Which Enterprise Applications Can Cater to the 4Ps of Product Safety

The critical part in the 4Ps-enabling applications landscape would be a Process Manufacturing ERP system like Lawson M3 [evaluate this product]. These systems are typically the most important for tracing and establishing the quality fence. Namely, ERP systems process inventory transactions that can come from the entire value chain. Process manufacturing ERP systems often have the laboratory software applications as well, while the procurement module can handle specifications, vendor certifications, and vendor rating.

Interestingly, Olin doesn’t consider product lifecycle management (PLM) systems to be critical with regards to product safety. Still, he at least acknowledges PLM systems’ help with creating quality specifications and matching approved ingredients to geographic markets (e.g., can this ingredient be in a product that is going to be sold in Japan?).

Supply chain event management (SCEM) tools are certainly critical for visibility and action reasons, albeit they can overlap with the inventory management modules of ERP systems. These visibility and workflow-based tools help only if they have lot tracking capabilities, perhaps bolstered with radio frequency identification (RFID) sensors and accompanying applications.

To that end, recently launched Lawson M3 Trace Engine is a standalone solution that combines repository, SCEM, data cleansing and integration, and workflow capabilities for food safety in extended supply chains. The product was described in great detail in my previous two-part blog series.

Manufacturing execution systems (MES) are important since HACCP capabilities are often found within them, but typically a MES is lot-blind and thus has to be interfaced to an ERP counterpart. Likewise, a laboratory information management system (LIMS) or quality management system (QMS) is a critical part of the quality fence for handling testing rules, analysis of results, vendor ratings, lab instructions, etc.

Food and Drug Safety: Prevention Better Than Cure (For Sure) – Part 1

Food production and distribution is a serious and strategic business, and I am not aware of anyone in my surroundings that takes it lightly; food can not only delight us, but can also make us quite sick and indisposed. While my inner circles (pets included) have luckily not been casualties of recent salmonella, E.coli, and whatnot outbreaks from tainted chilly peppers, tomatoes, spinach, pet food, or most recently peanut butter, the 2008 year-end holidays were not much fun for my family.

Namely, the “G.I. bug” that our 18-month-old likely got in her playgroup spread so quickly and violently to anyone who was in contact with her (including the broader family members that stopped by to just traditionally exchange holiday gifts). Sure, viral gastroenteritis might likely have had nothing to do with what we ate at the time, but the feeling of being listless and other unpleasant (and unspeakable) G.I. bug symptoms were quite similar to those that food poisoning outbreaks can “treat” us to.

Food processing and distribution are not be the only market with burning product safety issues, since similar issues can also apply to the drug and pharmaceuticals sector or consumer packaged goods (CPGs); remember lead-tainted toys or antifreeze-laced toothpaste coming from China? Still, we all seem to be the most sensitive about food-related breaking news, possibly due to the likelihood of those hitting home (perhaps even in a willful way by bio-terrorists).

Thus, some food processing market experts have lately been frustrated by companies’ focus on location and lot control, serial number tracking, and traceability as the panaceas to solve product safety issues.

While important, these critical capabilities still help mostly with minimizing the damage (i.e., during product recalls), but the damage to customers and company’s brand has unfortunately already taken place, leaving many folks seriously ill (if not even fatally affected).

Track-and-trace After the Fact: Good But Insufficient

On the other hand, while I agree that detecting the problem before “the horse leaves the barn” would be a great use of IT tools, my IT experience still only involves location and lot tracking (while the product is in the hands of the manufacturer) and traceability (once the goods go to the customer). The goal has typically been the immediacy of problem identification and minimizing the extent of a product recall.

Sure, random sampling of ingredients is usually performed by labs and quality control (QC) departments, but they can only report an “accept” or “reject” status. To also be fair, Hazard Analysis and Critical Control Points (HACCP) is a systematic preventive approach to food safety and pharmaceutical safety that addresses physical, chemical, and biological hazards as a means of prevention rather than finished product inspection. Still, like lot control and traceability, HACCP is only a piece of a much broader product safety issue.

Optimized Scheduling and Planning with Product Safety and CTP Constraints

With compliance and safety constraints integrated into planning and scheduling processes, companies can simulate the impact of a product safety occurrence. Planning that stops organic lots from being stored in a bin with inorganic lots is an example of proactive planning. As time pressures increase, supply chains and products get more complex, and relying on manual processes or human intervention is increasingly risky.

The chance of product safety issues from cross contamination or Hazard Analysis and Critical Control Points (HACCP) monitoring for inability to make product claims is increased as products and package options proliferate to meet consumers’ demands for wider variety of products, improved compliance and ensure product claims. Companies can ensure compliance and product safety while increasing throughput by up to 40 percent (based on Infor customers’ results) via deploying constraint-based optimization software that includes handling organic requirements, allergens, impurities, processing aid contaminants, package compatibility or stability, or equipment or storage constraints.

