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Salesforce Commerce Solution Guide

Extending the Supply Chain, Part 1: From Floor to Fulfillment

By Andrew K. Burger
Dec 7, 2006 4:00 AM PT

New wired and wireless Web services are improving supply chain and business-to-business-to-consumer (B2B2C) network management at both ends of the chain. As companies such as Ariba and IBM are hard at work extending supply chain and B2B network management with new and improved service-oriented architecture (SOA)-based Web services at the partner and customer end, wireless sensor network (WSN) providers such as Arch Rock are working at the opposite end, pushing wireless Web services-enabled networking onto the shop floor and to previously inaccessible production locations.

Extending the Supply Chain, Part 1: From Floor to Fulfillment

"It has never been simple to manage the information that flows through a product supply chain. Companies must work closely with suppliers, logistics providers, distributors and retailers to collect and manage information about customer demand, sales orders, distribution schedules, production planning, manufacturing, sourcing and product design," McKinsey & Co. consultants Aditya Pande, Ramesh Raman and Vats Srivatsan state in a March research report.

"But this task has become even more complex because outsourcing has stretched supply chains around the globe. Companies not only buy more of their raw materials, components, design services and manufacturing from far-flung third parties, but also rely on contractors to coordinate the manufacture and movement of their goods," the report continues.

New Releases, New Possibilities

Arch Rock recently introduced the Arch Rock Primer Pack, a complete wireless sensor network (WSN). The company claims it is the first of its kind that can be fully integrated within current state-of-the-art enterprise systems architectures, enabling staff to use standard Internet systems management tools to monitor, control and maintain them down to the level of individual sensor nodes.

"Sensor networks in the past have been approached as technology 'islands,' divorced from the broad set of widely used Internet standards," says David Culler, Arch Rock founder and chief technology officer. "Primer Pack uses those standards as the basis for bringing the sensor network into the Web services environment and integrating it with enterprise applications. For the first time, users can access and remotely manage the sensor network just as they would any other networked device."

After five months in development, Sunnyvale, Calif.-based Ariba last month brought to market the latest version of its on-demand, software-as-a-service (SaaS) B2B network platform. The release includes more than 140 new capabilities spanning Ariba's on-demand solutions and the Ariba Supplier Network, and is designed "to drive greater visibility across all spend categories, active compliance from procurement through payment, faster enablement of suppliers, and rapid adoption of spend management best practices," according to Ariba.

"Technology-based solutions have driven radical improvements in sourcing and procurement over the last decade, yet substantial challenges remain," says Bob Shecterle, Ariba's vice president of solutions marketing.

"Companies still lack visibility into their spend at deep levels across the full organization. They struggle to enable suppliers to easily and quickly do business electronically," he adds.

"Maverick buying is a common occurrence, and change management a difficult proposition. With our latest on-demand release, Ariba takes these issues head on, providing companies of all types with an enhanced set of solutions that deliver the capabilities needed to proactively manage spend and accelerate bottom-line result," Shecterle explains.

Increasing Size and Complexity

As the conduct of business has become more complex, supply chains are being stretched to their limits. At the same time, it has become more complicated to manufacture products; time-to-market schedules have shrunk; and corporations have expanded around the world.

While some of these trends may reduce costs, the McKinsey consultants note, "executives have given up something valuable: easy access to critical data -- such as details about quality, supplies on hand and manufacturing capacity -- that could help raise productivity."

For example, they add, "a computer hardware company's supply planner, trying to meet a spike in demand for certain products, needs capacity and inventory information from several components suppliers and several contract manufacturers, but the data may be locked up in the IT systems or spreadsheets of a dozen or more companies.

"Likewise, a manufacturer seeking to reduce warranty costs may want to connect data at the far ends of its supply chain, from field service technicians making repairs to components suppliers trying to keep their costs low. Reconnecting the dots isn't easy, given the widening range of players in the supply chain and their divergent interests and incentives," the report observes.

SOA, WSNs to the Rescue

It's exactly these issues that companies including Arch Rock, Ariba and IBM are busy addressing from technological and operational perspectives, albeit based on their own perceived strengths and competencies.

