Supply Chain Management

Of late, via market hearsay, some level of intelligence gathering and straightforward google search, I've been trying to read up and wisen up on IBM's Smarter Commerce initiative. On first look, this may sound like another one of those attempts to prefix the word "smarter" with just about everything, but coming from an organization which has taken up the task for making the planet itself smarter, I was intrigued as to how the acquired companies (specifically Sterling Commerce) would stack up in this list.

 

Here's some webview on this:

 

Gary Schoch in his profile pretty much lays out the fact that there indeed is a Smarter Commerce strategy within IBM. (Read Gary's profile here: http://ae.linkedin.com/in/garyschoch). Per this (as of 31-Jan-2011), Gary is part of QUOTE Worldwide Commerce Solutions Sales organization, which delivers end to end solutions for customers spanning multi-channel commerce, through to order management, warehouse management and logistics management capabilities in a highly competitive marketplace UNQUOTE. Well, if this isn't WCS + Sterling, then I'm retiring from the business.

 

It also helps that Gary mentions he QUOTE developed the acquisition strategy for the business of Commerce, working with clients to understand market needs and converging that with IBM's vision was the key to the latest acquisitions of Sterling Commerce, Coremetrics and Unica. UNQUOTE

 

Erstwhilte, one of the IBM partners who does a fair bit of work on Websphere Commerce Server (WCS) had organized a Smarter Commerce day (http://www.fiwe.se/ibm-commerce-day_2010/) back in November which talked more of the front-end than the back-end supply chain which I wanted to know about. Todd Watson's developer works blog also had references to Smarter Commerce, then again the title also had Smarter Analytics (there we go again, with smarter everything).

 

The way it is evolving, Smarter Commerce would be an integrated product strategy that fits in what IBM has today (WCS components around portals, order capture, e-commerce etc) with what they have bought (Sterling Commerce, Unica, Coremetrics, ilog etc). Throw in some analytics (smarter analytics, if you may) via Cognos and you do have an end-to-end sales & marketing offering tailored to the e-commerce world. Throw in some more of fungible, powerfully reusuable ideas (I recall the Interconnected-Instrumented-Intelligent buzzwords springing out of every Consultant & SI conferences or Pulse events I've been) and you have a pretty neat pitch. So much so for the naysayers who said these random buys didn't make sense together.

 

Where I'm looking forward to the evolution of Smarter Commerce storyline around three angles:

1.     What happens to all that nice back-end logistics stuff? Sterling WMS offering pre-dates DOM/OMS by a few years (that's what Infosys had spun off into Yantra 15 years or so ago). The Nistevo TMS acquisition though niched in terms of geo (US) and offering (on-demand) would also need a more liberating home, which IBM may be able to provide.

2.     Sterling's alert & monitoring framework was pretty useful in creating some kind of a Supply Chain Event Management (SCEM) solution for DOM clients to flag them when things routinely go wrong (partials, substitutes, date changes, quantity mods, failed allocations...the works). I expect that to remain, and if possible, branch across the other components that make Smarter Commerce, well, smarter.

3.     While JDA has now become the undisputed leader in Supply Chain Planning (SCP) with i2 also in their kitty, anyone trying to form an end-to-end Marketing/Sales/Fulfillment strategy would realize that without solid forecasting and replenishment planning, you do not control the strategy side of your sell-side supply chain. I'm not making any bets here, but an SCP offering (or may be 2 or 3) may make a pretty nice fit into the larger picture.

 

In the days to come, I'd be keenly watching how the Smarter Commerce pitch evolves and how IBM would live with a fairly confusing multi-brand strategy unifying them under the smarter umbrella. Something tells me that for all the folks who worried about Sterling's B2B trampling over SCM and then DOM crowding out WMS/TMS, the reports of their deaths do seem vastly exaggerated (with my apologies to Mark Twain). In the meantime, lets all go get smarter...

