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SCM systems supply vital lifeline to businesses

This article appears in the issue April 2000 [Volume 9, Issue 3]

Ensuring no links are missing

An efficient, wall-to-wall supply chain has become essential to every business that needs to tightly control its goods, services and operations. If all stages of an organization's supply chain management (SCM) system work smoothly, everyone from core company personnel to users will be happy.

Bob Timberlake Apparel is an outdoor clothing and accessories manufacturer. Its executives confirm the importance of being able to rigorously manage every aspect of the company's production, order fulfillment and customer services. Bob Timberlake's two-part supply chain system links the firm's operations with its distributors and suppliers, and coordinates orders with its retailers. Administrators say that the company's Lotus-powered supply chain management system "distributes information early in the manufacturing cycle, which allows our organization to reduce development time and excess inventory costs by enabling collaboration among our partners."

To emphasize the value of having a well-oiled SCM system, Tim Minahan, e-business research director of the Aberdeen Group, addresses the issue. Says Minahan, "In the future, the most successful businesses will be those that can establish, manage and maintain a dynamic supply network--a series of supply chains that a firm can rapidly assemble and adjust to respond to unique customer requirements."

Minahan adds, "Such hyper-responsiveness will require organizations to be able to leverage global communication networks to exchange vital business information--such as production forecasts and capacity information--and to collaborate on business analysis, planning and other activities throughout their entire supply network."

New offerings provide added components

To provide firms with the ability to create efficient supply networks, many companies have launched SCM products and services. Several of those offerings are described here:

SPS Commerce, a vendor of Web-based supply chain management solutions, recently enhanced its Trading Partner Enablement (TPE) services. Its new (mainly outsourced) offering can empower businesses with the ability to track and analyze transaction data and to predict and plan inventory requirements.

The SCM and business intelligence company has a number of retail customers including Sears, Kmart, Sherwin Williams, Fingerhut, Target and JoAnn Stores. SPS' clients expect accurate, constant and full control over their operations from start to finish.

One example of what SPS offers Sears has to do with its widespread distribution network. The huge retailer has seven distribution centers throughout the country and more than 6,000 vendor trading partners.

Until recently, some of Sears' larger partners were automated through old-school methods--the largest percentage of its suppliers were still functioning with manual systems. While Sears insists on electronic compliance from all its vendors, its management realized that mom and pop suppliers might not be able to afford to implement across-the-board electronic conformity.

Jon Lissman, system integration manager for Sears' vendor relations group, comments on how SCM helped make a potentially awkward situation workable.

"We have a number of small vendors for whom traditional solutions for electronic compliance are prohibitively expensive or too technical for the staff to handle," Lissman says. "By using Web-based electronic data interchange (EDI) from SPS Commerce, however, these vendors have been able to establish electronic trading relationships with Sears quickly and at a price attractive to them."

SPS Commerce's new enhancement to its Trading Partner Enablement (TPE) services enables all vendors with Web browsers to conduct their transactions electronically. In addition, by providing even more personalized services such as manual conversion, SPS is able to guarantee Sears that all of its trading partners can comply with its mandate.

Data runs in a variety of formats (XML, EDI, HTML) from the vendor to SPS. SPS then converts the data into whichever format the hub requires and sends it on to the hub company. The vendor can access the service from a Web browser or can fax, e-mail or mail its POs, invoices and so on to SPS Commerce where the necessary data conversion takes place.

Vertical reborn to horizontal

Keeping up with the limitless details surrounding customized parts and assemblies can be an formidable responsibility. Supplybase.inc has taken on the mission of providing specialty manufacturers with Web-based tools to reduce time-to-market, enhance product differentiation, lower product costs and streamline supplier management. The firm's flagship product is Supplybase.manager--a collaborative platform targeted at high-end OEMs.

Nortel Networks uses Supplybase.manager to speed its design and development cycles. Brian Robertson, VP of EDS Business Operations with Nortel, says the product leads to "greater predictability in project schedules. This will lead to higher customer satisfaction through consistent product delivery schedules and faster time to market."

A few months ago, Supplybase.inc introduced a new, broader-based offering called Supplybase.source, which is free to manufacturers. Its mandate is to help procurement managers and design engineers find, qualify and initiate business from one place online.

To round out its line, Supplybase.inc soon plans to launch Supplybase.exchange, which basically is a hosted version of Supplybase.manager, aimed at the mid-tier manufacturing market. That service will allow customers to communicate and collaborate with 80,000 suppliers in 45 commodities residing in the company's Supplybase.central database. Exchange can be integrated into existing enterprise resource planning (ERP) and SCM products.

Instant gratification required

In a just-in-time world, on-command shipments make trucks into rolling warehouses. TanData develops Internet-based shipping management technology for e-commerce and SCM. Its customers range from small online retailers to large software firms such as Pandesic, Intershop and I2 Technologies ... not to mention Dell Computer, one of the largest hardware firms in the world.

To close potential cracks in any phase of the supply chain, TanData has just released ChainLink, an e-commerce approach providing customers with shipping information from the point of order entry to the point of shipment. ChainLink runs on NT, calls for about 100 MB of space, and its data requirements depend on the kinds of transactions performed. Rating queries, for instance, might use minimal space while some data-intensive shipping applications could require about 1 KB per package.

Patrick Evans, president of Evcor Systems, confirms the value of a product such as ChainLink. "All customers have unique requirements for running their shipping operations," says Evans. "TanData's shipping software will allow the Evcor network to implement a Web-enabled thin client using a Microsoft COM objects-based solution, which can be customized to the level our customers demand."

Major manufacturers and online businesses have jumped on the SCM train--and they are continuing to do so in increasing numbers, changing their operations to work smarter and respond to their users' needs more quickly and cost-effectively.

Janet J. Barron has been a published technical writer for over 20 years. E-mail redbaron@agate.net.


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