SAP Highlights Supply Chain Management Tools

  • Written By: Steve McVey
  • Published: December 22 1999

SAP Highlights Supply Chain Management Tools
S. McVey - December 27th, 1999

Event Summary

At last week's eBusiness Conference & Expo, SAP AG updated attendees on its supply chain management application, Advanced Planner and Optimizer (APO). The solution is designed to enable companies to perform collaborative optimization across their supply networks to facilitate customer service and order fulfillment. Available supply chain management modules include collaborative planning, forecasting and replenishment (CPFR), Internet-enabled vendor-managed inventory, ATP and shipment tendering. SAP has extended its pilot customer base to more than 350 installations in multiple industries worldwide.

Market Impact

SAP is working hard to win acceptance for APO amid the multitude of other supply chain offerings flooding the market. The number one ERP vendor has expanded its test sites to comprise more than 350 separate installations, a number that rivals the customer base of best-of-breed SCM vendor Logility. Its flood of APO applications parallels the deluge of press articles that filled news wires for two years prior to the beta release. SAP is able to maintain the intense campaign by virtue of its strong market position and wealth of development resources it can devote to ironing out bugs in the software and making enhancements based on pilot user feedback. SAP will eventually be successful in overcoming much of its competition, if only by using its sales and marketing muscle to quash efforts by other ERP and best-of-breed vendors (See TEC's Technology Research Note: "SAP AG - ERP Leader with a New Dimension" September 1st, 1999). SAP's marketing department is aided considerably through the company's decision to develop APO from the ground up, a fact that appeals to IT professionals who are looking for a seamless integration between ERP and supply chain. Less inspired is their attempt to differentiate APO's Available-To-Promise functionality by reshuffling it from the standard term into "Promise-to-be-Available."

User Recommendations

Users wishing to acquire transportation planning, vehicle scheduling, repetitive manufacturing, or supply chain network design solutions should look to third party vendors such as i2 or Logility, as these modules will not be available until the second quarter of 2000 or later. Keep in mind that, although these vendors have certified interfaces to SAP R/3, access to the integrated system via an Internet portal will not be straightforward. Users should also approach the broader issue of SAP's ability to offer truly Internet-enabled solutions with trepidation. Ironically, initial reports of version 1.1 pilot tests indicated some limitations of APO regarding web enablement (See: "SAP APO: Will it Fill the Gap?" September 2nd, 1999). In any event, SAP's product test of APO version 2.0 was only completed within the last several weeks, leaving the "field test" in the hands of new clients.

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