Supply chain forges new link - use of Internet to enhance relationships between manufacturers, suppliers and customers - Internet/Web/Online Service Information

Software Magazine, Oct, 1996 by Anne Knowles

Pioneering manufacturers are utilizing the Internet to extend their enterprises to include customers, distributors and suppliers.

Expected benefits include reduced inventory and lower communications costs.

Brandon Systems likes to look technically savvy. After all, the Lyndhurst, N.J., company is in the business of supplying talent to information technology makers. "We're in the supplemental staffing business for the information services industry," says Steve Lucas, chief information officer of the $80 million firm. "Temps for the computer industry, if you will." Brandon's creed: If your best programmer gets appendicitis two weeks before a new enterprise- wide application goes live, or your help desk finds itself short- staffed two days after the application gets up and running, Brandon will save the day.

"Because of the nature of the business we're in, we've tried to be as high-tech as possible to show we know what we're talking about," says Lucas. Therefore, after automating its entire operation to allow its 31 branch offices to access information on payroll and work schedules from a central database, Brandon ventured onto the techiest thing going -- the Internet -- so it could communicate with the Fortune 1000 firms to whom it supplies talent.

Brandon launched its World Wide Web site in February, and today posts job openings and what Lucas calls a "mini-application" that is filled out by several hundred job seekers per week. "Our approach was to develop a real business application for the Web as a vehicle to talk to more people," says Lucas.

Brandon, which recently merged with $1.5 billion Interim Services Inc., Fort Lauderdale, Fla., and is changing its name to Interim Technology Staffing Solutions Group, is also merging the two firms' Web sites. Then, sometime in Q4/1996, Lucas plans to deploy the Infinium Websight accounts receivable application from Software 2000, Hyannis, Mass., to allow Brandon's clients to look at their accounts, including history, balances and invoices.

"We should be able to cut calls in half," predicts Lucas. "It's the kind of thing that will pay for itself in three months." The next step will be letting clients place job orders at the site. Eventually, Lucas hopes to do all client communications via the Web. Brandon is one of a handful of companies starting to utilize the Internet to help them manage their supply chains and extend their enterprises to include customers, distributors and suppliers. Whether a company is in the business of people, parts or produce, the Internet will likely become the primary mechanism for conducting business-to-business commerce.

The concept is a no-brainer, but according to users and software vendors, the execution of it is still six months to a year away. The Internet is one of four components that make possible what the Aberdeen Group Inc., a market research firm in Boston, calls "dynamic enterprise resource planning (ERP)." When combined, these components, which include the Internet, traditional ERP packages, electronic data interchange (EDI), and supply- and demand-forecasting software, are redefining supply-chain management, according to Ed Black, director, client/server solutions at Aberdeen. The goal of this melding, which Black calls "infinite resource planning," is for manufacturers to provide suppliers and customers a window into their supply chain so they can reduce inventory, better utilize plant capacity and cut communications costs. "The potential costs savings can be tens of millions of dollars to the bottom line," says Black.

Supply- and demand-forecasting software -- or what Aberdeen calls "advanced planning engine technologies," or APET -- is now available from a handful of vendors, including American Software, Atlanta; i2 Technologies Inc., Dallas; and Red Pepper Software Co., San Mateo, Calif. Some have partnerships with traditional ERP vendors such as The Baan Co., Menlo Park, Calif.; PeopleSoft Inc., Pleasanton, Calif.; and SAP AG, Wayne, Pa. Those ERP vendors in turn have announced partnerships with OneWave Inc., a Watertown, Mass.-based start-up whose Internet de-velopment tool integrates front-end Web access to back-end application data. The importance of such alliances is highlighted by PeopleSoft's September announcement that it would acquire Red Pepper Software. Earlier this year, PeopleSoft announced a new product line incorporating Red Pepper's Response-Agent manufacturing optimization software.

Meanwhile, Baan, PeopleSoft, SAP and others are working on new releases of their ERP packages that allow users to deploy the software on the Web and use standard Web browsers like Netscape Communications Corp.'s Navigator and Microsoft Corp.'s Explorer.

Most of these Web-enabled versions are not scheduled for release until year-end, so many users are in a wait-and-see mode or beta testing software in small pilot projects on company intranets. Associated Food Stores Inc., for example, is beta testing OneWave's OpenScape software on an intranet in what Byron Goodwin, director of information services at the Salt Lake City-based distributor, describes as an alpha test of an application the company will eventually deploy on the Web. The $950 million wholesaler sells both packaged foods and perishables to 700 retail grocery stores in Utah, Idaho, Montana, Wyoming, Colorado and Nevada. By year-end Goodwin hopes to construct a Web site so the company's customers can access their accounts and Associated Food Stores' product reference guide. The guide is currently printed in hard copy and sent out to customers, a process that Goodwin calls both expensive and inefficient because produce pricing alone changes several times a day.