Through its standalone SCM system, J.D. Edwards is plotting a regime change for the old, ever-present manufacturing resource planning (MRP) systems: It's planning to kill them off.

So what does J.D. Edwards have planned? It can deal with the heavy lifting of process integration through supply chain processes and also understands the subtlest of SCM, thus killing the MRP logic. Why should business people care? Without going into the maze of algorithmic superiority, several fundamental concepts of MRP are dissonant with the way businesses work:

• MRP is a batch process that relies on forward-scheduling techniques that inherently rely on inventory to solve production problems, rather than advanced planning that blends strategies to solve real-time order requirements.
• MRP is four walls. Many businesses are virtual and want a plan that includes multi-partner visibility. J.D. Edwards' new consensus planning should provide visibility, multidimensional analysis, and the ability to "score" the reliability of the forecast from various participants.

Beyond changes to advanced planning, J.D. Edwards has some interesting strategies and capabilities to note:

• Demand management. Beyond having a sophisticated forecasting application with partner Demantra, J.D. Edwards will use the consensus application with forecasting for discrete and industrial customers whose demand planning requirements aren't as algorithmic. A framework for dialogue and demand accuracy take these sectors far, versus consumer packaged goods firms that benefit and have the discipline for a heavy-lifting algorithmic application from Demantra. Demantra and J.D. Edwards' contract continues through 2005, and a healthy pipeline continues for these partners.
• Execution management. A Warehouse Management System (WMS) integrated to order management and transportation, it offers complete promising and transaction integrity through order management and delivery. J.D. Edwards has WMS and some Transportation Management Systems (like most ERP vendors) and accomplishes more advanced capabilities through partners like Logistics.com for advanced logistics. It's not clear yet if the recent purchase by Manhattan changes that relationship.

J.D. Edwards has shown a great deal of forward thinking to cut a separate path for SCM. It takes a large investment to get there, and not just development, but also sales and marketing. We expect more brave moves and more sales as it builds out a deeper client base and extends its product's reach. And we come to bury MRP, not to praise it.

J.D. Edwards Plans the Death of MRP
First Published November 7, 2002

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