logility

Applause!

by Lora Cecere on October 25, 2013 · 1 comment

Last week, I wrote about the evolution of supply chain planning. In my blog post, I commented on HOW little supply chain planning has  changed in its twenty-year evolution. As I worked with clients this week, I had a long and hard talk with myself. I am part of the problem. I, like other analysts, are stuck in the traditional software APS paradigm.

In this post, I want to pay homage to trailblazers. This post is a commentary to companies that are challenging the traditional Advanced Planning System (APS) paradigms and trying to forge a new path.  As a start-up, I understand how hard it is to pave a new road forward. Here I share insights on four enterprise solutions. (Next week, I will focus on the new forms of business networks that are evolving.)

1) Kinaxis. The Kinaxis solution is probably one of the most misunderstood supply chain planning platforms. With its origins in “fast MRP”, the company has gone through multiple name changes to establish an identity and gain market traction.  It is a flexible, in-memory model and platform that enables visibility, demand and supply balancing, what-if analysis, allocation and available-to-promise (ATP) functionality. Throwing APS tradition to the wind, Kinaxis branded under the term “rapid response” five years ago and has recently been pushing the promise of the Supply Chain Control Tower.

In leaving the Kinaxis user meeting this week, I am struck by three things.  First, their recent work on mobility and defining the user experience on a mobile application is very cool. Secondly, the flexibility of the Kinaxis solution makes the product hard to message, but the clients that have figured it out, are very happy.  (Some of the happiest….) And, third, the solution is most often deployed in material-intensive supply chains for what-if simulation and visibility. It is a cloud-based solution that scales easily for hundreds of users. It has helped many clients that were too constrained by the inflexibility of the traditional APS platform.

At the conference, Kinexions, I heard many clients speaking freely about the deployment of Kinaxis and the turning off of Oracle and SAP APS solutions.  Many were almost giddy. The ease-of-use of the Kinaxis system was freeing for their teams.

2) Logility. I like the work that Logility has done in the redefinition of demand planning. Their work on New Product Profiler (a product to forecast a new product) and on attribute-based planning termed Proportional Profile Planning is very encouraging. It should be considered by all Logility customers struggling with demand accuracy in new product launch and promotion management.

3) Solvoyo. This week, I also spent time in Istanbul discussing the evolution of concurrent planning with some of the best minds in supply chain operations research.  Many of you may recall the great work that Koray Dugan and Omer Bakkalbasi did at i2 Technologies.  They are now teamed together working on the development of concurrent planning.

Essentially, the team is removing the partitions between network design, sales and operations planning (S&OP), inventory optimization, fulfillment and transportation planning. Originally, supply chain planning had to be compartmentalized to enable optimization solvers to run within a feasible timeframe. However, with the advent of cloud computing and more advanced optimization techniques, the team at Solvoyo is using parallel processing in the cloud at Amazon to provide decisions on demand (Software as Service that delivers the output and decisions integrating with the client’s existing software). As a result, the solution is solving inventory, transportation, and fulfillment in one model across strategic, tactical, operational, and executional horizons.  Is this important? Yes for three reasons…. The depth of the solution, a more scalable solution, and the bringing of the decisions on demand helps companies that are struggling to get and retain talent.

Inventory problems solved in isolation have had little adoption. Inventory needs to be part of a deeper, more connected solution. The Solvoyo technologies allow users to evaluate the form and function of inventory in network design and connect it to fulfillment and transportation planning. For an old gal in supply chain planning, I love seeing a new definition of supply chain planning.

4) Terra Technology.  Terra Technology has dubbed its solution demand sensing and with twenty consumer goods companies using the solution, the company is attempting to gain new clients in distribution-centric industries that are not consumer goods (e.g. distribution, chemical processing. food manufacturing and apparel). The solution replaces rules-based forecast consumption improving the translation of demand from a tactical forecast to a more useable and accurate demand signal for fulfillment. Companies using the Terra solution are averaging a 10% reduction in inventory on the balance sheet and an improvement in customer service fulfillment. However, despite seven years of product marketing, the company is still not well understood by prospects requiring ongoing dialogues with the buyers.

While the replacement of rules-based demand consumption, may seem like a small thing, the impact is significant, and the math has not been matched by the several want-a-be competitors that have tried….

