MarketScope for Supply Chain Planning: Process Automation

MarketScope for Supply Chain Planning: Process Automation, 2009 28 April 2009 Tim Payne Gartner RAS Core Research Note G00163278 SCP capabilities exist along a continuum between process automation and process innovation. The bulk of users and vendors are orientated toward process automation, which is the focus of this MarketScope. What You Need to Know Through 2007 and early 2008, the market for supply chain planning (SCP) technology enjoyed a healthy period of growth. Through 2007, the SCP global market saw increases over 2006 of 19% (the best year's growth since the beginning of the decade. SCP spending now represents nearly 40% of all supply chain management (SCM) spending — the biggest sector of SCM. Prior to the recent economic downturn, Gartner was projecting approximately 11% compound annual growth rate (CAGR) through 2012, based on companies' needs to drive more efficiency and, in some cases, more effectiveness out of their supply chains. With the impact of the downturn, we are currently forecasting a 7% CAGR to 2013 for SCP technology, which illustrates the importance of SCP technology to support supply chain efficiency. Some ERP vendors (for example, Oracle and SAP) have made significant investments in their SCP applications and provide solid foundations for SCP process automation initiatives, as separate suites to their core ERP offerings. Some best-of-breed vendors have evolved to support SCP from a more-integrated perspective, and have recognized that a sizable proportion of the market is looking for "good enough" process SCP automation functionality, with an easy-to- deploy and easy-to-use framework that will support fast and targeted return on investment (for example, Logility, OM Partners and JDA Software). Often, for SCP process automation implementations to work and be successful, the user organization needs to find a way to quickly accept and adopt the necessary business model changes, rather than customize the SCP solution to meet its exact process needs. Typically, the deployment of the software is not the rate- determining step alone; however, unusual requirements and/or endless changes will take longer.