To All:
SAP announces release of supply chain software......
SAP Delivers SAP APO, Cornerstone of Synchronized Planning And
Execution Components of Supply Chain Management Solution; New
Components Extend Supply Chain Capabilities
LOS ANGELES, September 15, 1998 -- Today at SAPPHIRE(R) '98, SAP AG (NYSE ADR: SAP)
announced significant advances toward creating an entirely closed-loop, supply chain solution for its
customers that reaches from product design to the final consumer. Foremost among these is the on-time
first customer shipment of SAP(TM) Advanced Planner and Optimizer(TM) (SAP APO(TM)). SAP APO is
at the heart of the SAP Supply Chain Optimization, Planning and Execution (SAP SCOPE(TM)) initiative
and provides synchronized planning and collaboration among supply chain participants. Additional
announcements for supply chain management include new technology within SAP APO to quickly create
optimized execution plans for the rapid manufacture of products with many configuration options, an
enhanced warehousing and transportation system providing the logistics execution layer of supply chain
management, and advances in electronic commerce between businesses. SAP now provides
industry-leading, unique capabilities to create feasible supply chain plans that can be realistically
executed.
The supply chain offerings provide companies with an important set of tools that help build and manage
collaborative, synchronized supply chains that extend outside the enterprise to optimize critical success
factors such as cost control, time to market and effective partnerships. SAP provides customers with a
closed-loop solution from customer contact to production to delivery to product and customer service that
enables companies to serve their customers in new ways that are faster than ever.
Highlights of the supply chain announcement include the following:
First customer shipment of SAP APO including capabilities for demand planning, forecasting,
production scheduling and Global Available-to-Promise with synchronization across all supply
chain participants
A new Rapid Planning Matrix (RPM) technology within SAP APO that enables manufacturers to
manage the high degree of product variants and achieve mass customization, and offering the
most timely, accurate and detailed data for supply chain optimization
A new SAP Logistics Execution System (SAP LES) that extends the SAP R/3(TM) warehousing
and transportation functionality to enable the efficient flow of goods along each step of the supply
chain
Introduced within the SAP SCOPE initiative at SAPPHIRE Madrid last June, SAP
Business-to-Business Procurement(TM) (SAP BBP(TM)) is an open full-cycle Web-based
procurement solution with a new browser-based user interface that handles the entire
requisition-to-payment cycle via one easy-to-use single-entry screen.
"SAP now provides customers with a fully integrated and highly functional supply chain management
solution that will help reduce costs and improve time to market," said Dr. Claus E. Heinrich, SAP AG
executive board member. "With complete integration from sales to service, SAP provides the most
complete supply chain management solution available in the industry. Companies can now rapidly
achieve clear results through reducing inventory and filling orders more quickly and efficiently, thereby
providing better customer service and more accurate supplier scheduling. Most important, the supply
chain management offerings from SAP will greatly help companies with their ability to get products to
market rapidly."
First Customer Shipment of SAP Advanced Planner and Optimizer
The pilot program for SAP APO was launched in July and has been accepted positively. Companies
using the pilot SAP APO software include AMP Inc., Motts and Colgate-Palmolive Co. in the United
States, and the Goodyear Tire & Rubber Co. and Salzgitter AG in Germany. These customers represent
all regions of the world and many vertical industries. SAP APO currently offers industry-specific
functionality for many industries including automotive, high technology, consumer products, oil and gas,
pharmaceuticals, and chemicals. Market demand for SAP APO is very strong, and SAP expects to
deliver the first customer shipment version this month to up to 50 customers. General availability of SAP
APO is on target for December 1998.
"We've been working with SAP for some time on the development criteria for SAP APO and have been
testing it for the past couple of months," said Ed Toben, vice president of global IT at Colgate-Palmolive.
"We are very pleased with both the quality of the product and with the benefits we will derive from its use.
We expect SAP APO to provide us with significant supply chain process improvements, tight integration
with our ERP systems and improved return on investment."
SAP APO includes functionality exceeding what had been originally promised. SAP APO provides a
complete suite of advanced supply chain planning software for real-time planning and decision support --
from the Supply Chain Cockpit, Demand Planning and Supply Network Planning and Deployment to
Production Planning and Detailed Scheduling, as well as Global Available-to-Promise. Together, these
applications offer a complete, integrated solution enabling close interaction and synchronized planning
across all supply chain participants -- from the supplier's supplier to sales, purchasing and production
planners through to the final customer. (See SAP APO news brief for more details.)
"With delivery of SAP APO, SAP will deliver the central element of its SAP SCOPE initiative," said Ann
Grackin, a partner and analyst with Benchmarking Partners. "SAP APO provides companies with the
ability to meet their supply chain demand forecasting and production planning needs and achieve tight
integration with other aspects of the enterprise. With this delivery, SAP extends its industry-leading,
comprehensive set of solutions to meet customer needs."
