Solvoyo Blog

Important Considerations in Selecting a Supply Chain Planning Platform

Aug 20, 2015 5:04:00 PM
Yu-Cheng Shen, PhD
Written by Yu-Cheng Shen, PhD
Vice President, Customer Operations

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Supply chain planning used to be a lot easier, but in today’s world of global sourcing and an almost infinite array of paths from the source to the customer, the complexity is daunting. That’s why today’s supply chain planning systems cover everything from production, transportation, sales and operation (S&OP), to replenishment planning and much more. Today’s planning solutions are expected to be able to solve a dizzying array of planning challenges businesses face every day, and yet be flexible enough to accommodate the diverse requirements of users from across an expanse of industries.

Organizations considering buying or replacing their planning systems should be aware of the range of features available today and how each might contribute to the overall effectiveness of their supply chain and, most importantly, align with their specific business needs. You may not need each of these features today, or want to pay for them before you actually need them, but don’t eliminate the possibility that you might in the future as your business grows and becomes more complex.

As you review these capabilities, identify your highest priority needs based on the optimization impact each capability might represent, and the relative necessity based on your situation.

  • Multiple user functionality. Historically, businesses looked at processes in silos – from production, to inventory to distribution - despite the fact that most are deeply intertwined. This was primarily due to technological limitations as well as a rigid organizational design. Planning in siloed systems is sub optimal and partial. This realization has pushed today’s supply chain management leaders to view their supply chains holistically and increasingly push for syncing diverse planning systems with each other. A comprehensive supply chain planning system today needs to be able to cover all sort of planning needs of users from different departments within a company. Therefore, a multi-user system that allow for close collaboration, linking, and analytics between users at different departments is the de rigueur today.
  • Single data model. If a planning system has to support multiple user functionality, it needs to be designed and maintained in a single data mode to support users with different needs while reducing the data integration and conversion requirements that add processing time and operating costs.
  • Easy data interface with ERP or other systems. A planning system provides intelligent and actionable plans, typically through mathematical optimization, to the users to make smarter business decisions. Planning systems require data, and a lot of it, on which to build and derive the business intelligence from which it can make actionable plans for its users. In order to efficiently use the planning system, it must be easy for the planning system to interface with a company’s data sources, typically an ERP or a SQL database, with communication running both ways.
  • On-the-fly what-if analysis. Planning systems need to give users the ability to easily consider multiple options and contingencies through what-if analysis. Business decisions aren’t made considering only one scenario; examining alternatives allow managers to see tradeoffs and various risk/reward possibilities to arrive at solutions that fit them best. Your planning system must be equipped to support these kind of analysis day in and day out without requiring additional data inputs and support.
  • Aggregate levels usage. Look for a planning system that provides the ability to aggregate at any level users need, with functionality that allows aggregated levels to be easily introduced to the system to accommodate changing business environments. This helps ensure that a single planning system is being consistently used across your organization – from individual store managers looking at store-level data to a VP of marketing looking at aggregate national level sales data.
  • Built-in reports/graphs/maps. The primary purpose of a planning system is to help users make better decisions. In order to achieve this, planning systems must have the features that allow users to create custom reports, graphs or maps easily. It is often through these visual reports, graphs and maps that supply chain managers gain valuable insights to the problems they face and develop intelligent prognosis for their challenges.
  • Optimization and heuristic. Optimization analytics are often good for everyday business problems. However, when supply chain problems become larger and complex, the performance of pure optimization suffer. In these instances an approach based on heuristics and optimization are more appropriate. Therefore, a good planning system needs to provide both optimization and heuristics.
  • Web-based access. If you’ll likely have multiple users in different regions, the planning system should be available at all times. In addition, users should be able to access the planning system with a common internet browser from a range of desktop to mobile devices. With a common browser, users don’t need to have any additional systems installed thus reducing the need for maintenance and support staff.

As you search for the most appropriate system for your needs, keep all of these functionalities in mind, in a priority order that matches your situation, both now and down the road. Getting the most benefit from the system requires alignment between these features and your needs. If the system you are currently using falls short of this list, it might be time to re-think about the planning system you are using.

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Topics: Supply Chain Planning, Mid-market companies