Each of these companies have attempted to blaze a new trail in their own way. They are fighting bigger competitors that have done less platform innovation that charge much more for their solutions, but are more aggressive in marketing. Additionally, the higher costs of the extended ERP solutions makes them much more desirable for large system integrators to implement and recommend.

As I sit in seat 16C on a packed plane winging my way to Minneapolis, I just wanted to raise my glass and applaud the innovators. Hopefully, you will check them out too….

Next week, I will be in New York on Monday and at the Consumer Goods Technology (CGT) conference. I hope to see you in my travels….

 

 

Buckle Up! I think it will be a WILD Ride.

by Lora Cecere on September 13, 2012 · 1 comment

Supply chain talent is constrained. As we try to find a solution for the supply chain talent gap, there are more questions than answers.

Last week, I attended a Penn State networking conference on the topic. It was attended by 35 supply chain leaders.  This week, I continued to learn about talent development by facilitating an executive workshop at the Logility Connections conference.

To prepare for the conference, I worked with Karin Bursa, Vice President of Logility marketing, to complete a survey of 44 Logility clients on the state of talent in the supply chain. (I think that the responses from the Logility customers are typical of the industry.) In this blog post, I share insights from these two experiences.

At a high level, supply chain leadership teams are facing a talent shortage. It is driven by three forces: baby boomer retirement, growth in emerging economies, and growing recognition of the importance of supply chain as a discipline. No one has an answer; but here, I share some insights on the approaches teams are trying.

The Problem

Data and Understanding. Getting clear on the problem is the first step. Despite thirty years of supply chain evolution, as shown in figure 1, executive teams are still struggling to understand supply chain.

In the last year, the talent gap has become more acute.  It is a common for executives to look at the situation and question why jobs have been vacant for SO long. Many wonder if ” the HR department is doing their job.” In short, it is a new era. There are new obstacles. Closing the gap of understanding by the supply chain executive team is the first place to start.

Figure 1: Supply Chain Management Pain

Open Jobs. Of the 44 respondents, 52% currently have open supply chain planning jobs. Business pain is acute in the area of demand planning.  The average time to fill a job is five months. I believe that this is only going to get worse.

Building retreads –stealing planners from other companies–is not going to be an answer.

I also believe that hiring students from supply chain programs at Universities will not resolve the problem. Why? The graduates from schools like Penn State are heavily recruited. As a result, only large companies with well-established recruiting programs will be successful with this approach.

Vertical Silos. While companies talk of breaking down vertical silos, only 27% of companies actively manage supply chain careers focused on cross-functional training (across make, source and deliver); and only 16% have a human resources department focused on the management of supply chain talent. As shown in Figure 2, in the survey responses, there is a clear gap in job progression opportunities. Skill requirements are also changing.  The planner today needs to be a combination of analytical skills, business knowledge and influence skills.

Figure 2: Today and Five Years

My Take:

Demand is eclipsing supply. The gap will grow larger. Buckle your seatbelt….

There are no “Sure-fire” answers, but here are some things people are trying:

Invest and Grow your Own. I do not believe that the industry need for planners will be satisfied by the current programs at business schools. Graduating students are being courted heavily, and many have unrealistic expectations. I think that companies will need to actively recruit from other disciplines –engineers and math students– and train them through active cross-functional development programs to be supply chain leaders. The Johnson &  Johnson Gold Program or the Intel Supply Chain Masters Program are good reference models for the industry.

Actively Partner with Local Schools. Go to your local school and try to get momentum with internships and co-op programs. Work to train talent in disciplines that are not as great in demand.

Career Move for Customer Service Employees? One company was having good experience in training talented customer service representatives to be planners. They were investing in training and working on teaching long-term employees new skills. I find this to be an interesting idea. Senior customer service respresentatives know the customers and the supply chain constraints.

Oops! Plane is ready to land. Gotta wrap this up!  I am off to Australia to speak to a conference.  And, I will miss my flight. We will be continuing this discussion on the SCI Community. Check it out at www.scicommunity.com.

Also, please join us for our first webinar on September 24th.  We will be sharing insights on supply chain financial benchmark data and evaluating how companies historically make trade-offs.  It is designed for anyone with an interest in metrics that matter (reference http://supplychaininsights.com/upcoming-webinars/).