Oracle Supply Chain Management


Dec 31, 2010

Last week’s Oracle Open World event at the Moscone Center in San Francisco provided an opportunity to gain insight into both the future direction of Oracle’s EAM applications and users’ best practices. The following highlights provide potentially rewarding ideas for companies that use Oracle for enterprise asset management (EAM).

Upcoming Fusion Applications and EAM

Oracle Fusion Middleware enables customers running Oracle E-Business Suite, PeopleSoft, Siebel, and JD Edwards to extend the business functionality. Oracle Fusion Middleware provides an extensible platform for applications layered on it. According to Oracle, 78 percent of customers using these Oracle applications have installed Oracle Fusion Middleware.

Oracle announced the planned release of Oracle Fusion Applications 1.0, which will be available in Q1 2011. The applications focus around:

· Customer Relationship Management

· Financials

· Governance, Risk, and Compliance

· Human Capital Management

· Procurement

· Project Portfolio Management

· Supply Chain Management

An Oracle customer’s strategy is straightforward. With Applications Unlimited, they can continue with their existing applications. If a function no longer meets their needs, they can augment it by building on Oracle Fusion Middleware with customization and/or adding an Oracle Fusion Application. Larry Ellison, in his opening keynote, stated that Oracle Fusion Applications is based on the best functions among Oracle E-Business Suite, PeopleSoft, Siebel, and JD Edwards. Thus, Oracle Fusion Applications should represent best-in-class functionality.

Future releases of Oracle Fusion Applications will increase their depth and add new applications. Since all four of the applications within Applications Unlimited have modules for EAM, ARC believes it is reasonable to expect an Oracle Fusion EAM application sometime in the future.

MRO Inventory Optimization with ERP/EAM

During an interview at OpenWorld, Andy Binsley, Sr. Director, Manufacturing and ALM Product Strategy at Oracle, explained the benefits of an integrated application (ERP including EAM) for MRO inventory management and optimization.

In most companies, MRO materials offer a significant cost improvement opportunity. Usually, inventory is bloated because maintenance, focused on high equipment uptime, has a clear interest in having parts available "just in case." Also, with each new piece of equipment and upgrade, new part numbers are created that duplicate some existing stocking units (SKU) – the same parts have multiple SKUs. Generally, the longer the plant has been in existence, the larger the opportunity for optimization – particularly in asset-intensive industries like chemicals, oil & gas, and utilities.

ERP includes modules for purchasing and inventory management. Since these modules are developed for direct materials, they are typically robust and well featured. These modules can also be applied to indirect, MRO materials. ABC classification focuses attention on the higher dollar volume, "A" items that provide greater financial benefit with optimization. Automated tools revise minimum/maximum levels based on changes in lead time, usage, supplier risk, and other factors. Some Oracle customers use advanced supply chain planning (ASCP) for a time-phased procurement plan that is regularly updated based on demand, inventory levels, and supplier parameters. These inventory management tools apply to MRO items with recurring usage for improved cost control and profitability.

Spare parts for critical equipment – where extended downtime has extreme negative financial impact – starts with reliability analysis. The business intelligence and analysis tools in an ERP suite help identify the critical equipment operating near capacity and constraining overall plant production output. Spare parts with extended lead times use simple min/max inventory management with the min set to one. Rather than stocking multiple units for various sites, supply chain management tools determine the best location of an expensive spare so one item can support several sites. The reduction in inventory conserves cash and benefits the balance sheet.

An Oracle customer in the utilities industry delivered a presentation on the company’s JD Edwards implementation. He provided insight into the benefits of "inventory data cleansing," i.e., reducing duplicate SKUs and adding category codes. Now, the utility’s technicians can search the MRO inventory and database using familiar "Google-like" search keywords, including non-case-sensitive wild cards. Also, search results have images that help the technician easily validate that they found the correct part. This usability, combined with cleansed data, provided value to the technicians and secured their buy-in. Also, clean data provides management with meaningful analysis and value.

