Advanced Planning & Scheduling (APS) Vendor Comparison May 1999

1. Advanced Planning & Scheduling (APS) Vendor Comparison May 1999

2. Table of Contents Introduction to APS Pg. 3 - 10 APS Market & Vendor Overview Pg. 11 - 18 i2 Technologies Analysis Pg. 19 - 30 Manugistics Analysis Pg. 31 - 42 SAP APO Analysis Pg. 43 - 51 Other APS Vendors Pg. 52 - 62 Future Direction of APS Vendors Pg. 63 - 70

3. Introduction to APS

4. Integrated Supply Chain Planning • The co-ordinated planning of activities that occur over time to forecast demand, procure, manufacture and distribute goods across the extended supply chain, from supplier to consumer. • Under Supply Chain Planning we develop and implement integrated solutions which address process, people, organisation and technology and which are consistent with the overall business and supply chain strategy. • The business processes involved include: sales and operations planning, demand planning, capacity planning, production planning, supply planning, MPS, MRP, DRP, transport planning, merchandise planning, category planning, launch/end life planning, factory line planning

5. Customers/Markets People & Organisation Facilities / Resources Products/Services Information Technology Processes Strategic Capacity Planning MPS Forecasting MRP Production Planning Transport Planning Sales & Operations Planning Integrated Supply Chain Planning Merchandise Planning Tactical sourcing Launch/End Life Planning Factory line planning Tactical Category Planning DRP New Product Development Sourcing & Supplier Management Manufacturing, Conversion & Service Operations Sales Order Management, Customer Service Logistics & Distribution After Sales Service & Reliability Retail Ops Execution Where does Integrated Supply Chain Planning fit?

6. Advanced Planning & Scheduling Technology • APS is an umbrella technology that acts in the following ways: • considers material and plant resources simultaneously • provides a modeling environment to incorporate business rules, constraints and goals in the planning process • optimises algorithms that incorporate business goals • leverages memory resident programs and databases to provide real-time plan and schedule creation and re-generation • supports real-time decisions with ‘what if’ analysis • provides real-time Availability to Promise AMR Research, September 1998

7. Years Strategic How should my supply chain be organised? (e.g. network modelling, material sourcing) How do I optimise flow through the supply chain? (e.g. demand, supply and materials planning) How do I satisfy a customer’s order? (e.g. capacity scheduling, transport scheduling) Tactical Operational Minutes What are Advanced Planning & Scheduling Systems? Advanced Planning & Scheduling (APS) systems are decision support tools which add value to Enterprise Resource Planning (ERP) systems, such as SAP R/3 or Oracle.

8. What APS systems do • Provide functionality for the gaps in ERP systems: • forecasting / demand planning • distribution requirements planning • constrained manufacturing planning and scheduling • transportation planning • Provide Decision Support Capability by focusing on exception management. • Generate plans utilising ERP data, to be executed by the ERP system. • Provide functionality to support extended supply chain planning (Vendor Managed Inventory, Collaborative Forecasting and Replenishment).

9. REAL-TIME TACTICAL OPERATIONAL STRATEGIC MATLS PLANNING MATERIAL CALL-OFF PROCUREMENT STRATEGY Region BUY SUPPLIER DEVELOPMENT PRODN PLANNING PLANT LINE SCHEDULING MAKE FACILITY PLANNING CAPACITY EXCEPTION MGT Sub-Region REGIONAL NETWORK DEFINITION SUBREGIONAL NETWORK DEFN MOVE TRANSPORT SCHEDULING AND PLG DISTN SUPPLY PLANNING INVENTORY STRATEGY AGE MANAGEMENT STORE Local PRODUCT ALLOCATION DEMAND PLANNING SELL CUSTOMER DEVELOPMENT DEMAND MANAGEMENT HOURS DAYS WEEKS MONTHS YEARS Supply Chain Processes - Who does what, where and when

10. Why use Advanced Planning Systems? “The application of advanced technologies in all three supply chain management time horizons will be the difference between adequate and great supply chain performance”. Source: Gartner, March 1998 “In much the same way that the microwave oven revolutionised cooking and CDs changed the way we listen to music, APS technology is changing the way manufacturers plan”. Source: AMR, March 1998 “In many cases supply chain planning applications deliver million-dollar-plus paybacks in the first 18 months”. Source: Gartner Group, ILS, December 1997 “Planning in a heartbeat”. Source: APS Magazine, June 1998

