Larry DeJarnett, CEO of Enterprise SolutionsDocument Transcript
PA R T N E R S H I P S
S U P P LY C H A I N S
CEO of Enterprise Solutions
arry DeJarnett is an A.T. Kearney vice president and CEO of Enterprise
Solutions, the joint initiative between EDS and A.T. Kearney charged with the
implementation of enterprise applications. Information Builders News spoke
with Mr. DeJarnett about the challenges facing enterprise customers as they
rethink their supply chains to cut costs and maximize value using ERP
software and other IT assets.
IB News - How have Enterprise Resource Planning (ERP) solutions
changed the way companies do business?
DeJarnett - ERP has probably done more to redefine how a company
conducts its internal business than any other tool in modern history.
Prior to ERP systems, internal departments concentrated first and
foremost on data for operation, reporting, and control. They knew that
the data could be put to use in other ways, but this was difficult to
achieve. ERP is a superb technology engine for integrating and sharing
common data across processes. This in itself does not automatically
create the integrated enterprise we all hoped for, but it has begun to ILLUSTRATION BY JUSTIN DIGGLE, TIDAL WAVE DESIGN
break down the walls separating a company’s internal departments, and
is a critical first step toward building a more efficient and streamlined
IB News - What will this business landscape look like three to five years
DeJarnett - Just as ERP is helping break down the walls between
departments and functions, so tools and techniques developed by
companies like Information Builders are the key to breaking down
some of the barriers in the extended supply chain. We believe today’s
traditional and somewhat lethargic supply chains will evolve into
dynamic “Trading Networks” whose members are inter-linked to
quickly and efficiently deliver a customized product to an end
36 INFORMATION BUILDERS NEWS
LARRY DEJARNETT results in a single step. This is to squeeze that last penny of cost
important to understand, because the from their supply chains. The new
CONTINUED FROM PREVIOUS PAGE real business value occurs largely model treats suppliers as trusted
from the alignment step. partners, which is easy to say, but very
IB News - How will businesses evolve There are only a handful of hard to do.
to achieve this Trading Network companies that have achieved the
vision and how might Information collaboration stage, but those that have IB News - What other key technologies
Builders technology play a role in the are realizing significant competitive will play a part in this framework?
process? advantage. DeJarnett - The ERP systems installed
DeJarnett - We believe there are three during the 1990s provide the backbone
stages in achieving the Trading Network IB News - What technological and for the 21st century Trading Network.
vision: Integration, Alignment, and cultural barriers currently exist to Supply chain management software
Collaboration. Integration refers to the making this business landscape a and other ERP “bolt-on” packages
integration of a company’s internal reality? are the next important parts of the
processes, which is usually accomplished DeJarnett - Most of the technology puzzle. The last piece of the technology
through the implementation of an barriers to the Trading Network puzzle is the Internet and e-
ERP system. Data migration and vision have been removed over the commerce, which provides enhanced
integration tools such as those from past three years. Perhaps the biggest connectivity between partners. These
Information Builders can help remaining challenge is a phenomenon technologies make it possible to
simplify the migration of legacy data that is both social and psychological connect the end consumer, through
into an ERP system and make it in nature. The end consumers are the the Trading Network, all the way
easier to link data among different kings in the Trading Network, since across the value chain. Ultimately,
types of ERP systems. everything is dependent on their they can be connected back to the
Alignment is typically a second step, purchases. It is difficult for many raw material suppliers, if needed—
in which a company’s operating companies to abandon the old model practically in real time.
procedures and its ERP software are of pitting suppliers against each other CONTINUED ON PAGE 40
synchronized to attain the benefits
too often missed during the initial
ERP implementation. Data ware-
housing is often a key facet during
“THE SC3 IS A WORKING EXAMPLE
Collaboration refers to the tight
OF THE 21ST CENTURY TRADING
coupling of a company’s trading NETWORK OF PARTNERS. BY
partners to quickly distribute infor-
mation up and down the Trading LEVERAGING EXPERTISE ACROSS
Network, so that a collective product
or service is delivered to the MULTIPLE PARTNERS, INDUSTRIES
consumer better and faster. This is
often accomplished through Internet/ AND CLIENTS, WE ARE ABLE TO HELP
Web-enabled tools and technologies.
