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One of the newest morsels on the tech industry's buffet of buzzwords is Supply Chain Event Management (SCEM). And though, in the past, enterprise software buyers seemingly displayed an insatiable appetite for the latest acronym, times have changed. A tighter economy and jaded IT community have analysts trying harder to define SCEM and corporate managers working diligently to understand whether or not they need it.

Unlike CRM and some other popular "techronyms," SCEM hasn't ballooned into an all-encompassing category of its own with blurry boundaries. Analysts appear to agree that SCEM is a function or capability within the larger realm of supply chain software. One reason is SCEM is not a stand-alone application; it requires an underlying business system that collects day-to-day transaction data and organizes it. Another reason is that SCEM is a discrete feature supply chain software vendors easily have added to their product suites through partnerships, acquisitions or by developing the functionality themselves.

But classifying a buzzword as a function rather than a category doesn't answer whether or not the enterprise needs it. Many business managers still aren't clear on what benefit SCEM delivers and where to apply it for rapid ROI.

Parsing the Techronym

Supply Chain Event Management evolved as an extension of process control. Organizations manage their processes with planning. But even the best laid plans can be interrupted by the unexpected. Consider a new product launch with an initial forecast that underestimated demand. In today's just-in-time manufacturing era, companies quickly discover not enough finished product exists to fill orders. Then, they find scant time available to procure more supplies and make more products within client delivery requirements. Add to the supply-chain complexity other product launches in multiple markets for numerous customers, and process breakdown becomes a snowball expanding in size and gaining speed as it barrels downhill.

SCEM software enables companies to respond rapidly and sometimes automatically to unplanned events - without having to completely regenerate plans. SCEM applications accomplish this by notifying supply chain managers when specific "events" occur, e.g., when inventories are depleted, shipments delayed, etc. Data that represent exceptions from plan are red flags. Often times, automated responses can resolve these issues promptly, but in all cases managers have the opportunity to analyze problems and determine solutions.

This visibility is SCEM's greatest benefit. Seeing a problem is 90 percent of fixing it. Individual events are leading indicators; i.e., opportunities to stop the snowball a few feet farther up the hill. In the past, companies dealt with emergencies after the figurative avalanche crushed the village. Supply chain managers waded through reams of reports after the fact and attempted to mitigate the damage of lagging production schedules missed shipments or spiraling costs. Only goodwill might keep a disgruntled customer in the fold.

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