11. APS Market & Vendor Overview

12. APS Projected Growth - Revenue in $ millions Source: AMR Research, 1998

13. APS License Revenue By Geography Europe 17% Asia/Pacific Rim 8% Americas 75% By Industry Source: AMR Research, 1998

14. Challengers Leaders • I2 Technologies Ability to Execute Ability • to Baan Manugistics Group • Execute SCT/Fygir • PeopleSoft • • SAP SynQuest • • • • Paragon Mgmt. Systems • Thru-Put • LPA Software WebPlan • Aspen Technology/Chesapeake • • • Mercia Logility Numetrix Demand • Advanced Planning Systems Management As of April 1999 Niche Players Visionaries Completeness of Vision The Advanced Planning Systems Market Source: Gartner Group

15. APS Market Share i2 Technologies Other 34% 24% (including SAP APO @ < 1%) Manugistics 17% CAPS 2% LPA 2% Numetrix 6% SynQuest ILOG 2% Chesapeake 5% Logility 2% 4% Baan SCS Source: AMR Research, 1998 2%

16. Features of APS Vendors Production Scheduling Demand Planning Distribution Planning Capacity Planning Trans- portation Software MPS ATP yes Manugistics yes yes yes yes yes yes i2 yes yes yes yes yes yes yes SAP APO some yes yes yes yes yes some Paragon yes yes yes some yes yes some Red Pepper/PeopleSoft yes yes yes yes yes yes no yes yes yes yes yes some Numetrix no

17. Baan* Chesapeake/ AspenTech Fygir/SCT i2 Technologies Logility Manugistics Numetrix Paragon PeopleSoft SAP APO, 1Q99 Synquest Thru-Put Deploy. Network Capacity Demand Distrib . Manu . Manu . Transp . Plan. Plan. P&S P&S Plan. Plan. Plan. Sched . Planning Function Functionality from vendor Third-party application Limited or immature functionality Functionality from vendor tailored primarily for discrete repetitive, ATO, MTO manufacturers Functionality from vendor tailored primarily for process and hybrid repetitive manufacturers Functionality from vendor tailored primarily for MTO/ETO manufacturers Gartner Group, “How Well Will Your ERP/SCP Vendor Serve You? ” Nov. 24, 1998 Areas of SCP Functionality by APS Vendor

18. APS Vendor by Vertical Industry Industrial Products Food / Beverage/ Electronics/High Medical Services Pharmaceutical / Chemical/ Petro Other Assembly Semiconductor Aerospace & Automotive Oil & Gas Assembly Defense Apparel Biotech Chem Mills Tech CPG VENDOR Acacia Technologies (APS Only) Adapta/DynaSys Advanced Planning Systems Auto Simulations Baan/Barclain Bridgeware C-Way Systems Chesapeake Decision Sciences Distinction Software Enterprise Planning Systems Fygir i2 Technologies Logility Manugistics Mercia Numetrix Ortens Paragon Management Systems PeopleSoft-Red Pepper PRI Automation/Internal Logic . SAP/APO Scheduling Technology Corp SynQuest Taylor Manufacturing Systems Thru-Put Technologies Tyecin Vishal (formerly ShivaSoft) Indicates good fit for typical industry requirements No support for this vertical industry Some support for typical industry requirements

19. i2 Technologies Analysis

20. i2 Technologies Functionality Strengths • Strong vision of end-to-end supply chain • Memory resident technology • Heavy High-Tech/Electronics focus with industry leading clients • Value-based pricing model and rapid implementation methodology represents a confident approach to the market - goal is “to provide $50 billion in value by the year 2005”

21. i2 Technologies Functionality Weaknesses • Scalability problem due to memory-resident architecture • Is not well-suited for continuous manufacturing • Must focus more on process industries • Many modules use the same core planning engine • Internal growth • Transportation planning not fully integrated • Vision not yet realized; some products still under construction