Moreover, as companies look to outsource more, the ability to include supplier or internal CTP capabilities can ensure that the lowest risk suppliers are proactively selected. This can not only improve product safety, but can also minimize inventory levels and improve cash flows.

Shaping Demand to Improve Compliance

When companies are faced with suppliers or products that cannot meet future compliance, risks become unacceptable and demand will likely be reduced. The only decision may be to sunset products. The use of integrated pricing and promotions planning and management can identify impacts on margins, cannibalization, and more profitability transition to lower risk and higher margin products.

Risk Management

To proactively identify and mitigate compliance, safety or other internal or supplier risks, risk management should be included in all levels of planning and execution. As suppliers face increased financial pressures, will their quality suffer (or might they even go out of business)? With increased risk transparency, companies can start to improve compliance and product safety while minimizing risks.

Moving to Proactive Product Safety in Planning, Scheduling, Asset Management, and Product Development

Most companies need to incrementally improve their processes, information, and systems to achieve holistic product safety and compliance. By using a risk-benefit and cost-benefit analysis strategy, companies can identify areas to start with, and gradually close product safety risk holes. As they adequately control an area of risk, they can incrementally move to the next area of improvement and incrementally minimize risks.

To that end, companies should develop a master plan to holistic product safety. This overall plan should include:

* Holistic Enterprise Asset Management (EAM);
* Holistic Product Lifecycle Management (PLM) with Design for Compliance, Quality and Product Safety tenets;
* Material and Product Screening and Control;
* Optimized Scheduling and Planning with Product Safety and Capable to Promise (CTP) Constraints;
* Shaping Demand to Improve Compliance; and
* Risk Management.

Holistic Enterprise Asset Management

Leaky pipes or roofs, metal shavings from poorly maintained equipment that fell into packaging processes, inadequate sanitation procedures, and other asset maintenance issues have lead to several high profile product recalls and corporate embarrassments. Effective preventative maintenance capabilities within EAM systems like Infor EAM Enterprise Edition [evaluate this product] not only reduce product quality and safety risks, but also increase asset availability and extend the lifecycle of assets. Effective preventative maintenance (including reliability centered maintenance [RCM]) or stopping the usage of any “out of tolerance” conditions proactively improves product safety, minimizes write-offs, and improves fill rates (customer service).

Design for Compliance, Quality and Product Safety

In contrast to Lawson’s 4P approach in Part 1, Infor considers PLM as a focal system of record. Allergen labeling and claim substantiation recalls, home handling and usage instructions, supplier enablement, and designing products for compliance, quality, and food safety issues (including design for environment [DfE]) are all supported by integrated PLM processes. Starting with initial material testing via release of a product to localization at a plant, a PLM system controls more data about compliance, quality, and safety than any other application.

Trial protocols to ensure that companies are testing for the right issues can be developed within the product and seamlessly integrated to QA processes. Full labeling and compliance documentation by end-user, market, and country can be automatically generated.

With the increased use of outsourcing and pushing more research and development (R&D) tasks out to suppliers, manufacturers will strive to protect intellectual property (IP). Process manufacturing PLM solutions like Infor PLM Optiva [evaluate this product] should allow suppliers to disclose all the risks while protecting vendors’ IP.

To that end, secure constituent formulas manage compliance data and provide masked R&D material data as necessary. When a compliance issue arises with a material that has critical security, compliance managers can search across this secure data and find other similar materials to proactively address other potential issues.

Designing with built-in quality, compliance, and sustainability in mind will minimize the time and cost to scale, ensure product safety, and improve the product success rates. In parallel, companies can benefit from reduced costs, improved product performance, sustainability, minimized time-to-market (TTM), and ensured product’s regulatory compliance.

Building upon Reactive Product Safety Strategies to “Proactive Product Safety” Strategies

Companies can implement a sound process manufacturing enterprise resource management (ERP) system like Infor ERP Adage [evaluate this product] at both the lot and sub-lot level or Infor ERP LX [evaluate this product] at the lot level only. Enterprises can than immediately capture extended lot and sub-lot data that can be used to actively protect product safety. They can integrate data from quality assurance (QA), analytics, specifications, and lot tracking modules to actively manage product safety and minimize the chance of a recall.

With every lot-based transaction, companies can initially capture and incrementally add safety, compliance, performance, and cost data. With information like vendors’ location and risk rating, dates for shelf life, effective and retest dates, allergens (or other labeling data), proof of absence of harmful attributes, etc., automated specification matching ensures that lots or sub-lots can only be used for safe or approved usages.

This can stop cross-contamination or reduction of the product’s value based on co-mingling of high value lots with lower value lots. As an example, the higher value of organic or specific farm lots or sub-lot is reduced to the value of product to the lowest co-mingled lot value. Since co-mingling of an organic lot with an inorganic lot reduces all the lots to an inferior inorganic value, not only are you overpaying for the organic lot but also the price of associated products is reduced.

