Can Webplan Reconcile Planning and Execution? Part Four: Challenges and User Recommendations
Written By: Predrag Jakovljevic
Published On: July 3 2004
past two years or so have been an interesting if not a tumultuous period for
the Ottawa, Canada-based, privately-held Webplan Corporation
felt compelled to further refine its original supply chain planning
(SCP) and business-to-business (B2B) collaboration value proposition..
The vendor has refocused on highly actionable Response Management software (a
subset of broader Corporate Performance Management [CPM] software, which is
about communication and delivering actionable intelligence at the right time)
for manufacturers and distributors, what it believes will be a growth market.
at the end of 2003, Webplan announced that changes made to its business direction
in 2003—including a drive toward delivering value to manufacturing customers
through Response Management software—has gained acceptance with both its manufacturing
customers and strategic partners, laying the foundation for growth in 2004 and
beyond. Despite the fact that many manufacturers have invested in enterprise
resource planning (ERP) systems and many also have supply chain management
(SCM) systems, most continue to use inopportune batch reports and pesky spreadsheets
to manage their operations performance. These have proven to be inefficient
and error-prone methods of supporting decision-making, resulting in reliance
on "educated guesswork" rather than on accurate dynamic analysis to align decisions
with strategic objectives.
a detailed discussion of supply chain management—both planning and execution,
see the tutorial Bridging
the Reality Gap Between Planning and Execution.
however, faces a number of challenges in its quest to further promote RapidResponse,
its innovativeness notwithstanding. Namely, given its advanced planning
systems (APS) heritage, Webplan appears to be ahead of the pack in applications
for concurrently optimizing demand, order promise and inventory management,
taking constraints into consideration. Yet, in many markets, Webplan is far
from a household name, in part owing to its small size ($13 million in fiscal
2003 revenues) and the lower visibility of a privately-held vendor. Additionally,
in most markets, it might be known either only as a SCP/APS provider or a combined
optimized operational performance management/SCEM provider. These marketing
gaps must be addressed for Webplan to progress to the position in the market
justified by its broad product offerings.
Still, RapidResponse at this stage does not encompass the holistic view of the entire supply chain, which may still make one area more efficient at the expense of efficiency in other areas. For example, the product does not address transportation as a shared or coordinated service, which leaves the manufacturer's purchasing team to "own" the inbound goods, while someone else (sales, shipping, third-party logistics [3PL] provider, etc.) will own the outbound. There is not much integration of transportation and warehousing processes at this stage either. Nor do merchandise planners have much useful output from the system to decide which promotions and product assortments to run, and gauge different effects on demand.
collaborative SCM areas that Webplan has to better address in the future are—computer-aided
design (CAD) document exchanges; sourced components and parts compatibility
testing; pricing aggregation and fluctuations; cooperative marketing within
trading partners; coordinated field and external services; international trade
logistics (ITL) and accompanying documentation; payment adjudication; and so
will not happen soon based on the product's devised roadmap, and on the vendor's
limited resources, albeit with a notable cash position of $20 million and backing
of its investors, GE Equity, Intel's 64 Fund,
and TechnoCap. Namely, while RapidResponse 7.3 introduced Live
Scorecard and enhanced financial analysis and engineering change analysis, the
next release code-named "Aruba" and slated for the release in the second half
of 2004 will be 100 percent Web-based, and will feature customer enabled setup,
enhanced alerting (with links to Scorecards), as well as Cognos
and other partner products' integrations.
is Part Four of a four-part note.
One detailed recent events.
Two and Three discussed the market impact.
The mitigating factor, though, is that on one hand most competitors do not cover all the bases of wider supply chain either. Indeed, the functional capabilities tend to reflect the given vendor's birthright, so that the vendors coming from the logistics place exhibit strong collaborative planning capabilities in transportation management, but are typically lighter in demand planning or in intelligent response to constraints and exceptions, and vice versa. On the other hand, the existence of so many vendors, with so many nuances in offerings, presents a challenge both to the vendors in differentiating their products and to the users in selecting a vendor.
many other vendors can enable companies to efficiently manage trading relations,
demand management and fulfillment processes. Companies such as Prescient
Systems, Escalate, Demand Management,
Descartes, Arzoon, RiverOne,
WorldChain, SoftChain, Logility,
Demantra, John Galt, PipeChain,
VCommerce, Ortems, SeeCommerce,
and Tradec (now part of Agile Software) in supply chain
event management (SCEM), visibility, and performance monitoring are able
to connect disparate systems to provide all the parties with near-real-time
information on current movements and trends.
too has been posting growth and good financial results lately, economic hardships
notwithstanding, by providing a homegrown like solution that is flexible and
integrated on a single data model and can be incrementally implemented as required.
