Online firms should apply ERP to logistics

Most of the e-commerce players have got the hang of capacity planning at the Web server and database level, but now they should...

Most of the e-commerce players have got the hang of capacity planning at the Web server and database level, but now they should be doing the same thing for their logistics operations, writes Danny Bradbury.

Popkin Software, which made its name in the application modelling space, believes that this issue should be addressed sooner rather than later, and has launched a business modelling tool called SA Simulator. The product is designed to help companies map their business processes and then allow them to play with various parameters to construct "what if?" scenarios.

Chris Nugent, senior vice-president of Popkin, believes that e-commerce will be the major business driver for the product. "One problem with the world of e-business is that many people are still feeling their way," he said. "If you want robust processes, then you really need to be able to perform various scenarios on them."

SA Simulator is not the only business modelling tool on the market. Others include Studio 2000, the simulation and analysis tool from Powersim. Nevertheless, according to Nugent, Popkin's advantage is integration with the company's existing software engineering tools, including a repository in which to store system development information.

The repository has a Visual Basic application programming interface, and it is possible to populate it from archives of real-world business data. The important thing, he said, is that users are able to vary information to see how far they can bend their logistical operations before they begin to create problems.

Nugent also criticisedthe traditional enterprise resource planning software (ERP) suppliers for a lack of simulation capability. In general, he said, ERP deployments involve straightforward implementations of the systems, almost allowing the software configuration to dictate the business process rather than the other way around.

"There is definitely value in designing the process behind an ERP implementation," he said. "Simulation will help, because you are trying to ensure, before the process breaks, that you know what you're in for."

Nugent's evaluation of the ERP market may be slightly askew, as many consultants have put their children through college by charging for process re-engineering as part of an ERP implementation. Nevertheless, the business case for Nugent's tool is solid.

Having a best-of-breed solution to address the issue is attractive. Given many businesses' apparent lack of initiative when it comes to managing back-end processes in any business context, they could do a lot worse than to look at a tool such as this.




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