 

 

Posted by Gopi Krishnan at 3:50 PM | Permalink | Comments (0) | TrackBacks (0)

In my previous blog, you read some of the best practices of preparation of data capture template. As you know, data is the fundamental to all performance metrics in your organization, data accelerates discussions, supports in gaining consensus from stake holders and eases decision making in any organization, you make sure to include all the important data fields in the data template during the tempate preparation phase. Preparation of Data Capture Template continues 

• Maintain version history for the data templates - this helps you to track the changes, to correct errors without affecting previous changes, to append data in the template etc.
• Follow easy file nomenclatures - this helps you to easily identity the data templates in future, to communicate better using the file names among the team, to avoid work on wrong files etc.
• Maintain the data templates in an organized folder structure in a document management system for easy sharing and retrieval.

Validating the data before load

Once you capture the data in the template, you will have a holistic view of the available data. According to Gartner, organizations should consider the below mentioned data quality issues

1. Existence (whether you have the required data)
2. Validity (whether your data values fall within an acceptable range or domain)
3. Consistency (whether the same piece of data stored in multiple locations contains the same values)
4. Integrity (the completeness of relationships between data elements and across data sets
5. Accuracy (whether the data describes the properties of the object it is meant to model)
6. Relevance (whether the data is the appropriate data to support the business objectives)

There are basic validations which you validate directly from the template - whether item or customer record has the key information, whether the data type is alphanumeric or integer, whether the field length is correct etc. But there are validations which you measure from an User's perspective - whether the template data includes all the available vendors and customers , whether the GL account of the storerooms are correct ? whether the customer address is the real address ? whether the item availability in the storeroom matches the actual stock availability etc. Find out all such data quality check list, validate the data, find out issues and correct the data in the template before you load the data into the ERP system. Usually, this will undergo multiple iterations and multiple stake holders will review the data as part of pre load validation phase.

Please add your comments and thoughts on this post. I would continue this topic in my next blog.

Posted by Jamuna Chinnathambi at 9:16 AM | Permalink | Comments (0) | TrackBacks (0)

Supply Chain managers constantly struggle to quantify investments and articulate the value for any reengineering exercise. A continuously learning organization, something exemplified by the likes of Toyota have taken articulation, assessment, measurement and insight generation to the next level by making it a part of their DNA. A widely accepted model for analysis of business processes is SCOR which lays out a methodology for organizations to view their supply chain in a different paradigm. The Supply Chain Practice at Infosys also has aligned its broad offerings based on the SCOR model starting with diagnostics and consulting to implementations. But talking about first measuring and then articulating realistically is something which has become an imperative in today's time when investments continue to be looked at under the lens.

 There is no disputing the fact that the key success factor in this pursuit, simply put, is exploiting data.  It's all about data and harnessing what is hidden from the decision makers and utilizes a triad of Mathematics, Operations Management and Technology to make life more fact-driven and moving beyond applying hunches and 'guess'timates to take routine decisions which on an incremental basis would yield an iceberg of benefit.  Even if processes and philosophies are in place to mine this gold, professionals usually are buried in the puzzle of how to get a notch higher for assessment and articulation. This is particularly true for operations and supply chain engagements as they attack the very core the way an organization conducts or operates its businesses. A perfect supply chain is often compared to a well oiled watch or a clock, where behind the needles are countless parts and gears working at their respective distinct speeds yet all harmonized to show you the correct time. That's precisely what supply chain managers grapple with, keeping the different network stakeholders in harmony for that elusive perfect order.
What is a good framework to evaluate supply chain/network competitiveness which could be a tool for the Consultant and an Operations Manager alike? Can there be a handful of key aspects which best summarizes and gives a capsule view of the state of the heart (Supply Chain)?.Here I would like to put forth my thoughts on how the 4V concept suggested by APICS helps in this regard.

APICS body of knowledge talks of four Vs and feel every supply chain network can put itself though this road test which comprises of: a) Variety b) Variability c) Velocity and d) Visibility
This below table filled in with KPIs and considerations would be the end state; an exercise trying to assess and quantify a supply chain organization or more precisely, aligning the network competitiveness with SCOR

SCOR Phase                          V Principle	Plan	Source	Make	Deliver	Return
Variety
Variability
Velocity
Visibility

 My propensity is to talk further from Planning through Return, but I am in two minds. Let me take the APICS route for planning in this edition which include areas like Sales & Operations planning, Mix /Assortment planning, and Production planning.

