供應鏈管理規劃與建置實務

1. 供應鏈管理規劃與建置實務 張國揚 Kevin Chang GCSM, i2 Taiwan

2. Terminologies Logistics Management Supply Chain Management (SCM) Enterprise Resource Planning (ERP) Advanced Planning and Scheduling (APS) eBusiness, eCommerce, eProcurement 物流管理 供應鏈管理 運籌管理 企業資源管理 電子化商務管理

3. Why Supply Chain Management It’s not just about profit. It’s all about competition and survival.

4. Supply Chain Management Basic Concept and Contents MIS? DesignSource NegotiateBuyMakeMoveStoreServiceFulfillSell Market

5. SCM Components SRM SCM CRM

6. Deployment of SCM Time Hours/ Minutes Months/Years Days/ Weeks

7. Strategize SCM • Design your supply chain • Evaluate alternative partners • Set transportation contracts • Jointly develop business plans • Optimize service/parts levels to budget

8. Strategic Decisions • Where do you locate facilities? • What should your product mix be? • Make versus buy decision and sources? • Which transportation modes and partners should you use? • What will your distribution network look like in the light of a merger or divestiture? • How do you determine service stocking levels to stay within your budgets and space?

9. Plan SCM – Demand • Predict demand • Collaborate on demand • Collaborate on supply • Optimize product mix for total profitability • Profitably match supply to demand • Detect & solve problems • Allocate supply

10. Thomson Consumer ElectronicsEnhancing Customer Satisfaction & Revenues Thomson saved over $128 M in inventory and realized over $210 M in revenue upliftfrom their DP implementation After 1 week 2 days 95% 95% 8-12 BEFORE 4 – 5 weeks 10 days 35 -70% 73% 5.5 Planning Cycle Time Forecasting Cycle Time Forecasting Accuracy Order Fill Rates Inventory Turns

11. WhirlpoolSlashing inventory with better demand management Product Availability Customer Service Finished Goods Inventory Whirlpool saved over $15 M in inventoryfrom their DP implementation BEFORE Less than 60% Reasonable Huge AFTER > 70% Improved by 10% Slashed by 50%

12. Plan SCM – Supply • Predict demand • Collaborate on demand • Collaborate on supply • Optimize product mix for total profitability • Profitably match supply to demand • Detect & solve problems • Allocate supply

13. Challenges in Matching Supply With Demand...What Do You Do… • When inventory and capacity shortages occur outside your four walls? • To balance material and capacity needs against your demand? • To decide on the right product mix to profitably meet demand? • To communicate real-time with your suppliers? • To quickly respond to changes in demand? • To allocate supply plans to your demand plans? (i.e., do you have preferred customers?)

14. Herman MillerTurning the Tables on the Furniture Industry Lead Times On-time Shipments FGI Inventory Levels WIP Levels • Herman Millerincreased revenues by $300 millionwithout any additional capital investment AFTER 2- 4 weeks (vs. industry average of 12-18 weeks) >98% Slashed 3 weeks of FGI - $ 75 million Slashed by 50% BEFORE Six weeks+ 70% Huge Huge

15. VF CorporationSlashing Inventory through Supply Planning Customer Service Planning Cycle Times Inventory - WIP and FGI • VF Corporation slashed over tens of millions of dollars in inventory and enhanced customer service AFTER Enhanced 10-15% Reducedby over 75% Slashed over tens of millions BEFORE Competitive Months Huge

16. Johnson & Johnson MedicalStreamlining the Supply Chain Planning Cycle Times Production Lead Times WIP and FGI Number of Tier 2 and 3 Distributors • J&J Medical improved customer service significantly while shaving over $40 million in inventory AFTER 5 days 30 days Reduced to $30 million 100 BEFORE Over 1 month 4 months $ 70 million > 1800

17. Timken Industrial BearingsEnhancing delivery performance Planning Cycle Times Production Lead Times WIP and FGI Delivery Due Date Performance • Timken slashed over $35 million in inventory with appreciable improvement in delivery performance AFTER Bi-weekly 6 weeks Reduced 50% and 30% > 90% BEFORE Over 30 days 10 weeks Huge 70%

