Supply Chain Brain - March/April 2012

Discrete manufacturing companies operating with highly complex supply chains in today's volatile business world need collaborative planning and the ability to quickly respond to variances in those plans. They often want to model 'what-if' scenarios to better prepare them for those inevitable hiccups – or new business.

Kinaxis designed its RapidResponse solution to help companies with demand and supply balancing, optimized forecasting, and improved supply chain performance. Recently it debuted an enhanced version called RapidResponse Control Tower.

To get a better understanding of the product and responsiveness, SupplyChainBrain met with some Kinaxis representatives and customers at the company's annual user conference.

Participants included Kinaxis CEO Doug Colbeth; COO John Sicard; Kevin O'Marah, senior research fellow at the Stanford Global Supply Chain Forum; Joe McBeth, vice president, supply chain, at Jabil; Erwin Hermans, vice president of supply chain solutions at Celestica; Tom Tael, Qualcomm's senior manager for business processes; Thomas LeBlanc, master scheduler at Varian Semiconductor; Mike Keltz, IT integrator at Lockheed Martin Aeronautics; and Lalit Panda, at that time CIO at D&M Holdings. Separate interviews with each person can be accessed at www.SupplyChainBrain.com.

Q: It’s a volatile world out there. What do you think is the biggest challenge facing your customers today?

Colbeth: I would say for three out of four of them, their biggest challenge is demand volatility.

Q: So what’s the tool they need to overcome that and gain competitive advantage?

Colbeth: In a very simple sense, we have customers where demand is greater than their ability to meet that demand. So being able to model demand in advance and secure the supply lines is critical. It’s essential to customer satisfaction. Because for many of our customers, if they lose their top customer, it’s just devastating.

Q: How can they acquire the capability to meet the demand? Colbeth: While there’s been a lot of progress in lean manufacturing and in other areas, where there has not been much headway is in tools. What I noticed when I got involved in this industry was that everything was disconnected. Demand planning people had not even met the supply chain planning people. You would hear the term ‘sales and operations planning,’ but they had not necessarily talked with anybody at the factory level where you’re doing your dynamic element of demand and supply. That’s why Kinaxis set forth on a long and heavy investment in creating what I call a control tower where all of these capabilities are essentially a part of this single platform.

Q: Elaborate on what this control tower concept means. Colbeth: We no longer think of the supply chain in a bubble. What happens in the supply chain has a dramatic impact on other areas of the business. For example, when there’s a major event in the supply chain, managers want to take that info and model the impact on cash flow. So the idea of a control tower is to think beyond the supply chain and be able to simulate anything anywhere at any time. That’s what the control tower enables a large enterprise to do.

Q: So, you’ve enhanced visibility. What else?

Colbeth: Obviously, you have to have visibility to a problem. And then the next thing is you have to be able to measure impact, and most companies aren’t very good at that because quite often the data is scattered.

Collapsing the time to respond, that’s where you create your scenario. That’s absolutely critical. That’s where you differentiate yourself from a competitor. So if you’re not proficient at collapsing that time to respond, you could potentially lose your top customer, and that’s just devastating.