Archive for the ‘Control tower’ Category

What Angry Birds taught me about supply chain improvement

Published June 23rd, 2014 by Jonathan Lofton 4 Comments

A while back I was watching my youngest son play Angry Birds.  It was interesting to watch because he would start a level and not really spend too much time looking at how things were set up.  He might look at what kind of birds he had to work with, but for the most part he’d just start playing.  Once or twice he got lucky and freed all the birds on the first try.  Mostly he’d play several times and finally figure out how to beat the level.  When he beat it, he went on to the next level.  He didn’t try to get the highest score; he was more interested in completing all the levels in each of the different themes.

I would go back and play the levels he completed.  My goal was to get the highest score and to get all three stars completed for the level.  So I would study the layout, see what kind of birds I had to use and devise my strategy.  Of course it almost always took me a few tries to pass the level (and sometimes lots of tries)!

What I realized was that it’s a lot harder to improve a score than it is to just pass the level, especially if you do a lot of collateral damage the first time you win – that first winning score is high.  It can also be frustrating (sometimes I had to put it down and come back to it later).  The other thing I realized was that I probably could have approached it just like my son … just start playing.  No matter how much I studied the level before starting, I rarely got the highest score on the first try.  Although I didn’t often have to change my strategy, I did have to make some adjustments to what the birds were doing …  and yes, there were a couple of cases where I had to adopt a totally different strategy.  But truth be told, I got the high scores and totally completed the level the same way he got the original win: by seeing how things worked out and making adjustments – trial and error.

So what does this have to do with Control Towers and Supply Chain Optimization?  Before I get to that, there are a couple of other pieces of the puzzle for this particular “what I learned” lesson.  One came from watching a TED video, “Tim Harford: Trial, error and the God complex”.

What Harford set out to show is that the common link among successful complex systems is that they all evolved through trial and error.  The other came from participating in a “Human Centered Design” course that emphasized being willing to experiment; being okay with not having the “right” answer, trusting that you’ll find one.  And what was the method of finding that “right” answer?  You guessed it, brainstorming/collaborating and prototyping … iteratively!

The dots that were connected and what I learned from this as I thought about Control Towers and Supply Chain Optimization was:

  • You need maximum visibility when you’re planning your next move – you can have what you think is a great strategy, but if you can’t see how all the pieces fit, you’re going to churn for a while.
  • You may not have to totally change your strategy, but you do have to be flexible enough to make adjustments to how you configure and execute your supply chain.
  • It’s hard to improve your supply chain performance if you are starting off with a decent score but the faster and more agile you can be at adapting your supply chain, the better chance you have of maintaining and improving its performance, even when there are disruptions.
  • Supply chains are continuing to get more complex with more players that need to collaborate, and if the success of complex systems inevitably comes down to trial and error, then you need a way to speed up the trial and error process to become a lot more successful a lot sooner (“Knowing Sooner, Acting Faster”).

No matter how well you’ve blueprinted your processes (“studied the level”), you’re probably not going to totally hit the mark (“get the highest score with all three stars”) on the first try.  So it’s important to stay flexible and ready to adjust, remembering that when you’re trying to be optimal (get the ‘high’ score), it will probably be less frustrating if you follow the example of a child:  Just try a bunch of stuff and see what happens, knowing that’s how most successful complex systems come about anyway.

Undoubtedly I’m biased, but this all confirmed for me that RapidResponse is ideal in terms of giving you the ability to see your supply chain end-to-end, collaborate with the various players and perform a slew of what-if scenarios to determine in real-time what the impact of adjustments would be.

Oh, the other thing I learned … Angry Birds, like supply chain improvement can be addictive!

 

Posted in Control tower, Demand management, Supply chain management


Bold Predictions for the 2014 Top 25 Supply Chains Part 1

Published May 13th, 2014 by CJ Wehlage 0 Comments

Last May, 2013, I wrote “Bold Predictions for the 2013 Top 25 Supply Chains”. I’m proud to say that three of my five bold predictions were “directionally correct”.

fortune teller gartner supply chain top 25I’d like to share with you my predictions for this year’s Top 25, but first, here’s a brief recap from last year’s predictions and the approach I took for this year’s Bold Predictions for the 2014 Top 25 Supply Chains:

1. After a three year run at #1, Apple will fall out of the top spot in 2013.
While Apple did not fall from the top spot in 2013, their total score dropped from 9.69 to 9.51, driven primarily by a 181 point drop in the Gartner Opinion vote.  They also saw increases in all three Financial categories.