18. Groupo GamesaImproved customer service with rapid time-to-value Planning Cycle Times Solution Implementation Time Packaging Material Inventory Delivery Due Date Performance • Grupo Gamesa implemented SCM across six plants in less than 8 weeks and realized over $ 3 million in cash flow AFTER 24 hours Reduced 50% Improved > 100% 56 days across all 6 plants BEFORE 4 days High Reasonable Anticipated over 4 months for each plant

19. Execute SCM? • Collaborate on orders for replenishment • Make accurate promises • Manage orders across multiple enterprises • Pick, pack, ship and deliver • Detect exceptions and manage them • Coordinate and replenish service parts

20. Execution Problems…Are You Challenged By… • Making bad promises that result in irate customers? • Your inability to respond fast enough to exceptions? • High transportation costs due to expediting? • Consolidating multiple line items into a single delivery? • Completing service or repair on the first call? • Delivering on VMI and CPFR commitments?

21. Barnes & NobleProfitably executing on supply to meet demand Inventory Forecast Accuracy & Supply Demand Matching Distribution & Transportation Costs • Barnes & Noble will unleash value • in excess of $21 million BEFORE Huge inventory at DCs Largely inaccurate resulting in stock-outs Excessive AFTER 30 - 40% reduction Significantly improved forecast accuracy and supply chain velocity Over $ 3 million in savings

22. Best BuyImproving customer service at a lower cost Forecast Accuracy Stockouts Logistics Spend Best Buy anticipates transportation savings of over $3.8 million in 2001 & appreciably lower stockouts • BEFORE • Reasonable • High during peaks • High from LTL shipments and expedites AFTER > 95% Significantly lower Savings >$ 60- 80K per month

23. The Home Depot Keeping Its Promise to Customers & Delivering On Time Transportation Capacity during Peak Seasons Delivery Commitments to Customers AFTER BEFORE Transportation Spend Inadequate Huge Reasonable Adequate Slashed over $5 M in 2000 Improved significantly The Home Depot has achieved over $5 M in transportation cost savings with $50 M in projected savingsover 2002

24. Pilgrim’s PrideDriving profitability in hard times Customer Service Determination of Landed Costs Transportation Costs Integration with SAP across 10 divisions BEFORE AFTER Significantly improved Accurate down to customer/SKU level Significantly reduced Seamless integration Reasonable Inaccurate Very high Huge challenge Significant reduction in cents-per-pound in transportation costs enabled Pilgrim’s Pride to become one of ONLY two profitable chicken suppliers in the world in 2000

25. Dell Computers High Velocity for Competitive Advantage î VMI On- Hand ì ì Ship-to-target Inventory Turns 70%Reduction 12% improvement >100% improvement With i2 DELL’s Competitive Advantage -24 days PC Industry Average Cash-to-cash Cycle* +30 days 26 % 2000 Rev. Growth Negative 6.83 % 2000 Profit Margin 3.86% 64 Inventory Turns 23 Dell implemented SCM in its Americas region in109 days with over 100% ROI *Cash-to-Cash = (Days of Receivables + Days in Inventory) - Days of Payables

26. Iomega Build-to-Order for Competitive Advantage Demand Forecast Accuracy Planning Cycle Times Inventory - WIP and FGI Supply Chain Model • Iomega transformed itself into a build-to-order supply chain and will realize over $325 million in value BEFORE Reasonable Over 3 months Huge Build-to-Stock AFTER 92-95% 11 days Shaved $ 200 million in 8 months Build-to-Order

27. Why Invest in SCM?Business & Financial Benefits revenues expenses ROA assets • Reduce operating expenses • Reduce logistics spend • Slash COGS (cost-of-goods-sold)

28. Why Invest in SCM?Business & Financial Benefits revenues expenses ROA assets • Reduce inventory (raw, WIP, FG) • Reduce planning cycle times • Reduce production lead times • Increase fixed asset utilization

29. Principles of SCM Success • Design and validate your supply chain strategy before you deploy – define scope and scale • Collaborate on demand and gain consensus for the most accurate forecast – execution • Collaborate, optimize, monitor and control, production, inventory, distribution and transportation simultaneously across multiple enterprises – global optimization • Execute, monitor, and review your SCMperformancecarefully withpredefined KPI and objectives – operations evaluation

30. Thank You