Overcoming The Obstacles To APS

It's no secret that APS (advanced planning and scheduling) vendors have been struggling to hold their market share recently. They have been battling the perception that ERP (enterprise resource planning) and SCM (supply chain management) solutions can provide the same functionality (see "Is APS Obsolete?" Integrated Solutions, April 2001). The technology also faces some inherent challenges in implementation.

"The complexity of the application is causing some people to take a second look at this technology. There is continued interest, but it isn't a panacea," comments Mike Campbell, president and CEO of Demand Management, Inc. (St. Louis). According to Campbell, many people underestimated the amount of data maintenance necessary to keep the system functioning. As a result, there has been greater emphasis on the planning aspect of the application over the scheduling aspect. "All you need is one glitch and the entire system is no longer responding accurately," says Campbell.

Matrikon Inc.'s executive VP of sales and marketing, Dilip Kembhavi says that vendors have responded to concerns about the complexity of APS by offering solutions with much shorter implementation time, sometimes as little as three weeks. Stand-alone solutions can be integrated with in-house systems more readily than previous versions of APS software, and users can realize 75% to 80% of the value of the system much more quickly. "Customers still have to accept the complexity of APS, but the normal constraints and best practices should already be a part of the product," notes Kembhavi.

Decision Support Vs. Decision Making
Those constraints and best practices are intended to save time and increase efficiency for users, but Kembhavi points out that some users make the system more complex than it needs to be. For example, forcing constraints or including too many constraints not only complicates the administration of the system further, it also robs the application of its greatest value: flexibility. It then becomes a tool to validate an existing decision rather than one which helps managers make better decisions.

Campbell feels that some users may not be getting the full value of the technology because they haven't seriously defined the benefits of their planning in improving execution. "Sometimes the result is that a facility just does the wrong thing faster by automating a mistake," says Campbell.

Kembhavi agrees that anyone considering an APS implementation must be willing to accept drastic cultural changes, rather than just programming the APS to replicate the way things have always been done. He recounts a recent experience in which the system faced resistance from both employees and management. Pockets of individuals within the organization wouldn't follow the schedule provided. Senior management insisted that one area of the plant, which was viewed as a key indicator, be utilized at a certain level. Though the plan illustrated how throughput might be increased by decreasing usage in that area, management insisted on those levels. Bottlenecks resulted both up and downstream, and no benefit was realized.

Is ERP Enough?
ERP vendors in particular have downplayed the importance of APS, saying that a good ERP system can provide the same functionality. However, Kembhavi reports that giants like Oracle and SAP are beginning to take a closer look at APS as B2B exchanges claim a greater share of the market. Supply chain synchronization, another rising technology, also demands accurate planning and scheduling. For companies that can't justify the cost of an Oracle or SAP implementation, Kembhavi foresees that the answer will be less expensive stand-alone products that often provide payback in as little as three months.