In the last three or four years, many new software applications that influence virtually every element of the supply chain have emerged. Among others, these products include applications for strategic sourcing, online auctions, e-procurement, procurement workflow, supply chain collaboration with channel partners, e-fulfillment, design collaboration, product life cycle management, event management and visibility, public and private e-marketplaces, and distributed order management.

These and other new software tools often leverage the Internet to achieve results we could only dream about just a few short years ago. Many companies have employed these tools to achieve substantial improvements in productivity and effectiveness. Others, however, have had difficult or even unsuccessful experiences with them.

That's why it strikes me that the more things change, the more they stay the same. Although we have experienced unprecedented development of new software in the last few years, I still see a large gap between different companies' abilities to take advantage of these capabilities.

The traditional guiding principles for gaining the greatest benefits from software remain true today. They are as follows:

Manage to a business case. It's important not only to develop a fact-based and compelling business case to justify an investment in new software tools but also to aggressively manage in accordance with that case. Carefully track both costs and benefits, compare them with the original estimates, and conduct monthly reviews to hold managers accountable for achieving the expected value and business benefits.

Do not shortchange training and change

management. Getting the full benefit of these software tools can require a substantial investment in training and change management. Unfortunately, some companies try to reduce their initial outlay by eliminating some of this investment or by minimizing their use of expert resources. This is a big mistake. Change management and the acquisition of new skills by your organization are both critical for maintaining a competitive advantage; plan to allocate sufficient resources to these activities.

Think big, but implement in stages. It's important to have a broad vision of how you plan to use supply chain technologies, but it's equally important to implement them in manageable chunks. Many successful companies operate with a "time to value" mindset, quickly implementing high-impact, high-value initiatives. This results in faster benefit realization, keeps organizational focus on the task at hand, and forces a rapid resolution of related issues.

Connect to the process. The implementation of new software tools provides an opportunity to rethink key business processes. In fact, the greatest value in the implementation of new supply chain software often comes from redesigned business processes. Therefore, it's important to manage both software selection and implementation from a process-design perspective.

I find that there is a growing gap between the performance of the leading and the average companies in most industries. The best are getting better at a faster rate than their average competitors are. One reason is the aggressive way leading companies have adopted new supply chain software tools. These tools can provide quantum leaps in efficiency and effectiveness while leading to lower costs, improved customer service and inventory availability, and increased asset productivity. Be thoughtful, however, in your approach to implementation and be sure to apply the guiding principles described above.