Integration of QA data from Advanced Shipment Notice (ASN) through inventory, production, shipping, and logistics modules (and their respective departments) enables companies to actively protect their product safety. Until all tests are completed and approved, a higher risk or lower quality material lot or sub-lot cannot be used throughout production and logistics.

Based on risk or quality ranking of a lot or sub-lot, additional testing for contaminants can be required to provide the coveted “proof of absence”. Not only is safety ensured this way, but also the ability to prove the origin (or another proof of absence) can improve the value of the end product. Active monitoring can actively identify risks or issues and preempt suspect lots from being used or shipped. Companies can actively monitor from initial shipment into inventory to production and through distribution.

Based on the risk and quality rating of the material, formula, or recipe, the appropriate level of testing can be activated and managed. This could include increased sample testing sizes (or more frequent intervals) and more extensive testing. More frequent sampling will identify issues earlier and ensure timelier issue mitigation.

As companies improve the depth and accuracy of supplier, material, and production data, performance analysis can be used to more accurately rate supplier, material, and production quality. Use of Supplier Scorecards with risk ratings can help drive purchase order (PO) volumes to more reliable suppliers and reduce safety risks. Since many suppliers are not staffed to implement advanced quality and compliance programs, many manufacturers are moving from just auditing to value-added supplier education.

Improved supplier quality can help reduce both manufacturer’s and supplier’s costs and improve the manufacturer’s quality and product consistency. While companies find that non-value-added costs are reduced and throughput can be increased, improved shelf life and quality can reduce returns and quantities of non-saleable or expired products. With higher quality products with value added lot genealogy, the ability to prove country of origin or organic type claims can increase the value of the products.

Food and Drug Safety: Prevention Better Than Cure (For Sure) – Part 2

Infor’s Proactive Product Compliance Strategy

In a nutshell, process manufacturing companies need to transition from reactive and firefighting strategies that mainly minimize recall costs to proactive product safety strategies that protect the company and its products. With a significant increase in high-profile product safety failures, reactive strategies like lot track-and-trace cannot stop recalls, even though they can make the recall process far more efficient.

In 2008, the root causes of various recalls covered a wide range of issues that included material tampering, allergen labeling issues, inadequate end-user food handling or preparation instructions, potential cross contamination of ingredients, plant health and safety conditions, unsubstantiated (or even willfully inaccurate) marketing label claims, and shelf life issues. The increase in recalls and the above wide range of root causes have highlighted opportunities for more than just internal improvements and need to “prove the absence” of anything that can result in a product safety issues or in a recall.

Yet, many companies continue to operate with the assumption of that an “absence of proof” is sufficient. They continue to assume that all suppliers have adequate data, controls, and safety and compliance processes. They thus operate under an opportunistic quality and compliance strategy, whereby the goal of supplier quality audits is to find ways to pass (certify) the supplier.

To adequately insure supplier capabilities, companies must move from an opportunistic “absence of proof” stance to a risk-based “proof of absence” strategy. Since a holistic strategy cannot always be achieved immediately, companies need to focus on their greatest areas of risk, minimize their time to close product safety risk, and continually build on existing capabilities.

With all members of the food supply chain (i.e., from farms, material/ingredients suppliers to product manufacturing, distributors and retailers) continuing to consolidate, the impact of what had been traditionally a small and localized incident is now multiplied across many regions and customers. Not only are traditional product safety issues magnified by industry consolidation and broader distribution, but also increased product complexity, associated claims substantiation requirements, and the speed at which the Internet spreads information further amplify the opportunities for risk and shrink the time available in which to respond effectively.

To protect their products and long-term viability, companies need to build on any existing reactive product safety capabilities to implement a proactive product safety strategy and provide the much needed “proof of absence.” Proactive product safety will not only protect their products but will also reduce non-value-adding costs and improve profitability.

Reactive Product Safety Approaches

A core component of an effective reactive product safety approach is bi-directional lot control and track-and-trace capabilities. To meet ever-shrinking recall response mandates, the lot and sub-lot track-and-trace feature must be integrated into every material movement, product production, packaging, and distribution process.

Whenever manual or document-based lot track-and-trace is used, the time, risks, and cost to respond is increased. With every additional hour required to respond, the cost of a recall is increased and the risk to the company and its brand are increased. With an effective lot track-and-trace feature available, companies can leverage such capabilities to more actively ensure product safety and protect brand and company image.

The (NA)Vision of Microsoft Dynamics NAV 2009 – Part 1

The first week of February 2009 was marked by two notable product launches, from vendors touting their respective simplified, more flexible, and intuitive products as exactly “what the doctor ordered” for the current economic malaise. While the unveiling of SAP Business Suite 7 has caused a flurry of media articles and blog posts like the ones from Ray Wang and Brian Sommer (and one of mine might still come down the track when all the dust settles), it is interesting that the North American launch of Microsoft Dynamics NAV 2009 a day later went with comparably much less buzz.

