Category Archives: Technology

the doctor’s Not Going To Stop Until He Exposes All Of The Elephants!

Late last fall in the doctor wonders why the elephants in the room are often so hard to see and the doctor exposes the elephants in the room I exposed the elephants in the room that were hiding behind the blinds, couch, lamp, and projection screen. But this is a very big room – and it is jam-packed with elephants. So today, in addition to the optimization, compliance, analysis, enablement, contract management, and hidden cost elephants, I’m going to expose the elephants hiding behind the coat rack, the bar, and the water cooler.

We’ll start with an RFX elephant, who’d have you believe that the number of pre-configured templates in the template libraries are an important selling point of an e-RFX tool. It’s not. After all, every business is different and, in reality, you’ll probably have to customize every single standard template that’s provided to meet your business needs before you can use it. That tells you it’s the flexibility of the tool when it comes to RFX creation that’s important – especially since, no matter how many templates are offered, there’ll always be templates that are missing that you need to create yourself.

Now we’ll move on to the e-Payment elephant who will tell you it’s the platform that matters – and, believe-it-or-not, who provides it. Although it’s important that the company that provides the platform be financially stable, it doesn’t have to be owned by a bank or the biggest player in the space to be useful, because, when it comes to e-Payment, it’s not the payment platform that matters – but whether or not it enables your organization. Does it support the types of payments you regularly make? (If you do a lot of p-card and ACH, and it only supports wires and ACH, then there’s a problem.) Does it automate the capture and transmission of all of the payment details that are required by your e-Procurement / EIPP systems as well as your accounting systems? Does it simplify the transactional processing, freeing up manpower for exception handling and more strategic purchasing responsibilities? Because these are the things that matter!

We won’t forget about the technology RFP elephant though – because this big-daddy of elephants, who is often willing to provide us with RFP templates for any technology we might want to put out to bid, will have us believe that you should be evaluating a solution based on the number of (pseudo-) standard features it has, and not whether it has the functionality you need. This is absurd – especially when you aren’t familiar with the technology! After all, why do you care whether or not it has 300 features you probably don’t need? And how do you evaluate solution A with 350 features vs solution B with 315 features vs solution C with 385 features when the common feature overlap between all three solutions is only 60% based upon your unduly long, inept, and inappropriate RFP that this technology elephant gave you. You need a solution that has the functionality that supports the business processes that you need. To do this, especially when you are unfamiliar with the solutions you’ll be evaluating, you need to send out a rather open-ended RFI that describes the processes you need and the problems that you are having and that asks the vendors to describe how their tool solves these problems. Then, you take the top 3 – 5 RFIs, figure out what your minimal baseline is with regards to key capabilities, and send back a more detailed RFP that outlines the core functionality you need (and any industry standard features you’re aware of that are also required), additional functionality you’d like, and the timeframe you’d like to deploy it in and note that formal submissions will not be considered until you get a full demo (if you haven’t had one already). But still, it should be short. Closer to 60 questions than the 600 or so “feature questions” that I’ve been hearing about from some vendors lately if you’re really focussing on what you need and not the market mumbo-jumbo that the elephants are feeding you.

So take heed, elephants hiding in the closet, behind the door, and under the boardroom table – because you’re next!

What Do Object Oriented Programming and Custom GUIs Have To Do With Actionable Data?

Note to the astute reader: This is essentially the same comment that I made in response to Jason Busch’s “It’s Not Just About the Data — It’s About Acting on the Data” post on Spend Matters on Thursday.

I don’t know, but if anyone can tell me, I’d be grateful. The Supply Chain Management Review recently ran an article titled “Supply Chain Measurement: Turning Data Into Action” that, apparently, uses a three step process to help you transition from making measurements to taking actions, which is, of course, the reason you’re measuring in the first place. If the measurements indicate that there is something that can be improved, then you should take action.

The steps are outlined as follows:

  • Understand Interdependencies – Use Themes and Patterns
  • Identify the Tradeoffs and Analyze Root Causes
  • Develop and Prioritize Action Items

I could be wrong, but I thought that patterns were generally used in object oriented design to represent standard relationships and interactions between objects and classes, without specifying the final application objects or classes that will be involved. In addition, I thought that themes were pre-configured graphical user interface customizations that are generally used to customize the look and feel of an operating system or window manager. I don’t see what either of these have to do with supply chain measurements. Furthermore, this looks more like a prescription for modernizing a classic procedural software application into a modern object oriented software application than it does for supply chain improvement. I have to say I’m just a little confused.

The article doesn’t help much. With regard to understanding interdependencies, it says to think of the data as a narrative; your job is to reveal the final story. A narrative? Are we supposed to be writing a work of fiction? Then it says that the data can be sliced into different thematics and that it’s helpful to visually map the metrics to the themes. Are we supposed to be creating works of art?

