InformationWeek
Defining The Business Value Of Technology
September 20, 1999
Logistics Building Blocks
SAP and FDX team to offer supply-chain system to automate movement of goods
By Jeff Sweat and Alorie Gilbert
FDX wants to further capitalize on its leadership in delivering packages and goods. Last year, it developed an interface that connected SAP to FDX logistics. But this new offering, called FDX Supply Chain Solution Suite, is more comprehensive, combining supply-chain planning and business-intelligence applications from SAP with supply-chain consulting, integration, application hosting, and carrier services, as well as global shipment-tracking systems from FDX.
Getting into logistics may extend SAP's strength in application software into E-business, says Joshua Greenbaum, president of Enterprise Applications Consulting. "This is the kind of deal they have to have in order to succeed in their E-commerce strategy," he says.
The package includes SAP's Advanced Planner and Optimizer and Business Information Warehouse, for coordinating the flow of material coming into a company from its suppliers, and FDX's logistics systems to track and execute the distribution of goods to customers. Both companies will also offer services and consulting to set up supply-chain systems.
Analysts say the integration features will make it easier for enterprise customers to move goods through SAP systems to FDX systems. "You can drop-ship through FedEx without having to switch between applications," says Greenbaum.
But not all SAP customers will be able to use the system. The Earthgrains Co., a wholesale baker, already uses its own delivery trucks.But supply-chain execution is a critical need for the St. Louis company, so it finds the overall technology FDX uses to manage its logisticsattractive. Says Steven Brazile, Earthgrains' VP and CIO: "If we could optimize logistics so we're not passing the same store three or four times a day, it'd be a big deal for us."
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And from our sister publication:
AP and FDX Corp. are teaming to offer a supply-chain logistics suite that will automate the movement of goods from a company's suppliers to its customers' doorsteps. The product hastens the ongoing attempts of FDX, the Memphis, Tenn., parent company of Federal Express, to enter the broader logistics market-also the goal of competitors United Parcel Service and Ryder System Inc.
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