Tag Archives: JDA

JDA hosts a great event…but what does the future hold?

index

I just came back from Nashville, well actually Las Vegas but was in Nashville to start the week. The JDA Focus 2016 event was being held in the Music City. It brought together a large gathering of some of the top supply chain professionals from the around the globe. Per usual, JDA put on a good show, at least the first day since that was what I was able to attend! But even being in Nashville for less than 24 hours, I took away some observations from the event and JDA:

  • Talking a good game – The main stage presentations by CEO Bal Dail and Chief Revenue Office Razat Guarav were in stark contrast to the former administrations. How? Much more focused on the disruptors facing the market and with a keen eye on the future. Bal focused on the company embarking in a “big pivot” focusing on how customers are impacting our businesses. While Razat hit on the major disruptors that face supply chains and our industries. More on both later. What was refreshing was a message from main stage that called out and hit on many of the trends and drivers that we are all facing. Both Bal and Razat also started giving the audience a glimpse into how JDA will address these shifts, whether it is the new retail.me offering, greater emphasis on JDA labs or creating a digital hub, all promising efforts to address their customers’ needs. Coupling their willingness to address new disruptors head on coupled with solutions that are poised to take on these changes was refreshing to hear from this leadership team, not always what would come from main stage.
  • Facing disruptorsand making the pivot – One of the big threads that we at Constellation Research have been working on with our customers were reflected on main stage in Nashville (as much as I would like to take credit for those ideas…alas I cannot). Razat hit on 5 big themes of disruption: mobile, IoT, social, cloud and big data. We speak at length about these disruptors; feel free to read our research, but what is the biggest underlying driver is the rise of the consumer. Many of these disruptors have empowered the consumer, given the consumer a growing voice in the ecosystem. When it comes to the supply chain whether you are B2B or B2C the consumer has become the driver – your business must make this the center of their strategy. The same goes for the technology providers that are servicing these businesses. Bal and his team have a great challenge ahead as they look to pivot themselves to help their customers’ better address the consumers and the disruptors that have made chaos the new norm.
  • So where does JDA go from here? So JDA is painting a picture of awareness and willingness to pivot to meet their customers’ needs. Good. But what does the future hold for JDA? Over the past decade the company has absorbed Manugistics, i2 Technologies and Red Prairie. All were best of breed supply chain solution providers. JDA became, on paper, a supply chain powerhouse being able to address a wide array of industry needs. Ranging from process and discrete manufacturing, retail and logistics. Impressive. But the question remains – what does New Mountain Capital have in mind long term for this asset? While other supply chain players have been focusing their efforts on specific industries – players like Plex focused on manufacturing, Aptos being spun off from Epicor to focus on retail while Epicor can concentrate on ERP. Can JDA continue to find success competing on all fronts? Or do they need to consider following a similar strategy as Epicor and break up the parts? Maybe the pieces competing on their own are more powerful than the whole? I do not believe this is the only direction JDA can take, but at some point New Mountain Capital will want to reap the rewards from their investment. How that happens will be interesting to observe.

JDA remains a major player in the field of supply chain. The leadership and culture have an aggressive level of expectations of themselves and the business – it is now up to the solutions and software to catch up. They are clearly aware and in tune with the disruptors that are impacting all businesses. The next few months will be crucial for the JDA leadership team to implement their pivot strategy and find success.

 

Disclosure – I worked at i2 Technologies from 2004 to 2009, i2 Technologies was acquired by JDA in 2009.

Advertisements

Leave a comment

Filed under Current Events, Supply Chain

Christmas is around the corner – what Santa Claus can teach us about supply chain

You better watch out
You better not cry
You better not pout
I’m telling you why
Santa Claus is coming to town
Santa Claus is coming to town
Santa Claus is coming to town

Yup, the big guy dressed in red is getting ready to make his annual appearance. Bringing all the girls and boys, as well as some lucky moms and dads, presents and gifts for their Christmas trees. And all he expects in return is maybe some milk & cookies or even a carrot for his reindeer. But did we ever expect Santa Claus to provide us with some simple lessons that are applicable to our supply chains?