Variety: Variety in a planning problem would mean maintaining the optimal mix of SKUs and hence the aggregate families which are a basic unit of planning processes.  This mix is to be optimized in such a manner that it represents the popular mix at that time of the year as well as does not lead to loss of customers who look up to you for specific offerings. Increasing variety could serve niche customers but could pose customer service a challenge including demand planning and forecasting. So this is a key consideration for the planning phase.

Variability:  Here again the Pareto principle applies where 80 percent of the products have lesser variability/predictable behavior and 20 percent would have greater demand variability.  Variability can be better managed by synchronizing sales and operations planning and even better if the variants or product mix is optimized. From a production planning perspective this is achieved by effectively agreeing on the frozen to slush zone and institutionalizing the same. Better managing variability has a direct impact on working capital reduction as it impacts the stock/inventory carried in the network.

Velocity:  A responsive supply chain is a competitive edge where every cog in the wheel and more importantly the source of every product in the factory is able to scale and up and down. A chase strategy in capacity and production planning could ensure the desired pace in the network.  The max and lower boundary values of capacity would define the max and min of velocity that the source can attain. Additionally, if a healthy mix is attained in mix planning, the same would lead to higher inventory turns and keep the drum part of Goldratt's D-B-R at desired levels.

Visibility: This is an easy one. S&OP processes and tools increase visibility across the sales and operations organizations. CPFR aims at better planning processes capitalizing on the collaboration aspect of conducting one's business. Visibility by sharing business plans and constraints (be it capacity or material) helps transform functions like procurement by enabling regional buying of difficult to forecast part of the portfolio. This brings in tangible benefits like reduced lead time and at the same time, reducing stock levels required for the same.

The above key considerations help at arriving at ways to measure and quantify the competitive quotient(CQ) of the network. The SCOR along with the 4Vs streamlines the thought process on each critical phase in the supply chain.  I would like to know your thoughts on the above and applying it to the remaining phases as prescribed by SCOR viz-a-viz source through make and deliver to return. What would the key KPIs be that you all think could be associated with each phase? It would be great if you can share your experiences.

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Posted by Dawn Mathew Varghese at 3:47 AM | Permalink | Comments (0) | TrackBacks (0)

Recently we received a requirement for showcasing our credentials in SRM-PLM integration space, with the experience of being a part of the team who executed this assignment I would like to share the same with the functional and technical feasibility of the carryover of business turnaround especially the round robin procurement process in engineering projects. With this integration it gives leverage to the purchasers with a good sight for negotiating in a competitive environment

SAP Supplier Relationship Management (SAP SRM) supports integration with SAP Product Lifecycle Management (PLM) cFolders 2.0 or higher. After the installation of the SAP PLM cFolders, the purchasers can have their space to communicate clearly the engineering design documents and share the information with the potential suppliers and create a folder there to store information, and share it with potential suppliers. PLM functionality has a template which can be used by both parties where specific information relative to the specifications and design can be stored, the data can be kept more confidential by having segregation like public or private folders function for both purchasers and bidders.
To achieve this technical integration between SAP SRM and SAP PLM key configurations required are
1) Defining a new Logical System for cFolders in both systems for communication between the two systems
2) Define Logical System as a Back-end System so for SRM cFolders would be the backend system for any document flow
3) Adding cFolders Role Users for Purchasers and Bidders, and RFC Users in SRM system this enables the Purchasers and Bidders to access the documents dependent on the role
4) Add cFolders Role to Composite Roles for Purchasers and RFC Users
5) Activate Service CFX_RFC_UI and Create an External Alias in the cFolder System
6) Test Service CFX_RFC_UI
7) Configuring the users for communications
Once when the technical integration is achieved the functional flow to carryover the business can go along the process to follow is as below
1) The purchaser creates an RFx in SAP SRM, and then creates a cFolder for that RFx. The purchaser can do this under Collaboration in the Documents area of the Header data tab page in SAP SRM. When the purchaser chooses Create, a folder is set up automatically in a public area in cFolders, as part of the competitive scenario.
It is important at this point to save the RFx by choosing Save. If the RFx is not saved and subsequently gets lost, the link to the folder in cFolders will also be lost and you will be unable to retrieve it.
 

