Cloud-based Analytic Apps Optimize the Supply Chain

They work with leading ERP systems, they are quick and easy to deploy and they are relatively cheap, starting at just a few thousand dollars per month. These are typical software-as-a-service (SaaS) selling points that in this case apply to supply chain analytic and process automation applications provided by FusionOps.

FusionOps Insight is the vendor's just-launched analytic dashboarding environment designed to deliver metrics on inventory management, procurement and spending, supply chain, and supplier performance. Customers self-provision the dashboards by downloading trial-version support software and then granting read-only access to specific SAP data sources (Oracle integrations are said to be planned). FusionOps securely uploads customer data (to a SAS 70-certified data center) and customers are notified when metrics and reports are available online. Professional services are available for customization.

FusionOps Streamline delivers on-demand procurement and supplier management processes. Designed to extend both SAP and Oracle ERP systems, Streamline is said to reduce operational costs, increase responsiveness and ensure compliance by automating supply chain processes and eliminating untracked manual work steps.

Contract manufacturer Kimball Electronics has been using FusionOps Streamline for nearly a year, and it credits the service with optimizing the company's buying processes.

"Our buyers have five days to handle purchase orders and ensure timely MRP [manufacturing resource planning] execution, but compliance wasn't what it should be," says Kimball supply chain manager Gwenda Waldron, citing slow responses from suppliers and time-consuming manual work steps.

Deployed in January 2009, FusionOps Streamline was up and running at two sites within 12 weeks, supporting Kimball's two largest suppliers. It has since been rolled out to more than 300 suppliers and will support five Kimball plants by early next year. The on-demand service has given Kimball a unified process for executing purchases, all but eliminating manual data entry and inefficient communications via EDI, fax and e-mail.

"The buyers don't have to do all the data entry, everything goes out in a consistent, efficient manner, and the suppliers like it because they can just log on to the portal and see all the requests from Kimball in one place," Waldron says.

Kimball is now testing FusionOps Insight, which will provide executives with dashboard views into inventory trends, spend, purchase-price variances, supplier selection and supply chain execution performance. "Insight monitors how long suppliers are taking to respond, whether deliveries are arriving on time and whether quality targets are being met," Waldron says.

Kimball earned a return on its investment within a few months, according to Waldron, with MRP execution rates now in the 70-percent range, up from the mid-40s before Streamline was deployed (80-percent execution is "industry leading," according to Waldron). Order cancellations are also being handed more effectively and EDI costs have been all but eliminated, the latter defraying the cost of the FusionOps services. FusionOps Streamline starts at $5,000 per month while Insight starts at $3,000 per month.

Companies with business process management systems could build automated processes something like Streamline and companies with BI suites could build dashboards comparable to Insight. But FusionOps executives say the SaaS appeals of fast deployment, low cost and minimal IT support requirements will win over even those already invested in BPM and BI systems.