He has the global fulfillment thing down...

He has the global fulfillment thing down…

  • He makes and list and checks it twice. Sage advice about how to handle all the data and information that extended supply chains produce and leverage on a weekly and daily basis. Many of the conversations I have had with supply chain practitioners and service providers comes back to getting a cleaner and more complete view of all the data that their supply chain produces on a weekly and daily basis. Look at what Santa is able to do – put all those wish lists in one aggregate list. He does check it twice to ensure consistency and correct for errors. Also good advice. Since we all know what garbage in gets us…companies like Avaya have worked with solution provider Kinaxis to create a more clear and single view of their distributor network and the data that is the connecting glue. One clean and unified view! Make sure to clear out that garbage before it gets into the system – or on Santa’s list.
  • Gonna find out who’s naughty or nice. Yup Santa also looks at his data to segment his customers. Granted he has two simple categories. Our supply chains’ customers and suppliers are also segmented and they do not fall into simple “naughty” or “nice.” But maybe the simplicity of how Santa does his segmentation should drive our own. The key is identify what key variables matter to our businesses and supply chains. Determine which variables you need to identify and focus on to create the most effective segmentation. Santa might not explicitly state it, but his segmentation like our supply chains leverages a greater number of predictive analytics to drive better clarity. For example service providers such as Infosys work with a large office products manufacturer to better understand customer segments to establish service level engagements. Santa and our supply chains need to lean on tools and service providers that can help identify the variables to effectively and efficiently segment our target audience.
  • He sees you when you’re sleeping …He knows when you’re awake. Maybe Santa has a secret deal with the NSA to eves drop on our calls…okay I joke…I think…but Santa makes sure he is aware of his consumers’ characteristics and where they are in the gift receiving pipeline. If we are awake he wouldn’t deliver our presents! Your supply chain needs to be sensitive to customers and where they are in the buying cycle. Think of how companies such as Steelwedge and Salesforce have worked together to help their customers better with the S&OP process by tying in the data coming from the Salesforce CRM to get a clearer view of where customers are with regards to the transactional pipeline. It is not simply about identifying our sleeping patterns, but understanding where we stand in terms of the buying cycle what our demand is and might be – are we in a position to have our gifts delivered by Santa?
  • Santa’s a busy man he has no time to play…He’s got millions of stockings to fill on Christmas day. Wow, talk about solving the delivery to the home enigma. Santa and his reindeer are able to criss cross the global, in one night, and accurately deliver a vast number of packages, of different shapes and sizes, to millions of locations! Unbelievable. Santa is also ahead of the curve as he has been able to provide home delivery since day 1. Now I am not saying we can all find a Rudolfo with his nose so bright to guide our fulfillment and logistics departments, but there is something to say about how integrated Santa’s workshop is with his distribution center and his logistics. He cannot be expected to demonstrate this level of efficiency is he stocks the wrong goods, doesn’t properly load them to his sleigh and then takes poor routes to his delivery locations. Clearly the value for supply chains to integrate the warehousing and transportation is what Santa’s efficiencies demonstrate.  Vendors like Oracle with their integrated WMS/TMS and now yard management (that is like what Santa does with regards to managing the elves and ensuring their are efficient) or JDA with their TMS integrated with the WMS acquired in the RedPrairie merger, are prime examples of solutions that even Santa would appreciate to ensure seamless optimization between the workshop and the big red sleigh – ensure the inventory that he has to haul around the world on the night of December 24th is properly slotted and routed.

The one aspect Santa does not seem to have worry too much about, is with returns. He does not seem to have a good reverse logistics or after sales service department. But since he has gotten so much of the upfront part right he does have to worry about delivering the wrong items! Alas our supply chains do not have that luxury, and our supply chains do need to take into account reverse logistics, returns, maintenance and other after sales issues. But thanks to Santa Claus we have something to aspire to with regards to our supply chains.

Merry Christmas! Happy Holidays!

