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Oracle Supply Chain Management Review

 

Oracle was founded in 1977 as a database and middleware software developer. In 1986, Oracle started developing business applications and in the early 1990s, developed an ERP system. Soon after, Oracle started adding Supply Chain Management software modules. In 2005, Oracle acquired PeopleSoft after PeopleSoft had acquired JD Edwards. Other Supply Chain Management software related acquisitions include Demantra and Retek. Oracle is the second largest SCM software vendor.

Vertical Markets

Oracle’s SCM customers are midsize to large enterprise companies across a broad base of industries. Oracle expanded their vertical markets with the acquisition of JDEdwards, PeopleSoft and Retek customers.

Supply Chain Software Solutions

Oracle developed an E-Business Suite that includes ERP, CRM and SCM. Through many of their acquisitions, Oracle has multiple brands for ERP, CRM, PLM, and SCM with overlapping functionalities. For the retail industry, their solution is Retek’s Merchandising, Store Systems and SCM. Oracle's current generation of enterprise software is called Fusion, which operates in both a cloud and on-premise delivery, and coexists with Oracle's legacy business systems.

SCM Features

The following is an evaluation of Oracles’ E-Business SCM. Unless noted with the brand name (i.e. JDEdwards or Fusion), other brands are not part of this evaluation.

Oracle has positioned Demantra as their S&OP and demand management solution for the E-Business Suite, Fusion, JDEdwards and PeopleSoft ERP brands; Demantra is also used with other third-party ERP and SCM systems.

Software Architecture and Cross Application Solutions – Fusion is Oracle’s SOA middleware. The Application Integration Architecture (AIA) is the business application integration technology that works with Fusion. The Fusion and AIA features include tools for:

  • Web Services
  • Business Processes and Workflow
  • Business Analysis
  • Business Intelligences
  • Business Event Monitoring

Sales and Operation Planning – Demantra automates the preparation for the monthly S&OP executive meeting, including consensus building, on demand plans and supply plans. Upon approval, the plans are published and enabled for continuous monitoring and revisions. Exceptions to the plans generate alerts to the individuals responsible for resolving any problems.

Demand Management – As opposed to the best fit approach to forecasting, Demantra forecasting allows for multiple models to be combined, based on probabilities of each model. The forecast dynamically adjusts to changes in trends and market conditions. Dematra forecast allows for causal factors and demand history as input. Through collaborative features, customers can collaborate on forecasting their demand. Demand data is managed at granular groupings to improve analysis and demand shaping opportunities.

Order fulfillment integrates with Order Management and WMS to auto generate pick and pack to fulfill customer orders.

PeopleSoft ERP uses the PeopleSoft proprietary demand management solutions.

Supply Management –

Strategic Network Planning – Oracle’s product is called Strategic Network Optimization (SNO). SNO integrates purchasing, production, distribution, and transportation for analyzing and planning of mid-term and long term sourcing decisions. Planning tools include what if analysis, constrained resource optimization, constraint based cost optimization and demand matching.

SNO integrates with JDEdwards’ EnterpriseOne and Oracle’s E-Business Advanced Planning Command Center.

Distribution Planning – Planners can view the global positioning of inventory, override automatically generated allocations and optimize shipments. Postponement and risk pooling strategies help determine inventory placements. Distribution planning includes algorithms to target the most profitable customers, channels and product mixes.

Available-to-Promise (ATP) and Capable-to-Promise (CTP) features are part of Global Order Promising which helps to improve on time deliveries.

Replenishment – Includes ability to auto generate POs from demand, sales orders, and sourcing agreements.

Vendor Managed Inventory – VMI replenishes customer inventory based on stock and sales data sent to the vendor.

Procurement Management – Strategic sourcing functionality includes:

  • Long Term Planning
  • Support for RFP / RFQ
  • Supplier Contracts
  • Supplier Score Card
  • Online Auctions
  • Electronic Catalogs for Print and Web Publishing

Purchase Order (PO) module supports:

  • Centralized and Decentralized Procurement
  • Aggregated Demand
  • Converting Demand into POs
  • Integrated Receiving and Payables

Warehouse Management System:

Yard Management – Oracle does not support Yard Management. Dock door appointments are supported, when WMS is integrated with Oracle’s TMS. Planners can manage the arrivals and departures of trailers, schedule dock door appointments and optimize dock usage.

