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7/17/2001



Rail News: Rail Industry Trends

Class Is attempt to address customers' growing supply-forecasting demands


The supply chain planning and scheduling market last year grew by more than 75 percent to nearly $2 billion, meaning supply chains — and Class Is — under pressure to more rapidly respond to changing customer needs and market dynamics are trying to quickly adopt collaborative planning tools to answer customers' forecast demands and better manage equipment and materials, according to an ARC Advisory Group (ARC) study released July 17.
"Collaborative planning tools focus on managing the changes in demand and supply that frustrate planners and keep supply chains from achieving peak performance," said Sid Snitkin, vice president of ARC, a strategic planning and technology assessment consultant, in a prepared statement. "By enabling rapid integration of new demand forecasts and changes in supply plans, trading partners can better manage their own operations and avoid costly buildups of obsolete materials and products."
ARC's Collaborative Planning and Scheduling (CPS) Global Outlook study estimates that worldwide CPS shipments will grow at a cumulative 23 percent average growth rate over the next five years, with North America remaining the largest CPS market.
Collaborative planning tools already are high on many Class I e-business priority lists as the railroads attempt to better manage customers' demands. During May interviews, some Class I e-business executives either mentioned plans to implement collaborative planning applications on their railroad's Web site or highlighted existing tools.
Canadian Pacific Railway in December plans to launch Capture Empty Equipment Demand, designed to enable customers to forecast their rail-car demands; Union Pacific Railroad soon plans to roll out a forecasting tool designed for large bulk shippers, enabling those customers to input their 14-day car demands; and Burlington Northern Santa Fe since March has offered a coal forecasting tool, enabling its utility customers to estimate their four- to eight-week coal car demands.
CPS also ranks high on the to-do list of RailMarketplace.com, the Class Is' supply-chain e-marketplace. RailMarketplace officials plan to offer industry suppliers collaborative planning tools as the budding site rolls out applications through late summer and fall.


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