Screen Shot 2014-12-18 at 9.07.03 PM

Leave a comment

Filed under Current Events, Supply Chain

End of an era at JDA – Hamish Brewer leaves supply chain vendor

Today JDA announced the changing of the guard at the head of the company  with long time JDAer – Hamish Brewer moving on. Interim CEO Baljit (Bal) Dail will take over until a full time CEO is found.  From an outside perspective this is a surprising announcement. However, from a business stand point this makes sense.

Since the acquisition/merger with Red Prairie in April 2013, the dynamics for JDA has changed. What has been a strategy of acquiring new revenue streams – see Manugistics and i2 acquisition – could not be sustainable. At some point JDA will need to compete with organic development of its own and revenue if it hopes to challenge the likes of SAP and Oracle. It looks as if the board determined that Hamish was not the right person for this new challenge. Mr Brewer does deserve a lot of credit for being able to cobble together a family of supply chain vendors and not only keep the ship afloat but also continue to drive JDA forward.

Whether it is Mr Dail or a new CEO, they will face some challenges:

  • How will JDA continue to drive and grow revenue. JDA has the classic problem of a large business, the good is they have a large portfolio of products the negative they have a large portfolio of products. In such verticals as automotive they are facing challenges from the likes of Kinaxis. In the S&OP space the likes of SteelWedge offer a viable option. Of course they always have the threat from SAP and Oracle.
  • Speaking of product portfolios…JDA, like many legacy vendors, straddles the world of on premise and cloud offerings. While I think there remains room for both, I think the value that comes from being more “cloud heavy” will start to out weigh on premise. For example companies such as One Network or E2open have leaned heavily on the cloud and in doing so are able to bring added benefits of creating turn key networks. Users who need to integrate large networks of suppliers, customers and partners via their solutions into their supply chain network will lean more and more towards cloud heavy offerings.

The new CEO for JDA will face some interesting challenges. However, the company still has a number of arrows in their quiver. It will be interesting to see how the company moves forward. And what type of background the next CEO has will go a long way in determining where JDA finds itself in 5 years.

 

Disclosure: I worked at i2 Technologies for 5 years. I left i2 Technologies prior to being purchased by JDA in 2010.

 

Leave a comment

Filed under Current Events, Supply Chain

Top 3 things to look for in 2014

When it comes to the supply chain space and solutions, there are three trends I am looking for in 2014:

  • Software providers will strive to offer full supply chain solution suites. Mega vendors such as SAP, Infor and Oracle have been ahead of this game, just by their sheer size. A growing number of service providers such as JDA and Logility will continue to push in this direction –looking to offer their own supply chain solution platform.  Practioners will seek service providers that can address larger and more inclusive supply chain challenges, rather than simply optimizing pieces of the overall puzzle. They recognise that optimizing parts of the supply chain can often times lead to unintended consequences in other parts of the supply chain. This does not mean that software providers that do not offer a full end to end solution will fall out of favour. These bolt-on solutions will continue to allow for targeted supply chain problems to be addressed. However, these solution providers will have to continue to demonstrate how their solution will be interoperable within the overall supply chain solution network. If you are already engaged with a mega vendor, lean on them to understand how their solution suite can address your larger supply chain issues. When it comes to vendors with smaller solution footprints, ensure that they can seamlessly tie into the solution ecosystem.
  • Expect innovation from the non-usual suspects. Innovative solutions as well as thought leadership will not come only from best of breed providers or consultants, but also from such sources as 3pls and contract manufactures. These players will bring their unique perspective to the supply chain, and drive innovation and thought leadership from the manufacturing and transportation position….think about 3D printing from your contract manufacturers like Flextronics or Jabil and how they are applying this technology and how that innovation can impact your supply chain. Or how your logistics provider like DHL, FedEx or UPS will drive aspects like same day delivery or multi-channel retailing. Other logistics providers who can empower you to drive your supply chain into emerging marketing such as the likes of Agility or Imperial Logistics. Innovation in the supply chain had become more democratized; do not hesitate to look to all your service providers for innovative thinking.
  • It will not be about big data but about actionable data. The notion of large amounts of accessible data will not diminish, on the contrary the amount of data we have access to for our supply chains will only continue to grow. But the vendors that are equipped to provide actionable data is going to be more important than big data. For example vendors such as IRI and Neilson can already provide large quantities of consumer data. Other business intelligence vendors have the ability to take massive data to cleanse and harmonize data. But practioners need to look for the vendors that are focusing on identifying that actionable data. To borrow a phrase from a conversation with SAP – “the haystack keeps getting larger and larger, and you are still looking for that needle” Solution providers will start focusing on identifying the actionable data, rather than just big data. Just because we can start looking at every last piece of data does not mean we should be doing so. Solution providers that offer the intelligence to find the key pieces of data within that haystack will be the ones that gain in relevance.  Companies like Zyme are focused on the hi-tech space will be able to give companies like Barnes and Nobles a better understanding of what data they need to be aware of for products such as the Nook tablet. Work with your service providers to go deeper than just looking at big data – understand what types of data they are comfortable with and what industries they have deep knowledge of.

