves many changes in the engineering and design of a product throughout its production. In this manufacturing environment, orders are based on contracts as opposed to work orders, which means it is crucial that the manufacturer meets its project deadlines.

ETO enterprise resource planning (ERP) software manages project deadlines and milestones within the manufacturing environment. However, with today's increasing amount of global sourcing, additional functionality is required, and this is where SCM software comes into the picture.

Because precise components need to be routed from different sources during the process of designing and manufacturing of the product, suppliers need to be made aware of the product requirements in enough time to be able to deliver these requirements to the client.

How can suppliers be linked into the operations of the manufacturing firm, which can make demands on a whim?

How SCM Software Components Relate to the ETO Manufacturing Environment

The main modules of SCM software include the following:

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Warehouse management system (WMS)—enables firms to optimize methods of storing and moving inventory through the warehouse.
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Transportation management system (TMS)—enables transportation firms to manage and optimize any mode of transportation.
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International trade logistics (ITL)—helps organizations with the logistics of importing and exporting, the finances related to these activities, and collaboration between firms across multiple locations.
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Supplier relationship management (SRM)—manages the relationships between suppliers, distributors, and manufacturing firms. SRM is one of the key features that enables manufacturing firms to source products quickly.
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Demand management (DM)—forecasts how much product to move through the supply chain, how much product to produce, and how much product will need to be produced in the future, based on historical data.
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Supply chain analytics—enables supply chain managers to create work-arounds if problems within the supply chain occur. Supply chain analytics is comprised of supply chain optimization, supply chain event management (SCEM), and production and supply planning.
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Order management—enables suppliers (or manufacturers) to take an order, search within their inventory to see if the item is available, and ship the item to its final destination.

SCM software integrates into the ETO software infrastructure, enabling manufacturers to source goods from multiple suppliers. Because of the project-based nature of ETO manufacturing, the need for different and multiple components, as the engineering of a product changes, is essential for the manufacturing project to succeed.

Here's a look at how the seven main SCM modules can be applied to the ETO manufacturing environment:

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Using warehouse optimization techniques built into the software, the WMS will facilitate the quick movement of goods coming into the manufacturing environment in order to get the goods to the workstations as soon as possible.
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The TMS will enable ETO manufacturers to obtain the components as quickly as possible by choosing the most appropriate means of transportation. Also, if a transportation route is blocked, the TMS will help drivers find an alternate route, which ensures and improves delivery times, and enables the project costs of the ETO product to fall within a tolerable range.
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The SRM software will choose the appropriate supplier. (A detailed example is shown below.)
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Finally, because multiple orders are being delivered to the manufacturer at the same time as engineering changes are happening throughout the design of the good, the order management system will integrate with the ETO software to send out the appropriate orders to each supplier. This helps to ensure that suppliers send the correct components needed for ETO production.

Let's look at an example that illustrates the SCM process involved in ETO environments.

Figure 1: SCM at work in an ETO manufacturing environment.

Figure 1 represents a typical manufacturing situation. However, because of the nature of an ETO environment, precise components are needed quickly, thus putting pressure on suppliers to deliver components on time so that the manufacturer can meet its project deadlines.

In the above diagram, we will consider Supplier 1 a dedicated supplier, meaning that it usually provides the components to the manufacturer, and Supplier 2 up to Supplier N will be considered new suppliers.

In this example, let's say that Supplier 1 falls short on the order, creating a long lead time for the manufacturer—an unacceptable situation due to project deadlines. Whether the manufacturer obtains only part of the order or none of the order, it will have to choose another supplier, since deadlines need to be strictly adhered to in an ETO manufacturing environment. And let's say Supplier 2 has the component the manufacturer needs and can deliver it in a shorter time frame.

