|By Jeri Donn||
|October 5, 2012 09:45 AM EDT||
Cloud computing has changed the way we work. People and businesses can now access services, applications and infrastructure over the Internet, with lower costs, higher productivity and an enhanced user experience.
While cloud computing has revolutionized many aspects of business, its effects have been quite dramatic across supply and demand management. Cloud-based Sales & Operations Planning (S&OP) is particularly powerful, connecting disparate demand, supply and financial data from a wide swath of packaged and home-grown enterprise information systems as well as a forest of spreadsheets, harmonizing everything into a single, meaningful plan. Delivering this supply chain "Big Data," analytics and reporting in the cloud means that it can be deployed, scaled, and interconnected quickly, enabling truly collaborative supply and demand planning.
Cloud makes S&OP faster, more transparent and collaborative. It works, it's proven, and it can immediately adjust as needed based on changing business demands. Applications delivered via cloud not only makes it easier to connect disparate business processes and applications, it eliminates the traditional ‘forklift upgrade' process of traditional software vendors. Keeping up with the latest innovations is automatic, so enterprises can focus on their business instead of technology issues.
An Early Commitment to Cloud for Enterasys
For wired and wireless network infrastructure supplier Enterasys Networks, the cloud was not simply a path to IT value and cost savings, but rather it is considered a strategic weapon for competing against very large competitors. Enterasys has rolled out a broad range of cloud solutions company-wide, from gmail and Google Apps, in addition, to replacing Microsoft SharePoint, with Box for cloud-based content management and on-line collaboration. An avid advocate for cloud, Enterasys CIO Dan Petlon is a member of the customer advisory board for its cloud CRM solution, SalesForce.com.
One of its early business processes to benefit from cloud computing is S&OP, a journey which began in 2005. By harnessing the power of the cloud through S&OP vendor Steelwedge to better align its demand and supply plans internally as well as with suppliers and customers, Enterasys has achieved better demand predictability, reduced inventory and contributed to a 95% rate of global customer satisfaction.
The company's achievements have not gone unnoticed. Because of their innovative S&OP use of cloud computing, Enterasys has been recognized by Gartner as embodying advanced S&OP Maturity. The company's exceptional S&OP practices have resulted in three years of sequential growth during a period its peers were plagued with sluggish growth. With cloud-based S&OP technology, Enterasys identified $3 - $4 million in savings per quarter, and, in 2012, achieved the milestone of eleven consecutive quarters of improved year-over-year growth.
Creating a Demand-Driven Mindset
Enterasys' wired and wireless network infrastructure & security solutions help enterprises stay in front of changing connectivity and security needs. Back in 2004, the company realized that the impact of constantly evolving global business change on its supply chain meant that improving its ability to predict demand was paramount. The firm subsequently embarked on a CEO-driven mission to transform itself into a lean, responsive and much more demand-driven business.
According to Vice President of Operations Jack Lyon, "We needed to do a better job at predicting demand, so that we could reduce excess and obsolete inventory; you own it and have to write it off." Lyon's baseline assessment of supply chain challenges also included order delays, sluggish market response, short product life cycles and organization silos of information. Compounding the problem was a completely outsourced supply chain with contract manufacturers building all of its products.
Enterasys embarked on a mission to create a worldwide collaborative integrated process and methodology that supports and delivers a demand plan with one agreed set of numbers. The company set out to find an IT solution incorporating a S&OP software platform.
S&OP Year One: Anticipating the Market
Within a year of Lyon's assessment, the company improved its bottom line by applying new techniques and cloud-based technology to a proven S&OP process. With the cloud-based S&OP platform from Steelwedge, Enterasys connected its people and processes to better understand operational tradeoffs when changes in the business environment did not align with its business plan. The company selected Steelwedge's S&OP solution because it is built on a single, cloud-based Integrated Business Planning platform used by large, global manufacturers across multiple industries.
Enterasys uses Steelwedge to unite people, process and technology for an agile planning environment and growing business.
In 2005 the Enterasys S&OP process brought together a cross functional group of leaders from sales, marketing, product management, operations, finance and supply chain. At the same time, Steelwedge integrated and normalized the data from each of those groups that resided in their respective systems such as SAP and Salesforce.com --and eventually added in BigMachines as well. From there, Enterasys drove significant and immediate changes in its business starting with better demand predictability, which in turn, directly affected its ability to respond to change.
