By Paula Rosenblum, Managing Partner
5/27/2008
Nikki and I are freshly back from Momentum, Manhattan Associates’ annual Users Group convention. Nikki’s article talks about a particular panel, but I want to address the tone of the event itself and provide some overarching observations.
You do learn a lot about how a company is treating its customers and how well its implementations go by attending these conferences, especially if you give yourself the luxury of attending sessions where you’re not the featured speaker. Truly, during user conference season, we “Subject Matter Experts” tend to slip into an event for our own sessions and then hurry off to our next gig. For a change, I wasn’t in a hurry, and Orlando is just a short drive from home so I attended lots of sessions over two days.
To give you a flavor for what I saw, the working title for this piece was “Shiny Happy People.” This was a very happy bunch of users. I didn’t get a sense that anyone had big gripes or complaints with Manhattan, its roadmap or its current suite of products. It’s rare when the speakers at general sessions of a technology vendor’s user group conference are actual users, but Manhattan had not one, but TWO customers – UnderArmour’s CIO and Papa John’s CFO speaking to all attendees.
So, what about Manhattan Associates in retail? As far as Supply Chain Execution is concerned it’s well-known and a home run. Then there’s this thing that has come to be called “Supply Chain Planning,” otherwise known as the former Evant assets. Users of this application love it, but it has become a well-kept secret in retail, and that seems unfortunate. I think I understand the “why’s” of this problem and will indulge myself in a bit of a rant.
“Supply Chain Planning – In Your Dreams”
Supply Chain Planning is an analyst term, and it’s one that technology vendors have adopted over the years. It sounds good and is right to some extent, but the problem is it’s too narrow. And it implies that the planning task sits with supply chain executives, rather than merchants or category managers.
I know the supply chain guys reading this now are saying things to themselves like “From your lips to God’s ears is this a supply chain function.” In fact, almost every department in the retail enterprise has to plan their business and payroll based on expected sales and receipts. And we know that these planning processes are broken. Departments do not operate off the same set of data. Fractured planning processes remain the single biggest challenge in retail execution today.
Here’s a simple example from one of my past CIO lives. The IT group was implementing a system that passed expected receipts into an Open to Buy system, but I had a dilemma. What should we do with PO’s that had expected arrival dates in the past? My dear friend, the GMM (she really was a dear friend, but she could drive you insane) said, “Just put those purchase orders into the current week.” My reaction was “I can’t do that…it’s not right.” We settled on putting them into an “overdue” week…but think about it for a second. How in heaven’s name was the distribution center going to plan for those receipts? Or the stores for that matter. Would they come this week? Next week? EVER? That’s why retailers continue to cite fractured planning processes as their single biggest merchandising business challenge.
So, I’m here to declare there IS NO SUCH THING AS SUPPLY CHAIN PLANNING in retail per se. Let’s call it Retail Enterprise Planning, which feeds merchandising, supply chain, and store execution.
What’s a Supply Chain Management Company to Do?
Here we have Manhattan Associates, and they’ve bought themselves a very nice asset in Evant. One user I bumped into moved from one company to another, and she’s getting the planning application installed at her new company, just like she did at her former one. She’s a believer. She’s also a merchant. To gain better momentum in retail planning (sorry, I couldn’t resist) Manhattan must cultivate more people like her. It has to speak to a new audience. Manhattan has to become friends with the merchants. Manhattan must stand toe-to-toe with companies like SAS and JDA.
There are a few additional pieces needed to fill out the planning footprint, but Manhattan’s off to a very good start. Now it has to find its voice as an enterprise planning software provider. Because, like I said before, in my little world, a supply chain plan is only as good as the merchandise plan. If those processes are disconnected, there’s no solid ground to execute against.
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