Planning a supply chain is a complicated task and requires a lot of complex calculations. However, it does not require a lot of different kinds of data.
This is an important point to remember. In this blog posting I want to discuss what to worry about when it comes to getting data for your supply chain planning system, and what not to worry about.
Basically, planning calculations need to consider all kinds of different data elements at the same time so the system needs to utilize a data architecture that is separate from the ERP system’s. This means that all planning systems, whether they are offered by an ERP provider or a Best-of-Breed provider, need to be bolted-on to the ERP system with integration middleware. I know that even the thought of integration to an ERP system makes many IT folks nervous, but when it comes to supply chain planning systems the integration should not be the biggest worry.
Let’s break it down; there are 3 data factors for IT folks to think about when a new planning system is being launched. In the order of easiest to hardest, they are:
1) Integration to ERP Transactional system
2) Getting the planning data complete and clean
3) Making sure the planning system will scale and be reliable
Integration to the ERP Transactional System
This is the one that everybody spends most time worrying about, but it really is not that hard and it’s the easiest to get passed. First, there are only about 15-20 data tables that are required for supply chain planning. The ERP transactional system will only contain about 10 of the key data elements. Things like process routes, resource alternatives, resource capacity and resource availability, demand planning hierarchies do not have strong representations in ERP transactional systems. These need to be defined in the Manufacturing Execution System (MES) or the supply chain planning system, itself. Second, there has been a standardization of the data integration in-and-out of ERP systems. The data-exits have been set up and well documented. Both Best-of-Breed and the ERP vendors use the same data-exits. Third, there are standard interfaces for supply chain planning that have been standardized over the years in major ERP systems, like in SAP® and Oracle®. So to sum it all up, a small set of data needs to be interfaced using a method that has been worked on for over 10 years. So, not much to worry about here.
Getting the Planning Data Complete and Clean
This is one of the factors to worry about. You must pay attention to the Master Data Management (MDM) part of the application that comes with your supply chain planning system. The data for planning needs to be verified carefully to get the best results, so strong master data management is critical. This means that the MDM part of the supply chain planning system needs to be able to identify errors in data, its structure, and also make sure its correct in context with other data. The contextual checks are what make MDM for supply chain planning systems so important. Basically, The MDM for planning needs to take the data from other systems and clean it up with input from the user. It also needs to make it so that it is easy for the user to add data to the system that does not exist anywhere else. Note that attribute-based master data management makes this easier, by enabling data definition based on product characteristics.
Making Sure the Data Structure Can Scale
This is another thing to worry about. Even if the data is clean and complete, the system will not work properly if it is not structured to be efficient and reliable. If the system is slow, the users will not be able to complete the needed steps in the process and will give up. Make sure to check how the data is structured for scalability. A point to remember, memory-resident cache is critically important for planning systems. Understand how this is architected for all the planning modules needed. Is there a single point of failure? Can you add user-defined attributes in the memory resident cache? Can you change the imbedded logic in the memory resident cache? If the answers do not show that the system is scalable, configurable, and reliable, then the system will fail because the IT staff does not have the ability to change any of this.
In summary, data integration between ERP and a new planning system is the easiest part of its implementation but most IT folks seem to focus most of their worries on it. Maybe because its under the control of the IT staff to fix. What you should really be concerned about is the part that is not under their control, which is the underlying power of the planning systems’ data management capabilities. This has a big impact on the data runs and takes more effort to fix. Even a bigger concern should be the questions related to scalability and configurability of data cache within it. If that is not right you are dead in the water.
About the Author: Bill Green is the Vice President of Solutions at Adexa, for more information about him please visit http://adexa.com/company/green.asp
For more information about different types of Supply Chain Planning systems visit: Demand Planning, Inventory Planning, or Sales and Operations Planning.