For example, within a year, the company could determine in near real-time when a product was not selling as well as expected and drive demand-shaping activities to stimulate sales. Alternatively, if products were selling better than forecast, Enterasys could look first at sales data to see if the growth was sustainable, then reach out to its contract manufacturers to ascertain their capacity to boost production short and mid- term.
The bottom line was clear as well: decreased excess and obsolescence accounted for a whopping $3 to $4 million in savings per quarter initially.
But better demand planning was just the beginning of the ongoing transformation that Enterasys continues to drive from cloud-enabled S&OP. Armed with cross-company data and insights, the S&OP team moved its discussions from having enough supply to fill a particular order, to strategizing on improving gross margins. It regularly uses S&OP to power "what if" scenario planning across many facets of its business to understand the impacts of potential changes on customer satisfaction, revenue, sales and production.
Seven Years Later: Collaborating and Orchestrating
Enterasys has taken a purposeful, incremental "win" approach to driving advancement and ROI from its S&OP. Seven years later, the company has a global, collaborative and integrated S&OP process and methodology, powered with the Steelwedge cloud-based S&OP Platform. Its demand and supply plans are aligned internally and externally with suppliers and customers. In turn, better balance is delivering better predictability, better cash spend and better customer success.
Among the results Enterasys achieved from its mature use of cloud-based S&OP:
- Timely and accurate information through automation
- Cross functional alignment through a collaborative planning approach
- Higher customer satisfaction through better fulfillment
- Sustained high global customer satisfaction (ATP): 95%
- Customer fulfillment: over 97%
- Reduced inventory: 21% year over year
- Forecast error (MAPE): averaging 24%
- Revenue impact less than 5% (of material overhead/excess inventory)
Most impressive though was that Enterasys has realized year over year growth for the past three years (2009-2012). Even in 2011, where its sector saw a 3% drop, Enterasys kept growing and outperforming all other networking companies. Critical to that business stability is Enterasys' cloud-based S&OP foundation.
Crawl, Walk, Run, Sprint: the Promise and Perils of Optimizing Business in a Volatile World
Under Lyon's leadership, S&OP has become a key strategic lever for the company's continued market growth and competitive advantage. But Lyon isn't resting on his laurels. He maintains that the ever shifting marketplace requires constant vigilance on agile business planning to maintain great customer success.
"We traded up our problems, by transforming from a manually intensive supply chain into a lean and responsive organization," says Lyon. "For us, success is all about strengthening the collaboration with customers, delivering on our promises and meeting their expectations. Therefore, our optimization work is never done."
In summary, the cloud-based S&OP transformation at Enterasys resulted in the following improvements and lessons learned:
Stronger collaboration within the organization: A demand plan with one agreed set of numbers fosters alignment and a "we're in it together" culture, eliminating finger-pointing.
Better inventory balance: S&OP helps model the optimal inventory balance. Keeping the lowest possible inventory is not always the right solution: balance needs to be struck between revenue growth and high customer satisfaction while protecting the balance sheet.
Automation powers valuable analysis: Integrated data and executive level reports from the S&OP platform facilitate a collaborative, global S&OP process, freeing resource time for analysis vs. data gathering and manipulation. This, in turn, powers continuous improvement and faster process maturity.
Enabling "bluebird" opportunism: Insights from accurate S&OP data and timely "what if" scenario testing supports "bluebird" demand opportunities that weren't in the forecast at all. With tighter contract manufacturer collaboration, this provides reliable answers to questions like: Can we support it? If not now, when? What other options do we have for supply if we don't have it?
Lyon sums up Enterasys' S&OP success by stating, "We've been successful with S&OP because we've taken an iterative, ‘Crawl, Walk, Run, Sprint' approach to implementation, testing, measurement and advancement. "It's a non-stop journey. The only constant in business is change, whether its market disruptions, economic volatility, a natural disaster...or you name it: they all have varying degrees of impact on the process. Achieving a ‘sprint', may only happen for a matter of seconds before continuous improvement kicks in and you re-evaluate. But we have an agile foundation in place to help us deliver better, more consistently-regardless of the circumstance."