There were related Dynamics NAV 2009 events in some other world regions, but I cannot say much about their attendance and noise level. Despite the Microsoft Dynamics NAV 2009 launch in the US proceeding somewhat quietly (the replay of the event can be seen here), I think it might have as much future impact in the market as SAP’s mega-counterpart.

Namely, the clout SAP Business Suite [evaluate this product] has in the upper end of the enterprise resource planning (ERP) market, Microsoft Dynamics NAV (formerly called Navision and Attain) [evaluate this product] has in the lower end of the market.

A cult ERP product in the small-to-medium business (SMB) market, Dynamics NAV has long been a well-oiled and growing business within the entire Microsoft Dynamics enterprise applications group. Although not necessarily a trailblazer in terms of product technology and scalability compared to its fellow Microsoft Dynamics products, Dynamics NAV can boast an impressive global popularity and presence (with dominance in continental Europe), a large global partner network. In addition, it is the most widely localized Dynamics product.

The US Microsoft Convergence 2008 user conference was mostly about the upcoming Microsoft Dynamics AX 2009 release with the “upper mid-market product” themes of globalization (multinational and multisite capabilities), regulatory compliance, and user experience (UX) design (via personalized Role Centers). However, Dynamics NAV 2009 took the spotlight at European Microsoft Convergence 2008 last fall, and will likely repeat the feat during the upcoming US Microsoft Convergence 2009 event in March in New Orleans.

Microsoft Dynamics NAV (née Navision)

Before delving into the enhancements of the latest product release, it might be useful to reflect a bit on the product’s genesis. The global numbers below speak volumes, since today Microsoft Dynamics NAV has

* more than 70,000 customers (and over 1.25 million licensed users)
* more than 3,400 certified partners, including both value added resellers (VARs) and independent software vendors (ISVs)
* more than 2,000 add-on partner solutions
* more than 40 localized versions sold in over 150 countries

From its inception in 1984, the erstwhile Navision Software company has made efforts to enable its software platform and applications to go hand-in-hand. This has meant providing enough native functional footprint to serve as a foundation while also leaving sufficient “white spaces” for partners’ add-on industry solutions (and intellectual property entitlements).

The very first release of what is today Microsoft Dynamics NAV appeared in the early 1990s, and featured a command line interface (CLI) appearance. That product was all about getting the basics right in terms of the financial management functionality.

The second generation of Navision in 1995 featured a Microsoft Windows graphical user interface (GUI). That release added a number of industry solutions from partners and Navision’s own business management functional modules (i.e., manufacturing and distribution). However, as a limitation, there were two separate product variants (instances) for manufacturing and distribution environments at that stage.

The third generation of Navision in the early 2000s (prior to being acquired by Microsoft in 2002) was mostly about integration and pulling all of the native modules into a unified suite on a single database. The choice of database has remained until today: either Microsoft SQL Server or the proprietary Navision C/SIDE database.

The Navision 3.0 suite then offered natively the following functional modules: Financial management; Distribution; Manufacturing; Customer Relationship Management (CRM); Service management; and E-Business solutions. The native functional footprint has largely remained unchanged. For more details on the product, you may want to read Scott Hamilton’s book entitled “Managing Your Supply Chain Using Microsoft Navision. One chapter is reprinted on TEC’s site here.

In Microsoft Dynamics NAV’s target market are those nimble companies with distinct business processes and a strong need for a flexible, vertically focused solution. Core market segments are: wholesale distribution (with about 45 percent of the customer base), manufacturing (with about 30 percent of the install base), and business services taking the rest of customers.

Some high profile customers include Steinway & Sons, GfK Aktiengesellschaft, Jack Wolfskin, EXHAUSTO, CF Chefs Inc., Seventh Generation, and FC Köln. But my estimate is that about two thirds of NAV customers are in the lower midsize business segment (under 50 employees), often with only a few IT staff members or power users. Another unconfirmed estimate is that the product’s average sales price in terms of software license fees has been around US$ 27,000.

In still another frequent scenario, Dynamics NAV is often used for divisions of multinational companies in a hub-and-spoke manner. Microsoft defines the Corporate Accounts Segment (CAS) as those companies with over 1,000 employees.

In this setup, the corporation’s HQ or the “hub” will use Oracle or SAP (or even possibly Microsoft Dynamics AX) for financials and human resource (HR) management in a centralized shared services mode. On the other hand, Dynamics NAV will serve autonomous divisions (“spokes of the hub”) and integrate (or “talk”) to the HQ, especially at the financial reporting and consolidation level. Microsoft Dynamics NAV CAS customers include Harger Lightning & Grounding, Asian Paints, Goldschmidt-Thermit-Group, Salonit Anhovo, and Brush Wellman (Japan) Ltd.

