Roadmap Addresses Supply, Demand Chain Management

Investments by electronics manufacturing companies of millions of dollars in software products to manage and automate supply and demand quantification have not prevented margins of error from 50% to 100%, according to a recent report by Technology Forecasters, Inc. (TFI, Alameda, CA). The study, �Supply-and-Demand Chain Software: Systems Required through the Product Lifecycle,� finds that these margins of error have created rifts between suppliers and customers, cost business partners millions of dollars and delayed product launches.

The report maps which application systems are required in an enterprise and the business process and data flow through these required systems. The study�s results will be presented March 6 during TFI�s Quarterly Forum for Electronics Manufacturing Outsourcing and Supply Chain, to be held at member Varian Electronics Manufacturing�s facility in Tempe, Arizona.

According to the study�s manager, Niti Agrawal, �In the late 1990s, because of internal corporate initiatives to implement e-commerce, e-procurement, and other e-programs in enterprises, many high-technology companies and their contract manufacturers invested millions in software applications to manage and automate aspects of their supply chain. Some of these software implementations generated positive return on investment; many did not.�

For the study, TFI�s team interviewed 23 established, emerging, broad and focused software vendors to, among other things, elicit feedback on integration challenges in using these tools. �From the results,� Agrawal stated, �we developed a model that provides guidance on product?related data flows between systems�organized the way OEM [original equipment manufacturer] managers view their product�s lifecycle, from design through end of life. For OEMs and their contract manufacturers to avoid common errors in supply-and-demand expectations, a seamless flow of information is required among software systems, functional departments and business partners.�

The study comes at a particularly critical time. With the high technology downturn of 2001 to 2002, companies have dramatically decreased information technology (IT) spending and yet still need solutions that solve tangible business issues and demonstrate rapid return on investment (ROI). Executives are faced with choices among an array of large and small software companies vying for scarce IT dollars. According to TFI, the model helps OEM and contract manufacturing executives objectively analyze their existing software platforms and close existing gaps.

In addition to the presentation of the results of the software study, the Quarterly Forum will include a panel of supply-and-demand-chain software executives discussing strategies to enable cost savings and superior communication between OEMs and outsourcing partners. Participating companies include J.D. Edwards, NewView Technologies, Parametric Technology Corporation, PeopleSoft, and Valdero�moderated by Agile Software.

Other sessions at the forum include: �Surviving the Industry Downturn� by Varian Inc. Electronics Manufacturing�s Vice President Wilson Rudd; a panel of original design manufacturing executives discussing intellectual property protection and comparisons with contract manufacturers; �Uncovering New Sources of Business Value: Focusing an Ecological Lens on the Supply Chain�; and �The Consumer Electronics Market: Trends and Strategies for Outsourcing.� That evening, a networking dinner for members will be sponsored by Teradyne Connection Systems.

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