As economic globalization makes the world a smaller place, U.S.-based businesses must increasingly source, produce and sell material in foreign lands. Without the right strategies for collaboration, visibility and event management, however, this can be bad news for the supply chain.
The challenge is to establish a core of business processes that can keep pace with the ever-changing global environment, says Brian Willson, director for chemical industry business at Microsoft (Redmond, Wash.). “How do you easily connect a new plant, new partner or acquired company in a new region to the business processes that are already established?” he asks.
According to the experts, the chemical industry has been slow to embrace ways to manage global supply chain challenges. A study by consulting firm Accenture (Chicago, Ill.), 2007 Global Chemical Industry Supply Chain Best Practices Study, revealed that while companies are becoming clearer about their supply-chain-strategies, change is slow and actual results have been relatively limited.
Christopher F. Lange, senior executive, global supply chain leads for chemicals and natural resources at Accenture, identifies four key areas for improvement. Most important is the increased involvement of supply chain function in commercial decision-making: what products to produce, where to produce them, what customers to serve and how to serve them. Also significant are planning, particularly demand planning and forecasting; functional areas such as transportation and material sourcing; and making sure that supply chain management is in the hands of talented people.
To help chemical processors take action, technology providers are developing products that help facilitate collaboration, visibility and event management. SAP Americas (Newtown Square, Pa.), for instance, now offers its Sales and Operations Planning product as a stand-alone solution that doesn’t require SAP to be running in the back office, according to Ray Adams, field services director with SAP’s chemicals business unit.
Other products of note include Microsoft’s BizTalk Server 2006 R2, aspenOne Dynamic Supply Chain Management for Chemicals from Aspen Technology (Burlington, Mass.)., and ORion-PI Value Network Optimization from Axxom Software AG (Munich, Germany). The outsourcing of transportation has led to a lack of transparency for many companies, says Adams. so SAP has created a new product, TM60, to address this area.