2014 should be another interesting year in the space…but then again isn’t every year that way?

Leave a comment

Filed under Supply Chain, Technology

Red Prairie “acquires” JDA, a $1.9billion gamble that is a company too far.

The supply chain and software worlds were thrown into a tizzy this past week with the announcement that Red Prairie and their primary investor, New Mountain Capital, would be paying a 33% premium to acquire publicly traded JDA software – click here for press release. This new entity will have a combined revenue of a $1billion, of course we all know that in the world of M&A, 1+1 does not necessarily equal 2 but sometimes more 1/2…This merger was kept under tight wraps. From what I understand no one, outside of a handful of individuals, knew about the deal until it was announced publicly. A testament to both companies running a tight ship. So what does this mean?

JDA has always been known as an acquirer of companies, most notably former supply chain darlings – Manugistics and i2. JDA’s modus operandi seemed to be – acquire tarnished brand, that has a good client base and technology. Apply JDA’s operational excellence and maximize margin on that revenue stream. Run that until the revenue stream slows down due to lack of innovation, and repeat. This is different in this situation. Granted Red Prairie is technically “acquiring” JDA. But the buzz on the street is really JDA is being taken private to merge with Red Prairie and be the dominate partner. This makes sense since the owners of Red Prairie have constantly sought a viable exit strategy for the software company. So under the protection of being private, JDA/Red Prairie will work to becoming the dominate supply chain vendor. But three things that need to be addressed

  1. Being private does not necessarily cure JDA’s problems. With Hamish Brewer running this new entity, there is much hope that being taken off the Wall Street carousel, will allow for a hard focus on SaaS and other necessary changes to the business to compete in the changing market. The question remains, is this in JDA’s DNA? They have not really proven to be an innovative company. They have always been an operational excellent business, but not a company that is going to take chances with innovation and R&D. With a spot light coming from an investor that just sunk a large chunk of money, the pressure might be greater than when it was a publicly traded company.
  2. Product overlap. Primarily what will the new business do with their TMS solutions? By my count there might be 3 versions – JDA’s, the old i2 and now Red Prairie’s version. Gartner and other analysts always ranked the i2 solution as one of the best, on the same level as Oracle’s GLog offering. This is not a trivial problem to deal with. There are other solution overlaps as well as matching R&D direction. In prior mergers it used to be clear that JDA was coming in as the dominate player. Not in this situation.
  3. Too big to succeed? Has this merger been one company too far? When JDA acquired i2, there was some noise that i2 and Red Prairie had explored merging instead (would have been a very powerful combination). An i2 – Red Prairie merger would have been a very powerful entity. The problem is that JDA is not i2, they are bigger! They have many more pieces that they have pulled together over the years. Adding a large piece like Red Prairie at this stage might have been too big a chunk to digest. A company too far.

This merger has much potential for both success and failure. Fundamentally both companies come to the table with pieces the other has been lacking. But I am just not sure that the cultures and the products will mesh in the near term. Going private is good, but I am not sure it will diminish the pressure on Hamish and his leadership team to get the new company on the right track.

JDA will no longer have the pressure to constantly grow revenue stream – through acquisition – but now they will need to get things in place for their investor to get a return on their $1.9billion investment.

Leave a comment

Filed under Current Events, Supply Chain