2. After placing 18th in 2010, 16th in 2011, and 7th in 2012, Intel will be in the top 3 of the 2013 Top 25.
Intel moved from 7th in 2012 to 5th in 2013.  While not #3, I think that’s a great move for a semiconductor supply chain during a rough 2013 economy.  Intel does well due primarily to it’s Gartner Opinion vote, which ranks Intel (515)  at 3rd behind Unilever (522) and Cisco (517).  Conversely, Intel is ranked #17 by Peer Opinion vote (756).

3. After placing 5th in 2010, 2nd in 2011, and 4th in 2012, Dell will fall out of the top 10.
I got this one right.  Dell continues to rank high in the Peer and Gartner votes.  However, 2013 Three Year Weighted Revenue Growth at -0.6% dropped them out of the Top 10.

4. Don’t be surprised if Coca Cola (#13 in 2010, #11 in 2011, and #6 in 2012) places #2 in 2013.

This was a tough one.  Coca Cola came in at 9th.  While they had improvements in all three financial categories, they dropped due to Gartner Opinion vote.  Which brings up an interesting comparison, the Peer vs Gartner Opinion.  When looking at the 2013 top 10 ranks in each category, Walmart Samsung and Coca Cola are in the Peer Top 10, while not even in the Gartner Top 10.  Then, Colgate, Pepsi and Intel are in the Gartner Top 10, but not in the Peer Top 10.

5. From #10 in 2010, to #5 in 2011, to #2 in 2012, Amazon will come in at the #1 spot in the 2013

Okay, this didn’t happen, but I’m still giving myself a thumbs up.  Amazon moved from at total composited score of 5.4 to 5.86.  Amazon has been doing a lot of build outs for both Web Services, Hosting and Fulfillment centers.  ROA at 1.9% in 2013 kept them from #1.  However, I think 2014 is the year the investments bring positive news.

My approach for this year’s Bold Predictions for the 2014 Top 25 Supply Chains
As the page turns on 2013, and the annual Gartner Supply Chain Summit approaches, we flock to the warm weather of Scottsdale, AZ.  I’ve looked into my crystal ball to make my 2014 Predictions.  Okay, not so much a crystal ball, but I’ve made some adjustments to improve my Bold Predictions.  I am going to put more stock in some common profiles: Supply Chain leaders who deliver conference keynotes and revenue growth.

I did a search on supply chain conferences from summer 2013 to April 2014.  Keynotes and main speakers are telling their supply chain story.  At the Gartner Australia conference, both Unilever and Haier spoke.  At the SCM World conference in Miami, Nestle, Lenovo,  BASF, Clorox, Under Armour and Caterpillar gave thought provoking presentations on their supply chain.  At the upcoming 2014 Gartner Supply Chain Summit, I see Schneider Electric, 3M and Colgate Palmolive are speaking.  Getting the success story out improves the Peer & Analyst Voting, 50 % of the total vote.  Having ran the High Tech practice at AMR Research, I even recall some supply chain leaders presenting, either in person in Boston, or through analyst calls, their supply chain strategies and successes.  Some companies provide insights to the Gartner reports, from a case study, participation in a quantitative research study, or sometimes a via quotes in key articles.  Most of these companies are going to rise in the Top 50 2014 ranks.

Then there’s the 50% Financial, which is broken into three parts: Inventory Turns, Return on Assets, and Revenue Growth.  Before we go running to review the Annual Reports for a bunch of companies, there’s one profile I like to consider, Revenue growth is the most leading indicator of financial performance.  Apple, Ford, Amazon, Lenovo had great revenue growth in 2013.  The automotive sector companies also saw good revenue growth, which could put BMW, Volkswagen, Hyundai Motor, or Tata Motors into the 2014 Top 50.

Check out tomorrow’s post for what I predict as:

  • Biggest Move Up the Top 25 Ranks
  • Biggest Surprises
  • Top 5 2014 Prediction

 

Posted in Control tower, General News, Supply chain collaboration


Part 3: My thoughts on Gartner’s Magic Quadrant for Supply Chain Planning System of Record

Published April 22nd, 2014 by Trevor Miles @milesahead 0 Comments

I was recently asked three questions on Gartner’s Magic Quadrant for Supply Chain Planning System of Record. As I said earlier, I want to share these videos with our readers…

The three questions I was asked were:

  1. What do you think of the Gartner Magic Quadrant for supply chain planning system of record?
  2. In your opinion, how does RapidResponse differentiate itself as a supply chain planning system of record?
  3. From your experience, what is the level of understanding of planning systems of record in the market?

