February 5, Provia Software (www.provia.com),
a somewhat tacit but quite steadfast privately-held provider of supply chain
execution (SCE) software solutions aimed at catering for the entire order-to-delivery'
collaborative process needs, announced that it has completed 2002 with over
80 client sites going live during the course of the year, which was also one
of the company's most profitable years ever. The more than 80 client go-lives
were a combination of new and upgraded sites worldwide, and reportedly came
from a wide variety of industries, including consumer packaged goods (CPG),
third party logistics (3PL), wholesale/industrial distribution, high-tech/electronics,
In addition, a number of Provia's clients added new products from the Provia suite to their logistics strategy, reflecting Provia's continued success in both attracting new customers and marketing into its client base with new solutions. Provia credits a part of its success to the fact that Warehouse Management System (WMS) software (particularly the legacy instances) tends to be among the most customized of enterprise applications, which often makes it more affordable for companies to forego the upgrade process and just install new more out-of-box functional WMS applications.
would be quite simplistic to state that Provia's stellar results regardless
of a depressed selling environment and a skimping software buying behavior stem
from the mere fact that it is a SCE vendor, and given the SCE market has been
resilient and defying current sluggish IT sales. Yes, Provia, like its high-flying
nemeses, Manhattan Associates (see Logistics.com
Becomes The Newest Of Manhattan Associates), RedPrairie (see
- New Name For A Brave New Value Proposition Paradigm ), G-Log,
HK Systems, HighJump and Yantra (see Yantra
Leader in Distributed Order Management, But Wait There's More), has been
thriving in part because it provides many part and parcel' components of SCE.
SCE has indisputably lately been growing faster than its other applications
siblings, given its low-hanging fruit that provide hard benefits (e.g., improved
inventory accuracy, improved space utilization, improved labor productivity,
etc.) with quick deployments and appetizing price tags. To that end, warehouse,
yard and transportation management have emerged as some of a rare remaining
areas where companies still have an ample opportunity to redesign and optimize,
while, at the same time, deploying these is less time-consuming and more oriented
towards tangible ROI.
the above vendors have many common threads within their success stories, they
all do have some specific differentiating value propositions. Otherwise, how
else would one explain the ongoing plight of some publicly held SCE vendors
like EXE Technologies, Industry-Matematik International (IMI),
and Catalyst International if just a mere SCE designation would
be a guarantee of success without keeping products abreast of latest trends
and/or without good execution?
is Part Two of a three-part note.
One detailed the recent product announcements.
Three will cover Competitive Strategy, Challenges and make User Recommendations.
Provia Product Strategy
As for Provia, its ability to prudently expand its traditional WMS savvy into a full-fledged SCE expertise to address increasingly required customers' order fulfillment management has played well to its ongoing strong performance. In today's depressed market, the message of quick and proven ROI with an impact on customer satisfaction echoes loudly enough to nonetheless keep both current and new customers deploying Provia's latest add-on modules.
In addition to attributing to this current industry-wide pragmatic buying approach, these traditionally unattractive applications (due to the complexity of the warehousing old-fashioned put-away/store/pick routines and integration involved in uniting the WMS with hardware like conveyors, bucket elevators, and other material handling equipment) during the market infatuation with e-strategies of fancy web storefronts and exchanges of the late 1990s, have lately also benefited from breaking away from these formerly insulated spheres of a four-walls nitty-gritty, and consequently expanding into more exciting aspects of collaboration. To that end, from the moment an order is created, Provia Software's ViaWare and ViaView suites aim at helping managers track orders in real time and make orders visible throughout the entire delivery process, which is the core of its value proposition.
Like many other SCE vendors, Provia has thus revamped its strategy to attack the lucrative business-to-business (B2B) order fulfillment software market. Since its beginnings as a mere WMS vendor 15 years ago, Provia has expanded its domain expertise into order management and fulfillment collaboration, and consequently, it now offers two major loosely-coupled suites of products to support these capabilities. The suites that Provia has built both through acquisition and internal development over the past few years allows it to pursue larger, longer-term contracts, which is an ability that should ensure its future success provided it continues to execute well and leverage its highly delighted client base.
ViaWare suite of execution applications for fulfillment is Provia's response
to an obvious trend among many warehouse management software vendors to round
out their product offerings by including adjacent functionality. Key components
of the suite are Provia's flagship warehouse management system (ViaWare WMS),
a yard management system (ViaWare YMS), an order management
system (ViaWare OMS) solely for third-party logistic (3PL)
providers (acquired in 1999 from Logistics Concepts), a transportation
management system (ViaWare TMS) (via a reseller relationship
with Pinnacle Distribution Concepts established in 1999), a small parcel shipping
(ViaWre SPS) management module, and the ViaWare Gateway
integration tool to other enterprise systems.
