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Article on SAP supply chain initiative................
SAP Announces Initiative to Deliver First Comprehensive, Integrated,
High-Performance Supply-Chain Solution
ORLANDO, Fla.-- SAP AG today at its SAPPHIRE(R) user conference unveiled its initiative for supply-chain optimization, planning and
execution (SCOPE).
The SAP SCOPE initiative combines the strength of the renowned SAP R/3(TM) enterprise resource planning (ERP) solution with new
advanced planning and scheduling (APS) products and technologies, third-party products, Internet capabilities and a comprehensive
business intelligence solution, SAP Business Information Warehouse (TM).
With the SCOPE initiative, SAP is directly addressing customers' needs for a cost-effective, high-performance, real-time planning and
optimization solution. SAP Advanced Planner and Optimizer (APO) component is fully integrated into the core R/3 enterprise
applications, enabling customers to directly execute their optimized plans. The new solution will offer SAP customers significant
market advantage through increased responsiveness to their customers, and through reduced costs and greater efficiencies in their
operations.
Today, R/3 already offers the industry's broadest supply-chain automation solution, allowing companies to integrate their entire supply
chain from their suppliers' suppliers to their customers' customers. The SAP SCOPE initiative builds on these supply-chain execution
capabilities and adds deeper functionality and new APO technology. APO will be delivered as a single Business Component integrated
with R/3 through SAP Business Framework(TM), allowing customers to add or upgrade APO with minimal disruption to their core
business infrastructure. SAP APO will be compatible with R/3 Release 3.1 and Release 4.0, which means current SAP customers can
use APO to their advantage without having to upgrade to R/3 Release 4.0.
"We licensed R/3 because we believe its integration provides the infrastructure we need to build a global supply chain," said Peter
Burrows, chief technology officer of Reebok International Ltd. "SAP's integrated data model and the rich functionality of R/3 will allow
us to take on the organizational and business process issues to achieve our supply-chain vision. We welcome SAP's move to provide
its APO component integrated with R/3, so we can incrementally add advanced planning and optimization capabilities to our
supply-chain infrastructure without the upfront costs or the integration hassles of standalone products. It's a logical evolution for SAP --
and for us."
Customers using R/3 will gain significant cost and business benefits from SCOPE, including the following:
-- Ability to optimize performance and costs across the entire supply chain using the combination of APO and Business Information
Warehouse
-- Lower cost of ownership and reduced complexity through the elimination of third-party integration and interfacing expenditures
-- Unparalleled speed and performance through new SAP technologies, including liveCache, a memory-resident data-object processing
capability
-- Real-time cross-system, cross-company Internet-based simulation and decision support from synchronized data and tight integration
between the APO component and the R/3 execution backbone
-- Dramatically reduced costs and effort through the automatic generation of the supply-chain model
In addition, the SAP SCOPE initiative ensures the success of the extended supply chain by increasing the compatibility and
interoperability of multiple third-party solutions with R/3 through new supply-chain planning interfaces (SCPIs - "skippies"). SCPIs are
robust, stable interfaces that make it easier for SAP Complementary Software Partners to closely integrate their specialized solutions
(e.g., transportation optimization) into R/3, and they provide customers with greater assurances of long-term compatibility.
"Today's planning and optimization products deliver strong functionality that is focused on a single aspect of the supply chain," said Dr.
Claus Heinrich, member of the SAP AG executive board. "However, effective supply-chain management requires an integrated
approach that combines advanced planning and scheduling with ERP systems so organizations can realize ongoing benefits and cost
reductions. With SCOPE, SAP has developed a vision for supply-chain management that will be delivered over time to simultaneously
achieve supply-chain optimization and execution excellence."
APO Component's Main Elements
The APO component of the SCOPE initiative contains five main elements:
-- Supply Chain Cockpit. Key to the SAP SCOPE strategy, the Supply Chain Cockpit will provide a rich graphical interface to visually
manage the automated, seamless integration between planning and optimization decisions and execution. It will deliver
decision-support tools to facilitate knowledge workers' becoming actively engaged in real-time management of their supply-chain
activities. This solution will support the necessary balance of automation and live participation in the optimization process.
-- Available to Promise (ATP). ATP performs fast, high-volume, multilevel, simultaneous, rules-based checks on product and resource
availability and allocation of goods between trading partners. These checks allow more accurate promised delivery dates, reservation of
required material and product resources, and opening of planned orders to meet customer commitments. New memory-resident
data-object processing technology and multilevel and rules-based ATP (across multiple sites and multiple parts or ingredients) will
deliver high performance and scalability.