2) The purchaser goes to the cFolder and invites the engineers on the purchasing side to place all the relevant design and specification information in the folder for potential bidders to view. Only the purchasing side can make changes to the public area of the folder.
 

3)  When potential bidders access an RFx, they can see whether or not a folder has been created for that RFx. If it has, they can follow the link to the folder in the public area in cFolders, view the project information, and decide if they wish to submit a bid.
4)  Once a bidder chooses Create bid, a private area is created automatically in cFolders and all the data is copied from the public area to the private area. In this private area, bidders can place all the information surrounding their offer, and revise and update it at any time.
5) The purchasing side determines a winning bid.
6) All project participants on both the purchasing and supply sides can access the work area in cFolders,and add to and correct the data until all parties have agreed on the final and binding specifications.
Methods for working together include:
a) Documents
b) Bookmarks
c) Data sheets
d) Discussions forums
The link to cFolders is included in the bid and also in the follow-on purchase order or contract. The
collaboration area remains open, allowing the purchaser and the supplier to refine the design
documents even after the winning bid has been determined.

This integration is very useful for engineering relative procurement for corrective buying in a collaborative environment between the purchasing organization and engineering department.

Posted by Nilesh Dhoble at 5:24 AM | Permalink | Comments (0) | TrackBacks (0)

Thomas A. Edison said that there is no progress without restlessness and discontent. True are these words when it comes to understanding how a successful Projects must be managed.

Projects today are complex. Multi-tracks, Multi-cultural and Multi-time zones are just a few Project Management challenges. Communications, the cornerstone of Projects, is now a key problem for Project Managers and their teams to solve. Dispersed teams further add risks to successful Project Execution and their commitment to timely deliveries.

In addition to the above issues, risks that appear from changes to schedules, scopes and capabilities plague progress. Gaining visibility beyond weekly tasks is becoming a never possible. Most Projects have the "close and comfort" zone that Managers create in order to park and diffuse risks. In reality, this zone is so thin to bear the weight of most Project delays for ensuring turnarounds. 

Communication can become a reason for resentment. Keeping the teams focused on Delivering when Communication fails is a best practice way to regain and build Confidence.

Unknown and uncertain elements create a perfect storm for Project Managers. Leading teams to succeed in such a terrain of restlessness and discontent is no more a sign of danger but an effective technique of Project Management.

Finally to remember in Project Communications- a fat chance and a slim chance; both mean the same thing. Before context arrives, the problem is born and is growing stronger.

Posted by Shan Latheef at 2:23 AM | Permalink | Comments (0) | TrackBacks (0)

The chains of habits are too weak to be felt until they are too strong to be broken.

Can Existing Supply Chains be Modeled for Results?

There are a variety of supply chain models, which address both the upstream and downstream processes. The SCOR is one such model.

The SCOR or Supply Chain Operations Reference model, developed by the Supply Chain Council, measures total supply chain performance. It is a process reference model for supply-chain management, spanning from the supplier's supplier to the customer's customer.It includes delivery and order fulfillment performance, production flexibility, warranty and returns processing costs, inventory and asset turns, and other factors in evaluating the overall effective performance of a supply chain.

The Global Supply Chain Forum (GSCF) introduced another Supply Chain Model. This framework is built on 8 key business processes that are both cross-functional and cross-enterprise in nature. Each process is managed by a cross-functional team, including representatives from finance, logistics, production, purchasing, finance, marketing and research and development. While each process will interface with key customers and suppliers, the customer relationship management and supplier relationship management processes form the critical linkages in the supply chain.

Supply chain leaders must investigate current business processes and practices for fitment to SCOR. When Supply chains can be measured in terms of dollars and units, metrics and parameters - modeling for results and cross-functional collaboration happen.

Performance is a function of defined process, its constraints and outcomes. Consistent results and lost opportunities must be recorded for sustaining benefits. Modeling is just the begining of a journey to create a successful and un-surprising Supply chain. Changes to behavior in decision-making is the point when one can be certain that their Supply chain model is working.