The product’s core values have always been adaptability and customization for both users and partners due to its flexible and granular product composition. Consequently, there is an extensive library of industry solutions, country localizations, and languages, with an impressive international scope as a result. Microsoft Dynamics NAV has good penetration (i.e., a few hundreds of customers) even in some tough and possibly esoteric markets like the Balkans.

The Power of Knowledge — Knowledge is Power (Part 3)

SSM Synergy and Value “Multipliers”

Because the SKM solution is part of Servigistics’ overall SSM solution, users could leverage service and part usage history to narrow the search for the right resolution. Once one is found, the user can be directed to the right part and its best source given the customer’s service level agreement (SLA) commitment and location as well as part interchangeability options and availability in the network. The feedback with regard to resolution history and part availability can be automatically delivered as notifications back to the planning process so that everyone’s processes improve.

SKM can also attach possible parts to resolutions, ranked by probability, and provide links to Servigistics Parts Locator to identify the sourcing options. As for the link with the Servigistics Workforce Management modules, with the access to and from the Service Command Center and Service Mobility solutions, SKM could assign the required skill to problem cases in order to identify candidate technicians.

As for the synergy between SKM and Servigistics Pricing Management, companies could integrate part prices with required parts for a rapid resolution and thus drive revenue by making it easier for customers to identify the needed parts at satisfactory prices. The Sourcing Innovation blog post offers some more useful details on SKM.

Why Slow Customer Uptake, Then?

With minimal personnel requirements, anticipated return on investment (ROI) in less than six months, and developed sets of tools and best practices being touted as additional possible benefits, we should expect companies to be harnessing KM solutions in droves, right?

As a validation of the KM market, the combination of former Onyx and KNOVA has allowed Consona CRM to combine service resolution management (SRM, not to be confused with supplier relationship management!) within the Consona Knowledge Management suite (formerly KNOVA) with the customer relationship management (CRM) offering, Consona Customer Management, formerly Onyx CRM. To that end, SRM/KM adds resolution and case management process to customer interactions, so that organizations are better able to serve customers.

The software not only allows call center agents to more quickly answer questions and resolve problems, but also supports up-sell and cross-sell opportunities. For its part, CRM software adds the customer context to searches. Namely, if the system has access to specific customer details such as the products or services already purchased, this information can be used to fine-tune the knowledgebase search and return only the most relevant results.

This can result in a better experience for self-service customers because they are only exposed to relevant results. The productivity and quality of customer service within the call center could therefore go up due to increased speed and accuracy.

Another more recent validation came from Salesforce.com, who has paid approximately US$31.5 million to acquire InStranet, a privately held supplier of KM software that is used in call centers and web self-service scenarios. The acquisition is the largest to date for the renowned and vocal CRM software-as-as-service (SaaS) vendor [evaluate this product] (in addition to being the Force.com platform-as-a-service [PaaS] provider), beating the US$15m it paid for wireless infrastructure provider Sendia in 2006.

A somewhat strange aspect of the acquisition was that InStranet has mostly (over 75 percent of its clients) been a traditional, on-premise software provider, with the rest being hosted in a single-tenant mode. These modes of operation have been exactly the opposite of the “No Software” mantra of Salesforce.com.

InStranet has also sold its KM products primarily to European telecommunications and financial service providers that have consumer-focused call centers with thousands of agents. More than 400,000 agents and knowledge workers use InStranet, and only time will tell how Salesforce.com will repurpose the software for other vertical segments.

Given all the above facts (including Salesforce.com going out of its way to acquire KM capabilities) that bode well for the KM applications, I was thus wondering why Servigistics cannot yet boast of a healthy roster of SKM customers? The vendor says that any new solution takes a while to percolate and then sell. Servigistics will disclose only that it has many current deals underway; it is waiting for them to close, which is also taking longer than usual due to current economic conditions.

In addition to Consona KM and InStranet, the competition from the Art Technology Group (ATG), eGain Communications, InQuira, KANA Software, and RightNow Technologies might make Servigistics’ selling job more difficult for SKM. Knova and InQuira are also considered Tier One KM products in terms of scalability, install base, search optimization, personalization, and with integrated forums software for peer-service that enables customers to help each other while providing valuable feedback (for new knowledge to be captured).

One could only imagine how these forums could work in conjunction with social networks down the track. As an idea, see TEC’s earlier article/podcast entitled “Social Networks: How They’re Turning CRM Upside Down.”

But Servigistics points out that SKM is more oriented towards field service than to the call center and consumer CRM side (where, for example, queueing theories might play a more prominent role). Even though the decision making is slower, the decline in spending could be a boost to service operations as customers/businesses are holding onto their assets longer, holding off replacing them as long as possible.

