Introduction: The Supply Chain Gap
Living in the global economy is a challenge for companies of any size, and recent business trends have only added to the complexities faced. Shrinking product lifecycles, increasingly complex supply chain and rising customer demands have all led to the need for more accurate forecasts. The impact of globalization, which has led to increased lead times for both supplier and customer, make it especially hard to be a thriving manufacturing or distribution company in the global economy of today.
Staying on top of demand, accurately planning production and inventory, and optimizing the sales and operations planning process have become not just best practices, but in most cases matters of absolute necessity. The companies that are able make the right decisions can lower their overall costs while improving their profitability, customer satisfaction, and competitive positioning. Those that can’t make the right decisions put themselves at risk for failure, or worse.
Further exacerbating the problem is the fact that the underlying complexity of their manufacturing and distribution systems is often growing, not shrinking, through the impact of globalization, merger and acquisition, and a host of other factors. Companies of all sizes can have multiple manufacturing systems, complex product and distribution requirements, and Global 1000-‐sized planning requirements. Getting a handle on planning, forecasting and S&OP in the context of this complexity is no easy task. Taking their business management processes to the next level by implementing a more integrated business planning function is even harder.
One of the problems facing companies trying to manage these often-‐conflicting requirements is that, while there have been considerable advances in the supply chain planning and decision-‐making technology, their technology choices have been surprisingly limited. On the one hand are supply chain planning solutions that, while generally effective, tend to be very expensive to implement and are complex and ill-‐suited for all but the very largest companies. On the other hand many companies have relied on lower-‐cost, simpler alternatives – from spread sheets to older-‐generation mid-‐market planning tools – that have proven to be unable to keep up with the dynamic supply chain and business climates they are supposed to help manage.
Demand Solutions, Inc. a 28-‐year old supply chain planning software and services vendor based in St. Louis, MO, recently brought to market a new supply chain planning product, DSX, designed precisely to fill the gap between overly large and complex enterprise solutions and the relatively low-‐tech or no-‐tech solutions that desperately need a refresh. Demand Solutions asked Enterprise Applications Consulting (EAC) to review the product and talk to customers about its usefulness in addressing the myriad issues confronting manufacturing and distribution companies today. The result of EAC’s review shows a product that is very well suited for solving this growing supply chain problem, particularly for companies that are running complex ERP systems, have multiple ERP solutions, or some combination of the two.
In particular, DSX is adept at supporting a range of supply chain management processes for its customers, including sales and operations planning, forecasting, vendor-‐managed inventory, and replenishment, among others. Those companies that are beginning to look at a more integrated planning function, one that can combine previously siloed planning functions under a single functional umbrella, will find DSX to be a good starting point. The fact that it is based on Microsoft’s .NET architecture and can run in the Microsoft Azure cloud is another important capability noted by customers. And the overall functionality in DSX also allows customers to leverage specific DSX capabilities for supporting workflow management, social/collaborative supply chain management, and lead time management, as well as offering cloud deployment options and advanced business intelligence.
This report summarizes EAC’s findings and discusses how DSX can help a broad range of companies overcome the limitations in their current technology and business processes.
Living and Thriving in the 21st Century Supply Chain
It’s clear that any company trying to thrive in the 21st century supply chain has encountered a fundamental problem endemic to enterprises of all sizes: how to improve planning and forecast accuracy in the face of an increasingly complex, time-‐sensitive, and globalized supply chain. This relatively straightforward problem is made up of a number of key components, all of which tend to conspire against simple solutions and easy fixes.
The problem with improving forecast accuracy is that it requires a carefully orchestrated process that collects information and data from a wide range of sources and stakeholders, some inside the enterprise and some outside, and uses those data to produce the best possible forecast for a given product or product line. The production of that forecast in turn depends on the collaboration of a set of decision-‐ makers and influencers – from supply chain planning to sales and marketing to retail or distribution partners – who may work in widely disparate parts of the enterprise or operate completely independently, as is the case with partners and customers. Finally, that forecast must be acted on and that action must be timely and easy to undertake, whether the action is to create a long-‐range strategic plan or the next day’s MRP run.
While this has always been the case with supply chain forecasting, the complexity and pace of the business market in the 21st century has made these issues even more acute. The stakes have never been higher, the margins for error smaller, and profit margins across the supply chain thinner and more vulnerable to cost overruns and error. The pressure and need for excellence have never been greater.
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