Building a community of users

On-demand solutions shine when it comes to collaborating with vendors, logistics providers and customers.

By Bob Trebilcock, Editor at Large -- Modern Materials Handling, 6/15/2006

In a global economy, it sometimes takes a village to manufacture a product.

On-demand supply chain management tools for that village are increasingly in demand, according to Beth Enslow, a senior vice president at Aberdeen Group (www.aberdeen.com) and author of The On-Demand Tipping Point in Supply Chain.

But that doesn’t mean companies are throwing out their legacy systems wholesale. Instead, Enslow says, companies are replacing selective modules, especially those “that manage externally facing processes” like transportation management and supply chain collaboration with suppliers and contract manufacturers.

There are reasons that collaborative processes lend themselves to the on-demand model. “Transportation management requires you to get outside the four walls of your enterprise,” says Roy Cashman, chief technology officer for Transplace (www.transplace.com). “You may be working with your own private fleet plus have another 500 carriers under contract. An on-demand solution provides an easier way to integrate with all of those carriers.”

The same can be true when it comes to coordinating the activities of contract manufacturers and third party distributors in a global supply chain, says Ed Lewis, president and CEO of Mitrix, (www.mitrix.com). “An ERP system often stops at the purchase order,” says Lewis. “But there’s that whole loop outside the company that’s part of the supply chain.”

But it’s not just connectivity and visibility across a community that these solutions provide, Lewis adds. “On-demand is an affordable solution for small and mid-size businesses that need to manage a global supply chain to remain competitive,” he says.