In this situation, let's examine how SCM software can allow the manufacturing firm to come out on top:

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Having an SRM system in place, the manufacturer can see which supplier has what supplies, when they have them, and the lead times required to get the supplies to the manufacturer. The manufacturer can also see what suppliers have penalties for not delivering on time, and which suppliers can deliver the products to it right now.
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The SRM software enables the manufacturer to choose the next appropriate vendor when the one it originally ordered components from cannot deliver for whatever reason. As shown in figure 1, if the first chosen supplier defaults on delivering the order, the SRM system will loop back to choose the supplier next in line. Once a supplier delivers the components in time to meet the project deadline, the manufacturer can finally produce the good and deliver it to the final destination.
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The order management system can leverage the integrated functionality of the SRM system so that even before the order is sent out, the system can search for suppliers that can deliver the goods.
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The TMS can integrate with the SRM system to ensure delivery of the products falls within acceptable tolerance levels of the project's budget, factoring in the continuing rise in fuel prices. This is done through transportation network optimization. (For a more information, please see the article Transportation Management Systems: The Glue of the Supply Chain.)
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Supply chain analytics enables manufacturers to avoid potential problems in the supply chain, using SCEM. SCEM gives the manufacturer the ability to take into account unforeseen events, and to plan accordingly. Using figure 1 as an example, the manufacturer is able to see that Supplier 1 has had problems delivering products in the past. Entering the loop, the manufacturer will attempt to find another suitable supplier, taking into account each supplier's pros and cons.
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Finally, once the product is produced, the manufacturer can use the above functionality to deliver the product to the consumer.

An SCM Vendor Overview

In the SCM marketplace, one finds many tier-one vendors that offer solutions in both the SCM and ETO software markets. Vendors such as Oracle, SAP, Lawson, Infor, Epicor, QAD, and IFS provide both ETO and SCM software. Other vendors, such as i2, HighJump, and RedPrairie, focus solely on SCM, yet these vendors can still help in lean manufacturing or ETO manufacturing environments.


SOURCE:
http://www.technologyevaluation.com/research/articles/how-supply-chain-management-helps-today-s-engineer-to-order-companies-19343/

Speedy Business Performance Management Solution

Applix provides a complete performance management software solution for finance and operations, without compromising its strong customer focus. The company has over 2,200 unique customers, and is growing at a steady rate. Aside from being top-rated in vendor satisfaction by BPM Partners Pulse Survey, Applix was ranked by The OLAP Survey as a leader in overall business benefits achieved by customers, and was ranked in the top three for customer loyalty.

Headquartered in Westborough, Massachusetts (US), Applix is a provider of business intelligence (BI) and business performance management (BPM) solutions. Incorporated in 1983, Applix first targeted software applications for the UNIX market. To capitalize on the emerging market, thirteen years later it acquired Sinper Corporation, an online analytical processing (OLAP) software developer. In 1998, Applix released its first TM1 product, followed by five subsequent releases, which aimed at enhancing its capabilities for performance management, Microsoft Excel integration, 64-bit platform support, and complex analysis. The Applix focus is to drive operational performance management by investing heavily in its TM1 product line. Operational BI (OBI) and performance management software provide the necessary shift from the traditional backward-looking view of BI, towards a forward-looking approach. OBI allows performance management functionality to be embedded in overall business operations. This takes the shift away from purely using BPM tools for financials, and creates the ability to leverage strengths provided by performance management software for use across the organization and to create alignment with an organization's business process flow.

Product Overview

Applix TM1 gives customers the ability to solve difficult business decisions and perform what-if analyses in a user-friendly environment, making it an above-average performance management solution. TM1 incorporates dashboards, workflow, and OLAP cubes in a fully integrated Excel and Web-enabled environment. Users are able to transfer their skill set seamlessly, due to the familiar interfaces. The product has an integration layer which connects easily to open database connectivity (ODBC), object linking and embedding database for OLAP (ODBO), SAP, and legacy data sources to capture the appropriate data, and has a powerful in-memory data management server engine to help accelerate query return times, thus improving performance. Additionally, TM1 dashboards, Web sheets, and OLAP cubes aid in planning, budgeting, and forecasting activities. TM1 enables complex data modeling and rules creation. Also, data can be updated in real time and reflected in Excel Web sheets, dashboards, and cubes, which can all be posted on the Web. TM1 uses its Web portal as a gateway for users across the organization, in order to allow them to exchange work items by viewing the same sets of data, and to manage decisions based on those data views. This allows TM1 users to collaborate on multiple tasks across the organization. Customizable dashboards and cubes help users analyze and answer defined business questions. This helps to drive potential opportunities (and to avoid risk), by identifying data patterns, collaborating with multiple task stakeholders, and creating business scenarios.