Then it goes on to say a a successful analysis of themes, interdependencies and tradeoffs reveals is where the levers are in your supply chain. Levers? Where did they come from? Now you have to be a mad scientist too?!?

About the only thing I understood in this article is that supply chains are complex, and that’s why you shouldn’t try to summarize everything about a supply chain in a single, short, article. Because you end up using so many metaphors that, by the end of it, your audience will, like Pinky, be stunned so senseless that all they can do is ask about the metal floors.

Supply Management in the Decade Ahead IX: Leveraging Technology Enablers

This post continues our coverage of “Succeeding in a Dynamic World: Supply Management in the Decade Ahead” (a detailed report based on research jointly undertaken by the ISM, A.T. Kearney and CAPS Research), and our review of the seven critical supply strategies for succeeding in a dynamic world in particular, with the fourth critical supply strategy identified by the report – the leverage of technology enablers.

Ten years ago, the use of information technology in supply management was just emerging. As of today, an enormous amount of technology has been introduced to make supply management “easier” and more effective. In the next ten years, there will be both a continuation and expansion of technology introduced over the past decade and the introduction of totally new technological advances that will continue to expand the scope of supply management.

The report addressed what supply executives will want from technology in the future. Their wish list consists of ease of access; visibility through web-based tools; collaboration platforms for everything from product development to operations to schedules; tracking and simulation; powerful tools for risk, compliance, and supply market analyses; and user interfaces that can be grasped as intuitively as customer-focused e-tailer’s sites are.

In the future, these supply managers will focus increasingly on collaboration and collaboration-enabled technologies, advanced analytics will become common, and needed information and interaction with suppliers will become external rather than internal. Other strategies employed will be the use of a common company-wide data store for supplier, item, and service data; integrated applications and processes for supply-management; the embedding of best practices in supply management tools; and using tools that provide transparency of operational information throughout the supply chain.

The authors of the report believe that 2007 was the year where we “crossed the chasm” with respect to most of the functional areas in supply chain management and that we will thus, from this point on, see continued refinement of technologies already introduced. Specifically, spend management will continue to expand its flexibility for analytics and companies will be less challenged by the need to perform extensive data cleansing; optimization will continue to expand its feature set and capabilities; and contract management software will become more integrated.

New technology introductions over the next ten years will go beyond sourcing and compliance into more value-based areas. For example, collaboration tools will be linked to PLM and future tools will allow workflows for different supply chains to have different sets of processes. The emerging technology solutions, whatever they are, will leverage improved analytics, broader data integration, and collaboration.

the doctor Would Like To Remind You (that the One System Solution is Still a Pipe Dream)

The One System Solution Is Still a Pipe Dream! And no vendor is going to get all of the pieces right no matter how big they are or how many resources they have. I bring this up because, in talking to a number of smaller, innovative, vendors lately the number one reason that they’re offering as to why they’re not getting more business is because a number of customers are apparently demanding a one vendor solution when it comes to their sourcing or procurement technology platform. This is ludicrous! (Not to be confused with Ludacris.)

If one vendor could get all the pieces right, don’t you think it would have happened by now? Don’t you think that either Microsoft, IBM, SAP, or Oracle would already have the perfect solution? And more importantly, don’t you already deal with a plethora of technology vendors – and a slew of hardware, software, and consulting vendors to boot?

It’s not about one vendor – it’s about one platform. And by platform, I mean a common architecture and communication capability, not a specific vendor software offering. What’s important is that you choose a set of products that support a set of standard protocols for data interchange, because then you can use best of breed solutions for each part of the sourcing and procurement process – and that’s the key to extracting real value from the process. Let’s face it – it’s not just about integration and automation – because there’ll always be exceptions, so you’ll never get rid of all of your tactical staff. Furthermore, the more the suite doesn’t do with regards to best practice sourcing and procurement, the more people you’ll need to do those tasks manually, so you’ll just be switching out tactical staff for more strategic staff – who won’t be as productive as they could be because you don’t have a best of breed solution!

The reality is that most of your savings will come from proper application of advanced analytics tools for spend analysis, award optimization, and risk management – and, let’s be honest here, weak imitations will not cut it! A static reporting application on top of a data warehouse is not spend analysis; monte-carlo simulation or heuristic evaluation of a handful of possible award scenarios is not optimization; and the ability to identify risks is not the ability to manage them.

