SAP planning tool put to test by users
computerworld.com
Early adopters say new supply-chain software needs to mature, but it's a good start
By Craig Stedman
01/18/99 SAP AG released its new supply-chain planning software on schedule at the end of last month, and early users are gearing up to see if the technology delivers on all the German company's promises.
Beta testers such as Colgate-Palmolive Co. and Mott's North America don't expect SAP's Advanced Planner and Optimizer (APO) to immediately match the breadth of functionality provided by more mature supply-chain products from the likes of I2 Technologies Inc. and Manugistics Group Inc.
And the early adopters are still waiting for SAP to come through with critical support for feeding production schedules and distribution plans from APO to its R/3 back-office applications. That link is being promised for shipment later this month in the form of a software patch, said Shawn Mullen, APO project manager at Mott's.
But Mullen added that the Stamford, Conn.-based maker of juices and applesauce is moving ahead with plans for a spring rollout of APO, which is being counted on to help Mott's improve its demand forecasting accuracy and reduce finished-goods inventory costs.
APO initially "won't capture all of the technology that I2 or Manugistics have, but SAP is coming in and offering up a pretty good solution," Mullen said. And the ability to tap SAP for both back-office and planning software was a big plus for Mott's, which has been using R/3 since early 1997.
Mott's began installing the general-release version of APO last week for testing purposes. If all goes well, Mullen said, the company will start using APO in March to plan inventory replenishment for its customers and then launch demand planning and distribution scheduling in May.
A Matter of Time
SAP shipped a pilot version of APO in mid-1998 and in September put out a beta-test release that still lacked some of the promised functionality. For example, early users said the finished software adds a link for sending data from R/3 to APO.
Ed Toben, vice president of global information technology at Colgate-Palmolive, said the New York-based consumer products company also plans to start replacing its existing supply-chain planning systems with APO before April. Expected benefits include more on-time shipments to customers.
APO "will need to go through some maturing stages," Toben said. "But it's getting to where we need it to be." And the promised close ties between R/3 and APO were just as big a lure for Colgate-Palmolive as they were for Mott's. "Our best case is that everything here eventually becomes SAP," Toben said.
Steven Cole, an analyst at Forrester Research Inc. in Cambridge, Mass., said SAP still has to mesh together the production and distribution planning pieces of APO -- a process he expects to take until next year to finish.
Not all R/3 users are champing at the bit for APO. For example, Lucent Technologies Inc.'s power-supply division began to use R/3 at its headquarters in Mesquite, Texas, in late November. But the company is sticking with I2 for demand-forecasting and production planning.
I2's Rhythm software "does everything we need it to," said Karen Peterson, manager of business process planning at the Lucent unit.
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James, no clue on fourth shift. I'm far from being a guru in SCM.
regards,
Denis
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