Perspectives on Various Issues of Interest

Fine Balance

Seed Money For Entrepreneurial Venture - The 401K Option

Firms such as BeneTrends in North Wales, Pa & Guidant Financial Group in Bellevue, Wash. are observing almost 30% to 35% increase in customer volume for a new venture funding approach that taps into the entrepreneur's 401K for a charge. In this non-traditional mechanism for small business loan an entrepreneur creates a corporation with the help of an outside advisor. The corporation in turn starts a 401K plan and the entrepreneur rolls over existing retirement funds into the account. According to the 401K rules, such investiments (as against withdrawals) are permissible and are not subject to the 10% penalty. Firms such as BeneTrends and Guidant charge $4,500 to $7,500 for their services.

Source: Burnsed, Brian, "From 401(K) Nest Egg to Seed Money," Business Week, December 22, 2008, pp. 64

Supply Chain Infrastructure Priorities

In the recently published research report, Aberdeen Group surveyed 800 supply chain executives, 80% of whom identified their companies as being involved in domestic and/or international supply chain transformation initiatives. Aberdeen report the following supply chain infrastructure priorities that companies believe are most important to their supply chain management technology roadmaps (Source: Aberdeen Group, March 2008):

1. Business process management or workflow: 48%
2. Supply chain event management and alerting platform: 43%
3. Master data management (internal): 40%
4. Data warehouse or business intelligence platform: 28%
5. Enterprise application integration: 23%
6. Service-oriented architecture and composite application support: 20%

The following were the key partners for enabling supply chain management technology roadmap (Source: Aberdeen Group, December 2007):

1. Internal IT teams/ custom development: 47%
2. ERP vendor: 22%
3. Consulting company: 16%
4. Best-of-breed SCM vendor: 14%

When viewed from individual infrastructure areas the following results were observed (Source: Aberdeen Group, December 2007):

1. Business process management or workflow
    a) Internal IT: 48%
    b) ERP Vendors: 49%
    c) Best-of-breed Vendors: 46%

2. Supply chain event management and alerting platform
    a) Internal IT: 40%
    b) ERP Vendors: 48%
    c) Best-of-breed Vendors: 51%

3. Master data management (internal)
    a) Internal IT: 38%
    b) ERP Vendors: 44%
    c) Best-of-breed Vendors: 38%

4. Data warehouse or business intelligence platform
    a) Internal IT: 27%
    b) ERP Vendors: 30%
    c) Best-of-breed Vendors: 19%

5. Service-oriented architecture and composite application support
    a) Internal IT: 21%
    b) ERP Vendors: 16%
    c) Best-of-breed Vendors: 24%

6. Enterprise application integration
    a) Internal IT: 21%
    b) ERP Vendors: 28%
    c) Best-of-breed Vendors: 20%

Source: Aberdeen Group, The Supply Chain Executive's Strategic Agenda 2008: Managing Global Supply Chain Transformation

Product Life Cycle Management

An Aberdeen Group report on PLM, titled, " The Best Kept Secret of Top SMB Product Developers," benchmarked more than 290 SMB (Small and Medium Business) survey respondents in July 2008, finding that SMB adoption of PLM solutions is expected to grow 200 percent over the next 2 years. In addition, SMB professionals using PLM reported strong return on investment, including 18.5 percent improvement in product profit margins, 16 percent faster design release to manufacturing, and 54 percent quicker approval or rejection of engineering change orders.

Researchers determined top issues driving PLM adoption by SMBs include the ability to create higher quality products, manage increased complexity, improve collaboration and improve the speed to market. SMBs also can use PLM to help them conform to international requirements.

Source: Rennie, E. "Accelerated Innovation: Midsize firms rush to adopt product life cycle management." APICS Magazine, Nov/Dec 2008: pp. 32-36.