2014 Readers' Choice Survey: Supply Chain Planning

Download the full 2014 Supply Chain Planning Report

The supply chain is an increasingly complex system. For consumer goods manufacturers, this includes the 10 percent increase in the number of items sold over the last five years, and the 70 percent error and 9 percent bias associated with new product launch. Suffice it to say that planning has never been more fundamental to a consumer goods company’s top and bottom lines. Lora Cecere, founder, Supply Chain Insights, assesses the current state of planning.

Can you characterize interest and investment activity in this area?
Cecere: The supply chain planning market was over-hyped in the 1990s, collapsed in the early 2000s, and today, is still consolidating. Despite the strong returns to corporate performance for supply chain leaders, the market remains stagnant.

There are major gaps in user satisfaction with demand planning, supply planning and manufacturing scheduling. The current planning framework, defined in the 1990s, remains largely the same despite changes in business requirements and opportunities in computing power and visualization.

Still, for consumer goods manufacturers, planning is important. Why? Getting good at planning is fundamental to actualizing growth strategies that have stalled, but the adoption of good planning processes is slow. The biggest barrier is corporate behavior. Most companies reward the urgent over the important, and struggle to create an environment to use planning software effectively.

Can you comment on the top providers in this category? How is market consolidation affecting adoption and progress?
Cecere: With market maturity, the supply chain planning vendors consolidated. Most of the players on the list made major purchases, and are still rationalizing software platforms. This market consolidation adds to market confusion for the buyer of software.

At the current time, SAP continues to lead in buying preference due to market position, strength in corporate financials and the support of a strong system integrator base. Oracle’s user satisfaction is similar and buoyed by strong solutions for transportation planning and the legacy implementations of Siebel for trade promotion management. JDA is maintaining a strong legacy base from the purchase of Manugistics. These customers are strongly influenced by IT standardization directives and are working on many co-development programs to augment supply chain planning gaps.

Large system integrators favor the implementation of planning solutions from large ERP providers; and as a result, the list is predominately these players.

Both Logility and Terra Technology have innovated in the last year bringing some new solutions to market, and have high user satisfaction and loyal customer base, but there are fewer implementations.

Will investments in this area change over the next few years?
Cecere: Investments in 2014-2016 will be in the redefinition of demand. This focus will favor the best-of-breed solutions. So what happens to the supply chain planning market? Recovery takes time. Thought leaders will push for new solutions and late adopters will slowly redesign planning processes. It will not happen overnight.