One should also note the capabilities of Viewlocity, which came as a result
of a three-way merger and that combines former SynQuest's "quick-solving"
planning and execution capabilities that have been linked with former Viewlocity
and Tilion's event management capabilities (see Merger
Mania at Its Extremes). The combined solution aims at supporting the
real time enterprise through adaptive supply chain capabilities, including explicitly
planning to maximize supply chain profit in a dynamic environment, while meeting
or exceeding customer expectations.
pure-SCM leaders, i2 and Manugistics, have
made forays into marrying these components of SCM, while leveraging the best
practices across multiple industries. In a mass-manufacturing environment these
systems may still provide deeper granularity for operational planning, while
Webplan is more oriented to problem identification and resolution, even if it
is not closely tied to the SCE layer yet. Not to mention the former core-ERP
eight-hundred-pound-gorillas' (i.e., SAP, Oracle,
PeopleSoft, SSA Global, QAD,
etc.) ever increasing footprint in the SCM market, and their displeasure with
the likes of Webplan "piggybacking" on their install bases.
the same time, other best-of-breed SCP vendors have been stripping down and
streamlining products sets, given their cumbersome and confusing offering in
the past, which have consequently resulted with a bad image in many cases. An
emerging SCP approach espoused by the likes of Optiant, SmartOps
and LogicTols has been to use inventory optimization techniques
that create plans to minimize inventories across the network, but with achieving
desired customer service targets.
owing to the plethora of solutions with no immediate or apparent differences,
Webplan needs to more aggressively spread the message of offering much more
than glorified event management applications, whose stand-alone application
provider days are numbered. Even without the extraneous market drivers, like
recession, the future of a plethora of SCEM vendors remaining as viable stand-alone
entities would be highly dubious. Like the former material requirements
planning (MRP) providers, which are nowadays all but extinct due to either
their evolution or merger into materials resource planning (MRPII)
first, and eventually in manufacturing-oriented ERP providers (or the demise
of the less decisive others), today's SCEM vendors simply cannot remain as viable
stand-alone component providers. Consequently, as MRP stands today, it is part
and parcel of ERP, SCEM, being rather an enabling technology in a supply chain
network than an application on its own, will gradually be blended into the SCM
family of "matter-of-course" modules, losing thereby its functional sovereignty.
while RapidResponse is an impressive product that adds some response value proposition
to customer demand events, it nonetheless does not necessarily insure the execution
of plans, given its output remains a mere simulation. The challenge and irony,
that is not only applicable to Webplan, is that not many companies are yet able
to connect SCM operational metrics to the strategic corporate metrics. Given
human nature, Webplan, by bringing greater transparency to supply chain operations,
may even be stonewalled by some managers because they perceive that it will
prevent the covering up of unattractive figures or pushing the blame to someone
else (see Why
Most Balanced Scorecards are Subverted).
In order to optimize their extended supply chains, manufacturers need to address the planning, execution, control, and analyzing aspects of SCM, where Webplan seems to have solutions for most, if not all of them. On a more general note, neither planning nor execution tools can be a panacea for a dysfunctional supply chain. Both areas have to be concurrently analyzed and optimized.
enterprises with appropriate performance management metrics in place are characterized
by their ability to articulate strategies into easily understood action plans.
They also emphasize data gathering from monitoring the performance of the action
plan and fine-tuning it. Hence, in any case, the prospective customers have
to be aware of how actionable any solution is. Also, standardized and centralized
data; tighter collaboration and trust among trading partners; and tighter alignment
between corporate strategic goals and SCM operational metrics are key success
factors (KSF) of contemporary supply chain management.
The manufacturers of all sizes from the industries of Webplan focus, which have complex supply chain environments (such as, multisite environments, a great percentage of outsourced operations, and a high-percentage of demand variability) and whose suppliers need access to aggregated demand, but which have the need to rapidly respond to unplanned events as to avoid excess inventory and obsolescence exposure on one side and stock-out and low customer service exposure on the other side, should place Webplan on their short list. However, at this stage, ideal manufacturing prospects would be those that mostly build to order and ship directly, so that they are not burdened with the outbound warehousing and multi-modal logistics issues that would make it a much more difficult problem.
Those companies with existing ERP or SCM vendors in-house should evaluate Webplan in addition to their incumbent vendors due to the vendor's success in co-existing situations where customers have found that it often complements and improves upon the solutions offered by the existing enterprise applications vendors. Existing Webplan customers should evaluate the remaining portions of its forthcoming product suite releases (that will also feature some attractive third-party solutions) in search for additional value.