22. Module Analysis - i2 Technologies Demand Planning Strengths Challenges • SOP integration and relationship • Detailed Synchronization, Database Performance • User Skill Sets • Data/Screen Customization • Process & Rules for Forecast Development • Planner allows for realignment and reconfiguration of historical demand based on customer and/or distribution changes • Modeling Product, Geography & Time (35 techniques) • Top-down, Bottom-up, middle-out analysis • Menu of Statistical Forecast Calculations • Bookmarks & Intuitive Navigation • Powerful Analysis Tools (e.g. XMAM) • Supports concurrent unlimited causal factors • i2 • Technologies • Demand • Planner

23. Module Analysis - i2 Technologies Distribution Planning Strengths Challenges • Models multi-plant complex distribution networks • Make to order, make to stock or make to forecast • Propagates changes upstream and downstream and predicts inventories • Manufacturing, distribution and materials plans can be done simultaneously and includes cost data for scenario • Enables the matching of demand to supply, allocation of orders, evaluation of transportation requirements • Can model a wide variety of business rules • Models Real-time ATP based on capacity and materials as well as inventories and orders. • Tariff and service level set up likely to be complex • Pricing and tariff complexities likely to extend the initial configuration of the system • Will require some manual intervention to manage execution level detail • i2 • Technologies • Supply Chain • Planner

24. Module Analysis - i2 Technologies Available to Promise (ATP) Strengths Challenges • Real-time ATP based on capacity and materials as well as inventory and orders • Reliant on Supply Chain Planner for all inventory information and updates • i2 • Technologies • Available to Promise • (ATP) • Proven to work with a wide variety of ERP, order entry and Internet-based environments • Enables due date promising based on allocation logic that can consider sales hierarchies, pricing categories, and priority customers • Due date quoting to assess the impact of adding a production order to the current plant schedule • Quick response time

25. Module Analysis - i2 Technologies Production/Capacity Planning Strengths Challenges • Knowledge of i2 Fundamentals for Defining “Strategies” • Availability of Qualified Modeling Resources • Management Definition & Use of Solution Strategies • Robust options to plan tooling effectively • Time-phased model characteristics allows a single plan with the appropriate granularity for various time horizons • Hard/soft constraints - capacity & materials • Visibility to exceptions allows early warning to problems and dramatic improvement in planner productivity • Single and Multi-plant master schedule based on aggregate material and capacity constraints • i2 • Technologies • Factory Planner • Advanced • Scheduler

26. Module Analysis - i2 Technologies Transportation Planning Challenges Strengths • Graphical mapping capability can display global network and flows • Easy navigation and flexibility in defining/changing attributes • Common optimizer between Modeler Manager and SCP • Option of using on-line or stand alone tariffs • Manager will optimize around the least cost path and model at the operation level • Detailed level of cost accounting to track incremental expenditures by customer • Comparison and evaluation of scenarios requires data export and manipulation • Managing the set up of parameters is complex • Tariff and service level set up tends to be complex • Requires some manual intervention to manage execution level detail • Need to access statistics with a report writer tool • Incorporating transportation suite functionality into international ocean transportation environment • i2 • Technologies • Supply Chain • Planner • Shipment • Scheduler • ITLS

27. Module Analysis - i2 Technologies Inter-Company Collaboration Strengths Challenges • Enables collaborative planning with customers and suppliers, via the Internet using a multi-dimensional database and on-line processing (OLAP) tools • eBPO (e-business process optimization) approach and strength in high technology industry puts i2 on the leading edge • Full Collaboration suite is available in the “Global Series” of products • Not fully established in consumer products industry • Late start in CPFR i2 Technologies

28. Module Analysis - i2 Technologies Technical Integration Strengths Challenges • Well designed software & technical architecture • Robust /powerful RhythmLink integration tool • Good use of proven middle-ware products • Partially scalable due to: • Object design • Request/Promise • Memory resident • Strategy driven planning • Evolving product • Active Data Warehouse is still relatively new • i2 • Technologies • RhythmLink

