BOSTON—The emergence of on-demand supply chain management (SCM) applications for such functions as transportation management, supply chain visibility, collaborative forecasting, inventory optimization, and demand/supply synchronization was much in evidence in the results of a survey of 180 supply chain executives conducted by Aberdeen Group, the Boston-based research firm.

According to the report, The On-Demand Tipping Point in Supply Chain, more than half of the respondents to the survey said they are either already using or are considering on-demand SCM applications. These programs are delivered on a pay-as-you-go basis, usually over the Internet.

On-demand products can help companies improve externally oriented processes that legacy SCM applications do not sufficiently support, said Beth Enslow, Aberdeen's vice president of enterprise research. Accordingly, on-demand SCM applications can be a boon for companies that need to better control their supplier base.

One of the biggest benefits of these solutions is that vendors often have pre-connected networks that include existing suppliers or customers. When trading partners are already using such systems, shippers can get up and running more quickly than they can with traditional software models.

Another attraction of on-demand SCM applications is that they cost less to implement, said Ward Crimmins, vice president of technology at Kenco Logistics Services, a Chattanooga, Tenn.-based third-party logistics company. "For areas where we do not have systems developed, it makes more sense to go to pre-developed solutions," he said. "This way, we don't have to take on additional ownership for a particular application. We are finding that on-demand SCM applications are offering us something that can be used right away from a company with a specific focus and a support staff we can turn to when needed."

On-demand isn't limited to the domestic environment. Enslow cites the example of clothing manufacturer Liz Claiborne, which uses an on-demand supply chain visibility product from TradeBeam. "They use it to monitor all shipment activities, delivery status, and customs status," she said.

The intersection of inventory and transportation management is prime on-demand territory. "We are finding that many companies are using these on-demand solutions not only to better understand inventory status, but also to start managing it more proactively," Enslow said. "They can quickly see where things are and know where a demand spike may be occurring in another part of the country so they can reroute items. Or if a shipment is running behind schedule, they can decide to put it on a truck rather than rail."

According to Enslow, any transportation-related function is a candidate for an on-demand solution—whether transportation procurement or functions related to domestic or international transportation operations.

"A lot of the functions associated with traditional SCM applications are only built for the four walls of one enterprise, and on-demand SCM solutions are helping companies go outside of those walls," said Enslow.

For more about on-demand transportation applications, see "On-demand is on the rise" in the March issue of Logistics Management, available online at www.logisticsmgmt.com.