Product Strengths

TM1 has the ability to perform powerful what-if analyses against large data sets, faster than many competitors. Applix TM1's complex analytical queries are dealt with in memory through the use of a 64-bit processing platform and a caching architecture, as opposed to having calculations stored within a server (disk space). The development of 64-bit processing represents a significant trend in BI, for accommodation of large amounts of data. The advent of 64-bit processing also allows data to be updated effectively in real time. Vendors such as Information Builders and MicroStrategy also have this capability, and Hyperion is working on developing a platform compatible with Microsoft. Compared with most performance management vendors, however, Applix has taken the lead in providing a platform that provides users with the ability to create complex queries quickly, and to reflect those results on a Web portal in real time. Additionally, calculations are performed in memory and not within a server environment, which contributes to the quick response times.

Applix TM1's integration with Excel is above average, and permits users to use spreadsheets as the basis for creating Web sheets and dashboards, and to post their data to the Web. TM1 has integrated the use of Excel into its BI platform. Multiple users across an organization or across multiple geographic locations are able to access published data sheets, to edit the sheets, and to have the data automatically written to the server and updated on the Web. Cubes empower users to analyze data by drilling through multidimensional data views, and by identifying trends as well as data sources. With TM1 cubes, an organization can post OLAP cubes to the Web in different forms, such as graphs or as data integrated with Excel.

TM1's analytical capabilities focus on providing users with user-friendly access to cubes and reports. As opposed to developing complex and robust cubes that are only used by one or two super-users, Applix TM1 allows users to create compact cubes to hone in on an organization's business questions and on developing user-friendly intuitive cubes that help answer essential questions, and that are accessible to anyone in the organization. This is done by limiting a cube's scope to between five and ten main dimensions, and by authorizing users to choose what dimensions are available to drill through. These cubes provide users with the functionality to edit, change, and transfer data to Excel; to post changes to the Web; and to view the updates in real time. Although cubes are usually designed with a limited number of dimensions for focusing on actual business questions, it is possible to reflect up to 256 dimensions, which makes it a robust analytical tool. Users can also identify what dimensions they want to view and drill through, as opposed to the dimensions that are reflected in the background but not viewed online.

TM1 Rules helps users define the cube rules, allowing for complex and repetitive calculations within each OLAP dimension. Users create cubes through wizards, giving business users primary control of their analytics (as opposed to relying on the information technology [IT] department). Cubes and the associated data are then connected via defined rules, and the cubes can be customized for maximum efficiency by using rules from multiple applications.


SOURCE:
http://www.technologyevaluation.com/research/articles/embracing-complexity-a-speedy-business-performance-management-solution-18550/

Responding to Warehouse Management Needs

Modern warehouses have complex requirements. Fast product cycles, the need to decrease inventory and increase the flow of goods through the supply chain means that warehouses cannot remain static. Virtual real time data must match the supply to demand. Furthermore, many light manufacturing operations, such as final assembly, customized packing, labeling, and engraving, have been moved from shop floors to warehouses and distribution centers (DC). As a result, supply chain execution (SCE) software has been created and amended to handle these complex requirements. Warehouse management systems (WMS) play a key role in a company's postponement strategy to delay the customization of products until after the products or customized components leave the manufacturing plant.

Part Three of the Adonix' Mid-Market FORMULA--Adopting Best of Both "Organic Growers" and "Aggressive Consolidators" Worlds series.

To address SCE for users of its discrete and process manufacturing suites, Adonix (www.adonix.com), France's largest, privately owned enterprise solutions provider for medium manufacturers, provides three distinct offerings for automating warehouse activities, based on key factors such as transaction volumes and complexity of processing requirements. WMS and SCE might be the best examples of Adonix' commitment to providing its customers with the building blocks for supply chain management (SCM). Its research and development strategy has involved examining and prioritizing market trends to help customers grow and new products and services are then introduced through both in-house development and acquisition.

