Kinaxis has announced a new Web-based, on-demand service for its RapidResponse product line. In partnership with IBM Global Services, Kinaxis will offer software as a service (SaaS) to address some of the critical supply chain challenges facing OEMs, manufacturers and distributors that source and sell their products globally. The new offering securely connects RapidResponse to supply chain data residing in disparate systems, enabling an aggregated, multiple-enterprise view of the brand owner's business. Ventana Research thinks Kinaxis is pursuing the right strategy in evolving its software into a package that easily integrates supply and demand data in real time from multiple tiers of the supply chain. However, the company needs to continue to differentiate its software and demonstrate its value in the growing market for sales and operations planning (S&OP) software applications.
Globalization is changing the way manufacturers and distributors operate their supply chains. Outsourcing, contract manufacturing, shorter lead times and more regulations are the new facts of life, and company managers are struggling to respond adequately to them. In many extended enterprises, each business link in the supply chain operates with a different set of plans and assumptions, and systems and processes are not well-integrated. Thus, managers must respond to escalating demands despite limited visibility into and control of these systems. To regain both, organizations must augment their supply chain management (SCM) platforms with niche applications that help cope with the growing complexity of managing global supply chains. Kinaxis offer such an application.
Its RapidResponse packages supply chain planning and product information in what Kinaxis calls ActiveSpreadsheets. These configurable Web-based applications resemble spreadsheets and provide access to information in multiple applications, including enterprise resource planning (ERP), customer relationship management (CRM) and product lifecycle management (PLM), as well as existing SCM sources like demand planning (DP) and advanced planning and scheduling (APS). RapidResponse includes LiveScorecard, a performance improvement application usable for finance, operations and sales and marketing that allows management to create, compare and score what-if plans for continuous measuring and monitoring.
What's new in this Kinaxis service is a conduit it calls RapidResponse Glass Pipeline, which securely connects a central instance of RapidResponse to supply chain data residing in systems external to the organization. This allows an aggregated, multiple-enterprise view of the brand owner's business. "Glass Pipeline" refers to the transparency of data flowing between trading partners. Synchronizing the feeding of multiple data sources into a single source supports the brand owner's requirement for a multi-tier view of its extended supply chain while removing the burden on contract manufacturers and suppliers to constantly produce and share requested data extractions, which can consume both time and IT resources.
Ventana Research believes that introducing its SaaS offering and glass pipeline capabilities increases the likelihood Kinaxis can persuade OEMs, manufacturers and distributors to consider it a solid SCM software provider. But Kinaxis must continue to distinguish itself from decision support and S&OP suppliers like DCRA, Interlace and SymphonyRPM that have gained broad industry adoption of their tools and from large enterprise application providers such as i2, Oracle and SAP, which provide SOA tools for integrating trading partners. Kinaxis has much deeper domain knowledge and understanding of the business challenges and processes in electronics than these other providers, but it must show customers outside this market how its products provide a long-term solution for integrated performance planning.
Ventana Research believes that global organizations should look to applications like Kinaxis' multi-tier tool to establish shared processes, data and metrics between trading partners. Electronics OEMs, manufacturers and distributors have begun to realize the importance of building repeatable processes for creating plans and providing ad-hoc, what-if scenario planning and have adopted software tools to support them. Those in other industries who also trade in global markets should learn from these experiences and evaluate the benefits of these tools as well.
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2006 Ventana Research