If there's one benefit to the shakeout that has rattled the information technology sector and related industries in the past few years, it's that those companies who are still in business have undoubtedly developed proven and worthwhile products that are providing real value to customers.

This is especially important now, as companies that are purchasing IT products and services are working with tighter budgets coupled with increased demands for return on investment.

According to Boston-based AMR Research, when it comes to supply chain management applications, i2 Technologies is the market leader, with 24 percent of the market share based on license revenue. During the second quarter of this year, more than 85 companies went live with 120 implementations of i2 solutions, leading i2 closer to its goal of generating $75 billion in value for customers by 2005. In addition to supply chain management applications, i2 is also the revenue leader in the eCommerce content and product information management markets.

A Recipe For Success

Andy De, director of SCM product marketing for i2, says that "visibility and collaboration" continue to be two of the most important features for the latest breed of supply chain management applications. De's observation is supported by Jupiter Media Metrix, which found that more than 25 percent of B2B executives surveyed by the firm said they'll add collaborative features to their private trading networks within the next year. Moreover, the addition of collaborative applications, including inventory level monitoring and product design to private trading networks, will outpace those of transaction focused enhancements, as only 20 percent of B2B executives indicated they'll focus on procurement features.

As for visibility, Jupiter analysts say improving inventory visibility is a key component to the success of both original equipment and contract manufacturers because it allows them to plan just-in-time manufacturing.

i2's commitment to offer products that enhance collaboration along the supply chain was demonstrated recently when the company expanded its relationship with E2open, the global collaboration network for the electronics industry. E2open enables collaboration among OEMs, contract manufacturers, distributors, and suppliers, and supports the entire product lifecycle, including design, manufacturing, procurement, and asset recovery for computing, networking, telecommunications, and consumer electronics products. The combination of i2's powerful applications together with E2open's Internet-based, scalable common architecture make for an attractive product.

By using collaboration solutions based on this architecture, trading partners can avoid the cost and risk of building a network by connecting to their supply chains through a private and secure network. Customers can also bring their trading partners on board quicker, potentially decreasing supplier integration and deployment costs and facilitating better collaboration among multiple, global tiers of trading partners. This improved collaborative supply chain management solution can reduce inventories, cut down on lead times, and improve on-time delivery.

"i2's industry leadership and supply chain expertise, combined with E2open's unique IP and ability to reach tier one and mid-market suppliers, raises the bar for other solution providers," notes Joanne Friedman, vice president for international business strategies at META Group, an industry analyst firm. "While the industry has seen a plethora of partnership announcements, this joint solution and co-development effort may really establish a precedent for other industry players, indeed challenging others to truly collaborate to bring customer value and a real end-to-end solution for customers."

Jupiter Media Metrix points out another advantage, adding that more than 80 percent of B2B buyers will be strongly influenced to trade online with suppliers who offer more comprehensive services, including collaborative product design and supply chain inventory visibility. And, 54 percent of B2B buyers would treat suppliers as "preferred vendors" if they provided such value-added services.

Adding Service to the Mix

When it comes to service requirements, "a small company essentially has the same needs as a multi-billion dollar company," says Anand Iyer, i2's director of product marketing, factory planning and scheduling solutions. This is another area in which i2 has excelled. The company's customers are also representative of a broad range of industries, from aerospace and defense to pharmaceuticals and health care.

Many companies have invested in IT products and services to help manage their supply chains and other aspects of their businesses in recent years. While some may be more hesitant now to plan on additional purchases due to economic and political conditions, in fact the present business climate actually compels decision makers to invest in such tools.

Given increased market pressures and tighter competition, companies can't afford to maintain less-than-efficient supply chains. Fortunately, their choices for vendors, while smaller in number, are abundant in value. And, given the nature of IT development, whereby new products are being developed and existing ones upgraded continuously, the applications available today are incredibly sophisticated.

Some of the advantages of supply chain management applications, as highlighted by i2, include:

Inventory Reductions

• Supply and demand visibility substitutes inventory with information.
  Increased planning frequency and fidelity lowers the requirement of buffers against uncertainty.
  
• Ability to know when to buy materials based on customer demand, and the capacity, logistics, and other materials needed to build the order to completion.
  Increased Customer Satisfaction
  
• Better positioning supply chain resources to anticipated demand.
  
• Reduced lead times through optimal inventory management.
  
• Understanding the capability to deliver on a promise based on availability of materials, capacity, and logistics.
  
• Proactive notification of potential delivery problems and the ability to react with velocity to examine ways to maintain the delivery date.
  
• Use of "part criticality planning logic" to increase stocking of critical parts while decreasing overall service parts inventories.

Revenue Growth

• Intelligently offering the "right" product mix to increase revenue per customer.
  
• Real time visibility across the supply chain (alternate sources, parts, cancelled orders, capacity, etc.) enables order fill opportunities that are otherwise lost.

Throughput Improvements

• Better coordination of material and capacity prevents loss of utilization waiting for parts.
  
• Optimization of changeovers, batches, and other scheduling constraints maximizes productivity.

Operating Cost Reduction

• Optimized logistics planning to reduce expediting, overtime, and trucks leaving the docks half-full.
  
• Forward visibility to prevent "last minute heroism" incurred to maintain customer service.