VMS Develops Optimization Method for Supply Chain Management

Heidelberg, 2007/05/14 – Software-Based Process and Best Practice Analysis Designed in Cooperation with Industry

SAP optimizer VMS is reinforcing its activities in optimizing supply chain management processes. In a pilot project involving well-known partners in Germany's industrial sector, VMS is developing a new Benchmarking method which makes it possible to measure in detail both the IT operations and processes. A supply chain oriented to best practice thus has a key advantage over the competition. VMS is now adapting its method of DNA-level Benchmarking to the special requirements in this field and is developing a measuring software program which is specially customized to the SAP supply chain management product Advanced Planner and Optimizer (APO).

"Benchmarking for supply chain management these days is usually based on surveys", explains Ralph Treitz, managing director of VMS. "That's a problem because these methods are based on the past and are latently insecure due to the latitude for interpretation. In addition, the focus is very strongly monetary." The idea of control by simple indices in this field is still particularly distinct. But in the value-added chain in particular, process-based criteria such as processing time or stock turnaround in detailed form and as a forecasting tool are especially important. Potential for improvement can only be insufficiently tapped by one-dimensional, historically-based key performance indicators (KPI) such as "inventory value as a percentage of turnover".

"The question should not only be how much money IT costs; it's more a question of finding out how effectively the value chain functions", Treitz adds. "IT departments must be able to actively discuss content and not only to help in optimizing processes but also to take over a leading role." In order to give CIOs or technical specialists a better planning basis for this, VMS optimizes its proven technology – with which almost 1,100 SAP systems have been measured to date – for measuring APOs. The VMS DataCollector is also used to sort technical data such as server time, availability or response-times automatically from the system, as also the size of the live cache, the number of planning parameters, basic data and constraints or time resolution. Compared to VMS' comprehensive database, a detailed comparative image which demonstrates the potential for optimization is then formed.

In its dealings with partners in industry, VMS will work out the critical characteristics for the use of APO over the coming months and then implement them using its software. "Thanks to our established client base, which consists mainly of major German company groups, we are able to precisely define the key requirements of effective supply chain management together with the manufacturing sector", Treitz emphasises. "This will allow us to present our new software as early as October; this software will ensure that planning bases will be created for optimizing the value chain in a manner which is as yet unknown."

Since 2002 VMS has optimized SAP systems at a large number of companies and stored their characteristics in the biggest and most detailed database of its kind. The VMS Benchmarkbase contains data on almost 1,100 SAP systems. Thanks to its unique, extremely precise methods, VMS has become the market leader in SAP benchmarking and can point to constant growth.

VMS has been optimizing SAP landscapes since 2002. VMS scans SAP installations from the process-level to the transaction-level and, as a partner of the CIOs, identifies strengths and weaknesses. In doing this VMS works with an integrated concept which covers the IT infrastructure and the IT and business processes. VMS' methods are "minimally invasive", because its work puts only a minimal strain on the client's resources. VMS offers the experience and data from about 1,100 SAP systems that it has measured and this enables it to give action-oriented advice on optimization and cost management. The structure and dynamics of the IT environment is then reproduced in a final VMS Report which is the navigation system of the SAP landscape.

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