WMS Applications Are Key
Generally speaking, WMS applications traditionally automate activities falling within the four walls of a warehouse, such as receiving, put-away, serialization, picking, packing, and shipping. The software market for WMS has consequently become more and more competitive as the technology has evolved to address the lion's share of customer requirements, such as more intricate advanced shipping notice (ASN)/ RF receiving, lot/expiration control, location selection, wave building, labor planning, advanced kitting, wave templates, material selection, compliance labeling, picking/packing, cluster/batch picking, serial number capture, catch-weight capture, cycle counting, task management, replenishment, container tracking, cross docking, report generation, shipping paperwork, carton selection, etc. Like any software technology that has been reaching a plateau in the maturation curve, WMS products have evolved to a point where there is little differentiation among them.
since the warehouse is no longer merely a static storage facility, it now has
to use real-time data to closely match supply to demand, eliminate the need
to hold excess inventory, and increase the flow of goods throughout the supply
chain. Therefore, due to the SCE software's capability to handle these complex
requirements, there has been a trend of postponing many light manufacturing
operations (e.g., final assembly, customized packing, labeling, engraving, etc.)
from shop floors to warehouses and distribution centers (DCs), and a WMS package
plays a key role in the company's postponement strategy to delay the customization
of products until after the products, or a set of common components, have left
the manufacturing plant. To that end, introducing an advanced kitting capability
within the ViaWare WMS was Provia's apt answer to helping its customers reduce
the costs associated with their supply chains, where one of the most significant
facilitators is postponement, and that is where kitting helps because it allows
enterprises to keep their products in a more generic state for as late as possible.
To that end, Provia's advanced kitting capability allows users to have generic
products assembled ahead of time with the option to assemble and configure them
to order', based on last-moment customer requests, which should keep inventory
levels lower and increase material velocity. This overall reduction in inventory
in turn reduces costs within the supply chain, and also, the better service
provides a higher level of customer satisfaction, as has been the case with
Provia's high-profile customers TaylorMade Golf and Lanier.
During these days of careful cash flow and asset management, more and more manufacturers are attempting to get rid of unnecessary inventory, and the place to start is with finished goods inventory. Postponement indeed allows manufacturers to limit their finished goods inventory by postponing production of the final product as long as possible, in the ideal case until the order is in hand, and then it is shipped out immediately.
If one can build the sub-components to the most generic level and harness a WMS that can take an order and explode it into a bill of material (BOM), with the components being the generic SKUs (stock-keeping units), pick the components of the exploded BOM, deliver it to a kitting station, and then have it assembled for final distribution, this would be a very effective method of mass customization and inventory reduction for the manufacturer. Consequently, the need for these light manufacturing activities in warehouses rather than on the shop floor has forced WMS vendors to include more functions in their packages that would previously have been considered manufacturing functionality, such as BOMs creation for kits, assembly work plan and instructions, kit assembly user dialogs, kit-to-stock, kit-to-order, de-kitting, special packaging/labeling, accessories (non-stock items) processing, and reporting of completions against manufacturing steps, so that the enterprises can postpone the production of their finished goods and decrease their own costs.
Products such as cans/bags of food, boxes of cigarettes/candies, bottles of pills/drinks, or luxury watches/giftware usually have multiple packaging configurations or labeling requirements. From an inventory management point of view, each of those different packaging configurations or labels is a separate SKU and a separate unit of finished goods inventory. But if the underlying basic product is the same for all those configurations, a manufacturer could postpone the customization by producing the generic product, and performing the final packaging and labeling as orders are taken and shipped. By doing this, they also avoid the need to forecast what the individual demands will be for each SKU, but rather to forecast the aggregate demand for all the unfinished generic products (i.e., product families or sub-assemblies), where the margin of forecast error is usually much lower. As a result, there are fewer deviations from forecasts and the manufacturer does not run the risk of accumulating excess or obsolete inventory of any of those packaging configurations. By providing all the above advanced kitting functionality, and more, Provia often stands out amongst its peers during software evaluations.