Adonix has provided warehouse solutions in North America since the 1980s, which has allowed it to leverage existing experience and skills. It also has a fairly strong historical customer base starting with Navistar and VWR Scientific, and is a pioneer in the radio frequency (RF) technology, authoring LXE LDS device drivers. Existing and prospective user companies can use the warehousing capabilities within the Adonix' offering set that match the sophistication of their facilities:

1. Adonix Geode GX is a full-function WMS designed within the Adonix X3 development framework to meet the needs of mid-sized companies with large transaction volumes and sophisticated warehouse practices. It is an enterprise-level configurable, multisite, multi-company, multilingual, multi-database/multi-operating system, and multi-workflow solution with rules-based inventory storage and retrieval and automation capabilities.

Adonix' ideas behind Geode GX has been to offer "tier one functionality at a tier three cost-of-ownership" to medium companies that do not necessarily want to compromise on functionality and cost. As the flagship X3 ERP product, the WMS extension is also configurable for the changing needs via a 4GL personalization and configuration toolset. Adonix recently redeveloped Geode within the X3 technology and plans to sell it both as a module of Adonix X3 and as a best-of-breed WMS solution in its traditional market, especially the consumer packaged goods (CPG) vertical.

2. The Adonix Advanced Warehousing and Adonix Data Collection modules provide RF directed support for primary warehouse activities including receiving, put-away, palletized order picking, pick planning, and shipping.

3. The Adonix X3 Inventory module provides core location and stock management functionality as an integrated component within Adonix X3. It can work either as a paper-based solution or with ADC support for most inventory transactions.

This is Part Three of a four-part note.

Part One detailed the company and its products.

Part Two discussed Adonix' strategy.

Part Four will cover technology, challenges, and make user recommendations.

Adonix X3 and Geode GX

Adonix announced the North American availability of Adonix Geode GX in May at the Distribution/Computer Expo 2005 at the Navy Pier in Chicago, Illinios (US). The product is configurable for a user enterprise, and supports current technologies such as RF devices, bar coding, and features multi-site, multi-workflow, and has many accompanying automation capabilities (such as conveyors, automatic storage and retrieval systems [AS/RS], carousels and sorting equipment). Its open design orientation makes it relatively easy to fit into most operating environments including support for Microsoft Windows and UNIX platforms as well as for Microsoft SQL Server and Oracle databases. Also, its user interface (UI) is available both on the Internet and in traditional client/server mode.

GX has been implemented in over 100 Europe sites and Geode has been implemented at 350 sites, in industries as diverse as retail distribution, manufacturing, wholesale, automotive, chemical and third party logistics (3PL). Its users include market leaders such as Hewlett-Packard (HP), Wyeth Lederle, and Philips. The launch follows several years of successful implementations at customer sites throughout Europe, with other high-profile luxury CPG/retail customers, such as L'Occitane, Cartier, and Christofle, industrial/automotive customers, such as Michelin and Schneider Electric, high-tech customers like Bull, and 3PL customers like Air France, Danzas, TNT, Exel, Geodis, and Kuehne & Nagel. The North American pilot installation has been completed and is live as of early June 2005 at the US distribution operations for L'Occitane in Lyndhurst, New Jersey (US).

What might be particularly appealing about this best-of breed WMS offering, however, is that it was designed using the enterprise resource planning (ERP) counterpart, Adonix X3's toolset, and that it also mirrors the Adonix X3's target markets process and discrete manufacturers and distributors (about 40 percent of customers), chemical and pharmaceutical distributors (about 15 percent of customer), 3PLs (about 30 percent of customers), and retailers (about remaining 15 percent). This means that, unlike most peer mid-market business solutions, which are a collection of acquired packages bolted together to form a suite, Adonix has taken the time and made the hefty investment to build a solution on a single architecture that is portable to multiple platforms. This has eliminated the need to learn and support separate system platforms and might be a key distinction for mid-sized companies with limited resources, while trying to naturally boost functionality and configurability to take business to the next level of competitiveness.

Further, Geode GX complements the needs of those industries that are targeted by Adonix X3. Although Geode GX is designed to connect easily with Adonix X3 ERP, it can function as a stand-alone or can be loosely coupled WMS application with other transactional systems. The basis of the Adonix' approach is that warehousing practices can be defined by a number of practical workflows that apply to multiple vertical industries. Examples of these workflows include supply side manufacturing, vendor-managed inventory (VMI), and other supplier visibility tools, finished goods distribution, pre-distribution (retail) warehousing, web storefronts and online ordering, shipment track and trace, etc. Each workflow can then be tailored to the specific needs of an industry such as, lot control, quality assurance, import/export, serialization, and labeling.