"Wireless sensor networks are being used in numerous areas of manufacturing, such as machine monitoring, process control and regulatory compliance. But before you can optimize, you first have to have to be able to measure," states Arch Rock's Brian Bohlig.

"Wireless sensor networks offer insight and information from the previously inaccessible," he adds. "Once deployed, WSNs can detect problems before they happen and prevent costly failures or outages. Furthermore, once instrumented, new information and data can be collected that can keep machinery running longer and without direct human intervention."

Messaging middleware and now standard SOA-based applications such as IBM's WebSphere have been essential in efforts to bring together application and data systems from disparate IT environments spread across a range of far-flung sites.

"As IT systems have grown exponentially, companies have been left to handle increasingly complex software architectures. Traditional architectures have reached the limit of their capabilities, but IT departments still need to respond quickly to new business requirements, continuously reduce the cost of IT to the business, and seamlessly absorb and integrate new business partners and customers," Sandy Carter, IBM's vice president of SOA and WebSphere strategy, channels and marketing, told CRM Buyer.

"The software industry has gone through multiple computing architectures designed to allow fully distributed processing. ... SOA is the next evolutionary step to help IT organizations meet their ever-more complex challenges," Carter added.

"The desire for flexibility and integration is not new. As a result, several techniques exist, each optimized to handle a particular situation. Point-to-point connections provide simple, basic connectivity between applications through a messaging backbone. Enterprise application integration (EAI) makes it easier to manage a larger number of connections.

"SOA blends the best of these concepts into a new architecture that combines adaptable connections with well-defined, standards-based interfaces to help you build flexibility into your existing infrastructure," said Carter. "You can reuse SOA services extensively -- regardless of whether they are based on new services implementations or existing IT assets."

Ready for Prime Time

The ability to collaborate intimately with customers on a regular basis has been integral to IT providers' ability to successfully cope with the increasing scale and complexity of their businesses.

"Ariba is constantly consulting with customers on the process and value drivers in their businesses," Shecterle says, "consulting with industry analysts and experts on market trends and directions, and building on the best practices delivered by our services organization to identify new solution enhancements as well as to prioritize the development of new solution capabilities. The 140 new features in Ariba On-Demand Spend Management 9s3 are the result of these inputs and evaluations."

As for Arch Rock's approach to product development, Bohlig offers this explanation: "We build upon the broad contributions of the international TinyOS community in several ways. The community comes together in defining standardized interfaces at the system and network level, which allow for hardware portability, code reuse, interoperability and a competitive process for best-of-breed solutions.

"In addition, we have integrated each level of the WSN solution with widely adopted standards. In addition to IEEE (Institute of Electrical and Electronics Engineers) 802.15.4 at the radio link, the network is fully integrated with IP and conforms to numerous IETF RFCs (Internet Engineering Task Force Requests for Comments) and protocols. The application tier fully conforms to W3C (World Wide Web Consortium) standard Web Services, so all capabilities within the WSN are accessible directly in all widely used programming languages and environments, including Java, .Net, C#, C++, Perl, Python, etc.

"Enterprise information services simply access the Web Service Description for the Arch Rock WSN to utilize its capabilities. Indeed, the local processing on the WSN nodes is really a set of embedded services that can be composed according to the end users desire to create a wide variety of applications," Bohlig points out.

"The standards and technologies required to support SOA are in place and have broad industry support," notes IBM's Carter. "SOA uses widely adopted Web services standards to help ensure interoperability between services through well-defined interfaces. And the software that a business needs to support SOA is mature, integrated and available.

"While some industry standards are at various stages of ratification, the technology and business skills are already in place to build and deploy successful SOAs, as evidenced by more than 3,000 IBM SOA customers," Carter concludes.

Extending the Supply Chain, Part 2: SOA


Has technology made transportation more or less safe?
Traveling by all modes of transportation has become riskier with each passing year.
In general, transportation safety has been improving steadily, despite some failures.
Some modes of transportation have been improving while others have become less safe.
We may have reached a tipping point where more tech means less safety.
Don't blame the tech -- greedy companies haven't done adequate testing.
Government regulators have not been playing a strong enough oversight role.