The biggest pain point vexing companies today is concern over the economy, says Tom Strubel, application sales manager for value chain planning with Oracle Corp. "There's a lot of press about a potential double-dip recession," he says. "Everyone mentions that." Companies are nervous about over-committing on inventory. They're also concerned about their ability to re-plan quickly, in line with sudden changes in demand patterns.
When it comes to recovering their investment, buyers of information technology today are much less patient than in years past. Typically, says Strubel, they're looking for a full return within six to nine months. In the past, they might have tolerated a handful of multi-year projects.
Buyers' specific needs include the desire to obtain a better picture of actual demand, and get closer to the customer. "There's a big drive to seek more levels of detail in what end-customers are doing," Strubel says. A manufacturer of consumer packaged goods or electronics not only wants to understand the needs of retailers; it wants intelligence about what customers are actually buying. As for the current level of retail activity, Strubel says goods are selling well at the high and low price points. "The middle, not so well. We think that trend is going to continue."
An effective supply-chain management program is about more than software, he says. Other critical factors include process, internal politics, leadership and accountability. Change must start at the very top of the executive ladder, Strubel says, but senior management must also have buy-in all the way through the organization. "A sales manager in Asia needs to quickly understand that he has a new target that's different from yesterday."
Strubel says retailers are doing a better job these days of sharing forecast data with suppliers. There's no lack of information, he adds - the problem is sifting through it all, and making effective use of it in the upstream supply chain. Better collaboration in the area of product development is "another area of opportunity," he says.
