Demand-driven manufacturing is new business goal

Demand-driven manufacturing, not simply as in make-to-order, but as in real-time, integrated end-to-end supply chain, order- and intelligent selling-driven operations, that’s the new push from the big enterprise software vendors. PeopleSoft is the latest: due out with software imminently that Carol Ptak, the company’s global vice president of manufacturing (who co-wrote Eli Goldratt’s second Theory of Constraints (TOC) book), says it will massively improve users’ profitability. She describes that system as supporting lean thinking and TOC, through extended, integrated ERP with intelligent analytics and Demand Flow algorithms. It will also lean heavily on web technologies for the supply chain synchronisation and responsiveness elements. Tellingly, she believes that, as manufacturers’ business leaders adopt throughput-orientated KPIs over more conventional accounting measures, the benefits will kick in. That will mean a requirement for more cultural change, along lines already established, and holistic thinking – so it won’t come that easy. Ptak describes configurable, prescriptive analytics to drive opportunity management in terms of cross-selling, up-selling and the like, supported by integrated knowledge of supply chain capacity, constraints, orders, forecasts and so on. For PeopleSoft, Demand Flow – its acquisition from JCIT in the US – is the generic term for the behind the scenes ‘engine’ that will make much of this possible, working down from collaborative forecasting. Ptak talks calmly of a “quantum leap” in manufacturing, and of the company working again with Goldratt on his latest ‘Viable Vision’ offer, “to bring the company to have, in less than four years, net profit equal to its current total sales.”