Here’s my response to question #3. If you haven’t checked out my response to question #1 and question #2, you may want to view them first. Enjoy!

The report positions vendors based on completeness of vision in the supply chain planning system of record market and on their ability to execute to that vision. If you’re interested in reading the full report, the Gartner document is available upon request at http://kinax.is/Gartner.

Posted in Control tower, Demand management, Milesahead, Sales and operations planning (S&OP), Supply chain collaboration


How do you collaborate? A look at supplier collaboration

Published November 21st, 2013 by Nazli Erdogus 9 Comments

I love to get my hands on new devices and applications that can be used in the workplace. With so much access to technology today that allows workers to be in constant contact with colleagues, you would think that collaboration would be easier than ever. But, recently, I read an article arguing that there is increasing demand for more face-to-face communication in organizations. Of course, face time with colleagues is not always possible for businesses for multiple reasons, including time constraints and the high cost of travel.

According to a survey of over 1,000 U.S. employees, conducted by Kelton Global, people were asked how they prefer to collaborate and surprisingly 72% of respondents answered in person, 23% answered online and 5% answered via phone or video conference. In addition, nearly two in five employed Americans feel there is not enough collaboration in their workplace. There definitely seems to be a gap here. So while reading these articles, I said to myself – wait a minute, I know that we can help facilitate better collaboration in the workplace, as least for supply chain professionals!

This research takes me to our annual user conference, Kinexions, which was held a few weeks ago in Scottsdale, Arizona where our customers, partners and prospects got together to hear about recent developments in RapidResponse and our customers shared their stories of successful RapidResponse deployments. We also had something unique at this conference: we were able to show ‘supplier collaboration’ in RapidResponse. This feature enables an efficient and effective process between buyers and suppliers. Using RapidResponse, enterprises have direct supplier interaction with automated B2B data exchanges for a number of different situations.

At our conference, we were eager to present the power of supplier collaboration by adding another element to it.  We showed an integrated demonstration between RapidResponse and the GT Nexus portal. We received positive interest and valuable feedback from industry analysts, customers and prospects telling us how powerful and intuitive this approach is.

The demonstration pointed out a combined solution using the RapidResponse client and GT Nexus portal where suppliers and buyers sense, evaluate, decide and act upon a supply disruption. This integrated solution displays unique capabilities including multi-enterprise visibility, immediate simulations to enact on changes, and coordinated multi-party responses.

The ability to connect with the GT Nexus portal enables the supplier to sense the real-time data across a multi-enterprise level, feed this update to RapidResponse, and let RapidResponse do its magic in re-planning and scenario analysis. The scenario comparison uses a number of business metrics and enables the decision maker to analyze the comparison on financial impacts. Then, it’s time for GT Nexus to be fed back with the analyzed data for action.

This initiative serves a broad interaction between suppliers, buyers and even a possible additional tier of suppliers involved in the supply chain. We know that  letting a supplier have access to RapidResponse to commit to requested dates and quantities is beneficial to improve the flexibility of your supply chain and the profitability of your enterprise. We’re now adding some cream on top of it.

So, what’s next? The big thing is that we are not only collaborating with the supplier, but also letting suppliers to sense changes and the opportunity to make respective changes. With this in mind, we can also say what’s next could be preventing disruptions in your supply chain before they happen. Imagine a world where you can sense the disruption coming by identifying limits through your confidence intervals, looking at important metrics that perform a negative trend, and be able to respond to that as a preventive action. That definitely sounds like the next chapter.

It seems safe to say this integration would definitely bring more than enough collaboration in supply chain platforms to answer the need for more collaboration across different teams, thus enabling companies to do a better job of providing applications that encourage collaboration.

Collaboration is important and we definitely take it seriously.

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Posted in Control tower, Response Management, Sales and operations planning (S&OP), Supply chain collaboration, Supply chain management


A response to ‘Is Your Supply Chain Glass Half Full?’

Published November 13th, 2013 by Janice Kakazu 0 Comments

I just recently saw Bill DuBois’ blog post ‘Is Your Supply Chain Glass Half Full?’  It tickled my fancy and a few additional one-liners came to mind:

  • Project manager – I know you want to add cranberry juice to your martini glass, but I’ll need to write a change request for that.
  • Potential customer – I’ll order that drink if I can talk to 3 other customers who’ll tell me how good it is.
  • Supply chain consultant– Tell me about your requirements for filling that glass, and I’ll transform your glass-filling process!
  • Research analysts/Thought leaders – You’re at stage 4 of the maturity curve when you can segment all the glasses by fullness (or emptiness), sense how full each glass is with your eyes closed, and collaborate with the bartender to get a refill in real-time.

