In previous Supply Chain Matters commentaries, we have observed that utilization of SAP’s supply chain focused applications can serve as both a blessing and a curse. The blessing comes from the structural rigor for integrating enterprise-wide transactional, operational execution and master data with supply and demand planning. This rigor is often cited as the curse, since today’s highly dynamic supply chain business processes are expected to respond to ever increasing levels of network-wide complexity. Adding supplemental supply chain suppliers, partners or planning locations can cause planners to fall behind and become the critical stumbling block. The problem exists both in rather large as well as growing supply chain organizations.
In the specific case of SAP’s APO (Advanced Planning & Optimization), many SAP customers have deployed the Demand Planning application incorporated within SAP APO. It is probably the most widely deployed module, and for good reasons. Many industry supply chains are focused on being far more product or service demand-driven, thus sensing and responding to various multi-channel demand is a critical process capability.
Highly experienced users of the various components of SAP APO are either often promoted to higher levels of broader supply-chain wide responsibility, or they jump to other organizations that are willing to compensate more for APO-specific skills. As less experienced supply chain planners step-in, productivity and planning effectiveness suffers because the new planners lack the experience to manage input data, master data synchronization, and planning optimization results. Planners revert to their more comfortable Microsoft Excel skills to massage planning data for the broader organization and APO begins to become an operational data store rather than a planning solution. These types of challenges will likely increase as SAP migrates many of its supply chain planning capabilities toward it cloud-based, S&OP Powered by HANA platform that has integrated business planning as its prime objective.
To specifically help industry supply chain organizations respond to these challenges, Supply Chain Matters has been raising awareness to a cadre of smaller but highly focused system integrators who have developed self-contained, capsulized service offerings that address very specific business problem needs, including those related to SAP APO. Their focus remains targeted scope technology and services that can springboard and overcome business process or systems challenges on a far more timely basis.
One such firm is Bristlecone, a laser-focused services company primarily addressing supply chain deployment and time-to-value challenges. The firm’s client list spans a broad swath of industry supply chains including consumer products, chemical, energy, high-tech, industrial, and pharmaceutical. As our readers are well aware, each has its own unique supply chain planning process needs and requirements. Bristlecone has been populating its Bristlecone Online Store with a collection of fixed-cost, application accelerators developed from prior successful customer implementations.
To specifically address the challenges of SAP APO Demand Planning productivity, the firm has packaged a fixed-price service, best practices and enhanced productivity offering termed Demand PlanningNow™ that augments SAP APO with offline and online augmented capabilities. Demand PlanningNOW provides a flexible Microsoft Excel front-end interfacing directly with SAP APO Demand Planning as the back-end. According to Bristlecone, the service offering helps SAP APO teams by providing added flexibility and versatility for working with large data sets and multiple partners utilizing Microsoft Excel as a more familiar user front end tool. The packaged tool further provides an offline mode that allows users to perform simulations prior to uploading data as well as tracking data changes, providing front-end data validation and user alerts to unaligned data. As an added plus, Demand PlanningNOW™ can leverage SAP’s built-in security and does not require additional system security capability.
Bristlecone informed Supply Chain Matters that this productivity accelerator has been deployed with user training and software in less than 2 days at some customer sites, although the documentation quotes a conservative two weeks. In either case, Bristlecone’s Demand PlanningNow™ provides yet another example of a fixed scope, fixed-price technology accelerator application built on a niche supply chain planning SI firm’s acquired knowledge, best practices and technical expertise acquired from numerous implementations and supply chain team interactions.Your SAP focused supply chain planning organization may want to explore these available collections of application productivity accelerators from smaller but highly focused SAP systems integrators as an alternative to more expensive wider scope services.
Disclosure: Bristlecone is a current client of the Ferrari Consulting and Research Group.
In the week that Apple staged its massive media event announcing two of its newest iPhone models, BloombergBusinessweek featured an intriguing article titled: Apple’s iPhone 6 First Responders. The report serves as a very timely reminder of the critical importance for harvesting product performance and service reliability information very early in the product launch stages.
The Apple program outlined is termed early field failure analysis (EFFA). The Bloomberg authors had a novel spin as to the purpose, one that may well resonate with our reader audience: “ As customers line up to buy the device (iPhone) around the world, Apple employees will show up at work to learn how they screwed up- and fix it.”
Humor aside, the Apple program was conceived to resolve problems before they become far larger in-scope, when they are far more expensive to resolve across an outsourced supply chain. Bloomberg cites former Apple employee sources as indicating that EFFA testing is most stringent during the device’s first weeks of consumer sales, but can continue longer as problems arise. Therefore, the EFFA program for the iPhone 6 models is most likely underway as we pen this commentary. Once more, the report confirms that defective Apple devices returned at Apple retail outlets are directly airfreighted to Cupertino where the phone is physically examined and where manufacturing history can be traced to individual workers on an assembly line. There are some rather fascinating examples of how previous problems were found and resolved before they became a thorn.
