Supply Chain Shorts for the Week of March 4, 2013

This week TEC brings you news from Manhattan Associates, Descartes, TXT e-solutions, United Technologies, Agilent, and a company called Oz Development.

Registration has opened for Manhattan Associates’ Momentum 2013, happening May 19–22 at Caesars Palace in Las Vegas, NV. Industry events (see RedPrairie and JDA) have made the future even more interesting for Manhattan Associates; TEC continues to watch Manhattan’s strategy with considerable interest. TEC has written before about growth opportunities for Manhattan in manufacturing and in the retail space. We expect to hear more about Manhattan’s cloud strategy. What do you think will be the focus at Momentum 2013?

Logistics solutions and services provider Descartes reported its FY2013 results this week. Revenues, which are approximately 92–93% services-based, increased 14% in the fourth quarter, year-over-year, to $33.8 million, helping to drive up revenues for fiscal year ending January 31, 2013 to $126.9 million, up 11% year-over-year.

When we talk about supply chain risk management, too often we think about climate disruptions in another part of the world where we have suppliers, or, in the current economic environment, supplier viability. News this week drove home the lesson that supply chain risk management is a multi-faceted challenge, requiring supply chain managers and company executives to take a broader view. The Wall Street Journal reported that United TechnologiesPratt & Whitney unit uncovered a scheme by another United Technologies unit, Israel-based Carmel Forge, to falsify metallurgical test results on engine forgings. While, amazingly, the doctoring of the test results had reportedly been going for some 15 years, begging some obvious questions around supplier management and oversight, the falsified test results apparently did not result in any of the parts posing a safety hazard.

Supply chain vendor TXT e-solutions reported 2012 results this week. TXT reports that revenues grew by 15.8%, from €40.1 million to €46.5 million, with 3.3 percentage points coming from the earlier acquisition of fashion retail planning vendor Maple Lake Ltd. The results show that sales of software licenses and maintenance totaled €10.3 million, up some 14% from the €9.0 million reported in 2011. The acquisition of Maple Lake, closed in the fourth quarter of 2012, is intended to more than triple TXT’s target market, giving the vendor an opportunity with more than 1,500 large retailers in North America, Europe, and Australia.

There are some interesting takeaways from Agilent’s Annual Analyst Day this week. Soon Chai Gooi, senior vice president of the recently formed Order Fulfillment and Supply Chain unit, talked about Agilent’s supply chain transformation. Agilent offers a range of complex test and measurement products and solutions serving a diverse array of global vertical industries, and so its supply chain challenges serve as an interesting case study of sorts. Gooi spoke in some detail about Agilent's efforts and results. Gooi cites $56 million of cost savings realized this past calendar year, with plans to capture another $50 million of savings this current year. Agilent is focusing its efforts in three areas: 1. “value engineering” (engineering in cost improvements; and greater use of standardized materials and technologies); 2. “procurement leveraging” and sourcing from Asia; and 3. “streamlining the supply chain,” which Agilent says refers to site rationalization and logistic network optimization. Agilent reports having consolidated five manufacturing sites already, with another seven sites “currently in progress.”

Oz Development touts a “patented cloud-based platform that enables integration, automation, and extension of order management processes for small and medium-sized companies.” Hmm. While we are figuring out what that means, Oz has announced an expanded relationship with UPS including elevation to Strategic Alliance within the UPS Ready Program, additional support for UPS Freight and Ground with Freight Pricing, and the introduction of Advanced Fulfillment Extensions with UPS WorldShip. Oz Development may be best known for its OzLINK shipping solutions for 
QuickBooksNetSuiteMicrosoft Dynamics, and Sage.
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