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Wednesday, October 05, 2005

[ALI] Finding the right solution is the easy bit (BangkokPost Article)

Finding the right solution is the easy bit

Rene Rojas, RSCS Thailand

The real complexity of implementing supply chain management (SCM) IT tools is not necessarily technical. In a world of global solutions and complex manufacturing, SCM is a relatively small challenge for the expertise of IT engineers.

The complexity actually lies in the fact that implementations have to deal with other fundamental aspects, such as a variety of software vendors and products, requirements of multi-skilled technicians, variety of business areas, and finally a budget. And all of these have to move together towards the final objective of implementing a system.

Integrated architectures all face similar issues. How to migrate from the old database to the new one? What are my equivalents and gaps? Which are my requirements? Which components have to be replaced? What about compatibility aspects? There are a number of methodologies that have been developed specifically to address these aspects of systems implementation, the integration challenges and the risks associated with it.

IT literature is swamped with cases studies about successful implementations. They provide good reading but in the real world we have to face the marketing strategies used by the software manufacturers, the constant on-and-on between the business and IT departments, the business pressure to keep things running, the painful and expensive vendor support costs and other factors. Reality bites hard!

And finally, in which stage of the game are you? Are you implementing a totally new solution? Are you upgrading an existing one? Are you integrating new system components, say the merchandising or warehouse modules?

SCM is a term that refers to many challenges. The best way to see it is not by thinking across SCM but by which head of the multi-headed monster you have to face first. Supply chain is a set of multi-dependent business activities that are performed in various systems and architectural components. Overall, integration is the issue and it is there the expertise should be focused.

What do we have to do to migrate from one solution to another, minimising the impact to the already successful business practices and, at the same time, introduce new practices that will benefit the business? What is the business view in comparison to the software suppliers idea of business benefits and operational improvement? The point is that migration is an SCM attribute and with this a number of challenges that are not necessarily technical but business strategic.

What should be the testing focus, quality, risk or both? Which are the functional and operational aspects that place the business at risk? Who determines the approach? This approach decision has to be taken as it will clearly define the strategy applied during the creation of the Test Plan and execution.

Testing is an area that has traditionally been all but ignored and most managers are not even aware of the great development of testing methodologies and skills.

SCM implementations are subject to constant changes, all requiring testing. Establishment and creation of a test library and test catalogue is a strategic aspect that must be carefully considered in implementation.

SCM has very well defined business activities that can be easily documented with views on future use.

Business risk is the great motivation in testing and the business risks are easy to identify: articles should be available in time and quantity as required (for either retailer of manufacturer) and data consistency is a must.

On the other hand, quality will not necessarily minimise business risks but it can overtake importance, depending who is the main force behind the testing strategies and objectives in the project. A risk in itself.

Complex systems do not really exist nowadays. We have reached such a level of technical expertise and the market has such a variety of solutions that it is only a matter of putting the players together and to get on with the job.

Of course, this is more easily said than done. The complications fall in the aspect of planning and managing resources. The vendors, the business specialists, the stakeholders, the contractors, the implementers, and finally the different cultural influences if you are dealing with global strategic implementations.

Do not take the last one lightly as you may need to use a great percentage of your energy in simply managing communication and related issues.

The trap we seek to reveal is that successful implementation of an SCM solution does not only require SCM expertise. There are specific technical and business requirements to be met by a variety of people with a variety of skill sets.

SCM is an integrated monster where, as in most cases, a good team-minded set of specialists (team-minded more than specialists) and strong management are the most important success factors.

[Non-text portions of this message have been removed]

Asosiasi Logistik Indonesia [ALI]: "turut meningkatkan kualitas SDM Indonesia di bidang profesi logistik dan sebagai wadah komunikasi industri logistik di Indonesia" www.ali.web.id

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