Based on the general warehousing functionality discussed in Who Needs Warehousing and How Much Thereof?, Geode has many traits of best-of-breed WMS solutions, such as rules-based storage; allocation; picking; packing; loading; reservation (i.e., special order items) management; batch/lot control and serial number control; management of multiple product and location classifications; inventory transfers and external warehouse management; expiration/use by/sell by date control; European Article Number (EAN-13) or universal product code (UPC) management; cycle counting and inventory management; and a bevy of inquiries and reporting capabilities.

Further, its scalable tier one inbound features would include dock scheduling and management; inventory blocking and non-conformity management; automatic or manual allocation of inventory locations; location allocation in proximity of picking bays; inventory consolidation; multi-batch and multi-product slot management; validation against expected input/ASN, bonded stock management; quality control, including the ability to apply and remove holds on the incoming inventory; and inbound sampling. On the other hand, the scalable tier one outbound features include wave simulation and wave management; batch picking (order picking); order splitting; back order, and short allocation management (in case of insufficient inventory to satisfy all the orders); dates management (first in, first out [FIFO], sell by date, ship by date, etc.); replenishment methods (by using min/max limits, override, source control, etc.); carton sizing/pre-packing or directed packing; and shipment/load control and document preparation.

Parcel Shipping Closes the SCE Offering

When coupled with Adonix's best-of-breed Transcomm Shipping Solution (TSS) add-on for supporting multi-carrier, parcel manifesting with rate shopping, so Geode GX fills the gap between order and delivery for customers that have higher volume and complex distribution operations.

Adonix TSS is designed to fully automate the parcel manifesting capabilities of companies dealing with large daily volumes of small packet shipments using multiple carriers. Namely, because warehouses are increasingly shipping orders with lower quantities, but have growing line items, small parcel shipment (SPS) management systems may be even more important than full-fledged WMS/transportation management systems (TMS) systems for some businesses, particularly for those doing high volumes and complex order profiles. To that end, these kind of products should determine where products are going and which shipper to use ( e.g., FedEx, UPS, DHL, etc.), and it then creates the appropriate label during picking.

Conversely, the traditional WMS approach involves extra steps. It has to first perform picks, move items to the shipping area, and then generate labels. Other notable features these kinds of products have include integrated WMS check/pack dialog, carrier compliant labeling, parcel rating, on-line carrier manifesting, combined carrier/compliance label, pre-print labels for cluster picking, cash on delivery (COD) support, and multiple rate servers. Another buzzword applicable to both SPS and WMS is "cartonization", which automatically determines the best way to box and package orders (e.g., how many products or boxes will fit in a bigger box, factoring in component weight and size).

SOURCE:
http://www.technologyevaluation.com/research/articles/responding-to-warehouse-management-needs-18179/

Leader in Distributed Order Management

We recently visited with Yantra (www.yantra.com) and found that their reputation as the leader in Distributed Order Management is deserved. But we also found that they have other tools that shine.

Distributed Order Management

When a complex, distributed distribution system is in place, managing the complexity can be daunting and that is the environment where Yantra has built its reputation. Yantra is known for its core product, a Distributed Order Management application that coordinates the lifecycle of an order across an extended supply chain. It works with companies' existing systems to aggregate and manage orders across multiple channels, divisions, distribution centers and fulfillment partners. It enables companies to incorporate new sales channels with their existing systems, providing them an integrated view of customer purchases across divisions and channels.

The system uses configurable business rules and workflow to automate the manual activities often associated with managing orders in a complex, distributed environment. Each order line can follow a unique set of processes driven by any order related information. The system also automatically creates and tracks orders that result from, or depend on, the original customer order. Key attributes of the Distributed Order Management system are:

* Sourcing of orders across divisions & partners

* Granular management of complex order processes

* Aggregation of orders across multiple channels

Companies like Target, Best Buy, Eastman Chemicals, DHL/Allogis, APL Logistics and UK based Argos are all customers using Yantra's Distributed Order Management. For example, Target had a different order management system to support each of its six direct-to-customer sales channels. Now Yantra's product manages orders across all six channels. The orders range from standard pick-pack-ship fulfillment to complex, multi-step fulfillment and delivery processes.

