Supply Chain Consultants: “Today is the perfect time to invest in IT: ERP, WMS, TMS”

Madrid, Jan 21, 2015.-   AndSoft has selected two analyzes of Supply Chain and TMS, published by experts in recent days. We share with you for your interest and for comment. Tom Wrobleski is executive vice president of industry supply chains at Chainalytics. Recently he has published the following analysis on upcoming challenges of Supply Chain:

“There´s never been a better time to invest in your supply chain. Our global supply chain engagements have shown us that manufacturing-intensive organizations can get ahead of these converging pressures by considering four areas that can yield an increase in key metrics that measure the investment returns to the business, such as return on capital employed:

1. Invest in equipment and tools for manufacturing and assembly lines, including packaging equipment and materials.
2. Explore plant and facility relocation options to optimize supply chain costs.
3. Take advantage of the M&A environment to execute new product and brand strategies.
4. Invest in IT. Technology and IT have come a long, long way over the last three years, as supply chain Big Data has proliferated. The value of the data lies in the ability to visualize and interpret it and glean meaning from it. Today’s sophisticated supply chains handle not only internal data but also support close integration with complex external data sources, like supplier and consumer point-of-sale data, for better supply and demand sensing, forecasting and reduction of both downstream and upstream manufacturing, distribution and inventory holding costs.A well-executed IT portfolio program can achieve payback fairly quickly—sometimes within a quarter—through reduction of excess inventory costs. For example, a $1 million dollar advanced planning system implementation can save $5 million by ensuring your firm does more accurate demand and supply planning and reduces inventory turns by 10% to 20%, to save working capital. Additionally, many firms have delayed major upgrades to their core ERP, WMS and TMS systems, given the potential cost implications. But now is the time to revisit these decision,s given the impending cost of capital increase. With so much at stake, we think now is the perfect time for many manufacturers to revisit their capital expenditures and supply chain projects and goals. Companies that use fact-based transformation to justify the business case for major projects will enjoy the efficiencies brought on by thoughtful evaluation together with the historically low cost of making significant investments possible”.

Omni-Modal TMS

Meanwhile, Jim Geer is VP Solutions at MercuryGate, ensures that the transport need a transportation management system (TMS) that can deftly handle international, multi-leg shipments across a variety of modes (i.e., “omni-modal”). He adds the following analysis:

“As the transportation landscape has become increasingly complex, the need for a holistic technology platform that can handle a myriad different modes and business models has grown exponentially. Manual systems, spreadsheet-based processes, and disparate technology no longer suffice. In lieu of these traditional, ineffective approaches, both importers and exporters are turning to single-platform TMS that can effortlessly handle international multi-leg freight shipments using all modes. As more companies conduct business globally, and as more customers demand a wider array of shipping and receiving options, the need for omni-modal transportation systems has become imperative. For example, many industries now depend on ocean and air freight as natural and vital links in their supply chains. Industries such as apparel and automotive keep the ocean carriers humming, while pharmaceuticals and high-tech keep the air freight industry busy.

But ocean and air freight differ from truck freight in several ways. Take the scheduled nature of the freight movements, for example. When shippers are considering which carriers to use, traditional decision points like cost and capacity alone are insufficient. Sailing schedules and flight schedules need to be integrated into the TMS, for example, to enable logistics practitioners to make informed decisions.

The list of challenges that shippers face in today’s omni-modal transportation world doesn’t end there. Also impacting companies’ ability to effectively streamline and optimize their transportation networks are the many disparate or “silo’ed” systems that have been cobbled together over the years. Such systems require extensive (and often unattainable) levels of integration in order to operate interdependently. When you can’t look across all of your modes – including small package, less-than-truckload (LTL), truckload (TL), and others, you miss out on possible freight savings by not consolidating or optimizing those freight movements. In the absence of an omni-modal TMS, supply chain visibility is virtually inaccessible – particularly when companies lack the dashboards needed to properly oversee their end-to-end transportation networks. Finally, contingency planning is next to impossible – a point that can severely impact the way in which companies react and respond to network risk and variability.

A TMS platform with visibility across all transportation modes and the ability to identify potential for savings, optimization, and consolidation, addresses all of these challenges. Such platforms also help shippers build out partial shipments, move between modes (based on efficiency and cost, for example), and truly determine optimum ship modes – both from a cost and service time perspective”.