Integral Logistics Management — Operations Management and Supply Chain Management Within and Across Companies

9.6.3 Exercise: Software for Transcorporate Planning & Control

Intended learning outcomes: Evaluate the claim of some SCM software salespeople that SCM software at last solves the problems that ERP could not handle. Identify the real reasons for the success of SCM software implementations.

Figure illustrated the SCM software concept and some of the tasks it performs. In this exercise, you will examine this concept further and look at some success factors.

How do you evaluate the claim of some SCM software salespeople that SCM software at last solves the problems that ERP could not handle, such as:

a.    Taking into account capacity constraints when creating production schedules. (Hint: Compare especially the planning principles of the processor-oriented and the variant-oriented concept.)

b.    Finding the correct solution. (Hint: Look very carefully at the structure of Figure

c.    Finding best solutions rapidly (real-time planning).

Finally, consider the more general question that is raised in Section 9.3.1, which discussed possibilities and limitations of the IT support of planning & control:

d.    What are the real reasons for the success of SCM software implementations?


a.    When proclaiming the advantages of modern SCM software, salespeople often contrast SCM with older, outdated versions of ERP software. Ask a salesperson if he or she is familiar with any software for internal enterprise planning & control besides MRP II. Many software packages for the variant-oriented concept (for example, also project management software) and particularly for the processor-oriented concept, subsumed under ERP software, do indeed take capacity constraints into account.

b.    Figure shows that SCM software must get the planning data from a company’s ERP system. This means that the same errors in master and order data are generated in enterprise planning with SCM that were generated using ERP software. Ask the software salesperson about the consequences of erroneous data on lead time in the master data of ERP software for the quality of planning through SCM software. After all, the following principle will hold: “garbage in, garbage out.” Claims that SCM software eliminates the need for ERP software are true only in theory or in very specific cases. Ask the salesperson for examples that correspond closely with your own company’s situation.

c.    Rapid planning through the use of SCM software is generally only the case for variants of a plan that has already been calculated. Ask the SCM software salesperson how long it takes to transfer greatly changed master or order data from ERP to SCM software. Ask for a reference from a company similar to your own in order to learn about their experience with the data transfer.

d.    As in the case of ERP software, the decisive factors in success with SCM software lie in the company culture and the organization of supply chain collaboration. For implementation, therefore, the task is to find appropriate measures for all of the nine fields in the framework of Figure, and not for the ninth field alone.

Course section 9.6: Subsections and their intended learning outcomes