29. Future Direction - i2 Technologies • Continue to build eBPO (electronic Business Process Optimization) initiative- a new class of decision support software that can be used to both optimize and integrate key business processes while providing the prospective, forward-looking functionality required to support high-velocity businesses. • Concentrate on selling APS business solutions not APS software as future products will be solution templates that are industry-specific, have "templatized" engine functionality made up of sets of complementary products, and include workflow functionality • Capitalize on the identified 52 products that are required to support eBPO and look for co-development partners to work with the development of the 20 or so additional products it needs. • Develop cleaner integration with existing ERP systems. • Develop RhythmLite product which targets middle tier companies • Develop business solutions concentrating on Apparel, Medical Devices and Transportation Industry. • Continue to enhance templates relative to Hi-Tech and Automotive industries • Address virtually untapped APS European Markets

30. Selected Analyst Quotes: i2 Technologies • “...i2 is clearly executing better than any other supply chain planning vendor. In addition, with stated directions around its eBPO, GartnerGroup expects that i2 will continue to deliver a differentiated vision to the market” InSide Gartner Group, Supply Chain Planning Magic Quadrant 2Q99 Update, April 28, 1999. • “i2's sweet spot remains discrete manufacturers, especially in high tech and electronics. i2 is also making progress in helping apparel and automotive customers address some SCP issues” InSide Gartner Group, Supply Chain Planning Magic Quadrant 2Q99 Update, April 28, 1999. • “i2 Technologies - which reported revenue of $361.9 million and operating income of $30.3 million for the year ended 31 December 1998 - is now the only vendor in the Leaders quadrant. i2’s vision rating has increased because of its “eBPO (electronic business process optimization) initiatives. However, because of execution challenges facing eBPO, the rating of i2’s ability to execute has not increased…” Gartner Group, “Supply Chain Planning Magic Quadrant 2Q99 Update” April 28, 1999

31. Manugistics Analysis

32. Manugistics Functionality Strengths • Extended enterprise functionality • Virtual memory-based model: no problem with scalability • Large, well established player in the SCM market • Heavy CPG focus with a number of industry-leading CPG clients • Strong in distribution planning

33. Manugistics Functionality Weaknesses • Expand target markets outside of CPG • Delivery mechanism to match competitors in terms of time and value • Fully integrate manufacturing planning & scheduling functionality (e.g. Avyx acquisition) into product suite • Moving install base from mainframe to client/server • Despite aggressive, expansion Manugistics is only growing at half the rate of its competition • Lacks detailed constraint-based planning and scheduling for manufacturing

34. Module Analysis - Manugistics Demand Planning Strengths Challenges • Lewandowski method powerful time-series forecasting technique • Life cycle modeling technique for forecasting short life-cycle products • Forecast accuracy calculation(marketing mix, new product introduction, cannibalization) • Causal forecasting capabilities and variance reporting • Limited to two methods for statistical forecasting. • Comparing future, proposed and other forecasts not easy. • Heavy reliance on Excel for in-depth analysis • Lack of flexibility in forecast views. • Can not apply or use fill rates. • Allocation of forecast across time not possible in DP. • Manugistics • Demand Planner

35. Module Analysis - Manugistics Distribution Planning Strengths Challenges • Sequential planning approach inhibits change propagation, global optimization and quick response time • Cost-based constraints not robust enough to capture customer-level priority • No operational visibility within time-slider buckets • No container optimization • 45-day operational horizon limit • Re-direction functionality not available • Calculates safety stock given parameters • Inventory Vs. Customer Service Graphs • Multi-source distribution network modeling • Multiple time horizons • Manugistics • Distribution • Planner • Enables the setting of minimum safety stock levels for each SKU at each warehouse location and determines replenishment frequency • Develops a schedule of planned shipments with priorities for different demand types

36. Module Analysis - Manugistics Available to Promise (ATP) Strengths Challenges • Order visibility through ATP - captures/pegs orders through the production process • Structured for common interfaces with SAP, Oracle • High volume ATP in beta test • Usage/definition of SKU; extending to customer level will significantly impact complexity and software performance • Benchmarks vs. i2 indicate speed of response will be limited until a true memory-resident architecture is developed Manugistics