Other Tools for Other Needs

In addition to Distributed Order Management, Yantra provides other applications specifically designed to manage business processes across an extended supply chain.

Each is based on the premise that companies must more flexibly manage supply chain activity and require real-time visibility and control of operations both inside and outside of their enterprise.

Yantra's complete product suite includes:
Logistics Management Logistics Management is an Internet based application that manages multi-modal inbound and outbound shipments. It integrates relevant shipment information from suppliers, carriers and ship nodes into a single transportation execution system, providing real-time visibility and control of the entire process. Configurable business rules and transportation workflow enable companies to executive complex transportation plans.
Reverse Logistics Yantra provides reverse logistics capability that manages returns from the moment the Return Material (or Merchandize) Authorization (RMA) is created or a replacement order is submitted, throughout the reverse logistics and repair cycle until the item is returned to stock or discarded. A key differentiator for this product is its ability to automate the processing of different types of returns, giving companies the flexibility to modify the reverse logistics cycle to meet specific needs.
Warehouse Management WMS was Yantra's original product offering and they continue to add clients in this area. WMS is integrated with its core platform (see below) so customers can more effectively manage warehouse operations based on activities that take place across the supply chain.
Supply Collaboration Yantra offers supply collaboration capability forecasts and schedules, negotiating orders and monitoring inventory levels. Companies can then execute and manage purchase orders. Companies can effectively work with large vendors using EDI connections, as well as small and medium size suppliers by collaborating over the web.
Supply Chain Event Management Yantra provides an infrastructure for managing critical events across the extended supply chain. Using this capability companies can receive advanced notification and proactively resolve problems with orders, inventory and shipments. Alerts can be sent via wireless device, email, fax or through a web-based alert management console.
Inventory Synchronization Yantra manages and coordinates inventory stored at multiple internal and external locations, consolidating inventory data from multiple systems and providing global inventory visibility. It includes the ability to manage products stored by suppliers and outsourced logistics providers and offers global ATP capability.

The Power of the Platform

A key component of Yantra's applications is the technology platform upon which they are deployed. A critical component of the platform is a business process-modeling tool that enables companies to flexibly define supply chain processes within their organization and across the extended supply chain. This is how Yantra manages and monitors external transactions and identifies potential problems. It also includes a participant model that provides the flexibility to define the roles and responsibilities of supply chain participants. Yantra's Platform is a standards' based, J2EE compliant product that leverages open, web services technologies such as XML and SOAP.

Recommendations

User Recommendations Retail, High Tech, Distribution and Third Party Logistics companies with complex, distributed order management and execution needs should place Yantra on their short list. Those companies with existing ERP or Supply Chain vendors in-house should evaluate Yantra in addition to their incumbent vendors due to Yantra's success in co-existing situation where customers have found that Yantra often complements and improves upon the solutions offered by the existing vendors. Existing Yantra customers should evaluate the remaining portions of their product suite in search for additional value.

Yantra Recommendations Yantra appears to be ahead of the pack in applications for distributed order processing and related needs. In many markets, it is far from a household name. In most markets, it is known only as a distributed order management solutions. These two marketing gaps must be addressed for Yantra to progress to the position in the market justified by its product offerings.


SOURCE:
http://www.technologyevaluation.com/research/articles/yantra-leader-in-distributed-order-management-but-wait-there-s-more-16705/

The Channel Management Shuffle

We've all been there at one time or another, in a crowded place or driving while holding a cell phone to our ear in a tight embrace—and why? Because the automated attendant on the other end of the line can not quite make out our "command" to her (or him?) ... usually because of the tiniest bit of background noise or maybe she or he is just having a bad day ... whether it's trying to book a flight, find out the status of a flight, or check the status of an order or place a new order, the frustration can be massive. The flight from Atlanta to Austin can be twisted into the flight from Atlanta to Boston, and incorrect information given out to the unsuspecting party or the maze of options, keys to press, frequent flyer, or shopper numbers to enter can be daunting. And, let's not forget the other frequent headache that many of us encounter daily—trying to return an item purchased online to the retail store ... only to be told "sorry, but we don't stock or accept that item here". And, how many times have you received an "invitation" in the mail to join a "frequent somebody" program that you are already a member of? And last, the age old nightmare of trying to get reliable tech support for that laptop or camera we recently purchased only to be put on hold (or bounced around to countless different "desks") for an extended period of time and when we do get a "live individual", they are fifteen time zones away and speak another language as their "mother tongue" with English as a distant second. A very distant second.