What do dependency resolution, situational awareness, and superheroes have in common? Meet Chris Corriere, a DevOps/Software Engineer at Autotrader, speaking on creative ways to maximize usage of all of the above. Mark Miller, Community Advocate and senior storyteller at Sonatype, caught up with Chris to learn more about what his team is up to.
Oct. 24, 2016 03:15 PM EDT Reads: 1,788
As we enter the final week before the 19th International Cloud Expo | @ThingsExpo in Santa Clara, CA, it's time for me to reflect on six big topics that will be important during the show. Hybrid Cloud This general-purpose term seems to provide a comfort zone for many enterprise IT managers. It sounds reassuring to be able to work with one of the major public-cloud providers like AWS or Microsoft Azure while still maintaining an on-site presence.
Oct. 24, 2016 02:30 PM EDT Reads: 458
So you think you are a DevOps warrior, huh? Put your money (not really, it’s free) where your metrics are and prove it by taking The Ultimate DevOps Geek Quiz Challenge, sponsored by DevOps Summit. Battle through the set of tough questions created by industry thought leaders to earn your bragging rights and win some cool prizes.
Oct. 24, 2016 02:15 PM EDT Reads: 3,988
At its core DevOps is all about collaboration. The lines of communication must be opened and it takes some effort to ensure that they stay that way. It’s easy to pay lip service to trends and talk about implementing new methodologies, but without action, real benefits cannot be realized. Success requires planning, advocates empowered to effect change, and, of course, the right tooling. To bring about a cultural shift it’s important to share challenges. In simple terms, ensuring that everyone k...
Oct. 24, 2016 02:00 PM EDT Reads: 12,594
A completely new computing platform is on the horizon. They’re called Microservers by some, ARM Servers by others, and sometimes even ARM-based Servers. No matter what you call them, Microservers will have a huge impact on the data center and on server computing in general. Although few people are familiar with Microservers today, their impact will be felt very soon. This is a new category of computing platform that is available today and is predicted to have triple-digit growth rates for some ...
Oct. 24, 2016 02:00 PM EDT Reads: 34,148
The general concepts of DevOps have played a central role advancing the modern software delivery industry. With the library of DevOps best practices, tips and guides expanding quickly, it can be difficult to track down the best and most accurate resources and information. In order to help the software development community, and to further our own learning, we reached out to leading industry analysts and asked them about an increasingly popular tenet of a DevOps transformation: collaboration.
Oct. 24, 2016 01:45 PM EDT Reads: 1,380
Application transformation and DevOps practices are two sides of the same coin. Enterprises that want to capture value faster, need to deliver value faster – time value of money principle. To do that enterprises need to build cloud-native apps as microservices by empowering teams to build, ship, and run in production. In his session at @DevOpsSummit at 19th Cloud Expo, Neil Gehani, senior product manager at HPE, will discuss what every business should plan for how to structure their teams to d...
Oct. 24, 2016 01:30 PM EDT Reads: 1,329
SYS-CON Events announced today that SoftNet Solutions will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. SoftNet Solutions specializes in Enterprise Solutions for Hadoop and Big Data. It offers customers the most open, robust, and value-conscious portfolio of solutions, services, and tools for the shortest route to success with Big Data. The unique differentiator is the ability to architect and ...
Oct. 24, 2016 01:00 PM EDT Reads: 867
The best way to leverage your Cloud Expo presence as a sponsor and exhibitor is to plan your news announcements around our events. The press covering Cloud Expo and @ThingsExpo will have access to these releases and will amplify your news announcements. More than two dozen Cloud companies either set deals at our shows or have announced their mergers and acquisitions at Cloud Expo. Product announcements during our show provide your company with the most reach through our targeted audiences.
Oct. 24, 2016 12:45 PM EDT Reads: 4,712
When we talk about the impact of BYOD and BYOA and the Internet of Things, we often focus on the impact on data center architectures. That's because there will be an increasing need for authentication, for access control, for security, for application delivery as the number of potential endpoints (clients, devices, things) increases. That means scale in the data center. What we gloss over, what we skip, is that before any of these "things" ever makes a request to access an application it had to...