-- Advanced planning and scheduling (APS). APS will be automatically configured to support an innovative approach to traditional
supply-chain decision functions. These innovations include a fast and powerful memory-resident application server that will enable
real-time scheduling and optimization considering multiple constraints. APS capabilities will include rapid and intelligent material
requirements planning (MRP), distribution resources planning (DRP), master production scheduling (MPS), and deployment planning
and scheduling (DPS).
-- Forecasting. Customers will be able to perform high-volume, Internet-enabled collaborative forecasting. They can simulate and
execute comprehensive sales plans that incorporate data from point-of-sale (POS), open and collaborative forecasts, and other
sources, all using APO's enhanced graphical capabilities.
-- Supply-chain planning interfaces. A family of BAPIs, SCPIs address integration of third-party solutions at all major decision points
across the supply chain. They include extensions to SAP's current production optimization interface (POI), DRP, transportation,
demand planning and ATP. SCPI+ will evolve to include open access to memory-resident APO data for third-party planning and
optimization tools, and interfaces for accepting refined forecasts and schedules.
"The ERP battlefield is changing from just financials, logistics and manufacturing to ownership of the entire order-fulfillment process,
which extends to supply chain, sales and customer service. Anything less is just a point solution," said Bruce Richardson, vice
president at Advanced Manufacturing Research, a Boston consulting firm. "Supply chain as we know it will completely change in the
next 12 months. When customers hear what companies like SAP are doing, it will heighten their expectations."
Unparalleled Real-Time Performance
The SAP SCOPE initiative achieves its significant performance advantage through a number of new technologies developed by SAP to
enable the industry's first execution-based, real-time solution:
-- liveCache memory-resident data-object processing will allow large, high-speed, memory-based, task-specific applications servers to
be deployed within Business Framework.
-- Data objects are automatically populated, highly specialized data structures supporting high-speed optimization and planning
algorithms and easy-to-use graphical interfaces.
-- Real-time event notification is critical to integrating planning and execution: It brings exceptions and problems to users' immediate
attention.
-- Library for advanced optimization algorithms provides task-specific and industry-specific algorithms.
-- Enhanced graphical capabilities are key to engaging the user in the supply-chain planning process.
Achieving another industry first, SAP APO provides online integration rather than batch file transfer. This is enabled by a unique
technology that preserves the integrity between nonpersistent memory and persistent disk data. Customers benefit from both improved
real-time behavior and a closed feedback loop into the execution system.
Open Advanced Supply-Chain Management
The SAP SCOPE strategy for integrated solutions is a two-pronged approach. SAP will deliver its own fully integrated APO capabilities
to R/3 customers. And SAP will extend its Business Framework interfaces (SCPIs) to work with multiple supply-chain decision-support
vendors, including i2 Technologies Inc., Manugistics Inc., Chesapeake Decision Sciences Inc., Numetrix Ltd., Logility Inc. and others,
without embedding solutions from any individual vendor. This approach will provide users with unparalleled openness and flexibility in
integrating their own or third-party APO vendors' solutions.
Supply Chain Institute
The Supply Chain Institute is an educational forum sponsored by SAP to bring together executives, practitioners and thought leaders to
discuss supply-chain best practices. This institute will begin operations in the second quarter of 1998.
Pricing and Availability
APO will be made available to R/3 customers consistent with the SAP user-based pricing model. Deliverables under the SAP SCOPE
initiative are scheduled for rollout beginning in July 1998, with subsequent versions available throughout 1998. The SAP APO
component initially will be available on Windows NT, and is compatible with R/3 Release 3.1 and Release 4.0.
About SAP
The announcement was made at SAPPHIRE '97, the SAP annual North American user conference. This year's SAPPHIRE, held in
Orlando, will draw more than 10,000 attendees and more than 100 corporate partners to participate in a series of forums for gathering
and exchanging information on the future of enterprise computing and business strategies.
SAP is a market and technology leader in client/server enterprise application software, providing comprehensive solutions for
companies of all sizes and all industry sectors. Cultivating innovative technologies on a solid foundation of business experience, SAP
delivers scalable solutions that enable its customers to continually improve upon best business practices. SAP products empower
people to respond quickly and decisively to dynamic market conditions, helping businesses achieve and maintain a competitive
advantage.
Founded in 1972, SAP is based in Walldorf, Germany, and employs more than 11,000 people at offices in more than 40 countries who
are dedicated to providing a high level of support and service for the more than 11,000 installations of R/3 worldwide. |
