The Visible Supply Chain

Want to succeed in e-business? Give your stakeholders a view into supply chain performance, as well as the ability to make collaborative decisions

By Mark Smith

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Six Steps to Supply Chain Excellence

1. Break organizational barriers. Develop the ability to share information about business activities and interact on a near realtime basis across the supply chain. 2. Build visibility into the supply chain. Give more people a view into the metrics of supply chain performance. 3. Manage by metrics. Make your performance metrics align to cross-organizational business processes and assign them to specific individuals for monitoring. 4. Reduce the decision cycle process. Respond to market or customer demand in days and hours, not weeks. 5. Encourage decision-making collaboration. Make decisions collaboratively on the Internet, bringing relevant internal and external stakeholders into the process. 6. Reduce opportunity and problem resolution latency. Measure and monitor supply chain activities iteratively so you can respond to them more quickly.

Enabling Supply Chain Analytics

As I alluded earlier, the term supply chain analytics implies the process by which individuals, organizational units, and companies leverage supply chain information through the ability to measure, monitor, forecast, and manage supply chain-related business processes. As you might expect, the use of supply chain analytics is not a "winner-take-all" proposition; it requires an integrated assortment of technology, tools, and applications.

Recent advances in supply chain analytic application solutions have brought significant benefits to customers. These new solutions package application source extractions, domain content (including key performance indicators), and application logic in a manner that dramatically improves time to deployment.

Eight independent providers of supply chain analytic applications solutions exist, with two vendors, SageTree and SeeCommerce, focusing on that area exclusively. (These solutions vary in depth of capability and breadth of functionality; see Resources for complete list.) The major enterprise application providers - Oracle, PeopleSoft, and SAP - have entered the market with solutions that usually complement their respective application offerings; these solutions also require you to adopt an enterprisewide data model and framework. Although these solutions have sparked industry criticism, more mature versions of the products have recently become available.

The supply chain management-related vendors, which number at least 100, have been fairly quiet, with the exception of the two largest vendors, i2 Technologies Inc. and Manugistics, which have built analytic solutions beyond their traditional supply chain planning offerings. I2's Business Process Intelligence (BPI), which shipped at the beginning of 2000, is targeted at enhancing the value of existing applications and bringing new ones to market for the enterprise. I2 has integrated third-party data warehouse and OLAP technology, but its architectural design and applications will need time to mature. Thus far, other major application providers, such as JD Edwards and Baan, and procurement vendors, such as Ariba Inc. and Commerce One Inc., have been silent in this area.

Whether you're evaluating any of these analytic solutions or building your own, you need to strike a good balance between business functionality and technology. An analytic architectural framework can facilitate this process by serving as a foundation for framing technology and application solutions. (See Figure 2.) This framework will help you evaluate a vendor's solution and interfaces to operational and collaborative systems, as well as application and platform extensibility and customization.

Next-Generation Approaches

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Partly because of the cultural and organizational barriers I discussed earlier, most organizations are burdened by a disparate array of purchased or custom-built applications. A data warehouse approach is often the solution of choice here. Unfortunately, the latency of traditional data warehouse cycles will sabotage many of the activities I've described. (See sidebar, "Six Steps to Supply Chain Excellence,")

However, our growing experience in data warehousing has at least proven that business requirements should outweigh schemas, models, and technology approaches. One of the recent technology advancements that specifically address some of these challenges is that of distributed query management, in which OLAP servers, business modeling, real-time monitoring, and analytics cooperate to enable distributed access and analysis, a process that was once thought impossible. NQuire Software Inc. and InfoRay have both introduced new servers with these capabilities, enabling companies to forego a single data warehouse and schema and leverage existing data warehouses and marts, legacy systems, operational applications, and external sources instead.

Other significant improvements have emerged in application and user interface design, as portal user interface concepts, personalization capabilities, and role definitions now give users better access to relevant applications or content. In fact, a convergence of portal and traditional application user interfaces will provide clear, contextual, and relevant functionality to users in the years ahead. A clear example of this approach is SAP's mySAP Workplace, which leverages TopTier Software Inc.'s Drag & Relate technology and application integration framework to give business and line workers a single "point of entry" into internal and external information.

Supply chain analytics enable a rich variety of planning capabilities but has only begun to provide the information and analytics needed inside and outside the organization. Companies should look to leverage analytic application solutions that provide clear, distinct value in optimizing business processes, and give users access to information and apply analytics that can contribute to process and corporatewide goals and objectives. Business intelligence is possible only through a common information foundation that offers visibility and enables collaboration for everyone who has a stake in the business processes.