Hope you enjoyed that!

Do you have any other supply chain, “is the glass half full” one liners?

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Posted in Control tower, Demand management, General News, Inventory management, Response Management, Sales and operations planning (S&OP), Supply chain collaboration


Making Connections at Kinexions – Our customers say it all

Published November 4th, 2013 by Trevor Miles @milesahead 0 Comments

We had our annual user conference, Kinexions (pronounced ‘connections’ – isn’t English a strange and fabulous language?) in late October with record attendance and great feedback. The theme of the conference was our tag line ‘Know Sooner. Act Faster.’ Indulge me while I parse out our strap line.

Know Sooner – The ability to detect market changes quickly and determine whether the changes represent risk or opportunity, as well as identifying and alerting the people impacted by the risks or opportunities.

Act Faster – The ability to determine the best course of action quickly through scenario analysis within a team of people, across functions and even organizations, in a structured manner.

In other words our strap line is all about reducing decision latency through purposeful collaboration driven by responsibilities.

As usual it was the great customer testimonials that drive home the benefits of this theme through:

  • Rapid time to value in the initial deployment
  • Rapid innovation on the part of Kinaxis
  • Consistent value delivery over time as they expand into new BUs, geographies, and business processes
  • Mature into a Planning Control Tower – End-to-end supply chain planning process enablement

Of course that is easy for me to say, so I want to focus on external validation of these points.

We had Christian Titze attend our conference for the first time from Austria. In a short summary of the conference Christian states that:

Client companies at the conference demonstrated several ways in which they are adapting and improving their supply chains. These included speeding up time to value from deploying new software, and using embedded analytics and master data management (MDM). In doing so they showed how they were redefining their supply chain planning (SCP) application portfolios to support an adaptable and capable planning system of record (SOR).

Several client companies showed how they were using RapidResponse as a planning SOR. Some are now decommissioning their other SCP solutions and even moving material requirements planning (MRP) out of their ERP systems. This indicates Stage 3+ IT maturity for planning, whereby a planning SOR is in place and ERP systems are seen solely as transactional SORs.

Titze, C., Payne, T.; Kinexions 2013 Shows the Value of Adaptable Planning Systems of Record; Gartner, Inc.; 31 October 2013 .

Unfortunately Ray Wang had some travel issues meaning he could not attend our analyst/influencer session in which we have open kimono discussions with several customers, but Ray has attended our user conference in the past and knows several of our customers. However we were fortunate to have Holger Mueller on a panel which I moderated. Holger has tons of experience in large ERP vendors so it was great to see him endorse the benefits of our technical architecture in a Twitter stream with Ray, which is of course behind all the value delivery.

KinexionsTweetsHolgerRWang


Lora Cecere has been a consistent voice of the customer in the analyst community for well over 10 years now, often putting the software vendors feet to the fire, including ours. She calls this ‘tough love’. As a consequence any positive statements about a vendor need to be cherished, so it is with great joy that I can report that while at our conference, Lora wrote a blog entitled ‘Applause’ in which she states:

In leaving the Kinaxis user meeting this week, I am struck by three things.

First, their recent work on mobility and defining the user experience on a mobile application is very cool.

Second, the flexibility of the Kinaxis solution makes the product hard to message, but the clients that have figured it out, are very happy.  (Some of the happiest….)

Third, the solution is most often deployed in material-intensive supply chains for what-if simulation and visibility. It is a cloud-based solution that scales easily for hundreds of users. It has helped many clients that were too constrained by the inflexibility of the traditional APS platform.

At the conference, Kinexions, I heard many clients speaking freely about the deployment of Kinaxis and the turning off of Oracle and SAP APS solutions.  Many were almost giddy. The ease-of-use of the Kinaxis system was freeing for their teams.

Our Customers
While I wish I could share details of the customer stories shared with the influencers and as keynotes, these days companies are very reluctant to provide public statements of benefit.  What I can say is that during the influencer session we had three customers speak:

•    Flextronics – Customer since Oct 2001
•    Amgen – Customer since Mar 2009
•    NCR – Customer since Jan 2010

The consistent story across all 3 is how they paid for the initial investment in less than a year and how they have expanded their deployment of Kinaxis ever since, often to adjacent functions such as Finance, R&D, and Regulatory/Control. These stories were repeated in the main stage presentations by Cisco, Applied Materials, and First Solar.

