Test Of Supply-Chain ProwessTest Of Supply-Chain Prowess

Agilent Technologies Inc. is putting the finishing touches on a new supply-chain-management system that's already smoothing out the process of delivering its test-and-measurement equipment to customers. The system, built on Oracle's 11i E-Business Suite, is live now at more than 20 of Agilent's 30 manufacturing sites worldwide and will be up and running at all facilities next month.

Chip manufacturers like Intel and Motorola Inc. rely on Agilent's test- and-measurement products to help with their research and manufacturing activities. Often orders for Agilent's products are highly customized, making it difficult for Agilent salespeople to know up front if requested product configurations are possible. They'd take the order, but when it was forwarded to manufacturing, they'd learn that certain components couldn't be combined as specified. That meant going back to the customer, refining the order, and ultimately issuing an invoice that might not be in line with the original order quote.

Agilent, which was spun off from Hewlett-Packard in 1999, now runs the supply-chain and financial modules of Oracle's 11i E-Business Suite on an HP Superdome Unix server. Information such as available product configurations and production schedules at manufacturing sites is available for real-time access. So, when salespeople enter orders, they know immediately if Agilent can configure the products as requested and when they'll be able to deliver them, says Kunio Hasebe, VP and general manager of Agilent's test-and-measurement enterprise-resource-planning program.

Getting there has been anything but easy. Agilent began the 11i deployment in June 2002 at manufacturing sites in California and Malaysia. But because supply-chain systems aren't a core competency for Agilent's IT team, that first effort to link a new system with legacy data didn't go well. "We screwed up the data migration," Hasebe says. "When the customer placed an order, we couldn't even find it later."

Hasebe and his team stepped back and spent several months reconsidering their approach. They ironed out the data-migration issues, and, perhaps more important, they rallied the support of division managers who during the first attempt had been resistant to a technology they believed was being foisted upon them. With manager buy-in in place, Hasebe set up a plan to bring all 30 manufacturing sites online in four waves, using a core development team that would handle all the deployments.

During an Oracle-hosted supply-chain event earlier this month at which Hasebe discussed Agilent's deployment, IDC analyst Meredith Whalen said high-tech firms' spending on IT systems for manufacturing operations will grow faster than in other industries. Spending on supply-chain software leads IT priorities among high-tech manufacturers, IDC reports.

There are still some kinks to be worked out. Agilent's deployment hasn't translated into increased customer satisfaction yet, because customers are still trying to understand the change in Agilent's business processes. But Agilent has already seen bottom-line benefits from the supply-chain system. Among those are improved order accuracy, reduced support costs from having one technology in place rather than many homegrown applications, and the ability to reduce head count now that data moves seamlessly through an automated series of business processes.

Hasebe has one more thing he'd like to tackle--redesigning the network so queries flooding into the Superdome won't cause bottlenecks.