This means that more service delivery is demanded, which means parts optimization, pricing adjustments, field service, and service knowledge all need to be in place. When the service business is optimized, then businesses can profit on service rather than product sales. In addition, clients could be saving a bundle on spare parts inventory, optimized pricing, scheduling, and routing as well as by meeting SLA’s.

I think that vendors like Servigistics or Ventyx are exactly the type of service-oriented supply chain management (SCM) and/or enterprise asset management (EAM) vendors that can survive today: hyper-focused with very strong technology and footprint. I know some might say that optimization is dead, but not in the pricing or mobile workforce and parts planning space. There are still many problems to be solved in those areas that are too messy and ugly for Oracle, Microsoft Dynamics, or SAP to devote many resources to solving.

The (NA)Vision of Microsoft Dynamics NAV 2009 – Part 2

Life within Microsoft Dynamics

Of course, it was only logical to expect that the new powerhouse owner would try to leverage its renowned technology stack, possibly with an expected spin (or even reality) of potential customer benefits. The first product’s release under Microsoft was in 2004 under the name Microsoft Navision 4.0, since the “Dynamics” moniker came a bit later.

Microsoft Navision 4.0 was centered on the themes of improving the user experience (UX) design and further simplicity and productivity enhancements. To that end, the release’s look and feel reminded users of Microsoft Office Outlook 2003, whereas any analytical charting result could be presented in Microsoft Excel Viewer.

“Analytics” had long since become an increasingly important aspect of enterprise resource planning (ERP) software, and the company then leveraged Microsoft SQL Server Reporting Services (SSRS) and Analysis Services to package a set of ready-made analysis tools and graphical views of common key performance indicators (KPIs) by dimension. Further along the lines of delivering deeper integration with the overall Microsoft technology stack was harnessing the Microsoft SQL Server Notification Services to support e-mail business notifications to employees and trading partners.

The product also leveraged an extensible markup language (XML) port so that its modules could interchange data with other applications and external users via the Internet. This capability was especially oriented toward the hub-and-spoke deployment scenario that was mentioned at the end of Part 1.

The 4.0 release also unified and improved two human-to-application portal applications: Navision Commerce Portal (for customer, vendor, and partner access and self-service through a Web browser) and Navision User Portal (to provide personalized browser-based remote access to the solution for employees). For functional enhancements, there were improvements in the realm of financial management such as inter-company postings, partial payments, or an audited reversal of journal posting transactions.

Also delivered were industry templates to reduce the time it takes to configure the different modules for different specialist industries. Among the many industries that were supported in Microsoft Navision 4.0 were furniture and electronics engineering.

Microsoft Dynamics NAV 5.0

In 2006, Microsoft released Microsoft Dynamics NAV 5.0, which continued to leverage the parent company’s technology stack. For instance, users can now export data to Microsoft Office Excel and Word simply by clicking on the respective Excel or Word icons in any Microsoft Dynamics NAV screen.

Furthermore, users can synchronize common tasks in the suite with respective tasks in Microsoft Outlook. Namely, users can schedule meetings, manage contacts, and send e-mail messages in either application, and the data will automatically be updated in both programs. In fact, any field from any table in Microsoft Dynamics NAV can be synchronized with Microsoft Outlook. The only limitations might come from what the company’s information technology (IT) administrators decide to put as restrictions on a given user.

The Record Links feature makes unstructured information from all kinds of sources (e.g., e-mails or Web sites) easily available via links in Microsoft Dynamics NAV to increase productivity. In this product release, users can add links to any Web site or file stored on a document management system such as Microsoft SharePoint. For example, users could create links from an item in Microsoft Dynamics NAV to a product Web site, a video demo of the product, images of the product, or to other documents created in Microsoft Office.

Record links can be created in any Microsoft Dynamics NAV’s screen form, and can also be moving links. This means that when the same information is automatically moved from one area in a NAV application to another, the link will follow. For example, links created in sales quotes are automatically copied to the corresponding sales order when it is created, and to the invoice when it is posted.

Another convenient and time-saving feature comes from integration to Microsoft Windows Live Search Maps (previously Windows Live Maps and Windows Live Local). This nifty capability makes it easy to get a map and driving directions to a customer or business partner’s location directly from Microsoft Dynamics NAV (by simply clicking a button next to the relevant address, e.g., in the customer file or from the shipping manifest).

Continuing the work started in Navision 4.0, the built-in business analytics take advantage of the capabilities of Microsoft SQL Server Analysis Services (SSAS) so that users can present meaningful information in a more appealing way. With online analytical processing (OLAP) tools enabled by Microsoft SQL Server, users can draw upon table relations within Microsoft Dynamics NAV 5.0 for a multi-dimensional view of data. These OLAP cubes can then be accessed in a reporting application tool, such as Microsoft Excel or the original Navision’s Business Analytics Advanced Viewer.