What I love about these customer stories is that they give us purpose. Without tangible business benefits software is nothing but a few bits and bytes.

 

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Posted in Control tower, Demand management, Milesahead, Products, Response Management, Sales and operations planning (S&OP), Supply chain collaboration, Supply chain management


Part 2: Extending Supply Chain Planning Paradigms Beyond Advanced Planning Solutions

Published October 10th, 2013 by Trevor Miles @milesahead 0 Comments

This post is a continuation from a previous blog: check out part 1.

A Single Rapid Analysis Capability across Planning and Event Management.

A Single Rapid Analysis Capability across Supply Chain Planning and Event Management

Because Intelligent Business Operations (IBO) deals with important exceptions, a very rapid analysis capability is required — something which is not typically associated with supply chain planning solutions.

IBO deals with important exceptions, a very rapid analysis capability is required — something which is not typically associated with supply chain planning solutions.

The speed of cycling through the full set of OODA Loop[1] steps of Observe, Orient, Decide, Act, is the key to gaining sustained competitive advantage. As a result, much faster planning tools based upon in-memory technologies are required to take full advantage of the OODA loop, replacing traditional APS suites made up of loosely coupled applications that try to support both the initial plan creation and the OODA loop. The shortcoming of SCEM was that the Observe and Orient steps were supported by different technology than the Decide or Planning steps. And yet many of the same analytics used in planning are required to evaluate the impact of an event, making the support of these steps by different technologies impractical and ineffective.

Collaborative Decision Making for Complex Environments

Supply Chain Planning Paradigm Collaborative Decision Making for Complex EnvironmentsAnother aspect to consider is the context in which IBO is best used to assist people to make decisions. The Cynefin Framework[2] is very useful for understanding this. As seen from the diagram, the Cynefin Framework splits out the decision context into Simple, Complicated, Complex, and Chaotic, and also characterizes the approach most suitable for making decisions in each of the contexts. The fifth context, Disorder, the worst of the lot, is when a person does not know the context in which they are operating.

The tendency in Supply Chain Management and Operations in general, is to try to force all processes into the Simple context through Lean, Six Sigma, and ISO9000 by deploying Scientific Management methods[3] first developed by Frederick Winslow Taylor in 1911. Key to Taylor’s Scientific Management approach is breaking down processes into several small repeatable tasks that can be distributed across a team of people with little training and skill. APS systems were designed to support this approach by providing application to satisfy specific functional needs, such as Demand Planning, without considering the overall process requirements. However, the rapid increase in globalization, outsourcing, and product portfolios over the past 30 years has added tremendously to the volatility, uncertainty, complexity, and ambiguity in supply chains. Supply Chain Planning Paradigm - When should we collaborate

While Best Practice (applicable for the Simple Context) will always have a role to play because of the scale and efficiency it offers, many of the issues being faced in our global supply chains today require more agile and nuanced decisions, which are more suitable to the Complex quadrant of the Cynefin Framework, and more aptly addressed by IBO.

Complex decisions inherently require a more

collaborative decision approach across functions and trading partners supported by systems defined in IBO that enable rapid what-if analysis and simulation. Of course IBO supports all stages of the Cynefin Framework, including the Simple, Complicated, and, when necessary, the Chaotic. In fact, a key aspect of IBO is to enable companies to manage their business processes (and in the case of this discussion, their supply chains) in the Complex context and preventing them from tipping over into the Chaotic context frequently.

Know Sooner; Act Faster

The tenets of Know Sooner; Act Faster are rooted in both the need to manage the more complex and volatile contexts effectively, and the capabilities required to facilitate more effective decision making. Kinaxis has embedded the concepts of IBO in RapidResponse, enabling companies to establish processes across functions and even across trading partners, addressing both long term and short term decisions. Our focus is on helping companies radically shrink the decision cycles in planning and in response to events. The breakthrough of being able to Plan + Monitor + Respondin a single environment has enabled our customers to know sooner when reality is different from the plan, and to respond quickly and profitably as a result. In other words, they develop the skills and capability to act rather than react.

To learn more about this topic, feel free to view the complimentary Gartner Research report featured in the Kinaxis newsletter: How to Use Intelligent Business Operations to Create Business Advantage (Sinur J., Schulte R., Gartner Research, 20 March 2013).

