James Cooke is a principal analyst with Nucleus Research in Boston, covering supply chain planning software. He was previously the editor of CSCMP?s Supply Chain Quarterly and a staff writer for DC Velocity.
If you've ever wished you could make a few minor adjustments to the software you use, you'll appreciate Stuart Koehler's position. Koehler is the operations manager for First Supply LLC, a Madison,Wis.-based plumbing, heating, and kitchen supply wholesaler that uses Infor's warehouse management system in its distribution operations. Though the software does what it's designed to do, Koehler nonetheless wanted to have a modification made.What he hoped to address was a limitation in the software's label-printing capability—the system was unable to include as much product information as First Supply wanted on the labels it generated.
In the overall scheme of things, that was a minor concern. Still, it was something Koehler wanted to pursue. Although he could have gone directly to the vendor to have the modification made, Koehler chose a different route: He took the matter up with his software user group.
If that strikes you as a roundabout way to solve a software problem, you're probably not a member of a software user group. User groups—organizations made up of customers of a particular software supplier—have come a long way from their origins as forums for sharing war stories and swapping tips. These days, they're also an important communication channel between the users and the vendor. And in many cases, the groups have a great deal of influence on product development.
In fact, Koehler says that recommending upgrades and enhancements is one of his user group's main functions. "We come up with a 'top five' list of things we'd like to see improved," he explains. The group then presents its list to Infor, which oftentimes follows through and makes those changes.
That's exactly what happened in Koehler's case. The group recommended that the vendor modify the software's label-printing function. And sure enough, when Infor designed the next version of its warehousing system, it expanded the label's product information field.
Feedback from the front lines
Though they saw their heyday in the '80s, software user groups are still going strong today. They've undergone some changes in the intervening years, however. Nowadays, for example, user groups draw their members from all areas of the organization, not just from information technology (IT). Members may include warehouse managers, logistics managers, and operations managers like Koehler, as well as IT specialists, chief information officers, and even CEOs.
In the supply chain arena, user groups come in two types: "independent" groups that are run by members and have a loose affiliation with the vendor, and "dependent" groups that are formed by a software vendor that also provides financial support for the group.
Members of independent user groups tend to be customers of the big enterprise resource planning (ERP) software vendors, whose worldwide customer bases are large enough to support and sustain these groups. One such group is the Americas' SAP Users Group (ASUG). Formed in 1990, ASUG currently has 1,700 member companies and 50,000 individual members. It has 46 subgroups, called "influence councils," that focus on specific applications like warehouse management systems, advance planning and optimization systems, and supply chain execution systems.
ASUG uses its "collective voice" to make recommendations on ways in which SAP can change its products and services to meet customer requirements, explains ASUG President Rod Masney. He notes that the group's influence with the vendor has expanded over the years. "What's interesting is that 10 years ago, influence was at the operational level," Masney says. "Today, the user group influences the strategic level [of SAP]."
Another big independent group is the Oracle Applications User Group (OAUG), which counts about 2,000 companies among its members. This global organization has more than 100 subgroups, some of which deal strictly with supply chain applications. "OAUG is the voice of users that Oracle listens to," says Basheer Khan, president of systems integrator Innowave Technology and a member of OAUG's board of directors.
Members of dependent user groups, by contrast, are usually customers of best-of-breed software makers, which serve as the groups' sponsors. Supply chain planning and execution software specialist Manhattan Associates, for example, actively solicits members for its user groups from its customer base. Manhattan says that about 1,000 of its customers participate in 15 "product councils," which are organized around specific applications. "The councils get together at least once a year for a face-to-face meeting, and they do regular teleconferencing," says Manhattan's Eddie Capel, senior vice president of product management and customer relations. "We ask for participation in the design phase for the next release of a product. They get to vote on the features and functionality of the product."
HK Systems also invites user groups to suggest software modifications. Most of these groups meet on an ad hoc basis and hold frequent telephone conference calls. "A lot of our functionality is based on customer direction," says Dave Adams, vice president of product development. For instance, when the company upgraded its warehouse management system three years ago, it worked with a user group to improve the advance shipment notice (ASN) functionality in that release.
Other vendors organize conferences for their customers. For instance, AL Systems holds seminars several times a year that feature user presentations and small-group discussions. HighJump Software has been holding annual user conferences since 1988. These conferences provide another avenue for communication between vendor and user."We encourage regular feedback from the 'front lines' to ensure our products fit most effectively with the clients' requirements," says Chad Collins, HighJump's vice president of global strategy.
A little help from their friends
The benefits for vendors are obvious, but why do logistics professionals take time out from their busy schedules to attend user group meetings or take part in conference calls? It turns out that they see a host of advantages in joining these groups.
Ellen Martin, a vice president of supply chain business systems at Greensboro, N.C.-based apparel maker VF Corp., says she likes the fact that user groups offer a way for companies to ensure that software evolves along with users' changing needs. "When you buy a piece of software, it is what it is," says Martin, who serves on the board of directors for i2's user group. "Business conditions change, and software must change to be responsive. The user group gives you a manner in which you can work for change."