37. Module Analysis - Manugistics Production/Capacity Planning Strengths Challenges • Gantt chart view of production plans • Graphical view of the supply chain network easy to use and intuitive • Constraint Collaborator good for communication with factories • Development of constrained production plans • Aggregate long and midterm production plans • Cannot calculate tooling needs. • Capacity optimization is weak • Considers one constraint at a time resulting in multiple exceptions in other plans • Hard to nest business policies/strategies with optimization • Manugistics • Manufacturing • Planner

38. Module Analysis - Manugistics Transportation Planning Strengths Challenges • Scenario comparisons are easy to view and display • Facilitates multi-period, time phased modeling • Cost comparisons are well defined through variance field • Pre-formatted reports • Structured for common interfaces with SAP and Oracle • Supports US EDI transaction sets (ANSI) • Can allocate costs at shipment, order, and item level • Solver is not a mixed integer program • Performance concerns at the SKU, geography, and customer level • Cannot provide operational detail at the container level • Operational horizon limit of 45 days • Cost-based constraints are not robust enough to capture customer level priority • No end-to-end view of supply chain performance against the plan • Is not designed for international ocean freight • Manugistics • Transportation • Manager • TMS

39. Module Analysis - Manugistics Inter-Company Collaboration Strengths Challenges • Collaboration volumes may stress the current architecture • Scalability • Translate early start in CPFR into meaningful results • Enables Vendor Managed Inventories (VMI) with customers • Enables the incorporation of point-of-sale data Manugistics

40. Module Analysis - Manugistics Technical Integration Strengths Challenges • Response time for batch models is long • Batch processes create a bottleneck • Flat file integration is poor • Single threaded architecture • Requires data partitioning for any workarounds • Proven SAP and Oracle integration track record • Good customer base • Weakness acknowledged and being addressed, although with shrinking resources • Manugistics • Integrator

41. Future Direction - Manugistics • Capitalize on future release of Manugistics 6.0. • Refine new software which offers customers improved integrated constraint-based master planning, Internet capability, a GUI front end, a common look among modules, and performance improvements and integration enabled by a Universal Data Model, Open Application Integration, and a Dynamic Cache. • Utilize the enhanced Open Application Integration strategy which represents Manugistics approach to application-to-application integration using Enterprise Application Integration (EAI) provider Oberon Software. • Concentrate on implementing Delivering Rapid Results implementation services aimed at providing early supply chain benefits through the use of its products. • Develop SCM solutions that easily integrate with ERP modules, and also with best-of-breed SCM applications such as WMS, as well as with legacy systems • Broaden strong European market position • Address APS needs of middle-tier companies

42. Selected Analyst Quotes - Manugistics • “Given the strength of its products and consumer-oriented manufacturing functionality, [Manugistics] is not down and out yet. We'll have to wait and see how the market and its employees react to its financial difficulties. Whether financially successful or not, we believe there are good odds that it may find itself back on the market for acquisition some time before the year is out.”AMR • “Manugistics is a viable SCP vendor but must maintain focus, improve sales force productivity and craft a differentiating market message to remain an independent vendor…. Manugistics is particularly suited to consumer-oriented manufacturers and distributors, and those firms should "short list" Manugistics…. Due to the rapid changes in the SCP market and Manugistics' financial situation, clients should only pay for the functionality they can implement and gain return on in the next 18 months.”Gartner • “We are impressed that the company (Manugistics) still maintains a strong product portfolio and has a good story to tell, especially in supply chain, Internet-based e-commerce and collaboration, and in consumer-oriented industries”Advanced Manufacturing Research, Alert on Supply Chain Management, 04/02/99

43. SAP-APO Analysis

44. SAP-APO Functionality Strengths • SAP’s liveCache technology manages data for R/3 and APO centrally eliminating data duplication problems. • SAP’s commitment to support supply chain management, with logistics execution such as warehouse management, transportation, order management, and e-commerce in a single application suite is the only one of its kind. Weaknesses • APO’s function depth not consistent across industries • Small customer base • Manufacturing Planning and Detailed Scheduling modules still un-tested