 


Posted in Control tower, Demand management, Supply chain collaboration, Supply chain management


Extending Supply Chain Planning Paradigms Beyond Advanced Planning Solutions

Published September 30th, 2013 by Trevor Miles @milesahead 1 Comment

“Many business process directors are under pressure to help make the best possible process-related decisions to ensure desirable business outcomes, business differentiation and continuous innovation.”
Sinur J., Schulte R.,

“Use Intelligent Business Operations to Create Business Advantage”
Gartner Research, 20 March 2013

Nowhere is this statement more applicable than in the supply chain.

While the inventive concept of Intelligent Business Operations (IBO) is gaining traction in multiple functions and process areas, the applicability and potential is particularly high within supply chain management.

Intelligent Business Operations Delivers the Benefits Promised by
Supply Chain Event Management

Supply Chain Event Management (SCEM) first emerged as a hot topic in 1999, peaking in interest in 2001, only to fall away into obscurity. It has resurfaced recently, but centers around transportation execution requirements such as track & trace. Several factors played a role in the rapid rise and fall of SCEM as a topic, including the fact that SCEM was part of the .com bubble and that the appreciation of the benefits of sharing information between trading partners was a very new concept. But the major factor in its demise was that it was treated as an add-on to planning systems rather than as an integral part of planning systems. At the time, the generally accepted process coverage of SCEM included measure, monitor, notify, simulate, and control; however, the more difficult parts of simulate and control were never realized because this required them to be integral parts of the planning systems.

supply chain planning - intelligent business operations (IBO)As a result, SCEM solutions were little more than alerting mechanisms flooding users’ inboxes with hundreds of messages which were of dubious importance and provided no mechanism for evaluating the resulting impact of the event on the wider supply chain, nor identifying the people that should be notified about such impacts. And, very importantly, there was no way to generate actionable responses to the events. The reemergence of SCEM within the transportation execution space has been as embedded capabilities within transportation management solutions (TMS), and are providing valuable advantages even though the events being tracked are very limited.

The benefits to be realized from SCEM concepts have not diminished since their early inception in the late 1990s. In fact, because the early solutions never got past the monitor and notify capabilities and the recent reemergence in TMS is so narrow in focus, the benefits remain largely untapped; one of the most significant ones being improved customer service at lower cost.

Even more intriguing though is the emergence at Gartner Research of  Intelligent Business Operations (IBO) which incorporates many of the initial SCEM concepts in the broader context of any process. According to Gartner (Sinur J., Schulte R., “Use Intelligent Business Operations to Create Business Advantage”, Gartner Research, 20 March 2013),

IBO is an emerging style of business behavior that leverages analytics embedded in processes to support better decision making and improved knowledge worker collaboration. IBO-based processes are “smart” about the context in which they run, which is influenced by events external to the process.

supply chain planning paradigms - gartner supply chain IT glossaryInterestingly, all the fundamental capabilities of measure, monitor, notify, simulate, and control of SCEM have been included in IBO. While not directly transferable, the ideas are largely represented (and have been extended) in recent IBO-related concepts such as

  • Business Activity Monitoring (BAM) instead of Measure and Monitor,
  • Complex Event Processing (CEP) instead of Notify, and
  • Business Process Management (BPM) instead of Control.

More important is the application of IBO in the wider contexts of strategic, tactical, and operation planning, not only in execution. In addition, the inclusion in IBO of Constraint Based Optimization (CBO) and Simulation capabilities as core requirements address the initial short comings of SCEM, namely the ability to determine an appropriate response to an event.

What is not captured explicitly in the definition of IBO is the need to create the initial plan against which performance will be measured. If the capabilities used to determine an appropriate response to an event are different than those used to generate the initial plan, then it is unlikely that the response will satisfy the business goals of the organization. (Of course in certain circumstances, the business rules used to address an exception are different from those used to plan and manage operations under normal circumstances.)

The separation of planning from event management was the key weakness of early SCEM concepts, which was exacerbated by the narrow focus on execution, ignoring the rich opportunities in all levels of planning. We should not repeat the same mistakes.

To learn more about this topic, feel free to view the complimentary Gartner Research report featured in the Kinaxis newsletter: How to Use Intelligent Business Operations to Create Business Advantage (Sinur J., Schulte R., Gartner Research, 20 March 2013).  And, be sure to keep an eye out for part 2.

Posted in Control tower, Demand management, Inventory management, Sales and operations planning (S&OP), Supply chain collaboration, Supply chain management