So next time a marketplace gorilla tries to tell you that maybe a single suite solution will be better, take a quote from Wayne and say “and maybe monkeys will fly out of my butt“! And next time you find yourself starting to fall for such a line, got get a cup of joe and jump in a cold shower. The only valid reasons not to consider a best of breed provider are that they don’t make the solution you need, they don’t (and don’t plan to) support the standard protocols that your platform is based on, or the value they provide is not sufficiently more than the value a competitor with a broader solution provides. I’m not saying the little guy with a best of breed solution will always be better, it depends upon your specific needs, but “not a suite” is not a valid reason. It’s your problem – shouldn’t you get the set of solutions that are right for you?

Integration Point: Another Way to Get Your Trade Data in Order

I know I risk sounding like a broken record when I continually repeat myself on a topic, but some topics just can’t be ignored – and at least this time I’m introducing you to another company with a solution that I believe could help you with your trade data management efforts.

I recently had the opportunity to review Integration Point’s (acquired by Thomson Reuters) solution, and I believe that they are definitely one of the few providers with a chance to approach a solution that could theoretically be extended to tackle your global trade data management problems 100% in the future through a single, integrated, web-based platform. Right now, they’re probably a good two-thirds of the way there, and that’s currently further than any other solution I’ve had the opportunity to review so far.

Before we dive into their capabilities, let’s step back and define the problem again. If you review the Introduction to Global Trade wiki-paper over on the e-Sourcing Wiki [WayBackMachine], you quickly realize that Global Trade is quite involved, with the basic import and export cycles taking (at least) 14 steps each in the average case. Furthermore, in order to execute global trade, you need to effectively tackle ( 1 ) customs, security, and classification, ( 2 ) free trade / secure trade zones and agreements, and ( 3 ) regulatory compliance. Effectively tackling each of these challenges requires the ability to track and instantly access large amounts of data to create the forms and documents that different regulatory bodies require for the purposes of import / export, security verification, and regulatory compliance. Add extra emphasis to the “instantly” – the information needs to be accessible in real time – and this includes the ability to query up-to-date classification codes, tax laws, regulatory requirements, and denied party lists in real time.

As far as I can tell, with respect to the key supply chain destinations that compose most global supply chains (mainly, North America, the European Union, China, and India), Integration Point, with their extensible modularized web-based platform, has effectively solved the core customs, security, and classification challenge as well as the free trade / secure trade zone challenge. With solutions that address import and export classification (HTS codes), import documentation requirements, export documentation requirements, C-TPAT, AEO, denied party screening, FTA qualification, duty deferral, customs warehousing, customs control processing, and advance security filing – they have most of what your average multinational based in the US or the EU needs. Furthermore, they’ve built their platform to be extensible so that if you have additional classification or security needs, they can extend the solution to meet your needs. Maybe that’s why they already have over 80 multinationals as clients, including 11 of the Fortune 100.

The solution also integrates with a wide range of ERP and competitor trade platform software – including SAP, Oracle, JD Edwards, MAPIS, BPCS, MFG/PRO, American Software, EXE, Manhattan Associates, PKMS, and Infor – and they can usually integrate with additional software in reasonable timeframes since everything was built in house on a single, .NET-based, platform.

This only leaves regulatory compliance – which is a difficult challenge for any vendor because most of the major acts, like REACH, RoHS, WEE, etc. in the EU, require significant amounts of low-level manufacturing and product design details that are only found in, often archaic, PLM systems. However, their platform can track any product-specific data you like, can store any regulatory-specific requirements you like, and they can build custom searches and custom-matches as required by their customers – often in just a few hours – so if you know what the concerns are, you can track them and make sure they are checked before each award is made or each shipment approved, so if your needs are elementary, with some effort, you can extend it to serve as a basic regulatory requirements tracking system. However, it won’t be a full solution until they build in basic PLM data integration, tracking, and matching capabilities as well as the requirements of the major regulatory acts in North American, the EU, China, and India.

Integration Point also has the right viewpoint when it comes to global trade management – it should be proactive and not reactive. You don’t want to know about exceptions after a shipment has been approved, you want to prevent shipments with known problems from occurring in the first place. You want to make sure that the customer is not on the denied party list, that the distributor or 3PL has the proper transport licenses, and that you have the right export licenses before you even approve the order. You want checks to occur automatically as soon as each relevant piece of information is entered, every time something changes, and again just before the shipment is loaded – since denied party lists can change daily.

It’s definitely worth checking out – as they have more integration than Global Data Mining. However, that’s not to say that Global Data Mining isn’t a valuable solution too – as they are particularly good at mining your transaction data to find inaccuracies in classification or tariff & tax overpayments that a transaction-based compliance system like Integration Point isn’t customized for. The reality is that global trade is so complex that one solution probably isn’t going to cut it for a long time, if ever, but I do believe that starting with a web-based platform, like Integration Point’s, is a good start. For your reference, other players in the space are TradeBeam, QuestaWeb, Kewill Systems, and Management Dynamics.