SOUTHFIELD, MICH. March 15, 2001 Auto industry e-marketplace Covisint is adopting supply chain event exception and execution management applications from technology provider SupplySolution under an agreement, announced Thursday, that the marketplace's acting CEO says is just the first step in building its technology platform for supply chain management.
The agreement calls for SupplySolution to make its current supply chain execution infrastructure and applications available to all current and future Covisint customers worldwide. The agreement also states that the two companies will co-develop future supply chain applications that may include real-time ordering, planning and logistics.
The two sides did not disclose the financial terms of the agreement.
SupplySolution's offerings will be available immediately to all Covisint customers on a subscription basis. Current SupplySolution customers will be offered the opportunity to join the Covisint exchange at their contract anniversary date or sooner if the customer elects.
"This relationship provides instant access to services and applications that streamline supply chain execution, and technology that enhances and complements that of Covisint," said Chris Steele, supply chain lead at Covisint. Steele said the SupplySolution offering can produce measurable benefits in inventory reduction and associated costs within 90 days.
During a teleconference to discuss the deal, Covisint's acting CEO, Rico Digirolamo, said the SupplySolution agreement is just the industry-sponsored marketplace's first move toward building its technology platform for supply chain management. He said Covisint is pursuing a "best-of-breed" approach to building its technology platform, which means that its e-marketplace intends to assemble software components from what it views as the leading providers of applications for different functions. "This is the first step in what will be a multi-step approach in the supply chain management area," Digirolamo commented.
The announcement Thursday would appear to be something of a coup for SupplySolution. "This is our company's most significant agreement to date," said SupplySolution president and CEO Chris Moritz. "We see exceptional market potential in extending these offerings to Covisint's customers."
Founded in 1998, SupplySolution boasts today that its i-Supply offering is the automotive industry's most widely used Web-based application for direct material fulfillment, operating at more than 750 automotive supplier companies.
SupplySolution's supply chain execution offering contains three components: the i-Supply Service, i-GetIt and the SupplySolution Global Infrastructure. i-Supply is a real-time direct material fulfillment application, providing suppliers, manufacturers and distributors with instant information from their customers' enterprise resource planning (ERP) or other legacy systems, allowing them to manage inventories and work collaboratively with their supply chain partners. Implementation time for i-Supply can be as short as two weeks.
i-GetIt addresses requirements for real-time, secure data extraction and/or delivery of data to and from ERP, supply chain management, customer relationship management and legacy systems. SupplySolution Global Infrastructure addresses requirements for real-time messaging and message transformation, data/content management, user profiles, views and transaction management.
Announced in early 2000 and currently being developed by DaimlerChrysler, Ford, General Motors, Nissan and Renault, as well as technology providers Commerce One and Oracle, Covisint is intended to provide the automotive industry with tools for collaborative product development, procurement and supply chain management. The goal is to reduce costs and bring efficiencies to the business operations of the participating automotive manufacturers and their suppliers.
Steele said during the teleconference that Covisint is looking at opportunities, including with SupplySolution, to address other functions in the planning and execution sides of the supply chain, such as transportation management, inventory management on a broader scale, trade management, order management and others on the execution side; and forecast capacity collaboration, global availability to promise, demand and supply aggregation and logistics on the planning side.
Commenting on the Covisint-SupplySolution deal, Bill Platko, of Tower Automotive, which has implemented i-Supply Service in its business units, said, "This agreement builds on the extremely positive experience we have had to date with SupplySolution, and now offers us a single source to manage our supply chain needs moving forward."
Covisint is currently located in Southfield, Mich., with temporary offices in Stuttgart and Tokyo. SupplySolution's headquarters is located in Santa Barbara, Calif., and it has sales and service headquarters in Southfield, Mich.