Supply Chain Execution

Consumer goods firms are re-examining
their supply chain systems, underscoring the industry’s movement toward a demand-driven supply network (DDSN). In a DDSN, planning and execution must be tightly coupled to enable a company to sense and respond to changes in demand and supply dynamics — a goal that SAP (No. 1 in SCE this year) is working to achieve for its customers. mySAP SCM 5.0 concentrates on both the adaptive supply chain network and the ability to link the service supply chain with the product supply chain. The tool focuses on DDSNs for the consumer products industry, extending transportation planning and execution as well as RFID-enabled supply chain planning and execution capabilities.

While enterprise players are preparing offerings to accommodate a demand-driven supply chain, traditional SCE suppliers are looking to consolidate offerings to increase market penetration. In August 2005, Manhattan Associates propelled itself into the planning space when it acquired Evant. The acquisition extends Manhattan’s footprint to now include demand intelligence, advanced planning, supply chain planning and SCE solutions connected with a common business platform. The Gartner report, “Manhattan Associates Buy Brings together Execution, Planning”, says the acquisition raises the competitive bar for all SCM vendors, and represents the first real-world test of whether synergies exist between planning and execution.

After admittedly reaching an inflection point that required enhanced funding, RedPrairie was acquired by Francisco Partners, a technology-focused private equity fund. RedPrairie (which experienced a 30 percent growth rate for three years in a row) expects to accelerate growth while enhancing its focus on customer results.

Breakout Winners
Customer Experience
Supply chain execution systems must be agile enough to quickly respond to a rapidly changing product mix and short product life cycles, especially in the apparel industry. “We have worked closely with the Jesta team and understand that they continue to develop and support unique needs of apparel manufacturers,” says John Kirsch, president, Sportif USA. “Our goal was to...make our company more productive and efficient. Ultimately, it will improve our bottom line.”

Small/midsize business
Distributing products in line with customers specifications can ensure competitive advantage for mid-market firms in billion-dollar markets. Hawaiian Tropic’s experience with SAP and SAP business partner IDS Scheer has been overwhelmingly positive. “We now have a lot of flexibility in the way we run our business,” says Steve Swanson, VP of IT, Hawaiian Tropic. “We’re small and nimble relative to our competitors, so we can make quick decisions and provide more customized product to our customers. We’re willing to make the extra effort to be customer focused.”

Breakout Winners
Customer Experience
Goodyear turned to Sun’s 17,000 square-foot RFID test center for answers to RFID challenges. Once there, it tested various tags, readers, and printers to find the best solution for its RFID needs.

Small/midsize business
At KiMs, Microsoft Business Solutions - Axapta helps plan the snack maker’s warehouse space better, which leads to trimmed inventory levels and minimizes shrinkage.

RFID Software Vendors

It seems the days of slap and ship deployments are numbered as consumer goods firms are mandated to move forward with RFID plans. “As consumer goods companies expand their RFID implementations, they will need to manage multiple sites and multiple geographic locations,” says Erik Michielsen, ABI Research. Big players like SAP and Microsoft will continue promoting software efforts into 2006 that will benefit large deployments. Microsoft spent 2005 working on Windows and SQL Server software that could simplify the transference of data from RFID tags into databases. Meanwhile, smaller, specialized RFID companies and larger enterprise-level application integrators are partnering to address large-scale implementations. In September 2005, IBM partnered with OATSystems to provide RFID device management services to clients before IBM’s launch of its RFID WebSphere Premises Server. In any case, the success of future RFID software offerings to this industry still comes down to cost. “Once end-users expand to multiple sites, the cost for middleware alone will be very high,” says Michielsen.