Influencing the development of new features, moreover, can save shippers a bundle: If a desired enhancement is included in the next version of an application, then users can get it for the cost of the upgrade—and that beats the cost of customization any day. "We get something we see as a needed change," says Koehler of First Supply, "but we don't get charged a modification price for the change."
But logistics professionals see user groups as more than just a way to get the vendor's ear. For many, the primary draw is the opportunity to meet and learn from their fellow users. "If you're having a problem, you get a chance to collaborate with others on it," explains software consultant Phil Obal, who helped start a user group several years ago.
User groups aren't just for advanced "power users," however. Users at all levels can benefit from participation. "User groups are especially beneficial for companies that are experiencing the initial startup with an application," says Greg Vandergriff, a DC manager for Beauty Brands in Kansas City, Mo., who helped his software vendor launch a user group. In fact, when it comes to instruction, many find that the best tutors are their fellow users. "You're able to get more good information and more utility by being able to exchange notes with other people using the system," says J. Kevin Michel, manager of logistics operations at Cowan Logistics in Aberdeen, Md., who has participated in three user groups.
But for many participants, the relationship building facilitated by software user groups is the most important benefit of all. In a recent survey of DC VELOCITY readers, fully half of the respondents cited the opportunity to exchange knowledge and network with their peers as their primary reason for joining a user group (see the accompanying sidebar).
"It's a way to make friends," says Obal. "You build a relationship. You become a resource for them, and they become a resource for you."
software users like to talk shop
It's not just about the technical details. The chance to share knowledge and network with fellow software users is what motivates many DC VELOCITY readers to join software user groups.
And join they do. Forty-two percent of the survey takers (which included manufacturers, distributors, retailers, and service providers) said they take part in vendor-sponsored user groups, while 36 percent belong to independent organizations. Another 22 percent participate in both types of groups. When asked which vendors' groups they had joined, the respondents listed a number of suppliers, but the most common responses were SAP (25 percent), Oracle (14 percent), and Manhattan Associates (11 percent).
Though many said they had joined a user group for the chance to talk shop (see chart), a sizable percentage of the respondents said they had signed on in hopes of influencing software development. And it appears that they've achieved some success in that regard. The vast majority (94 percent) of survey respondents said that input from their user groups had led vendors to make refinements to their software. One respondent, for example, reported that his group had persuaded its vendor to enhance its system so that it could automatically calculate freight charges when an order was entered. Another said he and his fellow group members had convinced the software maker to add a feature that determined whether orders should be shipped as individual pieces or grouped together.
social networking
Why do logistics professionals join user groups? Half of the respondents to a recent survey said it was for the chance to exchange information and network with their peers.
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Serious inland flooding and widespread power outages are likely to sweep across Florida and other Southeast states in coming days with the arrival of Hurricane Helene, which is now predicted to make landfall Thursday evening along Florida’s northwest coast as a major hurricane, according to the National Oceanic and Atmospheric Administration (NOAA).
While the most catastrophic landfall impact is expected in the sparsely-population Big Bend area of Florida, it’s not only sea-front cities that are at risk. Since Helene is an “unusually large storm,” its flooding, rainfall, and high winds won’t be limited only to the Gulf Coast, but are expected to travel hundreds of miles inland, the weather service said. Heavy rainfall is expected to begin in the region even before the storm comes ashore, and the wet conditions will continue to move northward into the southern Appalachians region through Friday, dumping storm total rainfall amounts of up to 18 inches. Specifically, the major flood risk includes the urban areas around Tallahassee, metro Atlanta, and western North Carolina.
In addition to its human toll, the storm could exert serious business impacts, according to the supply chain mapping and monitoring firm Resilinc. Those will be largely triggered by significant flooding, which could halt oil operations, force mandatory evacuations, restrict ports, and disrupt air traffic.
While the storm’s track is currently forecast to miss the critical ports of Miami and New Orleans, it could still hurt operations throughout the Southeast agricultural belt, which produces products like soybeans, cotton, peanuts, corn, and tobacco, according to Everstream Analytics.
That widespread footprint could also hinder supply chain and logistics flows along stretches of interstate highways I-10 and I-75 and on regional rail lines operated by Norfolk Southern and CSX. And Hurricane Helene could also likely impact business operations by unleashing power outages, deep flooding, and wind damage in northern Florida portions of Georgia, Everstream Analytics said.
Before the storm had even touched Florida soil, recovery efforts were already being launched by humanitarian aid group the American Logistics Aid Network (ALAN). In a statement on Wednesday, the group said it is urging residents in the storm's path across the Southeast to heed evacuation notices and safety advisories, and reminding members of the logistics community that their post-storm help could be needed soon. The group will continue to update its Disaster Micro-Site with Hurricane Helene resources and with requests for donated logistics assistance, most of which will start arriving within 24 to 72 hours after the storm’s initial landfall, ALAN said.