Supply Chain costs have steadily increased over time despite concerted efforts by many manufacturing, logistics and transportation companies to hold the line. For many of these companies, particularly those with large and complex supply chains, optimizing the sales and operations planning (S&OP) process to improve customer experience and control costs has not been easy. Evidence of the impact of poor performing S&OP includes missed deliveries, reduced brand image, lost customers, higher working capital in inventories, higher labor costs, inability to compete effectively, and reduced operational and financial performance. Worse, without meaningful operational insight, organizations can leave good money locked or stuck in the value chain.
Why is it still a problem? After all, sophisticated ERPs, supply chain management, warehouse management, manufacturing, and logistics execution systems became mainstream decades ago to avoid these problems. As it turns out, decades and tens of millions of dollars later, these applications are still managed in silos, on a per business unit, plant, or regional basis, and they tend to support a specific set of processes and related view of data. More often, these silos also still require significant manual intervention, creating business and systemic gaps. In response to customer demands and market conditions, changes in data requirements, such as packaging variations, shipping variations, and special orders, can exacerbate the problem, increasing the potential exposure to business process breakdowns. Further, because there is little or no consistent development coordination across business functions, these types of changes can be very costly to implement.