Typically, maintenance teams focus on the equipment and give optimization of MRO materials little attention. Inventory management usually represents "low hanging fruit" to enhance financial performance in both profitability and cash conservation. Members of the maintenance team – particular those having planning responsibilities – will benefit from APICS (Association for Operations Management) training. They will better understand the fundamentals of inventory management and gain confidence applying these to MRO materials.

EAM integration with Shop Floor Systems

Users apply Oracle Manufacturing Operations Center (MOC), available for over a year, for production management, MES, and sustainability pro-grams. During OpenWorld, an Oracle customer in the mining industry described their application for condition monitoring.

MOC offers prebuilt performance dashboards and reports for real-time information and decision support. MOC has adapters to collect data from a variety of sources including automation systems, ERP, and EAM. Going beyond just information display, MOC has a rules engine for optimizing manufacturing operations that can also be applied to asset maintenance. This engine provides an event management framework including event occurrence, event monitoring, and event action. MOC can be integrated to equipment and automation systems using third-party device communications from Kepware, Matrikon, ILS Technologies, and Mitsubishi.

For the mining customer, visualization provided a complete view of the supply chain across organizational silos. This particular client also applied MOC for condition monitoring to identify equipment issues in real-time. The customer stated they have anticipated failures by four to six hours, preventing costly downtime.

Last Word

Oracle continues to execute on its promise with "Applications Unlimited." Users of Oracle E-Business Suite, PeopleSoft, Siebel, and JD Edwards can all preserve their investments, while benefiting from a clear strategy for adopting new technologies with Oracle Fusion Applications and Oracle Fusion Middleware.

Inventory optimization provides benefits the C-suite appreciates, such as improved profitability and cash conservation. Maintenance teams can leverage the existing inventory optimization modules in ERP. Investing in training for inventory management should yield excellent returns – as it did for Oracle clients.

For rotating equipment, condition monitoring suppliers typically couple their application with vibration sensors. Other industries could also benefit from effective condition monitoring, but solutions are lacking. MOC can fill the gap, as it did for a mining company.

Oracle has been growing both organically and through acquisitions. OpenWorld has also expanded and now fully occupies the substantial Moscone Center and spills over into nearby hotel conference rooms. The presentations and exhibit halls cover a broad range of technologies, products, customers, partners, and more. Plentiful information is available that can provide good business benefits – just be sure you have comfortable walking shoes.

ARC clients can view the complete report at  EAM Highlights from Oracle OpenWorld



Oracle Manufacturing Summit Co-Located with Panduit Showcase (Oct 26-28, Chicago)

By on September 8, 2010 1:46 PM

The 3rd Annual Oracle Manufacturing Summit will be held October 27 – 28, 2010 in Lisle, Illinois. It’s part of "Manufacturing Week" and is co-located with, and follows, the Panduit Reference Event. The Oracle Manufacturing Summit starts with a reception on October 27 and continues the next day with thought leadership content from Cummins, Leggett & Platt, Ingersoll Rand, Sherwin Williams, Cabot Microelectronics, and others. The agenda includes tracks for discrete, process, and lean manufacturing. Please note: The Panduit "Next Generation Enterprise" reference showcase is set for October 26 to 27 at the nearby Panduit HQ and features a site tour. Customers can attend either event, but  encouraged to attend both.
Learn more about the Manufacturing Summit.
Check out the Panduit Showcase

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August 31, 2010

Webcast: Genzyme Demand Management Success Story

By Paul Homchick on August 31, 2010 12:52 AM

Attend our live webcast, September 9th at 11:00 PT / 1:00 ET, to to hear Donna Malloy, Associate Dr. Demand Planning, and Ralph Martin, IT Business Relationship Manager, share specifics on how Genzyme Diagnostics implemented Oracle’s Value Chain Planning solutions with HCL Tech’s services to achieve real time, accurate and shorter forecast cycles with collaborative, proactive budgeting & planning across multiple functions and geographies. Register using this link.


