The supply chain management (SCM) market has a new focus. As more businesses complete implementations of supply chain planning systems, they are demanding software for the next layer of SCM: the execution layer. Supply chain execution products now account for 54% of the growing SCM market, says AMR Research, outstripping sales of supply chain planning software.
This trend has been a boon for G-Log, which sells transportation and logistics management software – a vital part of supply chain execution. Since launching in Europe in June 2001, G-Log has implemented its flagship GC3 platform at retailer Tesco, chemicals company DuPont, and global logistics provider Exel. "G-Log stands head and shoulders above its competitors, and is always on customer shortlists," says AMR analyst Gerald McNerney.
The company's success is based on a mix of product focus and smart management. Its founders, previously at SCM company Manugistics and warehouse management software company RedPrairie, have coupled their extensive knowledge of the SCM sector with an Internet-based architecture to produce a package that, they say, can cut 15% off a company's distribution costs.
The main focus of the software is improving the efficiency of the transportation process. For example, GC3 uses algorithms to optimise freight loads and calculates charges such as cross-border tariffs and carrier fees. The software also verifies invoices for logistics services by matching them to actual delivery times and the freight loads transported. Key to G-Log's success is the fact that it launched GC3 at a time when the dominant players in SCM, such as i2 and Manugistics, had put their own transportation management products on the backburner. As a result, G-Log expects to double its revenues to $30 million in 2002.
This 'head start' will not last long, however. Both i2 and Manugistics are now renewing their focus on transportation software. G-Log needs to move fast.