Posted by Shan Latheef at 1:57 AM | Permalink | Comments (0) | TrackBacks (0)

As we are welcoming the New Year 2011, I tried to figure out what Asset Management software users (mainly Asset Intensive organizations) should look for from their Asset Management implementation in next few years. Based on my experience from some direct & indirect client interactions in last couple of years, I tried putting together a list of trends and here is the synopsis.

In my view, Asset management software trends would vary based on the geography or economy. I see two different kinds of geographies/economies: (i) Matured Market (ii) Emerging Market. These two markets would have significant differences in Asset Management Software needs.

Matured Market - Most of the organizations in these markets have been using asset management applications for some time and now they should look for value adds to their existing implementations. Typical value adds, they should consider are:

• Consolidation & Upgrade - Many organizations in these markets have been using multiple applications, instances or versions of asset management applications due to various technology & applications limitations, acquisition of new plants using different applications, geographical spread etc. These organizations should look for consolidating their disparate systems into one platform of a single version of one application. This consolidation would help these organizations in harmonizing their business processes, reducing redundancy & inconsistency across applications, reduction in overall cost of operations, improvement in operational efficiency etc to name few of the benefits.

• Predictive Maintenance - Most of the organizations in these markets are still mainly using asset management software for Preventive & corrective maintenance. They use Predictive maintenance to some extent but are not taking full advantage. Predictive Maintenance should be the next area of improvement for them to move one level higher in asset management maturity model.

• Mobility Solutions - Though few of the organizations use mobile solutions for their asset management users, but Mobile solutions usage is still not reached the maturity levels as it should have. Maintenance users are not the back-office users and they work most of the time in the field working with machines, hence in order to increase their efficiency, organizations should look for equipping them with application enabled mobile devices where they should be able to access & use all features of asset management application quickly & easily.

• Integration with sensors, smart devices, GIS - Organizations in this market should start exploring the usage of integrating their asset management applications with smart devices to increase the uptime of their assets. Few organizations have integration with RFID tags, GIS etc. Advancement in technology fuelled by increased awareness in market & resource availability has mad

• Visualization, Optimization & Usability - End users for asset management applications are mainly the maintenance technicians & field engineers who are more comfortable with their production machines than the computer systems running software applications. Hence these users would look for an enhanced usability from asset management applications which would help them in using the software with fewer clicks in less time. Touch Screens, easier navigations etc could be some solutions for these users.

Emerging Market- Lots of new infrastructure is being developed for this market. Airports, Rail & Road infrastructure, Power Plants, Oil & Gas Refineries are coming up, which all need asset management applications to manage their heavy & critical assets. Hence these markets would take time to reach the level of asset management software usages as in matured economies. These markets have different needs:

• Master Data Management- These organizations would focus more on having a reliable, usable master data in their asset management software. Asset management softwares need an extensive planning for master data management. Even a small inefficiency in master data may lead to an unusable application. These organizations would focus on defining asset registers, standard operating procedures based on OEM supplier's recommendations. An interesting trend here for Greenfield project situation could be integration with EPC systems which would help them in automatically populating Asset register, BOM, spare parts, SOPs etc from EPC software.

• Preventive Maintenance to start with - These organizations would focus on corrective & preventive maintenance practices to start with and should wait for integration with SCADA systems. Once their corrective & preventive maintenance work strategies are in place and system & users get maturity, they should plan for to move the Predictive maintenance.

•  Mobility Solutions - Mobile solutions are no longer considered an advanced technology in today's scenario. In order to have an effective & efficient usage of asset management application, companies should look for implementing mobile solutions in the initial phases of implementation. Usage of mobile solution would increase the acceptability of asset management applications among field users.

Emerging markets certainly have most of the Matured Markets' requirements (except for consolidation & upgrade) as well but not in next few years. Emerging market initially would need to have basic software usage in place and then look for attaining next level of asset management maturity but certainly these markets would less time to reach the next maturity level as compared to time taken by matured market.

Posted by Praveen Kumar Agrawal at 1:46 PM | Permalink | Comments (1) | TrackBacks (0)