All is not negative, as some positive experiences do occur, but it seems that those are few and far between, and in many instances those positive experiences only occur after a very bad experience has occurred and only occur then as a means of "making it up to" the innocent consumer, thus not really even seeming positive.

We may all chuckle at the horror stories mentioned above, but it is no laughing matter. Especially when horror stories like the ones above cause a consumer to "tell all of their friends" or more importantly, to take their business else where. These experiences are all a direct result of decisions made every day by manufacturers, distributors, retailers, service providers, and technology providers. Executives and middle management are constantly faced with determining policy, process, and technology around managing one or multiple channels.

Forcing such decisions such as what or when to outsource in the channel, how many channels to have and what products to push through which channel, what skills and associated organizational models to put into place, what to spend on elaborate mailing and marketing campaigns, and what technologies to utilize to enable the plethora of channel management business processes—the channel management shuffle!! So, you may say "same old stories" regarding the ones mentioned above... but, you won't yawn and say "same old research" when you are finished reading the new report from Chainlink Research on channel management.

Areas critical to successful channel management:

The report explores a number of areas that are critical to successful channel management:

1. "Dance with the one who brung ya'"... or channel conflict and multi-partner management—management of channels, minimization of conflict in and across channels, as well as management of multiple partners in and across channels. We will cover the strategies and decisions that a well known technology company is employing and facing moving from a totally direct channel to a mix of indirect and direct.

2. "Save the last carton for me"... or inventory management and returns management—the user experience, returns, distribution challenges, and inventory management areas such as locating, managing, and allocating.

3. "The Tennessee Waltz"... or channel management technologies—the underpinning solutions and technologies to support channel management business processes, as well as what is on the horizon of future plans and initiatives for these solutions. For these technologies and associated vendors, we will look at the delivery architecture options that are available, as well as key strategies that the vendors are employing to assure domain expertise throughout their technology or product lifecycle.

4. "Do the Hokey Pokey"... or emerging best practices—for skill development and organizational models to ensure success in channel management.

All of these areas are viewed and analyzed through the Chainlink 3Pe "lens": Policy, Process, Performance, and Enablers.

Just a glimpse at some of the important conclusions drawn from the research and highlighted in the report:

* You must start from the customer and work back to ensure a positive customer experience. Simply put, this means that when you are designing processes and policies, ensure that all are validated or tested from the customer experience perspective.

* A value-based approach related to measuring and inducing partners in the channel is an emerging best practice. Meaning that, in order to determine how a partner is performing, other aspects beyond just sheer sales volume or revenue are considered. Such as quality (delivery and fulfillment) of performance, trained personnel, customer service practices and processes, etc.

* Software vendors must provide solid domain expertise both during the sales cycle and during the implementation phase.

* A shift of mindset is a must—the "old" mindset of policies, processes, and underpinning technologies that create a hand off to a channel partner versus the "new" mindset of policies, processes, and underpinning technologies that treat channel partners as an extension of your enterprise and thus creates holistic and total offerings for your customers.

So, why should you read this report? One word: risk. If you are responsible or involved in any way in managing or operating a channel(s) in your enterprise or for a customer, or providing an underpinning technology for managing channels, then this report is a must. Because the risk of facing the task of defining, managing, operating a channel, or providing a technical solution for a channel management activity without knowing about the hard-learned lessons contained in this report is far too great. So, read the report—and also watch the webinar replay. They may be the best dance lessons you can take before you embark on your own channel management shuffle!


SOURCE:
http://www.technologyevaluation.com/research/articles/the-channel-management-shuffle-18342/

N-Tier Demand Management

The classic bull-whip effect means that the further a supplier is removed from the end-consumer, the worse are the fluctuations in demand that they see. This has led many to recommend an n-tier approach to demand management, where everyone gets visibility to the end-customer demand at the same time. In practice, very few companies have been able to actually realize this vision. There are some practical approaches that a supplier deep in the supply chain can do to mitigate the bull-whip effect.