The vendor offers many other possibly differentiating capabilities within WMS-related functionality like dynamic re-slotting, i.e., determining the optimal slot size and place for any SKU based on data such as demand (i.e., whether it is a fast or slow-moving item), product groupings and physical characteristics, to also keep picking operations smoothly despite frequent promotions and changes to product mix. Doing this manually is almost impossible in environments where hundreds of SKUs get added and/or deleted every week. Thus, Provia's solution reviews a few weeks history of shipping and outbound orders, and then sets up accordingly forward picks for faster moving products and vice versa for slower-moving products. Also powerful is the serial number capture and tracking throughout the entire distribution chain so that, e.g., a cell phone body and its battery serial numbers and their whereabouts are traceable up- and down-stream.
YMS Integrated with WMS
Possibly the best in its class could be Provia's YMS (Yard Management System) with browser-based graphical drag-and-drop control of yard activities (e.g., yard control - including trailer tracking, trailer contents, trailer movement and graphical yard presentation; appointment scheduling - including inbound/outbound time, service time, resource requirements and equipment requirements; and carrier performance tracking like on-time and correct equipment aspects), and its seamless integration with WMS, thereby extending the WMS' functionality beyond the four walls of the warehouse into the yard. For instance, each trailer that comes into the DC is checked in through the YMS, which then triggers activity throughout the WMS, including wave planning, trailer loading, and cross-docking.
YMS and WMS communicate continuously as the YMS helps direct trucks to the proper
dock door for loading while the WMS prepares the orders to be shipped out. The
YMS then checks out trucks as they leave the facility and automatically informs
the ERP back-office system in place. Color-coded, graphical view of all trailers
in the yard is a nifty feature that yard managers find intuitive in pinpointing
bottlenecks, as operators can see color changes if trailers are beyond an appointed
time, or see where loads have not even been started. A landmark Provia customer's
testimony in this regard would be Owens Corning.
Small Parcel Shipment Management
due to the way warehouses are increasingly shipping orders with lower quantities,
but with increasingly growing line items, small parcel shipment management systems
may be even more important than full-fledged WMS/TMS systems for some businesses,
particularly for those doing high volumes and complex order profiles. To that
end, ViaWare SPS determines where products are going and which shipper to use
(e.g., FedEx, UPS, DHL, etc.), and it creates the appropriate
label during picking. Conversely, the traditional WMS approach would involve
extra steps since it performs picks, moves them to shipping, and then generates
Other notable features the SPS module would be integrated WMS check/pack dialog, carrier compliant labeling, parcel rating, on-line carrier manifesting, combined carrier/compliance label, pre-print labels for cluster picking, cash on delivery (COD) support and multiple rate servers. Another buzzword applicable both for SPS and WMS would be "cartonization" to automatically determine the best way to box and package orders (e.g., how many products or boxes will fit in a bigger box, factoring in component weight and size).
WMS Market Potential
In addition to the above demanding functional capabilities, seamless integration of transactional and decision-support applications has become quite important, and, consequently, modern SCE systems provide the tactical, transactional backbone for order fulfillment and visibility atop their core functionality of order management, warehousing, transportation, and inventory management. To be able to react to fluctuating demand, respond to customer specifications, and coordinate real-time event messages from multiple disparate systems, these systems are being further enhanced with decision support capabilities and planning engines aimed at order fulfillment and inventory and order status visibility.
Therefore, while many original WMS suppliers have lately added transportation and order management to their core products, and others have developed optimization or value-added service options, the most regular and justifiable enhancement has been Web-based order-fulfillment modules, which typically include real-time supply chain event management (SCEM), alert messaging, order tracking, and complicated workflow management. While the WMS market is expected to continue to grow modestly and faster than many other applications, it appears the customer order fulfillment process management as an add-on solution to WMS will experience much higher growth.
Thus, complementing ViaWare is ViaView, Provia's collaboration fulfillment suite, offering visibility, event management, decision support, labor analysis, and workflow capabilities. It interfaces with the ViaWare execution suite via the Web, e-mail, pager, fax, or XML (eXtensible markup language) documents, and it also interfaces with other SCE, supply chain planning (SCP), and ERP products or legacy systems. ViaView also contains a data warehouse as well as a data store, which is the real-time component allowing clients to subscribe to an event notification (e.g., an alert when the shipment is made) or non-event notification that allows warehousing personnel to take corrective action before a problem arises.
Provia has also been addressing supply chain collaboration and performance management, by providing tools that allow clients to set key performance indicators (KPI), monitor their performance against KPIs, and notify them when they are outside of specified bounds. A Web-based structure connects all possible execution environments together and allows a big picture view of an entire supply chain and KPI measurements.
concludes Part Two of a three-part note.
One detailed recent announcements.
Three will discuss Provia's Competitive Strategy, Challenges, and make User