As part of the TeamSAP(TM) commitment to customer satisfaction, SAP has already sponsored
numerous training workshops for pilot customers, consultants and partners on SAP APO, and the
product will be available for use with the AcceleratedSAP(TM) methodology for rapid implementation.
SAP provides an assessment service to help customers learn how best to balance their investment in
supply chain management software with expected returns on the investment. The company will also
supply customers and partners complete SAP APO guides to assist with their implementation.
New Rapid Planning Matrix Technology Within SAP APO Provides Unique Ability To Simulate and
Optimize Complex Production Plans
Manufacturers have never been able to integrate and effectively model and simulate the production run of
the following shift. This has been a major impediment to creating a fully optimized production
environment, especially in industries characterized by high volumes and a large number of product
options such as automotive and high-technology. By combining a matrix data model, state-of-the-art
algorithms and liveCache(TM) in memory processing, the new RPM technology provides the unique ability
to manage and optimize complex production plans. Complex plan simulations can be performed in
minutes, enabling iterative, alternative simulations to determine the most efficient production plan. The
RPM technology is an important tool to aid manufacturers with their efforts to optimize productivity and
meet customer requirements quickly, efficiently and cost-effectively.
The rapid planning technology will have particular value to the automotive and high-technology industries
as well as other discrete manufacturers with a large volume of orders and a large number of product
options. These industries are faced with the considerable challenge of producing competitively priced
products that are customized to the specific desires of their individual customers. Those companies that
can rapidly and cost effectively provide such mass customization have a competitive advantage. The new
RPM technology satisfies this need.
"With our RPM, we offer a new dimension of planning to automotive, high-technology and other industries
that manufacture highly-configurable products," said Dr. Peter Zencke, member of the SAP AG executive
board and chairman of SAP Japan. "Detailed data and a quick bill of material explosion for highly
configurable products are now easily achievable because of the combination of a logical matrix data
model, liveCache technology and the optimized planning algorithm -- a unique SAP innovation.
Companies using the RPM technology will gain a clear competitive advantage by speeding the efficient
manufacture and assembly of products that meet the specific needs of their customers."
The RPM technology is part of a joint development agreement with Daimler-Benz AG signed last July and
will be built into SAP APO. Initially, it will be available as part of the SAP Automotive industry solution.
"The cooperation we plan with SAP includes further development of the product and production
documentation as well as development of the innovative processes for our supply chain management,"
said Guenther Pauler, project leader, automotive SECAM at Daimler-Benz.
New Logistics Execution System Completes Closed-Loop Supply Chain Solution
The new SAP LES provides enhanced warehouse and transportation management functionality -- the
execution layer of supply chain management --enabling the efficient flow of goods along the supply chain
with greater speed and accuracy. Users ranging from forklift operators to warehouse supervisors and
transportation planners benefit from improved warehouse and transportation planning, inbound and
outbound processing, storage and facility management, warehouse technology such as radio frequency
control, optimized shipment scheduling and routing, shipment processing, freight cost management, and
shipment monitoring.
With SAP LES, customers will be able to not only provide Available-to-Promise but also available to final
delivery. SAP LES completes the integrated closed-loop of SAP supply chain management components
and SAP R/3 business processes covering planning, production optimization and logistics execution.
(See the LES news brief for more details.)
Goodyear Philippsburg implemented the first pilot of SAP LES as a standalone component in SAP
Business Framework(TM). "We especially like the integration of SAP TMS and WMS as we organize the
warehouse workload around the scheduled shipment," said Jurgen Herb, manager, systems and logistics
at Goodyear Philippsburg. "We have been live since last year, and this solution guaranties the necessary
performance and flexibility for our main distribution center as well as tight business process integration
with the main SAP R/3 installation in Luxembourg running sales and distribution, materials management,
financials and controlling."
SAP LES builds upon and enhances the warehouse and transportation management capabilities within
the industry-leading SAP R/3 System. More than 1,200 companies worldwide use these features today to
run their warehouse and transportation operations. Current customers include Rubbermaid Inc.,
Colgate-Palmolive, Goodyear, Nokia, Fujitsu Microelectronics Inc. and Earthgrains.
"Modern technology and advanced planning and monitoring tools are important prerequisites to support
efficient warehousing, distribution and transportation management," said Zencke. "Companies that deploy
SAP Logistics Execution System components across the enterprise will realize improved customer
service through better reliability and substantial cost savings from streamlined processes and efficient
use of resources."
As a new component, SAP LES extends the strategy to componentize SAP R/3. Some of the new
functionality within SAP LES, such as radio frequency control and task management, will leverage the
assets obtained through the recent SAP investment in OFEK-tech, an Israeli software vendor specializing
in warehousing and distribution-center logistics management and operations. Like other SAP
components, SAP LES will be built using SAP Business Framework and will retain tight integration with
SAP R/3 and other SAP supply chain management components. |