Build-to-Consumption

Outsourcing and leaner supply chains are pushing companies to using networked models (real-time sharing of information across multiple tiers) for demand management. Most networks today are still working on building connectivity with their immediate trading partners, but the real promise comes from connecting n-tiers. Successfully managing an n-tier networked model involves sharing of real-time data such as POS data, orders, and changes in plan. This vision does not necessarily mean that companies need to create a detailed model of the n-tier supply chain and run optimization logic as they might within their own organization. Major practical challenges that have kept many companies from realizing the n-tier vision must be dealt with, specifically

* Understanding multi-channel demand
* Avoiding multi-counting

Managing N-Tier Demand through Multiple Channels


Figure 1—Multiple channels for single customer

In an n-tier supply chain, demand to the supplier from a single customer, such as an OEM, may travel through multiple channels (see figure 1). It is up to suppliers to aggregate expected demand for each major [] customer regardless of the channel that it flows through. This requires understanding the total market size, demand elasticity, and share for each customer (see section below "Forecasting Your Customer's Demand"). In addition, many suppliers fail to effectively aggregate demand by channel for each major customer, although it is critical to understanding overall demand. Effectively synthesizing demand across multiple channels requires close dialog with the OEM about demand at the finished-goods level, and systems that are able to explode a complex demand BOM against OEM finished goods demand (see sidebar). That is why it is important to monitor and forecast OEM sell-through rates[]. Once these are in place, the dialogs with OEM about demand can shift from discussion about supplier's parts to discussion about OEMs finished goods, for which the OEM has longer-term data and forecasts than they have in their MRP plans for individual parts.

[1] Aggregating by customer is only worth effort for your top customers (e.g. the top 20% of customers comprising 80% of demand). Demand from smaller customers can be aggregated by channel.

[2] Sell-through means knowing your channels' sales data, in this case the actual sales of the OEM, rather than consumption into their production lines.

Avoiding the Multi-Counting Trap

Suppliers that are several layers removed from the end-customer in multi-tier supply chains are prone to confusion about true end market demand. Multi-counting of the same demand is a common symptom. For example, a large telecommunications carrier replacing their line of cell phones sends out RFQs to multiple phone OEMs, who in turn send RFQs to several contract manufacturers. By the time the demand signal gets to the supplier, it can be grossly overstated.


Figure 2—Multi-counted demand signals

If the supplier is several steps removed from the end customer, they need to use their own intelligence to ferret out big end-customer deals, to get a more accurate picture of actual demand. As they pursue opportunities with OEMs, the account management team should capture information on potential end-customer deals (e.g., end-customer name, project name, size and type of deal, etc.). This data is factored into the forecasting scrubbing process to eliminate duplicate demand (see sidebar "Rationalizing Demand Across Channels"). Getting salespeople to consistently enter this kind of data is not easy. It must be made nearly effortless, and part of their compensation should be based on consistency and accuracy in tracking large end-customer deals. Forecasting Your Customer's Demand Beyond this, you should forecast demand for your customer's whole market and their share. For example, if you are a supplier to Ford, you would create your own forecast of demand for the whole light truck market and for Ford's share. Or a supplier to Juniper Network would forecast the whole enterprise switch market and Juniper Network's share. This way, if several major customers have aggressive forecasts, you can make your own informed opinions about whether the total market is really growing, or whether there is some double-counting going on. Formulating your own market assumptions provides the checks and balances needed to get to the best number you can for each account.

Taming the Bull Whip

Suppliers that are several layers deep in the supply chain can stop being at the mercy of late or incomplete demand information by

* Developing a demand BOM approach to understanding the actual demand as it flows through various channels

* Having a disciplined approach to keeping their "ear to the ground" on what is happening at each of the largest downstream channels and end-customers or large OEMs

* Maintaining their own perspective, getting a good handle on the total market size and using it to sanity check forecasts they receive from their customers

These steps can help upstream manufacturers avoid much of the misery and destructive force of the "bull-whip effect" that is normally the bane of their existence.


SOURCE:
http://www.technologyevaluation.com/research/articles/n-tier-demand-management-17705/