Profile of Manugistics Software for Supply Chain Management
Manugistics began life as a company called Scientific Time Sharing Corporation (STSC), formed in 1969 in Bethesda, Maryland. In the beginning, STSC was geared towards writing programs using the APL computer language for IBM. After a number of years of developing APL programming for the personal computer and developing operational decision-support software, STSC changed its name to Manugistics in 1992 and focused on supply chain planning software.
Manugistics purchased a number of companies that offered manufacturing scheduling and supply chain planning software. Companies such as Avyx, ProMIRA, PartMiner and Digital Freight Exchange were absorbed into the Manugistics fold between 1994 and 2002.
The company went public in 1993 but the financial pressures of acquisition and the dot.com bust led to financially difficult times between 1998 and 2006. In 1999 licensing revenues were only $73 million which was a 30% decrease over the previous year. During that year the company posted its greatest loss of $96.1 million, which led to staff reductions of approximately 30% and realignment to focus on certain “customer-driven” industries such as automotive, electronics, consumer products, food & beverage and pharmaceuticals.
Despite the reorganization (including the appointment of a new CEO, Greg Owens, formerly the Supply Chain lead at Andersen Consulting), the company continued to see losses with each passing year.
The staff reduction had severely impacted the development capability of the company and in 2000 the percentage of development staff, 27%, was significantly lower than competitors such as i2 and SAP.
After continuing to struggle financially, Manugistics allowed itself to be purchased by JDA Software in July 2006.
At the time of the sale, Manugistics had over a thousand customers including many household names such as Hershey, Kraft, ConAgra, Unilever, Heinz, Coca-Cola, Avon, Black and Decker and Goodyear.
Integration with JDA
After the acquisition by JDA, the Manugistics software was expanded by its new owners to leverage the best of Manugistics with the existing JDA offering. In 2007 JDA launched the integrated solutions in Demand Management, Replenishment, Order Optimization, and Advertising and Promotions Management. The popularity of software-as-a-service (SaaS) functionality led to JDA releasing a Web-based Transportation and Logistics Management suite version 7.5 in September 2008.
The Manugistics solutions included a set of NetWORKS components such as NetWORKS Demand, NetWORKS Fulfillment, NetWORKS Transport RFQ, NetWORKS Transportation Routing, etc. These are nearly all recognizable as part of JDA’s current solutions.
In the area of Demand Management, the Manugistics NetWORKS Demand has become JDA Demand. The solution offers clients leverage in preparing for customer demand using statistical modeling to create the baseline forecast.
The JDA Demand solution offers the client a number of key advantages including;
- Advanced statistical modeling
- Demand classification and segmentation
- Multi-level forecasting
- New product forecasting
- Promotional and event data management
- Forecast collaboration
JDA has always been focused on retail clients and the JDA Fulfillment solution offers retail clients a tool to ensure that the correct items are in the correct distribution centers at the correct time. The JDA Fulfillment solution leverages forecast and end customer demand signals to create a multi-level replenishment plan down to the store level.
The fulfillment process commences with the setting of inventory policy decisions using safety stock strategies. Subsequently, the store-level forecasts are used to determine distribution requirements that pull product through distribution centers.
The JDA Fulfillment solution offers the following key capabilities:
- Multi-level replenishment planning
- Large-scale processing engine
- Finished good allocation flexibility
- Date sensitive inventory management
- Forecast consumption
- Purchase optimization
- Dynamic deployment