45. liveCache - High-Performance Memory-Based Computing (Quote from SAP Web Home Page) liveCache is an extremely fast memory-based technology for executing sophisticated, data-intensive functions. Operating within the SAP Business Framework, liveCache enables entirely new applications by offering orders of magnitude performance improvements for certain functions such as forecasting and supply chain planning and optimization. In today's hypercompetitive markets, the ability to respond to customer requests with speed and precision is vital to success. These intense customer demands have placed extraordinary pressure on organizations' planning and operational systems. liveCache provides the high-speed platform necessary for a real-time response even when intense computations are involved. For example, liveCache makes it possible for a sales representative to perform comprehensive available-to-promise calculations during a phone conversation with a customer. Eliminates Performance Bottlenecks Leveraging new, very large main memory hardware architectures that can support tens of gigabytes of RAM as well as 64-bit processors, liveCache eliminates bottlenecks associated with transferring data between disk and memory, thus removing a critical limiting factor on system performance. SAP began using a memory-based architecture with the introduction of R/3 in 1992 and extended it considerably in 1995 with R/3 Release 3.0. This architecture reduces disk I/O bottlenecks through use of shared, buffered data caches, to deliver rich application functionality with outstanding scalability. Now, liveCache extends this architecture by bringing application execution even closer to the data - both the processing of an application and the data it needs are contained in the same operating system process in RAM. Further enhancing performance, liveCache includes built-in business application logic and functionality. liveCache aggregates transactional data from multiple sources in main memory - including non-R/3-based systems - and then represents it in optimized structures for the task at hand. In this way, liveCache provides extraordinary performance advantages for operations involving in-depth analysis of massive data stores required for supply chain planning or forecasting. Because planning systems involve queries that essentially consume computing resources, it has not been possible to use actual operational data for planning systems without significant delays. Now, with liveCache and its ability to automatically aggregate transactional data from multiple sources on the fly, decision support and planning systems can use the most accurate, up-to-date operational data to derive answers to queries. Leverage Partner Efforts The current SAP memory-based architecture as well as the new liveCache architecture enable SAP to fully utilize 64-bit platforms, while continuing to support current-generation technology. SAP R/3 performance and scalability will benefit dramatically as memory prices decrease and hardware and operating system technology advances to support systems with tens of gigabytes of main memory. To ensure that design needs are met from the ground up, SAP has established partner relationships with the industry's leading suppliers of hardware and operating systems.

46. Module Analysis - SAP-APO Demand Planning Strengths Challenges • Allows for collaborative forecasting • Life cycle management for forecasting short life-cycle products • Has multiple view capability • Promotion planning, New product planning and cause-and-effect modeling and analysis • Is a functionality of the SD module in R/3. Cannot realign and reconfigure historical demand based on customer and/or distribution network changes • Calculate forecasts at customer, SKU, item, line and group levels • SAP-APO • Demand Planning

47. Module Analysis - SAP-APO Distribution Planning Strengths Challenges • Enables Supply Chain modeling to help balancing supply and demand on a macro level • Lets users synchronize activities and flow of materials throughout the supply chain • The Deployment module models inventory deployment, and supports VMI. • Scheduling algorithms are adjustable to variable length planning horizons • Ability to dynamically suggest stocking modifications based upon parametric tolerances • APO • Supply Network • Planner and • Deployment

48. Module Analysis - SAP-APO Available to Promise (ATP) Strengths Challenges • Provides users the capabilities to investigate supply availability on a memory resident, real-time basis across a potentially global supply chain. • ATP logic allows for product substitutions, location selection, and allocation of products • Lead time analysis derived from on-hand balances and scheduled production runs APO -Global Available- to-Promise

49. Module Analysis - SAP-APO Production/Capacity Planning Strengths Challenges • Users are still expected to use SAP R/3 MRP for the bulk of material planning • Material planning is limited to critical materials. • PP - DS is the least tested by First Customer Ship process customers (APO’s beta test) • Heavily dependent on liveCache • lacks a true modeling language and cost optimization • Supports constrain-based multiplant master scheduling used to develop tactical and operational plans • Detailed Scheduling used for bucketless planning for the sequencing and scheduling of orders through individual plants • APO • Production • Planning and Detailed Scheduling

50. Module Analysis - SAP-APO Technical Integration Strengths Challenges • A single facility to maintain the data integration for the APO-to-R/3 interface • Some data needed by APO is not in R/3 and must be maintained separately. • Users must determine the level of planning to be done using APO vs R/3 • APO • Supply Chain Engineer