Inbound Processing – Pallet and carton auto-identifications are matched to the supplier ASNs; receipts are auto generated. Manual receiving is supported against document types such as a PO or RMA. High volume inbound goods are directed to the more accessible locations. A sample of put-a-way types includes:

  • Hazard Materials
  • Item Fragmentation
  • Seasonal Items
  • Purchase Order Types
  • Item Categories

Outbound Processing – Oracle supports several methods for planning shipments. Depending on the shipment method, processes can include shipment consolidations, trailer loading and generating ASNs. Picking methods include:

  • Bulk
  • Zone
  • Discrete
  • Sales Order
  • Wave

Cross Docking – Inbound goods can be directed to the outbound process, with outgoing to an interim warehouse storage location. Expected receipts can be checked and matched for cross docks opportunities.

Value Added Services – Oracle’s WMS does not support Value Added Services, unless integrated with Oracle’s Project Manufacturing.

Storage – Oracle WMS supports lot and serial number tracking.

Transportation Management System

Planning – Oracle’s TMS includes decision support for:

  • Least Cost Analysis
  • Multi- Modal Options
  • Service Levels Optimization
  • Zone Routing
  • Asset Utilization
  • Multi-Stop Consolidation
  • Transportation Pooling
  • Cross Docking
  • Load Configuration

Dispatch – Based on load, pickups, modes of transportation, and route optimization, the dispatcher performs the following:

  • Assigns carriers to routes
  • Produces Shipment Documents
  • Generates EDI transactions

Visibility is provided through the shipment lifecycle.

Freight Charges and Settlements – Oracle features include a repository of contracts for all modes of transportation, along with the functionality to calculate charges. Charges are validated for the services provided.

Fleet Management – Asset management is available for customers who manage their own fleet.

Supply Relationships Management – Oracle’s E-Business Suite does not support a full featured SRM.

PeopleSoft’s SRM module is fully integrated with PeopleSoft’s ERP and SCM products.

Catalog Management – Includes web-based publishing with the ability to organize and publish the catalog for different trading partners. SRM transforms the supplier’s product catalog data to a uniform format for PeopleSoft’s procurement module.

Sourcing – The sourcing module manages the bidding process including: opening up a buying event (allowing named sources or general public to bid), managing the responses and analyzing the bids.

Contract Management – Both fixed item and open contracts can be created from the sourcing process. Contract management supports processes for generating purchase orders, item pricing and payment schedules.

Supplier Compliance – Supplier compliance contracts are integrated with PeopleSoft’s purchasing, payables and other SRM applications. Compliance is monitored for reporting supplier performance.

Customer Relationship Management – Oracle CRM solutions include Oracle Siebel, PeopleSoft, Oracle E-Business, Oracle On-Demand (a pure cloud CRM solution) and Fusion CRM. Each of the Oracle CRM solutions include order fulfillment, sales, marketing, and customer service.

Oracle SCM Strengths and Weaknesses

Oracle strengths include their size and their acquisition of SCM software vendors that include leaders and innovators such as Dematra, PeopleSoft and Siebel. Their Fusion and AIA architecture is a best class product, with SAP being the only vendor that can challenge Oracle on the suite of features and functionality. The gaps in Oracle’s E-Business Suite are being filled by best in class level solutions through acquisitions.

Their S&OP and Demand Management solutions have become best in class with the acquisition of Dematra. E-Business also has a full featured line of SCM products. For organizations using Oracle’s ERP solution, their SCM software becomes a top candidate for a SCM software initiative.

Oracle’s footprint is large and complex, and their lineup of products can be confusing. For smaller and midsized companies, Oracle tends not to scale down as well. A typical implementation requires Oracle certified consultants and often takes several months to implement one module, and that may be without any custom programming.

An area of uncertainty for investing in Oracle’s SCM software is the direction and decisions Oracle is taking with their new Fusion software. Oracle has taken the initiative to consolidate their business software under one technology that integrates with their Fusion software platform. Oracle’s current position is that they will continue to support and upgrade the E-Business Suite, PeopleSoft and JD Edwards brands. However, at some point, fully supporting the three enterprise software brands, plus the Fusion brand, will no longer make business sense for Oracle. As customers migrate to the Fusion software, the customer base will shrink for the other brands. Oracle’s customers will face the following uncertainties: cost and disruption of migrating to Fusion, how customized applications will function with the new Fusion applications, and the possibility of missing features or functionality.

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