The abovementioned Commerce Portal was discontinued, but not necessarily because Microsoft SharePoint became the standard Microsoft Dynamics portal technology. Rather, SharePoint is primarily used internally in the organization using an intranet or extranet. But an e-commerce solution has quite different requirements, especially if you sell in a business-to-consumer (B2C) scenario.

Hence, providing e-commerce solutions for Dynamics NAV is a now a partner game with independent software vendors (ISVs) like DVP or Script Server. Dynamics NAV partners offer all things related to electronic commerce, including managing the volume load (you never know if you have 10 or 100,000 customers hitting your e-commerce storefront at the same time), payment services, etc. Partners have reused the business logic in NAV, so that items, prices, item pictures, etc. are still all maintained in NAV and the orders end up being processed in NAV.

For conducting automatic Internet-based commercial transactions in an application-to-application (A2A) manner, there is still the original Navision Commerce Gateway. It is a business-to-business (B2B) document integration solution based on Microsoft BizTalk Server. Commerce Gateway maps and trades business documents between Microsoft Dynamics NAV and other systems. Microsoft BizTalk Server works with the Microsoft Dynamics NAV application server to automate and speed up transactions like sales order handling.

But in addition to becoming ever more compliant with Microsoft’s technology stack, the 5.0 release featured a number of functional enhancements such as sales and purchase document approval; prepayments; inter-company purchase cost distribution; service order handling; account schedules; inventory costing; job shop control; item tracking; and kitting. Last but not least, to aid partners’ productivity, Dynamics NAV started leveraging the Microsoft Dynamics Sure Step rapid implementation methodology.

Enter Microsoft Dynamics NAV 2009

Coming back to the main topic of this blog series, late 2008 saw the sixth major release of the product, dubbed Microsoft Dynamics NAV 2009. As for the application’s new functionality (or functional enhancements), this was delivered with NAV 5.0 and deliberately kept out of the NAV 2009 scope (except of course for the RoleTailored UX feature, which some could argue is a functional enhancement).

In addition to the new RoleTailored UX design (via over 20 Personalized Role Centers) and improved business intelligence (BI)/reporting capabilities (which have all been replicated from earlier deliveries of these features within the Microsoft Dynamics AX 2009 and Microsoft Dynamics GP 10 products). Dynamics NAV 2009 is additionally compliant with Microsoft .NET Framework Web Services for A2A integration, and exhibits a new “thinner client” technology within a three-tier architecture blueprint.

You can explore the Microsoft Dynamics NAV 2009 product on your own (just follow along the guided exercises and demos by simply logging onto the test drive environment here using a Web browser), and without having to install it on your computer. The final part of this blog series will analyze how this product release might have mitigated the many traditional flaws of Microsoft Dynamics NAV (and former Navision) while building upon its traditional (if not proverbial by now) positive traits.

ERP Vendors, Are You Green Enough

Disclaimer: The idea behind this post is strictly based on an assumption that has no scientific proof—and an approach that is very simplified. Thus, the results and conclusions should not be used for any serious purpose.

Recently, as a member of the TEC Green Team, I went through over 20 enterprise resource planning (ERP) vendors to examine elements within their offerings that help companies tackle environmental issues. During the research process, I got the impression that there seems to be a relationship between vendor size and the greenness of their offerings.

To confirm my impression, I took a super simplified approach. For vendor size, I used the annual application revenue data (year 2006) from a report produced by AMR, and for the greenness, I simplified it to the number of search results that include “green” on the various ERP vendors’ sites. Google was used as the search engine. (If you are not familiar with how to search only within one specific website, take a look at the “domain search” here.)

I picked the top 7 vendors because 7 is my favorite number. Also, I believe that the rest of the vendors won’t really change the trend line that I’m going to show, due to their insignificant numbers (in terms of both revenue and green count).

A few adjustments were made while collecting the green counts. For Microsoft, I narrowed down my search to microsoft.com/dynamics/ instead of the company’s homepage, and for Sage Group, I included both sagecrmsolutions.com and sageaccpac.com. Here are the results.

FIG. 1

For the next step I combined the green counts with the application revenue of each vendor and produced a chart (see FIG. 2). Each dot represents each vendor’s position on the revenue/green count quadrant. A linear trend line (instead of other more complicated trend lines) was then generated to see the linear relationship; the formula of the trend line is y=1.7564x – 1131.1.

FIG. 2

To verify whether the determined pattern between these two groups of data (revenue and green count) made sense, I calculated the correlation between the two variables. The result was 0.91. Not bad, because it is close to 1, the perfectly positive correlation.

Having completed all of the above steps, my conclusions is that, in general, the bigger an ERP vendor is, the more green capability it can (or shall) offer. What else we can do with the chart?

