July 1999 | Commentary | Supply Chain Technology

McHugh's Road Leads to Integrated Logistics System

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There are as many roads to supply chain management as roads to Rome.

One road is to concentrate on integrating the various levels of logistics execution—such as warehouse management, distribution management, labor management and transportation management—which allow the product to move from its point of origin to its consumption as fast as possible, at the lowest cost and in coordination with the supply and demand cycle. Each of these spheres of work and management has its own particular application and process needs.

McHugh Software International, Waukesha, Wisc., offers just such a logistics execution system suite of software applications. McHugh has been doing business within certain parameters of this business for 20 years.

Russ Meyer, McHugh's vice president of marketing and global alliances, takes a high-road view commensurate with an experienced company. He sees the primary values of McHugh's business as better products, better service, and a better company.

"We can review all kinds of technology with our clients," Meyer says. "But at the end of the day, clients want to know what is going to make a difference in their business. This is done with a value add that has economic gains and is done at the least possible cost. It is also done with the highest possible return in the fastest time to value."

"In the positioning of our products within the industry we have an integrated, go-to-market strategy," says Greg Aimi, McHugh's vice president of product strategy. "It encompasses sales, marketing, and product development. We reflect what the market is doing. We don't try to create solutions, then go find problems that these solutions solve. We try to observe the industry, and observe how our products are being used by our current and prospective customers."

McHugh Software offers three basic product categories that carry out the company's philosophy. These categories consist of warehouse management systems, labor management systems, and transportation management systems.

McHugh offers its warehouse management solutions as two separate systems:

DM plus, which operates at the enterprise level and provides functionality for total supply chain solutions. Sandvik Coromant, a worldwide supplier of carbide cutting tools, is a typical DM plus user.

DCS, which is scaled to mid-range warehousing, and was developed as a drop-in distribution package.

McHugh's labor management system product is called CALM. It maximizes labor resources within a distribution center and gives real-time reporting capability and tools for labor planning. The transportation management system is called TRACS. It is also a real-time tool that tracks, routes, builds, and assigns shipments. It extends McHugh's logistics system approach beyond the dock doors. A recent application of TRACS has been made at Sea-Land, one of the world's largest container shipping companies (global scale: 100 containerships and 210,000 containers).

"Our products can generally scale to the user; however both TRACS and CALM are typically more horizontal in application," says Aimi. "They conform to more of a usage profile. They have been scaled from mid-tier to large-tier companies.

"For these kinds of software applications, we are in a part of a life cycle," he adds. "We see that there are a few mature companies—those who have been around long enough and who have built enough products—for whom we can develop a majority package application that solves problems in a repeatable fashion.

"In the past, prior to available purchasable applications, a company would have to invest its own time and resources in programming to eventually come up with solutions. The better their team was, the better the solution."

Grand-scale applications within McHugh's arena of logistics execution and supply chain management are relatively new. "We only now have the replication of a capable application that is strong enough for general problem solving," says Aimi. "By focusing our applications where they have been most built up, we can match these solutions to solve a company's logistics problems, and solve them very well. This means a lot less customization."

"A company in a specific vertical market," Russ Meyer adds, "has a hard time differentiating itself from others in the same market. For example, a food and beverage company is basically the same, regardless of the brand name. The companies might debate that they are different, but if you look at it conceptually, there are best practices that apply generically to the majority of the operational aspects of their business. There will be peculiarities that make them different, but for the most part they can accept the 80-percent fit."

"We think of ourselves as the best of breed in logistics activity as it relates to order fulfillment and supply side logistics," Aimi states. "We understand, however, that the McHugh solution is not the total solution that a company needs to run its business. We have looked strategically at the solutions companies use on a comprehensive basis to add a 'backbone' to their operations. As part of that assessment, we have looked at SAP, Peoplesoft, and Oracle."

McHugh partners with Vastera, a provider of international trade logistics. This partnership allows the companies to serve customers requiring complex and robust trade functionality and country-specific compliance to local regulatory practice. The alliance further enhances their ability to offer solutions to global supply chain needs.

For more information on McHugh, visit www. mchugh.com

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