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Manhattan Associates Releases a Ground-breaking Supply Chain Planning Solution

Scott Fenwick, Senior Director Product Strategy for Supply Chain Planning at Manhattan Associates.

Manhattan Associates, a leading supplier of supply chain and omnichannel management software solutions, recently had a major product release that will shake up the supply chain planning market. The announcement came on May 15th at the company’s annual user conference, Momentum.

Manhattan Associates (NASDAQ: MANH) announced the release of Manhattan Active Supply Chain Planning. This puts their SCP on the same microservices platform as their other solutions. This allows for “the industry’s first unified business planning platform that enables bi-directional collaboration between supply chain planning and execution systems.”

Is this just standard PR hype? This is a significant step forward for the industry, but explaining why takes some effort.

Companies have a known problem synchronizing their supply chain plans with what can actually be executed. Manufacturers refer to it as the “shop floor to top floor disconnect.” This reflects manufacturers’ difficulty in synching the plans finalized in an integrated business planning executive meeting with what the shop floor is capable of manufacturing in the short-term time planning horizon.

However, the disconnect can also occur because the supply plan not only lacks sufficient granularity in modeling the constraints that occur in manufacturing, but the model is also not granular enough in its understanding of warehousing and transportation constraints.

A supply planning solution may only be able to achieve rough-cut capacity planning for a large, complex supply chain. For example, a supply planning solution may create a model that says a plant can produce 20,000 units of a product in a week. When the plan is dropped to the floor, the plant can’t produce that quantity of items nearly as quickly as thought. The plan was incapable of fully considering things like labor availability, machine throughput by product, product wheel, and other real-life constraints.

The same disconnect can happen in the warehouse and in transportation. For example, if a promotion plan has not been correctly modeled for the warehouse, there may not be enough storage capacity, dock doors, or workers to execute the day’s work. However, a Manhattan Active SCP plan is built with an understanding of what the warehouse is capable of from the bottom up. In the case of a big promotion, the resulting plan would be “smoothed” by beginning the execution of the plan days earlier.

Creating a bottom-up plan requires that data be transformed intelligently. Decades ago, the ERP market’s first big differentiator was the ability of the ERP to use a bill of materials to translate a demand plan – which forecasts in units – and then transforms those units into tons of raw materials that needed to be sourced. The BOM transformation creates a feasible plan for procurement.

What Manhattan is doing on the transportation side is just as revolutionary a transformation. In a warehouse, workers pick cases and build pallets. Pallet building logic understands the dimensions and weights of the cartons. Based on this, the solution understands that you can’t build a six-layer set of cartons on a pallet with product A. Product A is too big. It must be five layers. Similarly, you must put product C on the bottom layers on a different pallet. If you put product B on the bottom, those cartons will be crushed.

Once the pallet plan is complete, you can build a better truckload. The logic behind how many pallets it takes to fill a truck is similar to pallet-building logic. The trailer build is based on the dimensionality and weight of the pallets with a full understanding of issues like crushability and whether the pallets will weigh out or cube out a trailer. Cubing out is preferable; companies don’t like to ship air. A transportation plan built with a full granular understanding of trailer building constraints can also be smoothed.

In short, the bidirectional messaging between Manhattan’s SCE and SCP solutions helps create far more feasible and executable plans. It is worth noting that Manhattan does not have a production scheduling or planning application. This new product will be more applicable to retailers and distributors.

This appears to be a competitive, sustainable advantage for Manhattan. It could take competitors years to catch up. It is time for Manhattan to build a production scheduling application that will reside on the platform and thus provide a state-of-the-art solution for manufacturers, not just retailers and wholesalers.

The post Manhattan Associates Releases a Ground-breaking Supply Chain Planning Solution appeared first on Logistics Viewpoints.

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