JDA and IBM team up for integrated omni-channel supply chain collaboration

Supply chain and logistics software and technology provider JDA Software Group Inc. and technology bellwether IBM announced last week they are collaborating to provide shippers with an integrated omni-channel supply chain that will enable shippers to make smart real time sourcing decisions and provide customers with the best buying experience possible.

JDA and IBM said this collaboration will help to provide a dynamic view across various supply chain channels for retailers, wholesalers, and manufacturers to best meet customers needs for things like advanced delivery methods like ‘buy online and pick up in store’ and meeting customer expectations by providing a holistic approach through synchronizing order capture and order management with precision retail planning, efficient labor productivity, and intelligent fulfillment.

And they said part of the plan to address this will be by combining resources through JDA Intelligent Fulfillment and Labor Productivity offerings with IBM Commerce and Order Management solutions that the companies said will work in tandem to reveal the true cost of fulfilling an order, which includes inventory and labor costs, which, in turn, will help shippers better adjust inventory and resource allocations and execute decisions that they said meet and exceed customer expectations while helping to grow the bottom line.

“Omni-channel retail has brought about new challenges for retailers, particularly related to their ability to service customer needs across all channels,” said Scott Welty, JDA VP, retail industry strategy. “Most retailers are managing static, rules-based methods of distributed order management across siloed nodes of their network.  With the evolution of new strategies, such as pick from store and same day delivery, retailers now need to have improved visibility of inventory, future demand for products and built-in profitability metrics based on ‘cost to serve’ components like shipping costs, DC labor and even store labor. JDA and IBM have been collaborating for much of 2014 as both companies saw an opportunity to capitalize on IBM’s strength in Distributed Order Management and JDA’s market leading capabilities in Supply Chain Optimization and Store Operations.”

As for how this specifically benefits retailers, Welty used retailers as an example, noting that the benefits for them will be driven by the ability to apply unprecedented intelligence to the management and distribution of omni-channel orders. Retailers will now be able to have a 360-degree view of not only the orders that are being generated but current and predicted stock levels, as well as future demand for channel-specific orders, he said, adding that this will be extremely valuable as retailers begin aggressively picking orders from stores with the ability to ensure safety stock levels will not be jeopardized by online orders.  Retailers will also be able to ensure that critical constraint-based assets like logistics and DC capacity can be optimized by the supply chain solutions from JDA.

And by utilizing integrated task management into the equation, he noted that retailers can also ensure proper payroll is assigned to channels (DC and Stores) to effectively meet customer demand.  This type of collaboration, according to Welty, creates the ability to calculate the profitability of the order driven from cost and capacity constraint-based decisions.

And in addition to the dynamic optimization of sourcing omni-channel orders, the JDA and IBM joint offering will also enable retailers to provide consumers ‘intelligent offers’ that are favorable to the retailer’s cost-to-serve model.  Retailers will then be able to take profitable fulfillment actions into the upstream planning for both supply chain and merchandising activities.

“The new offering for retailers with this is the realization of an enhanced end-to-end shopping experience delivered from order placement to delivery, done so, on time and on budget,” said Welty. “No longer will retailers manage omni-channel retail as a collection of disparate processes and solutions from many best-of-breed vendors. They will now have the ability to maximize their channels in an integrated end-to-end order management and execution platform.”

Looking ahead, Welty said future plans for this collaboration include initial execution of this solution in the market and the exploration of additional opportunities to deliver even more value for omni-channel retailers.

“Whether they shop online, in store or on a device, consumers expect to have their product orders fulfilled exactly how they want it and at the lowest price without exceptions,” said Charles Chu, Vice President of B2B & Commerce at IBM, in a statement. “Any business that ignores these changing expectations does so at the expense of customer loyalty and revenue growth. Now with this collaboration between JDA Software and IBM, businesses will be able to seamlessly orchestrate a superior order fulfillment process that provides real value to the customer while eliminating costs and inefficiencies.”