Expert Insight

By Mr. Danny Halim
VP, Industry Strategy

JDA Software

Date: December 9, 2010

Supply Chain Comment: For Mid-Sized Companies, an Investment in Supply Chain Planning is an Investment in Growth

Any Technology Solution To Help Companies Achieve This Goal Must Deliver Value Fast

Mid-sized companies today are uniquely challenged to drive innovation in products and processes while establishing a foundation for growth and keeping pace with customer expectations. Any technology solution to help companies achieve this goal must deliver value fast – or they will never get off of the starting block.

So what should mid-sized companies do? They must embrace initiatives that quickly capitalize on opportunities to increase demand responsiveness and improve cash flow without interruption to daily business. Technology, implemented in a non-traditional way, can help mid-sized businesses seize such opportunities.

Growing Beyond Spreadsheets and Legacy Systems

A reliance on out-dated tools causes many mid-sized companies to struggle, because Excel spreadsheets and aging legacy systems simply cannot match the speed and breadth of today’s supply chain complexities. Additionally, they cannot accurately forecast future trends and needs. This forces companies to rely solely on the speed and experience of their people. There is no denying the value of an experienced in-house team, but at some point the team becomes overburdened with tactical, routine issues, leaving no time for strategic business planning. That is where the right technology can help.

Today’s supply chain planning solutions can identify improvement opportunities and help drive down costs. These solutions gather and analyze huge volumes of information from across the supply chain in real time, enabling companies to quickly identify potential opportunities and automatically adjust their supply chain plans to deliver high service levels and uninterrupted cash flow.  Additionally, the forward-looking capabilities of these tools can help companies mitigate business risks by avoiding customer service failures, out-of-control inventory building and operational breakdowns.

Moving Forward with Low Risk

Mid-sized companies, concerned about how much time and money it could take to realize world-class supply chain results, are often reluctant to implement new technology.  However, continuing solution advancements have made these powerful solutions faster and more cost effective to implement than ever before. When deciding whether to take the plunge, mid-sized businesses should consider the following:

  • Identify critical issues for short-term improvement. Companies often realize the biggest impact by making a small set of targeted improvements to their most significant supply chain pain points. Partnering with a solutions provider to conduct an upfront value assessment can help identify a few critical areas for short-term improvement, as well as define the potential returns.

  • Don’t let data concerns hold you back. Today’s supply chain planning solutions typically require only about 20 data points, which most businesses have at their disposal via existing spreadsheets and legacy systems. Such solutions can help these companies develop fully automated plans that will serve as the basis for making better, more informed decisions.

  • Seek functionality with scalability. As a company grows, demand changes and market conditions shift, ultimately leading to greater supply chain complexity. To get the most from their investment, companies should assess a technology solution’s ability to scale as a business grows in volume and complexity. As specific operational improvements are made, the company can move on to tackle new challenges — and meaningful results will begin to cascade across the entire supply network.
  • Make supply chain improvements without burdening IT. Mid-sized companies can avoid interruption to their daily business and over burdening their own IT resources by relying on the solution provider’s experts to run the software for them. A hosted supply chain planning solution in combination with a team of knowledgeable experts and a proven implementation methodology allows companies to adopt best-in-class supply chain processes that will drive business value. Additionally, such solutions can be implemented in as little as four months, resulting in a fast return on investment.

Final Thoughts

By adopting scalable supply chain planning solutions with a speed-to-value deployment approach, mid-sized companies can ensure that bottom line benefits are achieved quickly with minimal risk to the business. With today’s continued economic volatility, it is an approach all mid-sized companies should consider.

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About the Author

Danny Halim is vice president, industry strategies at JDA Software. He is responsible for developing strategic supply chain innovations for the consumer products industries.

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Halim Says:

(Mid-sized companies)must embrace initiatives that quickly capitalize on opportunities to increase demand responsiveness and improve cash flow without interruption to daily business.

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