Controlling Fragmentation and Change

Feature Article | October 4, 2007 by admin

From a business perspective, a closer look at the possibilities and impact of service-oriented architectures can benefit not only IT specialists, but also supply chain practitioners. Increased supply chain fragmentation is the central element of the upcoming trends that they will have to face. With rising consumer influence and global competition, companies are driven to introduce better and cheaper products more frequently. What’s more, products are becoming more complex as customers demand sophisticated features, new services, and a greater number of choices. The increased rate of change is shrinking product life cycles and forcing supply chains to become more dynamic and diversified. The supplier base grows to address the complexity and the time-to-market pressure involved.
As a result, companies are creating new or reconfiguring existing supply chain networks to connect with consumers in the global marketplace. To contain costs in such a dynamic business environment, companies outsource many supply chain processes so that they can focus their limited IT resources on their core competencies. However, these actions can cause IT costs to increase in the long term, because a supply chain that is fragmented across multiple enterprises also tends to create non-standard or differentiated processes.
Yet another supply chain challenge comes from the increased data volumes that will continue to grow exponentially as more products, network configurations, customer details, and user preferences require management. Sensory technologies like RFID help capture detailed information about products, assets, and materials in real time and accelerate this trend. Although all this data can give greater control to the business and make the supply chain information worker more productive, users also risk drowning in data if applications cannot synthesize and deliver the right data, at the right time, and in the right format.

Building an architecture for maximum flexibility

Sustained supply chain success requires an IT architecture designed to manage growing data volumes across disparate and distributed processes that constantly evolve. The highly flexible enterprise service-oriented architecture (enterprise SOA) from SAP can solve the dilemma of balancing standardization and differentiation in the context of the emerging supply chain challenges. Conceptually, the key capabilities and flexibility of enterprise SOA can be illustrated along three layers – integration, composition, and presentation – showing how they address supply chain challenges while containing IT costs.
The bottom layer of enterprise SOA provides a capability for system integration, easily connecting distributed supply chain applications via enterprise services. This means sharing data quickly across the ecosystem, without discussing every integration point or mapping interfaces according to the unique needs of each application in multiple enterprises.
The middle layer represents the composition services that contain the business process library. For example, SAP’s Enterprise Services Repository maximizes code reuse and helps adapt processes to new business requirements quickly.
The top layer of enterprise SOA focuses on an adequate user experience for supply chain practitioners. This layer consists of presentation services that effectively decouple the business logic from the user interface to enable different end-users to follow their preferred method of interaction.

Easily integrate at lower cost

The key benefit of the integration layer of enterprise SOA in the supply chain context is the enablement of efficient collaboration with trading partners via enterprise services across reusable standard interfaces, like Web services. To ensure the highest level of successful adoption in a fragmented supply chain, existing industry standards and naming conventions are taken into consideration in the design of the enterprise services for business-to-business (B2B) collaboration. The capabilities are delivered with the SAP Supply Network Collaboration application, a part of SAP Supply Chain Management (SAP SCM).

Core functionality for collaboration

Core functionality for collaboration

SAP Supply Network Collaboration comes with a core set of processes that are common to inter-enterprise or B2B communications, like delivery processing, sales and purchase order processing, and invoice processing. All the core processes represented in SAP Supply Network Collaboration are designed with robust interfaces and clear interaction patterns for easy integration of suppliers and customers – whether or not they run SAP backend systems.

Create customized workflows

Increasing fragmentation across functional silos means that more business processes must be cross-functional. For example, it is important to address both transportation and warehousing processes together to achieve higher velocity throughout the supply chain. The composition layer of enterprise SOA is a key enabler that helps build these cross-functional workflows quickly by using enterprise services as reusable software components. With this ability for rapid adaptation, supply chain management can deal with the increasing speed of business process changes.
To give business process architects full visibility, enterprise services are documented in SAP’s Enterprise Services Repository. The repository makes it easy to find, evaluate, and use existing enterprise services to adapt business processes. As a result, the repository helps reduce the costs of implementation projects by providing a clear overview of existing interfaces, including sample integration scenarios. SAP plans to ship the Enterprise Services Repository in November 2007.

Improve user experience

From the user perspective, the number of different applications or sources of data in a fragmented supply chain should be transparent. To enable a rich user experience, the presentation layer of enterprise SOA includes enterprise services like the SAP NetWeaver Visual Composer tool. This specific web service offers an ability to build custom user interfaces (UIs) with minimal effort to support the interaction technology preferred by the supply chain partner, such as Adobe Forms, Microsoft Excel, widgets, or other frameworks. With design tools like SAP NetWeaver Visual Composer, enterprise SOA focuses on custom-fitted UIs that provide the right data to everyone along a fragmented supply chain, even across company boundaries and when using the interaction software of choice.

Duet for demand planning

Duet for demand planning

Order-promising information, for example, is a type of data frequently needed by different partners. Many people inside and outside an organization, such as channel partners or logistics providers, must access the same information via different views or with different rights. Planners want to view sophisticated ATP rules governing partial or full shipments, but sales personnel just want the simple facts on whether an item is available and at which location.

UI for sales personnel

UI for sales personnel

When building a custom UI for sales staff with SAP NetWeaver Visual Composer, the enterprise services “Find Material by ID and Description” and “Check Requirement” can be included in the modeling environment with drag and drop. A few more clicks structure the input and output fields. The user can now enter a product description or select one from a list and enter the desired quantity to find out where the item is available. The UI is accessible from the Web and uses enterprise services to interact with the SAP SCM backend.
The modeling effort needed for customizing the screen is very low, because SAP NetWeaver Visual Composer doesn’t require writing code. The same UI can also easily be enhanced to create a sales order with the reserved quantity directly. Enhancement is done by adding fields in SAP NetWeaver Visual Composer that allow interaction with the SAP ERP backend over a create-sales-order enterprise service. With the UIs that are custom-built using enterprise services, enterprise SOA decouples the presentation layer from the backend business processes, ensuring that the processes consistently adhere to standards as much as possible.

Adaptability for future supply chains

With the integration capability, flexibility, and usability offered by the different layers of enterprise SOA, IT departments and supply chain practitioners get the abilities they need to address the challenges of fragmentation, change, and growing data volumes. By building this highly adaptable architecture, they can reach both their IT and business goals while balancing the competing objectives of differentiation and standardization.

Sree Hameed

Sree Hameed

Andreas Schoknecht

Andreas Schoknecht

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