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August 26, 2010

Learn About Oracle’s Advances in On Demand Procurement

By on August 26, 2010 3:50 PM

Oracle has made huge strides delivery of on demand procurement solutions. The success of Oracle Procurement On Demand has received attention from customers, bloggers like Jason Busch of Spend Matters, and analysts like Mickey North Rizza of Gartner.

If you’re curious to learn why, there’s an upcoming webcast you shouldn’t miss. On September 9th at 2pm EST Oracle and our partner Deloitte will host webcast explaining how Oracle Procurement On Demand enables and accelerates procurement transformation. In order to attend , you’ll have to register.


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August 25, 2010

AT&T’s 12.1 Upgrade Story

By on August 25, 2010 1:04 PM

Whether you’re actively planning an E-Business Suite upgrade or just curious, there is golden opportunity to learn more from communications bellwether AT&T. On Friday August 27th, AT&T will be sharing its story on an Oracle Customer Success Forum.

Customer Success Forums are informal, interactive, and give listeners the opportunity to interact directly with presenters. On this call, participants will have the opportunity to speak firsthand with AT&T. AT&T will open with a brief overview of its 12.1 upgrade experience, followed by candid discussion and an open question and answer session.

Please allow one hour for the call and registration is required.


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August 18, 2010

Oracle at the S&OP Innovation Summit – Boston, MA – Sept. 9th & 10th

By Paul Homchick on August 18, 2010 10:09 PM

Oracle is a sponsor and will be attending the IE Group’s S&OP Innovation Summit in Boston, the first of its kind on the East Coast. This Summit will bring together forward-thinking business leaders to shape the revolutionary ideas that spark innovation in
Sales & Operations Planning.  Join professionals from Alkermes, Analog Devices, Black & Decker, Bose, Chemtura, Fairchild Semiconductor, Nuance, Sharp, and Siemens and Oracle in learning about the newest technologies and best practices in sales and operations planning.
Oracle will be talking about our exclusive offering in Integrated Business Planning, and our new Rapid Planning tool.
More information (including registration details) is available here.


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August 16, 2010

Upgrading to EBS 12.1

By on August 16, 2010 6:03 PM

Gartner just published a positive report on Oracle’s E-Business Suite (EBS) 12.1.  This report validates the benefits of upgrading to EBS 12.1.
Oracle has purchased the external distribution rights to this research note.
For the link, and more information on this research note, please visit the Oracle Applications Analyst Relations Blog, or the individual blog post, here.


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Transportation Event Huge Success

By on August 16, 2010 5:24 PM

Gartner just published a VERY positive report on the Annual Oracle Transportation Management (OTM) Special Interest Group (SIG) Meeting in Philadelphia.
Oracle has purchased the external distribution rights to this research note.
For the link, and more information on this research note, please visit the Oracle Supply Chain Management Analyst Relations Blog, or the individual blog post, here.


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August 11, 2010

Customer Showcase Event at Panduit Oct 26-27, Chicago

By on August 11, 2010 1:00 AM

Panduit and Oracle will host a two-day interactive showcase focused on how the company has become a "Next Generation Enterprise." Panduit is a world-class manufacturer of leading-edge solutions for optimizing physical infrastructure. The showcase will take place at their new ‘green’ world HQ in Tinley Park, Illinois just outside Chicago. (note: use Midway over O’Hare if possible)

Attendees will have access to keynotes from Panduit, Oracle, and industry thought leaders; breakout sessions; demo grounds; and facility tours of Panduit’s HQ. This event is geared toward accounts from across North America who want to learn more about how Oracle can help our customers evolve into next generation enterprises.  The showcase will be followed by a Manufacturing Summit on Oct 28th.

More info to follow.

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August 3, 2010

Value Chain Planning – Rapid Planning Webcast

By Paul Homchick on August 3, 2010 5:41 PM

Attend our live webcast, August 19th at 10:00 PST / 1:00 EST, to learn how Oracle’s Rapid Planning solution can help your business improve production planning and reduce costs with event-driven real time planning and simulation. Register using this link.


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