Information Builders is an important
CRAFT A CLIENT’S STRATEGIC
player in this space with its Web
reporting tools and middleware
ROADMAP, QUICKLY IMPLEMENT THE
technology. SUPPORTING TECHNOLOGY, AND
IB News - Where do most enterprise EFFICIENTLY OPERATE THE
customers stand in this three-phase
process? TECHNOLOGY...THIS ALLOWS CLIENTS
DeJarnett - A large number of
companies have completed the integ- TO FOCUS ON THEIR CORE
ration stage by implementing an ERP
system. Many find, in retrospect, that
COMPETENCIES AND TO MAXIMIZE
they have a technical implementation/
integration, but have not achieved
THEIR BUSINESS VALUE”
true business process alignment. -Larry DeJarnett,
Most companies expected to achieve CEO of Enterprise Solutions
both the integration and alignment
38 INFORMATION BUILDERS NEWS
Information Builders Joins EDS and A.T. Kearney
To Build 21st Century Trading Network
New Supply Chain Competency Centers to Feature Information Builders Software as
part of Industry-Specific Solutions
Enterprise Resource Planning (ERP) software holds great promise EDS opened its first Supply Chain Competency Center in Plano,
for streamlining business processes and automating supply chain Texas earlier this year. Other centers will be opened in Michigan,
management activities. But between the theory of ERP practice and California, London, India, Asia, and Europe. Each center will target
the actuality of ERP use lies a rocky road upon which many well one or more specific industries, such as Utilities, Aerospace &
meaning companies stumble. "ERP is a superb technology engine for Defense, Automotive, Chemicals, Communications, Consumer
integrating and sharing common data across business processes," Industries, Financial Services, Hi-Tech, Oil & Gas, Pharmaceuticals,
says Larry DeJarnett, CEO of Enterprise Solutions, Inc., a joint and Transportation. Information Builders will be permitted to
initiative of A.T. Kearney and EDS. "But this in itself does not demonstrate its products to potential customers in the
automatically create the integrated enterprise we all hoped for." competency centers.
Enterprise Solutions was formed to help companies
bridge this gap with application templates and industry- Cutting Edge Concepts
specific enterprise implementations. Leveraging the Supply chain management concepts that will be
extensive experience of its two parent companies, the promoted at the SC3s include the following:
consulting firm is launching seven Supply Chain Synchronization, the tactic of matching the timing
Competency Centers (SC3s) where clients can try out and frequency of related supply chain activities such
technology options, evaluate ‘what if’ scenarios, and as production, distribution, execution of planning
work with partners to design new supply chain networks. cycles, and transfer of funds.
Information Builders software will be featured in the
Mass customization, configuring the products to the
worldwide rollout of the SC3s.
unique preferences of individual consumers.
The centers are designed to serve as a laboratory and
test bed for IT development projects, as well as a Globalization to allow suppliers, customers and
forum for sales, marketing and training. The primary technology facilities to be located wherever needed around the world to
focus is on supply chain optimization and implementation services maximize access to markets and capabilities.
for enterprise applications. The centers will provide emerging Disintermediation, the marginalization and removal of
business and technology demonstrations, including technology fit, traditional middlemen such as distributors from supply chains to
supply chain optimization and examples from A.T. Kearney’s 21st reduce costs.
Century Trading Network perspective. Postponement, the process of delaying value-added manufacturing
Industry Focus activities until as late as possible in the pipeline, usually to limit
inventory investment or to allow customization at the point when
"Each center will have a primary industry focus, pulling together perfect knowledge about the required stock is available.
the knowledge and capabilities of A.T. Kearney’s industry practices
and supply chain expertise with EDS’ electronic business and Segmentation, the process of disaggregating whole categories
supply chain technologies," explains DeJarnett. (customers, suppliers, products, etc.) into meaningful groups
The centers will include the latest in available technology based on particular characteristics, attributes, or behaviors.
including significant investments in hardware from IBM, Sun and The economic benefit comes from being able to focus scarce
Compaq/Digital. Initial software participants, in addition to resources in a manner that is commensurate with the impact of
Information Builders, include ERP providers SAP, Oracle, those resources.
PeopleSoft and Baan; supply chain package providers Paragon, i2, Pervasive Connectivity, the ability of members of the Trading
and Manugistics; and numerous supporting software packages from Network to link to each other via automated/electronic means to
Sterling Commerce, Interworld, Crossworlds, Syncra, Auxillium and facilitate the bi-directional flow of business information without
Mercury Interactive. a need for human intervention.
A.T. Kearney (www.atkearney.com), owned by information services Virtualization, extending a firm’s control of resources by
leader EDS, is one of the world’s largest and fastest growing entering into contractual alliances with asset-owning trading
management consulting firms, generating annual revenues in partners. The firm becomes ‘virtual’ to the extent that it
excess of $1 billion. With a global presence that spans every exercises effective control of assets that it does not own.
major and emerging market, A.T. Kearney provides strategic,
Transparency, the strategy of opening information and business
operational and information technology consulting and executive
processes to trading partners in order to achieve the common
search services to the world’s leading companies. EDS has been a
goals of the extended enterprise. For example, manufacturers
leader in the global information services industry for more than
frequently make their production plans transparent to suppliers
35 years. The company delivers systems and technology expertise,
in order to allow them to synchronize their materials
management consulting, business process management and
manufacturing and shipping processes.
electronic business leadership.
