Top considerations for your Future SC Software Selection

Top considerations for your Future SC Software Selection

Technology provides capabilities to optimize the operational planning processes of a company. Traditional Supply Chain (SC) software has been widely adopted for a long time, however companies’ No. 1 supply chain priority is to go a step forward on improving its planning capabilities

Given growing SC Complexity and Volatility, it is becoming nearly impossible to revise a complete supply chain without using the latest technology.

Benjamin Nitsche –  SC Volatility Management

Key Functional Capabilities

Let’s imagine that you have a bunch of softwares in scope but it seems impossible to start your comparison.

First of all, focus on how the tools solve complex challenges. Have a look to the following list of key functional capabilities:

  1. Collaboration. External collaboration both with customers and vendors is becoming more common.
  2. Performance Monitoring and Analytics. Includes performance management, business intelligence, alerting, and advanced analytics.
  3. OptimizationBased on a discrete snapshot of reality. Most often applied to inventory and supply planning problems.
  4. Simulation / Scenario Planning. Used to support long-term S&OP or IBP, risk management, SC design, and tactical demand and supply problems.
  5. Scheduling. Resource allocation and operational planning.
  6. Response Management. How quick it reacts to volatility in demand, supply, and product to improve delivery service and operation efficiency.

Choosing a SC Software Vendor

As a good rule, I will recommend you to look for a Suite provider, this means that your vendor must have multifunction product software and your future tool will cover at least four of the functional areas within Supply Chain Planning:

  • Sales & Operations Planning (S&OP)
  • Supply & Replenishment Planning
  • Demand Planning and Forecasting (DP)
  • Vendor Managed Inventory (VMI)
  • Inventory Planning
  • Available to Promise (ATP)
  • Production Planning and Scheduling
  • Distribution Network Planning

Software Evaluation Criteria

In particular for software evaluation you will based your decision-making on the following criteria: Functionality, Technology Alignment, Viability, and Services.

What is more, Total Cost of Ownership (TCO) should be also consider as an important criteria which is separately dealt with using cost benefit analysis.

Functionality

Responsive planning, Optimization, SC design features, S&OP process maturity, Scheduling , Scenario planning / simulation, Advanced analytics, Scalability and speed, Functional roadmap and User interface.

Don’t infuence your decision in marketing and promises, go to the facts. Make your own analysis and visit the professionals on those companies that are using the current solution (see the vendor credentials) and ask them for their feedback, this is going to give you a real approach.

Technology Alignment

Exception and constraints handling, Integration with ERP, other SCP and legacy systems and Compatibility with custom/legacy systems.

Probably the most critical criteria for your IT department because in the future they will have to create interfaces and adapt all the internal reports and documents that your company is using in order to visualize them in the new tool.

Viability

Financial health, Strategic alliances, Availability of support by geography, Total footprint and solution maturity, Market adoption, Vendor direction and Industry specific focus … Not everyone take into account this point but is a very important one.

Nowadays technology companies are involved in many M&A so don’t be surprised that the tool you bought 5 years ago is no longer available and your vendor is not giving you any support because the new company which adquires the rights is not interested at all into maintain it … 

Total Cost of Ownership (TCO)

Total Cost of Ownership considering yearly feeds for all users and Maintenance (very important for future software updates) and support cost.

Finally remember that the real cost of a tool is not going to be only the ammount of zeros that you will pay, always keep in mind future developments and how much are they going to cost you …


Conclusions

To sum up I may say that every project is different, and each client has unique requirements …

Write about your past software experiences and note if there is a bias towards one application over another.

Analyze your environment, especially if your company is focus on one specific software vendor. Establish key project checkpoints … and design a document template in order to do your evaluations of all the points explained before.

Good luck!

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Tearing Up the Rulebook: How Millennials are Changing Concepts of Forecasting

Tearing Up the Rulebook: How Millennials are Changing Concepts of Forecasting

… In the past, software was not powerful enough to provide a reliable forecast, but now we have tools and resources that provide insight like never before.

The question is, are you getting the most out of them?

Everyone knows that the present and future is changeable, so why then are we still using the same forecasting structures and assumptions? Why don’t we leverage technology to model different scenarios and build adaptive forecasts?

During my session, I stressed the importance of avoiding complacency when it comes to our forecasting capabilities, and how we should never regard our strategy as the “right” strategy.

We should never regard our strategy as the “right” strategy …

If you’re achieving forecast accuracy now, then you temporarily have a good strategy that must evolve with changing market conditions.

In my session at the Amsterdam IBF convention, I invited everyone to start thinking about how we can plan for all eventualities and base our analysis and conclusions on Forecast Accuracy Simulation, specifically in terms of what-if scenarios, hierarchy, and product segmentation.

What’s more, we discussed how to set up a separate business unit for Disruptive Innovation to develop the resources and processes needed to deliver improvements in forecast accuracy and greater operational efficiency.

Some of the Key Takeaways were:

  • The importance of leveraging software to build adaptive forecasts and develop a continually evolving approach
  • How to start adding real value to your forecast through demand driven models
  • How to organize for innovation and embrace different perspectives on forecasting

My deepest gratituted to all the IBF institute team.

The Institute of Business Forecasting & Planning (IBF) is a membership organization recognized worldwide as the premier full-service provider of demand planning, forecasting, business analytics and S&OP education. Having some of the world’s most well-known global companies as its members, the IBF is constantly finding and disseminating better ways to manage demand, improve organizational efficiency, and company performance. It has been said that no other organization on the globe has as much depth in its educational content for Demand Planning & Forecasting as the IBF.