Manugistics launches end-to-end manufacturing planning and scheduling suite

Integrated end-to-end manufacturing planning and scheduling software for every level – operational to strategic – has now been launched by Manugistics, the company that styles itself the only ‘enterprise profit optimisation’ (EPO – pricing, revenue and supply chain) software firm. At its ‘enVision’ 2001 user conference in Orlando, Manugistics formally launched its much heralded ‘manufacturing strategy’, founded on recently acquired Theory of Constraints (TOC) IT specialist STG at the production management and order promising levels, and existing Manugistics software for supply chain planning, management and fulfilment. STG’s software, now being integrated by the development team, is renamed, with the Advanced Planner Opt21 becoming NetWorks Production Planning and ST Point Planner and Scheduler, NetWorks Production Scheduling. Manugistics existing NetWorks Sequencing suite covers all of production management. It’s an important development – both for Manugistics and for manufacturers. For Manugistics, it moves the firm firmly beyond supply chain logistics and strategic planning and optimisation into the heartland of serious manufacturing. Sam Brown, Manugistics’ European product director, says: “On the manufacturing side we haven’t been seen as particularly strong so acquiring STG was an important opportunity. Now we’re able to offer a complete manufacturing strategy.” And John Watts, formerly with STG and now in Manugisitcs’ manufacturing strategy group, adds: “They wanted the OPT (Optimised Production Technology) brand, the generic, manufacturing-centric solutions and the people – professionals who know the software and the industry. We’re now the biggest company selling the Theory of Constraints solution.” For users, it’s another serious opportunity to harness the Goldratt-developed TOC/OPT technologies and methods of so-called advanced planning and scheduling (APS), and to seriously cut inventory and lead times and improve efficiency and profitability at the grass roots level – and then take that right through their organisations. And coming hard on the heels of the Eli Goldratt (father of TOC) ‘Necessary and Sufficient’ offer, involving SAP, IBM, Mapics and Lilly (see home page), it lends yet more weight to the unconventional, yet very successfully proven TOC movement, which seems at last to be gaining momentum as manufacturers reflect on their ERP investments. Watts: “As far as we’re concerned it lends credibility to the Theory of Constraints. It can only be a good thing. Suddenly the Big Five all want to set up TOC practices, and we’ve been in there for years.” And as part of the Manugistics organisation, he adds: “Now we can walk into a Tier One board and they’re interested.” And that’s another point. It’s generally accepted that STG, which was privately held with just 40 staff at the time of the acquisition, was going through tough times. TOC involves a considerable re-education and process re-engineering burden and, like Goldratt himself, the firm had struggled against the much more powerful traditional ERP/MRP II vendors. Even the surge of interest in APS – with its responsiveness and speed so well suited to the emergent e-business era – failed to stimulate growth. And STG lacked the financial muscle and marketing clout to get in at board level. This despite isolated excellent successes at Xerox, Boeing Rocketdyne and Caterpillar. Under Manugistics, all that’s changed. There’s clearly a good reason for users to be talking to the company at the highest level. But prices will have changed too. STG had tripled its prices in the last three or four years. But under Manugistics, Brown confirms it’s now the classic ‘value proposition’, solutions selling approach – prices based on likely returns. Says Watts: “Certainly, it will be more expensive – at least 50% more.” Given the way of things, long term this may be no bad thing. There is always an element of the higher the cost, the higher perceived value – and it’s in everyone’s interest that the vendor flourishes so that support is ongoing. Looking to the future, manufacturing currently represents about 30% of Manugistics revenues, and while there is no firm forecast for growth from this, Brown says it will be “significant.” There’s also now a clear opportunity for Manugistics to bring its optimisation software to the broader swathe even of SME manufacturers. Says Brown: “There’s an opportunity here for taking the high ground. ERP hasn’t gone away, and we’re not saying it should. Our challenge is to get the planning turned off in the ERP if they ever had it switched on and to move that whole production area up in terms of efficiency and profitability.” Initially, Manugistics is to focus on key verticals: life sciences, chemicals and energy, automotive, aerospace and defence, communications and high tech, and general industrial. Successes for STG since the acquisition by Manugistics include US helicopter manufacturer Kaman and Italian household goods manufacturer Merloni.