The report is worthy of a read since it provides further evidence of the importance of connecting the service management business process with the product supply chain. It further provides evidence of how Apple’s product management and supply chain teams harness early feedback information related to specific products to avoid more costly issues and to protect the image of the brand. I suppose we could add that it also avoids the wrath of CEO Tim Cook when consumers feedback any displeasure in an Apple product.
In mid-July, business and social media was abuzz with the announcement that two long-time rivals, Apple and IBM, would team-up in an alliance to create business apps leveraging Apple’s iPhone and iPad devices. Under the alliance, IBM will create what it terms as “simple” business productivity apps leveraging the respective Apple mobile devices.
Today, Bloomberg released some somewhat stunning news which many are speculating is directly related to above announcement. Supplier sources informed Bloomberg that Apple is preparing to manufacture the largest model iPad ever, a 12.9 inch screen device, with production scheduled to commence in the first quarter of 2015. That is 6-9 months from today.
As we have echoed in previous Supply Chain Matters commentaries, the Apple supplier network is feverishly ramping-up production volumes for new models of iPhones and iPads for the all-important upcoming holiday buying surge period. Apple’s three key suppliers of LCD screens are especially challenged due to a rather late design change incurred on the new iPhone 6 model.
According to the Bloomberg report, this rather large iPad screen model is being positioned to compete in the business applications arena as an alternative device for business tasks currently performed by laptops. The Q1 timing is especially noteworthy since that is the time when Apple’s China based suppliers and contract manufacturers temporarily shut-down for celebration of the Lunar New Year as workers return to their homes and families. It is a period where suppliers recover from the hectic end-of-year scramble. The fact that Apple is targeting yet another product release in this period is a probable sign that the IBM-Apple discussions were already in the planning stages prior to the official announcement last month. Both parties are aggressively planning to take advantage of the alliance opportunities.
Apple’s supply chain, S&OP teams and value-chain partners are once again going to be put to the test of simultaneous volume production ramp-ups involving a multitude of products including a new iWatch as well as phones and tablets. There is obviously little room for snafu’s and LCD screen suppliers may well be the critical linchpin to pull-off a series of simultaneous successful product launches.
Tomorrow, this author will be joining a distinguished compliment of speakers at the 7th Annual Supply Chain Management Summit sponsored by Bryant University and Benneker Industries. This event is turning out to be one of few premiere New England regional conferences focused on current issues and learning in supply chain management. Last year’s event drew upwards of 250 attendees among many industry settings.
Since many of our readers are located across the globe, the purpose of this Supply Chain Matters commentary is to summarize the key messages and takeaways of my talk.
My presentation is titled: New Developments in Supply Chain Technology- What to Consider in Your Supply Chain Investment Plans. The key takeaway messages I’ll be delivering is that three converging mega-forces:
- Constantly shifting customer and business needs requiring sense and response, as well as more predictive business processes and decision-making capabilities.
- Supply chain process and IT technology convergence providing more cost affordable opportunities for integrating both physical as well as digital information and decision-making capabilities.
- Digitally enabled manufacturing enabled by the Internet of Things.
are aligning toward extraordinary opportunities for what has long been the Holy Grail of our community, namely, integrating information and decision making across physical and digital supply chain spectrums. The alignments of the above mega-forces are providing significant opportunities in management alignment and top management sponsorship which can be leveraged. New and emerging technologies, especially engineered systems, cloud computing, predictive and prescriptive analytics are becoming the technology catalysts. Besides touching upon the latest advances and significantly changed IT market dynamics surrounding supply chain technology, my primary goal in this talk will be to advise supply chain teams on the most important investments to focus upon in the coming months and years.
First and foremost, and without question, the most important initiative for any supply chain organization today is a concerted set of initiatives directed at Talent Management. The business benefits of advanced technology are marginal without people who have the necessary and required skills to be able to leverage and harness these technologies. Recruitment, retention and increased skill needs are constantly identified as the single biggest challenge across C-level, business, IT supply chain and manufacturing teams, and the challenge will continue as newer technologies make their presence among industry supply chains.
More than ever in the past, supply chain, procurement, customer fulfillment, product lifecycle management and service management teams must have active technology awareness and planning strategies. The umbrella and accountability of the supply chain now involves far broader dimensions of common information and related decision-making needs. The notion of the goal for pursuing Integrated Business Planning is not just IT vendor hype, but a necessary and required capability. An organization’s Sales and Operations Planning capability is thus the most critical to focus and improve upon. That stated, an important reminder for cross-functional and cross-business remains that final objective is not technology alone, but rather required business objectives and outcomes.