SPRING/SUMMER 1999 39
IB News - What steps are EDS and
A.T. Kearney taking to position Information Builders Software at Work
themselves as major contributors to Enterprise Solutions is launching the SC3s to help companies update their traditional
this business landscape? and somewhat lethargic supply chains into dynamic ‘Trading Networks’ whose
DeJarnett - As a company progresses members are inter-linked to quickly and efficiently deliver customized products to
down the road to the Trading Network consumers. Information Builders products and services will play an important role in
the development and deployment process.
vision, it requires different core capa-
For example, EDA will supply data access and integration
bilities from its systems integrators technology for combining enterprise applications, merging
during each of the phases. data among computing platforms, and building extranets to
During the Integration phase, most link trading partners. WebFOCUS will be used for Web-based
companies require a systems integra- query and reporting activities and to supply crucial
tor that knows the ERP package well components of Enterprise Information Portals. SNAPpack
and is skilled in rapid deployment, will be used for data migration, building interfaces to ERP
scope management, and large-scale systems, and ERP reporting.
program management techniques. In Once supply chain operations are in place, customers often
the Alignment phase, you need build data warehouses and business intelligence systems to
industry and process knowledge and derive maximum value from their operational data. Business
Intelligence comes from scrutinizing each aspect of your
strategic insights to help draw the
business to ensure it enhances the total customer experience. To remain profitable,
greatest business value from the companies need to determine which products consume the most service time. And they
software. In the Collaboration phase, must be able to mine customer data for cross-selling, up-selling, and demographic
companies require a far-reaching and segmentation.
comprehensive set of skills and Information Builders products can play an important role in this context as well.
insights, combining strategic business Companies rely on FOCUS Six and the FOCUS database to build data warehouses,
insight, an understanding of the social establish business intelligence systems, and set up managed reporting environments to
and psychological aspect of business keep managers informed about the inner and extra workings of the business.
partnering, as well as systems
integration skills to tie all of the
partners together. client and partners. The SC3 allows designed to become the launching
As a trusted business-value team, clients to see how technologies and pad for services across the technology
EDS and A.T. Kearney are uniquely solutions can be used and combined, continuum, from enterprise strategy
qualified to provide business and either conceptually or in a proof-of- and design through enterprise
industry insight, combined with concept. By leveraging resources implementation and outsourcing.
technology prowess and the execu- across multiple services, this can be
tion capabilities required in all three done quickly, maximizing the business IB News - What are you able to
of these phases. The combination of value. Secondly, the SC3s serve as provide clients that they can’t get on
strategic and industry-specific ‘incubators’ of ideas, services, and their own?
consulting knowledge through A.T. alliances to attack specific market DeJarnett - The premier strategy,
Kearney, coupled with the vast niches. The first of these alliances is a operations technology, and process
infrastructure and operating collaborative effort announced in management capabilities of EDS and
efficiencies of EDS, have resulted in a mid-February between EDS, Para- A.T. Kearney can bring together
firm that is well poised to help gon, Selectica, and Sun to develop the combinations that others cannot. This
companies realize the Trading Web-enabled technology required to is our core competency. The SC3 is a
Network vision. support the Trading Network vision. working example of the 21st Century
Trading Network of partners. By
IB News - What exactly are the IB News - What specific services do leveraging expertise across multiple
Supply Chain Competency Centers EDS and A.T. Kearney provide partners, industries and clients, we are
and what do they offer clients? clients through the SC3s? able to help craft a client’s strategic
DeJarnett - The Supply Chain Com- DeJarnett - The SC3’s provide facilities roadmap, quickly implement the
petency Centers, or SC3s, offer two for marketing, training, remote tech- supporting technology, and efficiently
main capabilities. First and foremost, nology implementation and support, operate the technology on a long-
they are a place for clients to come and rapid systems deployment. They term basis, if so desired. This allows
together with their Trading Network also offer client ‘war room’ facilities, clients to focus on their core com-
partners, in conjunction with their partner alliance facilities, and a best petencies and to maximize their
strategic and technology providers, to practice repository. It is all provided business value.
create an optimal Trading Network within a technology infrastructure
design. The key is to identify those that has direct access to major
business issues most critical to the technology solutions. The SC3 is
40 INFORMATION BUILDERS NEWS