The companies' sales and operations planning solution is aimed at helping retailers transform their businesses.
JDA Software Group, which sells enterprise supply chain solutions,
and Oliver Wight, a global supply chain consulting firm, are jointly
releasing a sales and operations planning solution that can be used by
The companies announced their strategic partnership June 30.
"Traditionally, S&OP technology is aimed at manufacturers who
want to balance supply capacity with demand," said David Johnston,
senior vice president of supply chain for JDA. "For retailers,
merchandise planning is the closest thing they do to S&OP. There is
a big disconnect between how planning gets executed and the operational
Rather than just providing a way of balancing capacity with
fulfillment and demand, Johnston said the new S&OP solution ensures
a retailer's operational plan aligns with DC (distribution center)
capacity, available carrier lanes, expected revenue and margin targets,
and the overall strategic plan.
Dennis Groves, chairman of Oliver Wight Americas, said the scope of
S&OP has expanded from supply and demand execution to integrated
business management over the past 30 years.
"It includes product portfolio management, client demand management,
financial management, and executive management, driven from a company's
strategic plan," he said. "S&OP is designed to get a company one
set of plans from which everyone can execute."
Johnston said the solution can help retailers manage the flow of products around seasonal peaks and high promotion periods.
"It gives you the right visibility and planning data," he said. "You
can secure external and internal carrier capacity, as well as the right
labor in the DC and the right shelf space in the store, during times in
the year when you just can't follow a -just in time' methodology."
Tim Payne, an analyst with Gartner, said S&OP is often not even
called S&OP in the retail industry, reflecting that it is less
established with retailers than with manufacturers.
"However, as a business process, it makes great sense for any
organization that has to balance supply and demand," Payne said. "Any
initiative that helps to make this more doable is a good thing for
Payne said S&OP is evolving into a methodology he calls IBP (integrated business planning).
"This brings in more strategic alignment and adds more capability in
the area of financial impact analysis," he said. "JDA and Oliver Wight
would need to figure out how the solutions need to develop in order to
deliver more IBP capabilities in the future."
As part of the agreement, JDA will incorporate Oliver Wight's
methodology and consulting processes into its software solution
offering to increase the overall performance of its S&OP solutions.
Oliver Wight will also participate in and provide counsel to JDA's
Business Requirements Group for S&OP and will collaborate directly
with JDA's Product Management and Development Groups.
Dan Berthiaume covers the retail space for eWEEK. For more industry news, check out eWEEK.com's Retail Site