Aberdeen: Supply Chain Management Concerns

CIO: What challenges do mid-market companies face with respect to managing their supply chains?

Aberdeen Group SVP Beth Enslow: Mid-market companies have to meet very demanding requirements from larger customers. These larger companies have very specific mandates on how they want their orders fulfilled, how they want them packed and shipped, and what kind of information they want about those orders and their status. One of the challenges mid-market companies face then is that most of them don’t have the IT infrastructure to do this in an efficient manner. They end up having to throw lots of people at the problem.

What technologies can help mid-market companies work with their supply chain partners?

They need a platform to exchange information electronically, whether forecasts, order information or status information, and they need to have good visibility into what’s happening with specific orders. If you have information electronically, not only are you reducing the human cost involved in sharing information, but you can now collaborate at a deeper level because you’re able to share a wider degree of information. Sharing information electronically helps reduce errors and perhaps most importantly helps cut lead times so that you can deliver goods more flexibly and faster to the end customer. We see mid-market companies becoming more interested in on-demand supply chain management applications because they present a less expensive and less disruptive way for them to access this technology.

What do you mean by less disruptive?

Mid-market companies simply don’t have the bodies available to go through a traditional software evaluation and implementation process and then keep that system up to date. With on-demand software, a lot of that [implementation] work is now done by the vendor, which minimizes disruptions to the IT staff. For mid-market companies, on-demand has proven to be a faster way to get solutions up and running, the ROI is faster, and you won’t find yourself three or four versions behind and not having access to the newest functionality, because the vendor takes care of that for you.