Oct. 24, 2016 12:30 PM EDT Reads: 13,787
Monitoring of Docker environments is challenging. Why? Because each container typically runs a single process, has its own environment, utilizes virtual networks, or has various methods of managing storage. Traditional monitoring solutions take metrics from each server and applications they run. These servers and applications running on them are typically very static, with very long uptimes. Docker deployments are different: a set of containers may run many applications, all sharing the resource...
Oct. 24, 2016 11:00 AM EDT Reads: 3,583
Virgil consists of an open-source encryption library, which implements Cryptographic Message Syntax (CMS) and Elliptic Curve Integrated Encryption Scheme (ECIES) (including RSA schema), a Key Management API, and a cloud-based Key Management Service (Virgil Keys). The Virgil Keys Service consists of a public key service and a private key escrow service.
Oct. 24, 2016 10:15 AM EDT Reads: 1,078
SYS-CON Events announced today that eCube Systems, the leading provider of modern development tools and best practices for Continuous Integration on OpenVMS, will exhibit at SYS-CON's @DevOpsSummit at Cloud Expo New York, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. eCube Systems offers a family of middleware products and development tools that maximize return on technology investment by leveraging existing technical equity to meet evolving business needs. ...
Oct. 24, 2016 10:00 AM EDT Reads: 4,508
SYS-CON Events announced today that Isomorphic Software will exhibit at DevOps Summit at 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Isomorphic Software provides the SmartClient HTML5/AJAX platform, the most advanced technology for building rich, cutting-edge enterprise web applications for desktop and mobile. SmartClient combines the productivity and performance of traditional desktop software with the simp...
Oct. 24, 2016 09:00 AM EDT Reads: 3,485
JetBlue Airways uses virtual environments to reduce software development costs, centralize performance testing, and create a climate for continuous integration and real-time monitoring of mobile applications. The next BriefingsDirect Voice of the Customer performance engineering case study discussion examines how JetBlue Airways in New York uses virtual environments to reduce software development costs, centralize performance testing, and create a climate for continuous integration and real-tim...
Oct. 24, 2016 08:45 AM EDT Reads: 1,279
DevOps is speeding towards the IT world like a freight train and the hype around it is deafening. There is no reason to be afraid of this change as it is the natural reaction to the agile movement that revolutionized development just a few years ago. By definition, DevOps is the natural alignment of IT performance to business profitability. The relevance of this has yet to be quantified but it has been suggested that the route to the CEO’s chair will come from the IT leaders that successfully ma...
Oct. 24, 2016 07:30 AM EDT Reads: 16,464
Without lifecycle traceability and visibility across the tool chain, stakeholders from Planning-to-Ops have limited insight and answers to who, what, when, why and how across the DevOps lifecycle. This impacts the ability to deliver high quality software at the needed velocity to drive positive business outcomes. In his general session at @DevOpsSummit at 19th Cloud Expo, Eric Robertson, General Manager at CollabNet, will discuss how customers are able to achieve a level of transparency that e...
Oct. 24, 2016 05:00 AM EDT Reads: 889
Enterprise IT has been in the era of Hybrid Cloud for some time now. But it seems most conversations about Hybrid are focused on integrating AWS, Microsoft Azure, or Google ECM into existing on-premises systems. Where is all the Private Cloud? What do technology providers need to do to make their offerings more compelling? How should enterprise IT executives and buyers define their focus, needs, and roadmap, and communicate that clearly to the providers?
Oct. 24, 2016 04:30 AM EDT Reads: 2,520
As software becomes more and more complex, we, as software developers, have been splitting up our code into smaller and smaller components. This is also true for the environment in which we run our code: going from bare metal, to VMs to the modern-day Cloud Native world of containers, schedulers and microservices. While we have figured out how to run containerized applications in the cloud using schedulers, we've yet to come up with a good solution to bridge the gap between getting your conta...
Oct. 24, 2016 04:00 AM EDT Reads: 1,501
DevOps theory promotes a culture of continuous improvement built on collaboration, empowerment, systems thinking, and feedback loops. But how do you collaborate effectively across the traditional silos? How can you make decisions without system-wide visibility? How can you see the whole system when it is spread across teams and locations? How do you close feedback loops across teams and activities delivering complex multi-tier, cloud, container, serverless, and/or API-based services?
Oct. 24, 2016 03:30 AM EDT Reads: 1,064