ERP vendors may use the trend line to determine whether they have enough green exposure on the Internet. For example, if your revenue is $1 billion, your green count benchmark should be 625 (convert your revenue into $M and plug it into the formula mentioned above, 1.7564*1000 – 1131.1 = 625) If you have high green count then you are doing better on the environmental issue than the average, and vice versa. Adopting organizations may use it to determine above-average vendors to build their competitive edge in tackling environmental issues.

One big flaw of this research model is that the word “green” didn’t always relate to environmental issues. “Green” could be the family name of a person who works for a vendor, a part of the company name of a vendor’s client, or the original meaning – the color. So once again, please don’t trust the trend line results above. This is just for fun.

What Keeps EAM/CMMS Away From PLM

Today, many assets are designed and manufactured with the help of product lifecycle management (PLM) tools and systems, which contain highly valuable product definition information for enterprise asset management (EAM) and computerized maintenance management system (CMMS) operations.

That being said, if there is a way to tie the two systems (EAM and PLM) together, the result will be beneficial to original equipment manufacturers (OEMs), asset owners, and third-party maintenance service providers. However, this isn’t an easy job. The following are a few barriers between EAM and PLM as I see it.

1. Two Different “Lifecycles”

Yes, the product lifecycle (PL) and the asset lifecycle (AL) are similar. Both of them may begin at a strategic starting point (e.g., PL begins with planning the next offering for the market, and AL begins with planning the next purchase of equipment for a factory) and finish at the disposal stage. However, the difference between the two is also obvious. Quite often, the concept of “product” in PLM doesn’t coincide with the physical asset within EAM. In PLM, a product is likely to be a model or a version, which may have multiple physical instances. In other words, in the development process, a product is not serial-number-sensitive in many cases. Even cases in which the product structure contains part serial numbers, usually a PLM system finishes its job at the stage when the product is built.

To EAM, the original configuration of an asset at the time when it is delivered is helpful, but asset maintenance history and current configuration are more important with the passing of time. One solution for this situation is to connect EAM and PLM to each other.

2. Integration across Organizational Boundaries

As discussed above, it makes sense for an EAM system to be able to retrieve product design information from a PLM system and for a PLM system to receive maintenance records from an EAM system. Actually, some PLM systems are able to manage as-maintained product configuration, which means that the systems are capable of creating and maintaining configuration information for each physical asset. However, there are remaining issues, such as how asset owners or maintenance service providers will be able to access the product information as needed and how well the configuration information will be maintained every time a maintenance task is performed—given that PLM systems and EAM systems belong to different owners.

The integration between EAM and PLM is not only a technological issue, but also a business issue. I’m wondering if the whole ecosystem has found a way to distribute fairly the responsibilities and benefits associated with the integration between the two systems.

3. Intellectual Property (IP) Rights

Before cross-organization integration becomes feasible, an alternative solution is to implement a PLM system on the EAM side. More precisely, a product data management (PDM) system will suffice for the requirements of better managing product/asset definition information, since EAM will be able to manage the rest. Disregarding the cost of embracing another system, this solution has another difficulty—the intellectual property (IP) issue. As an asset owner, even if you have an in-house PDM system, how likely is it that your equipment providers will share their detailed design information so you can maintain it in your own system?

Retrieving design information directly from an OEMs’ PLM servers also faces the same IP control issue, but it seems to be more manageable, since the OEM can have control over what product information can be disclosed and what procedures are used to authorize access to that information. When the capability of storing computer-aided design (CAD) models in a non-file-based way is ready (which means CAD models are collections of objects in the database rather than distinct files), secure and efficient IP control may become even easier. However, in my opinion, IP control over product design information in a collaborative work environment is a complicated issue that can’t be resolved in a short period of time.

These are the barriers between EAM and PLM that I’ve seen. A blog series by P.J. Jakovljevic addresses some of the challenges from the strategic service management (SSM) perspective. What I can leave you with is an imaginary scenario like this:

One day, when a maintenance request is submitted to an engineer at the asset owner, AO-1 Company, he searches for a resolution based on the description of the problem. Unfortunately, within either AO-1’s or the equipment provider OEM Company’s database, he can’t find a satisfactory answer. However, a search result about a different company—AO-2—seems very applicable. This search result is about a resolution of the same problem, requiring the replacement of a certain part, which unfortunately is not in the inventory at AO-1. The engineer then submits an order request to the OEM and is informed that it will take 2 days for the OEM to ship the service part. In addition, the OEM also notices that within AO-1’s part inventory, there is another part that can be used as a substitute after light modification, which can be performed on-site, easily and quickly. After the engineer chooses the second option, he receives a dimension specification for the modification and a 3D animation of how to replace the part. The engineer then is able to complete this maintenance task and log the information in the EAM system before finishing his day. The OEM’s PLM system then realizes that this has become a repeating problem and routes it to the design team