I’m also urging technology selection teams to broaden their context of their technology planning to include leveraging information and decision-making capabilities across an end-to-end, value-chain and B2B business network. With today’s pace of business change, supply chain planning or forecasting can no longer stand-alone as a capability, and must be augmented and synchronized with the sensing of actual events occurring across the supply chain network. The good news here is that the supply chain technology market has shifted its emphasis toward broader support capabilities in this area.
For those who plan on attending tomorrow’s Summit, I look forward to meeting and chatting with all of you regarding your organizational and personal objectives. For those unable to attend, be advised that next week we will post a PDF copy of the presentation in our Supply Chain Matters Research Center for complimentary reader downloading. Minimal registration information is all that is required.
As always, give as a call or contact us via email if you require further assistance or if this type of presentation can assist your organization or forum in setting its supply chain management objectives for the coming year. Our home page can be accessed at this web link.
Three weeks ago, Supply Chain Matters commented on the effort underway among Apple’s ecosystem of suppliers and manufacturing partners to prepare for the upcoming product launch and distribution of the new model iPhone. Our commentary made note of reports indicating a number of moving milestones and potential challenges related to new product production ramp-up and product yield. Besides the next generation of the iPhone, there were additional published reports indicating that Taiwan’s Quanta Computer would begin mass production of Apple’s new smartwatch in July, with the planned product launch coming as early as October.
Today, Bloomberg, citing sources with knowledge, is reporting that Apple suppliers have also begun initial manufacturing of the planned new models of the iPad. According to the report, volume production of the next generation full-sized 9.7 inch version of the new model iPadAir is underway, with a newer version of the 7.9 inch iPadmini now entering production with general availability expected by the end of the year. The product introduction announcement is reported to be either at the end of Q3 or early Q4, but many Apple watchers are betting on the month of October, since other next generation products are scheduled for market introduction in that month. In any case, the NPI and volume production scenarios for iPad and iPhone are both pressing towards critical windows for required availability.
The latest quarterly financial results for Apple reflected a marked decline in iPad sales volumes, declining by over 13 million units, thus the upcoming new product introduction cycle is crucial. Timing is critical since there must be inventory available when consumers elect to make their end-of-year holiday purchases.
Like all things related to Apple’s product innovation cycles, design engineers introduce last-minute component features that would challenge any high volume focused supply chain. In our previous iPhone6 commentary, we highlighted reports of yield challenges with the larger LCD screen, the rumored inclusion of sapphire based screens and continued challenges for higher-volume production of fingerprint scanners. The next generation iPad Air is strongly rumored to include more innovative anti-reflective coating as well as a fingerprint sensor.
A separate report from the Associated Press further indicates that Apple’s sapphire glass provider, GT Advanced Technologies, indicated this week that its production facility is close to starting production, but does not expect to reach full operational production until early 2015. That is not an encouraging report for Apple’s supply chain planners and will likely lead to further tough decisions in the weeks to come.
Apple supply chain teams indeed important challenges is the coming 12 weeks with many simultaneous moving milestones impacting multiple product management plans. It is a consummate example of changing information in constant motion. Integration of NPI and supply chain information coupled with multi-tier response planning will invariably be put to the test.
Supply Chain Matters readers residing in the New England region are invited to join me at the 7th Annual Supply Chain Management Summit being held on Thursday, August 21 on the campus of Bryant University in Smithfield Rhode Island.
Over the years, this Summit has grown and matured into a northeast regional event focusing on a new burgeoning supply chain challenges and solutions. I was a featured speaker in the 2013 event which was very well attended and I’m pleased to be invited back to speak at this year’s Summit.
I’ll be joining a distinguished compliment of speakers for this year’s event including a dear former colleague, Dr. Larry Lapide who will be delivering the morning keynote, and Dr. Jim Tompkins who will deliver a very timely luncheon keynote.
My presentation is titled: New Developments in Supply Chain Technology- What to Consider in Your Supply Chain Investment Plans. This presentation will address:
- How senior industry executives view needs in business-wide decision-making, and what expectations they have for supply chain capabilities.
- The new requirements of Plan-Sense-Adapt- Synchronize and the new levers of information velocity-context- clarity
- A new thinking required to overcome current organizational and supply chain collaboration barriers
- What you should know as operations, planning, procurement or supply chain management professionals in terms of skills readiness and tool adoption
Individual registration for this upcoming conference is $150 with discounts available for organizational table sponsorships. Registration is available at this web link but act quickly since the event is a sure sellout.
If your organization has needs for a dynamic speaker, panelist or roundtable facilitator on compelling topics impacting supply chain management and B2B business networks, you are welcomed to review our Speaking Services page.