Service-Oriented Architecture Seen Spurring New Wave of Supply Chain Innovation

SOA eases integration and promotes agile business processes, improving competitiveness, AberdeenGroup reports

SOA eases integration and promotes agile business processes, improving competitiveness, AberdeenGroup reports

Boston  October 21, 2005  Companies are adopting a service-oriented information technology architecture (SOA) to solve their most pressing IT issues, with 45 percent of companies in a recent survey reporting that they have SOA or Web services projects involving the supply chain underway, according to a new AberdeenGroup research report.

Furthermore, in the report, "Service-Oriented Architecture in the Supply Chain: What Supply Chain Managers Need to Know," Aberdeen reports that of the nearly 300 executives surveyed, an additional nearly 20 percent of respondents plan to launch similar projects in the next 12 months.

"We found that when companies do indeed compete with their supply chains, most are entering the battle with their technology arms tied behind their backs," said John Fontanella, senior vice president of supply chain research. "Service-oriented architecture gives companies the very real opportunity to accelerate information integration while configuring business processes that can quickly meet internal and trading partner requirements."

The study also found that in today's enterprise, supply chain management is supported by a variety of software applications and services that are not well integrated or flexible enough to meet changing business requirements.

Other key research findings include:

  • Ninety-four percent of those surveyed use a combination of best-of-breed applications, on-demand services, enterprise resource planning (ERP) systems and desktop applications to manage supply chains.

  • The flexibility required from supply chain applications far outstrips their ability to provide it. In fact, 61 percent of those surveyed said that they are forced to employ manual application workarounds to meet requirements  or limit the services offered to customers.

  • The companies most likely to adopt SOA in the near term tend to buy applications that best fit their current technology requirements; they are less likely to have a corporate-wide ERP consolidation program in place.
The research report concludes that, with SOA, technology will finally support business processes rather than having supply chain applications dictate them.

A free copy of the report is available at

Additional Articles of Interest

 How are outsourcing and supply chain tasks such as purchasing and inventory management tied to "network-centric operations?" What is a network-centric operation? Read the article "The Future of Supply Chain Management: Network-centric Operations and the Supply Chain" to find out.

 A survey of consumer healthcare decision-makers shows opportunities for manufacturers to gain competitive advantage by focusing on some key points in their supply chains. Read more in the In Depth article "Leveraging the Supply Chain for Competitive Advantage."

 Words of wisdom from one university professor go a long way to help business students excel in supply chain management. Read "Interview with Dr. John T. Mentzer: Teaching Supply Chain" in the June/July 2005 issue of Supply & Demand Chain Executive.