InformationWeek

August 14, 2000

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Business-To-Business Apps Provide Quick Data Access

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More on supply chains:

Computer Reseller News Worldchain Asks: Why Can't We All Just Get Along? (7/3/00)

Computer Reseller News Study: Businesses Want A More Efficient Supply Chain (6/12/00)

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Tim Minahan, an analyst at the Aberdeen Group, says Agile has clearly gained an upper hand over most of its midsize competitors--a club that includes Manugistics Group Inc.--although it's still much smaller than industry leader i2 Technologies Inc. Its apparent success with customers such as Iomega Corp. and Dell is making other large companies give it strong consideration.

According to Minahan, research indicates that as much as 80% of a product's final cost adds up during the product-development or initial-sourcing stages, an area where Agile's deals with data providers add value. "Allowing engineers to understand what the variances are and see detailed spec sheets prior to making purchase decisions, and even prior to developing a product, is very valuable," he says, especially when companies work with multiple first-and second-tier suppliers or need to adjust product designs to meet local needs--incorporating the appropriate power supply and cords for U.S. and Japanese versions of a Dell computer, for example. Specification and materials data have been purchased from many sources and incorporated into Agile Anywhere, saving purchasers the time and expense of adding it themselves. Agile's ability to link with many material requirements planning and ERP packages from other vendors is also a bonus, says Minahan.

Analysts point to other pluses in Agile's products, such as a 56-bit, encryption security system that lets companies decide what information to share with their suppliers and partners and what information to block. "Security has been a key requirement for our customers right from the start," says Carol Schraeder, Agile's VP of marketing. For example, WebTV Networks Inc. uses Agile Buyer to send requests for proposals to and accept quotes from all the vendors that develop WebTV products, a list that includes Panasonic, Phillips, and Sony. These competing partners have access only to information that WebTV wants them to see, and they can't see one another's bids.

Although Agile's security features are stringent, end users don't have to feel straightjacketed by them, Stolle says. "Some companies may want a lot of security built into the system they're building; others may say, 'The design will be dead in three months, so who cares?'" he says.

Photo by Doug Knutson Optical Solutions Inc., a Plymouth, Minn., home and business optical-networking company with 105 employees and about $50 million in venture capital, switched from a cumbersome legacy materials requirements planning (MRP) system to a combination of Agile Anywhere and a new MRP system from Fourth Shift Corp. in 1998. Jackie Reed, director of quality and operations support, says she's thrilled with the results.

"Agile is the single best application software I've worked with, and I have yet to use it to its fullest capacity," she says. Optical Solutions shares its bills of material and product-change information with suppliers through Agile Anywhere, whether or not those partners are also using Agile's software. These documents can be presented in formats readable with common business applications, or within platform-independent PDX files The company also maintains its qualified vendor list within the package so partners know where they can go when they need a part.

Reed says her company was so impressed with Agile Anywhere that it recently beta tested a new Agile product, Agile eXpress Messenger, which transmits packaged PDX files between business partners. "We worked with a developer at Agile almost daily, feeding him our needs and telling him what worked well and what didn't," Reed says. "He was patient and responsive, and very customer-focused."

Still, not everything is perfect. Although she was pleased with Agile's response during the beta-testing process, Reed says she has "mixed emotions" about everyday technical support from Agile. "It's good, but it could be better," she says. "Hours mean the difference in time-to-market success, and waiting a day or two for a call-back is no longer acceptable." Reed also says Agile Anywhere's report-writing capability should be extended to let companies set up more kinds of custom reporting options.

Agile Anywhere's popularity is driving the popularity of Agile's procurement software as well. Agile Buyer takes the parts lists, specs, and other data generated by its sister application and uses it to automate the process of getting prices from suppliers and negotiating the best deal. This is a highly specialized business, Stolle says. "Direct materials procurement is not like catalog shopping," he says. "When you're negotiating with Intel for 4 million Pentium III chips, prices, availability, who will hold inventory, and programming on the chip are all issues you have to negotiate before you can issue" a purchase order.

Mike Pizinger Photo by Bill Kennedy For example, if Dell discovers its regular supplier will no longer make a bracket it's been using in one of its computers, it can use Agile Buyer to automatically send out specs-based requests for replacement parts to alternative suppliers, collect and compare their responses in minutes, get and register approval from team members, and make the final order on command. Without that capability, Dell would have to send multiple E-mails and faxes to each potential supplier, each communicating the same information, then shuffle through the responses. The process could take weeks.

Kimball Electronics, a Jasper, Ind., contract manufacturer with several thousand workers in three factories, has used Agile Buyer to boost its procurement operation. "We've experienced a dramatic reduction in our time to quote new business, from 18 days to an average of 10," says Bruce Reinhardt, Kimball's director of procurement. The new system is also more seamless than Kimball's old arrangement, in which product data came in from a MacPac ERP system and supplier quotes, and was stored in internal Excel spreadsheets.

While Kimball says Agile's support and technical expertise has been "exemplary," he would like to see a more robust part number validation routine in future versions of the software.

Agile, meanwhile, points to improved localization features, such as non-English interfaces and region-specific parts data, as ripe for inclusion in future offerings. That should be a boon for companies working with overseas manufacturers to produce products for domestic consumption, and for companies that want to increase their penetration of global markets.

"How can a company that's based in North America best communicate with suppliers in Japan or Europe?" Schraeder asks. "We say, 'English is the language of business,' but is that really true?" Betting that it's not, Agile released a Japanese version of Agile Anywhere 6.0 in April.

Indeed, globalization is one of the top factors driving midsize and larger companies to consider product data management systems at all, according to industry watchers. Producing the same device for various markets can necessitate changes in material origins, power supplies, and more to meet local regulations--a task that rigid record-keeping systems simply aren't equipped for. All of today's manufacturing models demand flexibility--and, according to its customers, that's precisely the area in which Agile excels.