According to the proverb “calamity is the touchstone of a brave mind,” in these tough times some supply chain management (SCM) vendors have been trying to take stock (no pun intended) of their offerings and how best to offer these to customers, to mutual benefit. In fact, I have recently seen some intriguing (if not bizarre) press releases (PRs), which read like some type of whitepapers or presentation transcripts.

They were certainly different (and therefore refreshing) from the customary dry and fluffy PRs that most communications folks use (especially during ordinary times). One such “educational” PR came this past summer from the spend management vendor Emptoris, and was analyzed in my blog post on five procurement commandments in a down economy.

A more recent similar PR came from JDA Software Group Inc., a provider of integrated merchandising and supply chain and revenue management planning, execution, and optimization solutions for the consumer-driven supply chain and services industries.  The PR came on the heels of the worldwide economy continuing to struggle and going into a tailspin, whereby new orders in the manufacturing sector are falling at record rates.

Read the rest of this entry »

For residents and tourists of Paris (France), using RER or Paris Metro is certainly a way to save on commuting costs (and parking frustrations) compared to owning and renting cars. This blog post is not about transportation, but rather about an inventory management method with a similar name.

Namely, this blog post is about RIR or Rapid Inventory Rightsizing, which is an innovative new program to help embattled companies relatively quickly free up cash and reduce the impact of the current global credit crunch on their supply chains. This pretty straightforward concept and message of improving a free cash flow (FCF) came recently from ToolsGroup, a global provider of demand-driven inventory optimization (IO) solutions. Regular readers of this blog site might remember my recent series on shortening long tails of supply chains, where ToolsGroup was also the protagonist. Read the rest of this entry »

Part 2 of this blog topic continued to analyze IBM’s rationale behind acquiring ILOG to bolster its service oriented architecture (SOA) and business process management (BPM) platforms, in part due to the capabilities of archrival Oracle.

What About ILOG’s SCM Products?

Whether as a sort of “collateral damage” (given IBM’s foremost interest in beefing up its SOA/BPM infrastructure product) or maybe not, the acquisition also leaves IBM with the supply chain management (SCM) applications business that ILOG has recently been developing in pursuit of a more profitable custom solution strategy. This strategy was going to complement ILOG’s tried-and-true “technology & platform” strategy of providing business rules management system (BRMS), optimization engines, and visualization tools. Read the rest of this entry »

Part II of this blog series explained ToolsGroup’s value proposition for achieving service level excellence in distribution environments. The point of the Service Optimizer 99+ (SO99+) suite’s name is that a “99+ percentage” represents the gold standard in customer service levels, and it takes a product purposely built to achieve service level excellence and to support such a high standard.

ToolsGroup’s latest version of software continues to build on the functionality needed to reach this goal.

Back to Mitigating Long Tails

Having put the necessary pieces in place, over the past year ToolsGroup has turned a particularly keen eye toward how to succeed in environments with a “long tail” demand. The long tail theory originally held that in an environment such as the Internet-based retailers (so called “e-tailers”), which is less affected by physical manufacturing, product and distribution constraints than so-called “brick-and-mortar” retailers, demand will spread across a huge array of items (a.k.a., stock-keeping units or SKUs). Read the rest of this entry »

Part I of this blog series introduced the notion of long tails in modern supply chains. That blog post also introduced the vendor ToolsGroup and its solution for planning and optimizing finished goods in distribution environments.

So, How Does ToolsGroup Solve the Distribution Puzzle?

Most of the benefits are driven here by the distinctive Stock Mix Optimization capability that has delivered higher service levels with much less inventory for ToolsGroup customers. As its name suggests, the feature is used to define and manage the right mix at each location in the supply network to deliver the targeted customer service level. Read the rest of this entry »

As a little kid growing up in former (and erstwhile happy) Yugoslavia and watching my elders, day in, day out, downing dozens of strong Turkish coffees with their neighbors and relatives (while discussing sports, weather, world politics, and the neighborhood gossip) I would sometimes naively ask for a sip of coffee. The deterring line (a bogey-man tale) from my folks would be that “kids that drink coffee end up with a tail on their rear side.”

A few decades later (being currently admittedly addicted to Starbucks triple-shot espresso drinks), it appears that modern supply chains suffer from long tails, albeit not due to anyone’s premature coffee consumption. That (and much more) was the enlightening conclusion of the recent Webcast entitled “Long Tails and Optimizing Inventories” conducted jointly by AMR Research, ToolsGroup, and Supply Chain Digest. Read the rest of this entry »

Part I of this blog topic introduced MCA Solutions and its flagship Service Planning Optimization (SPO) solution for planning and optimizing spare parts [evaluate this product]. That blog post also tackled MCA’s notably good times during 2007. In the meantime, an informative post on MCA was also published by the Sourcing Innovation blog.

A related 2007 milestone at MCA included a significant expansion with both new and existing customers in core markets, including aviation and defense (A&D), high-tech, and semiconductor manufacturing. Specific wins included the first joint effort with SAP for a large commercial aircraft manufacturer, expanded work with the US Navy to include planning for the entire naval aviation fleet, and successful deployments at new medical and capital equipment customers.

In addition to working with the largest corporate customers, MCA also cited growing revenue in the mid-market.  With its SPO OnDemand Software as a Service (SaaS) offering, MCA hopes to bring to smaller service organizations the same capability that service leaders in the Fortune 500 are seeing value from, but with a much lower upfront software and information technology (IT) infrastructure investment.

These benefits are attributed to lower monthly costs and faster implementations. The vendor will be expanding this offering in 2008 to make it even more appetizing and faster to deploy. The most recent win with the OnDemand SPO solution at Unisys Corporation might be a sign of succeeding with on-demand model at larger corporations as well as appealing to the mid-market. Read the rest of this entry »

Regardless of the economic environment (and sentiments), I always think of the opportunity within the aftermarket service and support as a profitable, high-margin and customer-captive business, and yet, still underserved. General Electric (GE) would be the proverbial example of a company that has focused on aftermarket opportunities, going so far as to call itself a “services” company as opposed to a “products” company.

GE indeed, starting with Jack Welch’s long chief executive officer (CEO) tenure, has been widely reported to have significantly increased both its total revenue and profitability by focusing on services opportunities in addition to developing world-class products.

The manufacturing corporate giant has certainly proven the value of serving the product aftermarket, which has recently been purported in a quantifiable manner by many pundits as a high margin business. For instance, AMR Research reported recently that businesses earn 45 percent of gross profits from the aftermarket, yet it is only 24 percent of their revenues, while a recent article in Harvard Business Review claims that we all spend US$1 trillion every year on assets we already own.

A related software category term was mentioned in TEC’s 2003 article titled Service Lifecycle Management - Tapping into the Value of the Product Aftermarket. Namely, Service Lifecycle Management (SLM) is a business initiative focused on servicing a company’s products, and the customers that bought them, after the product has been sold. Simply put, SLM focuses on making more money from the product after the initial sale. But it is more than that — it is also a way to become a strategic part of the customer’s business after the sale is completed. Read the rest of this entry »