Logistics Management - June 2010

lurs the line
logistics applications in a seamless manner.
“Customers are looking for tightly-integrated systems,”
says Shepherd, who sees order management-to-fulfillment;
warehousing-to-financials; distribution planning-to-manufacturing;
and procurement-to-warehousing as the most
critical ties that shippers are looking to make with their
ERP systems.
The economy is also driving more shippers to turn to their
ERPs for supply chain software. “Logistics departments use
to be able to pick whichever products they wanted to address
their needs,” says Shepherd. “Now, the corporate IT department
is more likely to be in charge of that selection process,
and that group is more likely to select an ERP vendor to fulfill
the need.”
Trends coming into focus
The fact that ERPs are making significant inroads in the
supply chain space is no surprise to the analysts interviewed
for this story. In fact, all four saw the trend taking hold more
than five years ago and further cemented in 2005 when Oracle
purchased G-Log, a privately-held firm that developed GC3
(Global Command and Control Center), a transport management
and freight optimization system that’s since been
replaced by Oracle Transportation Management (OTM).
“Here’s an ERP player that acquired a TMS provider, and
that continues to win deals as a best-of-breed TMS provider,”
says Adrian Gonzalez, director of Dedham, Mass.-based ARC
Advisory’s Logistics Executive Council. “Oracle can also win
deals by folding the otherwise standalone TMS as part of its
own ERP system.”
Oracle’s gutsy move into the best-of-breed supply chain
software space was soon followed by other such acquisitions,
and later by the internal development of WMS and
TMS software by leading ERP providers. But even as the
line between ERPs and supply chain software continues to
blur, there are some key issues that shippers need to consider
before deciding which route to take.
“It really doesn’t matter where the solution is coming from;
there are still integration challenges to deal with, business
processes to understand and solutions to configure,” Gonzalez
points out. “It doesn’t matter whether you’re using an ERP or
a best-of-breed system, those challenges will still be there.”
Gonzalez says shippers should also be aware that the
age-old arguments regarding standardization and concerns
about a single technology platform being easier to install and
integrate are no longer valid. Thanks to open standards and
service-oriented architecture (SOA), nearly all software solutions
can be more readily “hooked into” existing systems.
“There’s definitely some parity now in terms of integration,
whether you’re taking the ERP or best-of-breed
route,” says Gonzalez. “At this point, neither choice is easier
or more difficult than the other.”
What shippers should be thinking about is whether or not
an all-encompassing ERP provider can offer up the depth of
If purchasing/upgrading ERP software
during the next 12 months, will your
ERP application contain a...
56%
49%
45%
52%
WMS module
Not
asked
in 2007
24%
TMS module
2007 2008 2009 2010
Source: Logistics Management’s 2010 Software User Survey
34%
27%
June 2010 | WWW.LOGISTICSMGMT.COM Logistics Management 39