Imagine knocking on your boss’ door to explain why the company’s SAP Advanced Planning & Optimization (SAP APO) roll-out isn’t going well because someone forgot to nip an issue during the design stage.
That’s the scenario faced by companies if they can’t successfully maintain SAP APO after go-live. While meeting business requirements is crucial for the implementation team doing the process and system design, it’s equally important to keep long-term supportability in mind. In a new article for SCM Expert, “Five Case Studies to Help You Design SAP APO with Long-Term Support in Mind,” author Rajesh Ray offers a series of case studies to illustrate the importance of design for support – in other words, best practices that implementation teams need to consider while doing system design to keep long-term supportability of SAP APO as a goal.
I wanted to share a case study presented by Ray, who is a senior managing consultant and SCM product lead at IBM Global Business Services. It involves a fast-moving consumer goods company that wanted to enable its demand planning process using SAP APO. The company had more than 20,000 finished goods SKUs and wanted its sales force of 1,200 to participate in the demand planning process by providing input on expected sales for the next three months. A few months after system go-live, users started experiencing system slowdowns when entering data. In most cases the drill down to the lowest level was getting terminated. Finally the company’s support team had to take up another project to redesign specific planning books, data views, selection IDs, macros, and batch jobs.
Here’s what went wrong: The consensus planning process was designed in a way that the company’s sales forces needed to input their data at the lowest product location level. In the beginning of the month while entering expected sales data, there was a need to open up nearly 50,000 cells in planning books. During these two days of the consensus demand planning cycle, a huge number of users tried to log on the system at the same time, which resulted in serious system performance issues.
Ray offers two warnings about this scenario:
In SAP APO, every increased level in product or location hierarchy may create issues in terms of disaggregation or rounding, or lead to longer times for batch job runs. Some large implementations have realized this over time and rationalized their characteristics levels in the next version of their solution.
The performance of SAP APO planning books reduces drastically if there are more than 30,000 cells at any point. There are options to work within that restriction and still meet the business need – for example, the properly designing selection IDs or keeping a minimum number of key figures in highly used books.
I wonder how many of you have considered holding forums to keep your suppliers informed about new developments or changes to SAP software you’re using.
By the end of 2011, about 600 of Lockheed Martin Aeronautics’ suppliers will be using the new portal system to collaborate with the company and access parts of SAP SNC. As part of their introduction to the portal, those suppliers receive training before gaining access to it.
Meanwhile, a project team within Lockheed Martin Aeronautics also hosts biweekly user forums during which suppliers can get specific questions answered and share ideas and tips among their fellow suppliers.
“The forums allow us to show that we’re listening to suppliers and that we are changing the system based on their feedback,” Michael Palm, the company’s senior operations engineer, tells insiderProfiles. “There may be a case where the system works as designed but, from a usability standpoint, may not be streamlined. So we take that feedback and develop enhancements to make the tool and our suppliers more effective.”
I love the idea of such forums because they are simple and inexpensive. If you think about all of the outside vendors a company touches as part of the supply chain, any chance to connect better with those suppliers is a chance to improve operations and maintain better relationships.
Information is flowing at the pace of white-water rapids at our Logistics and Supply Chain Management 2011, Manufacturing 2011, PLM 2011, Procurement 2011, and CRM 2011 events this week in Orlando. Tons of sessions and crowded exhibit booths have led to strong word-of-mouth and a bounty of Twitter posts about the conference.
I’ve also noticed a bunch of new bloggers joining us from the ranks of the conference attendees (check out their posts here).
Here are a few trends and highlights that I caught my eye this week:
CRM
SAP CRM enhancement package 1 definitely grabbed the attention of attendees. Many people I talked to made mention of the enhancement package, so kudos to SAP for getting the word out and creating a product that has buzz.
This year, we tried new demo sessions at the conferences, during which attendees could take part in live demonstrations of SAP modules in action. Several of these demos were so popular that late-arriving folks had to be turned away, so repeat sessions were scheduled in response.
There is a healthy skepticism about mobility and how it applies to SAP CRM. A dozen sessions at the show discussed mobility’s relationship to SAP CRM, so people are interested, but at the same time not everyone is quite ready to drink the Kool-aid.
A shout-out goes to the two conference producers behind the content for these shows, Marcy Rizzo and Amy Thistle, who themselves took customer service to a high level in their dealings with speakers and attendees (the requests these ladies handled were at times non-stop).
SCM
Expert speakers pounded away on the notion that if your company has not been impacted yet by shifts in the global economy, it will be. Shifting views of the supply chain and manufacturing, combined with outside forces bringing the world even closer together, have put more power into the hands of consumers everywhere.
SAP Advanced Planning and Optimization is a function that all at once attracts users and also stymies them, as I simultaneously heard about its growing appeal and its pitfalls if not implemented well.
There was a particularly strong supply of dessert trays here at the Dolphin Hotel’s convention center. And judging by demand patterns for the mini chocolate cake slices, I know which treats are driving the local bakery market.
Although this comes from a purely anecdotal observation, I must conclude that service procurement has a healthy following because more than 100 people attended Suzanne Miglucci’s session on the topic. Given service procurement is a large source of unmanaged spend for some companies, there is probably good reason for the interest.
By the way, Miglucci – global procurement marketing executive at SAP – had me rolling with her wisecracks before the session, for which I served as a room monitor. Even better, she also made the unusual speaker effort of helping me greet attendees as they entered the room, and then took questions from her audience for 30 minutes after her presentation ended. That was real-life integration of SCM and CRM.
You didn't see how the tale illustrated the idea of a global economy changing before our eyes? You missed how water heaters represent a fluid view on customers?
Well, sit back and hear the story as told by Chuck Pharris, director of manufacturing solutions marketing for SAP, who spoke during the general assembly.
A company hit it big during a housing boom in the central U.S. by selling water heaters. In an attempt to further sell to high-end customers, the company developed a water heater that had a video screen built into it so that you could always see the temperature of the water.
To control manufacturing costs, the company opened its own plant to build the shells of the heaters. Looking for even more opportunities, the company started selling in California and actually moved its plant equipment out there. But then the market dropped in the Golden State, and the company was in danger of drowning.
So the firm quickly rethought its strategy, focusing on another area of the world with a housing boom: India. However, the customers in India weren't looking for water heaters with video screens, nor did they desire standard 80-gallon tanks. They wanted 4-gallon tanks, because space was limited and they didn't need a lot of hot water.
The company had to close its U.S. plant and outsource its manufacturing in various distant locales, which raised quality control concerns. And it had to upgrade its transportation network.
Phew.
Is that story real? Maybe not, but it sure gets you thinking about how economies in different regions and countries ebb and flow.
It is key these days to collaborate more with partners and outsource contractors, Pharris said. And being creative at a moment's notice is important, too, because in the near future, we will all be living in a global, innovation-based economy.
Supply chains and manufacturers exist to make those water heaters. Your job is to take those resources and learn how to rapidly align global opportunities to changing conditions, Pharris said.
At our series of supply-chain-related conferences next week, it will be interesting to hear how expert presenters and attendees view the supply chain in Japan as that country deals with the aftermath of the earthquake, tsunami, and radiation threats.
Japan’s presence in the supply chain and its foothold in industries such as automobile manufacturing and high tech both seem unsteady as the nation responds to a series of terrible crises. Even if your company doesn’t have direct business ties to Japan, it’s not hard to appreciate what could happen if similar escalated disasters hit other parts of the world.
All of our presenters turned in the slide sets weeks ago, so I don’t know any of them will bob and weave their discussions around Japan’s supply chain woes. But some of the sessions that have peaked my interest from a global perspective include the following:
