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by David O'Brien , Contributing Editor, David Caruso, Contributing Editor Posted on Wednesday, June 01, 2005 12:00:00 PM   The next-generation of manufacturing and supply chain operations is based on the Demand-Driven Supply Network (DDSN) concept. In it, end-user requirements will drive all supply chain activities among trading partners. The demands of servicing this end-user demand are straining in-house manufacturing models and traditional manufacturing technologies. In February and March of 2005, AMR Research and Managing Automation conducted a joint study to understand the impact that this new operational model will have on current and future ERP investments -- the traditional backbone of manufacturing information and intelligence. Many organizations, particularly smaller manufacturing shops, have realized that they do not have the IT architecture to compete in the new demand-driven world. The result is rapid greenfield adoption in the lower end of the manufacturing market. In addition, companies with existing ERP systems are taking a renewed look at their capabilities. Many are making substantial changes: adding functionality, upgrading to gain access to a broader, integrated suite of products or evaluating replacement of their existing ERP systems. ERP is rapidly becoming mainstream, as penetration and adoption in the large enterprise-class (2,500+ employees) market reaches almost 70%, consistent with other AMR Research studies. (See Figure 1, next page.) What is new is the acceptance of ERP technology in the mid- and low-end of the market. Sixteen percent of respondents are evaluating an ERP system for the first time in 2005. Today, small and mid-tier businesses are readily evaluating systems to help them manage their organizations. In fact, companies with fewer than 2,500 employees are two to three times more likely than their larger counterparts to be considering an ERP system in 2005. [Click to continue] |