SAP to offer major SCM upgrades in Release 5.0

Supply-chain solution will focus on analytics

With supply-chain management becoming a key benchmark for success in most industries, SAP will offer its enterprise customers enhanced SCM capabilities in the next release of its enterprise software, SAP 2005.

In an exclusive to InfoWorld, Greg Mekjian, executive vice president of North American Field Operations for Bristlecone, an SAP development and implementation partner, laid out three major supply-chain capabilities Bristlecone developed in conjunction with SAP that will be included in release 5.0.

A cross-docking module will be added to its Extended Warehouse Management Capability to increase the velocity of products through a warehouse or distribution center. The solution will harmonize inbound with outbound shipments, allowing distributors to off-load product from the inbound truck directly onto the outbound truck.

"Not having to pick the product [off the shelf] is a strategic advantage in inventory management," Mekjian said.

Analytics for the service-parts-management industry will include a module to optimize the planning and movement of service parts inventory. 

"Forecasting where inventory should be in field is new to SAP," Mekjian said, adding that it will allow a supplier to more readily ship parts within 24 hours.

Offering this kind of functional capability is critical to SAP in its continuing battle with Oracle for enterprise customers, said Josh Greenbaum, principal at Enterprise Applications Solutions.

"The name of the game is going to be improving horizontal capability, which in turn gives either company the space to dive more specifically into verticals," Greenbaum said. "This is evidence of the continuing refinement of the product line."

Finally, a Planning Results Analysis module will give users of planning systems the inventory data needed to help them factor in real-time supply-and-demand variables and present back in analytical format the data needed to make inventory decisions.

"Using this module, a supplier could make a decision to take inventory from one distribution center and send it to another or put the shipment of products on an expedited basis," Mekjian said.

SAP officials did return telephone inquiries.

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