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Supply Chain

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  1. Supply Chain • Three key metrics becoming increasingly sensitive to companies • Speed-to-market • Speed-to-volume • Time-to-profit • Continuum of business change • Integrating Supply Chain operations within the company • Collaboration with suppliers & customers • Synchronisation of entire supply chain into one logical enterprise

  2. Supply Chain • Four areas to address along this continuum • Product design • e-marketplaces • Collaborative manufacturing • Integrated fulfilment

  3. Supply Chain • Product Design - creating collaborative cross-company processes to design products that meet the market’s need and can be quickly and efficiently produced - reduces speed-to-market • Customer-driven design • Collaborative design • R&D sharing

  4. Supply Chain • Product Design • Customer-driven design • Customers far more integral to the design process • Fiat Punto - 3,000 customers - on screen style & features selection • software tracked customer priorities • directly influenced styling & concept design • Collaborative design • minimise design complexities that cause supply chain inefficiencies • suppliers, manufacturers & contract manufacturers collaborate • Adaptec uses Extricity software to connect with manufacturing partner in Taiwan, its assembly partner in Hong Kong & Seiko in Japan • modification process can be quickly iterated in real time

  5. Supply Chain • Product Design • R&D Exchange • Companies now commercialising innovations through development portals • TechEx.com - biomedical industry portal - matches research institutions, venture capitalists and corporate licensing professionals matched • Yet2.com can be searched for relevant patents

  6. Supply Chain • E-Marketplaces - using Web-based marketplaces as a fast-track mechanism to a tightly synchronised supply base • Started out as new way to procure product particularly MRO product (purely supporting transactions) - now widened to change how companies interact with their supplier base - mechanism for greater collaboration & synchronisation between organisations • Industry Vertical Marketplaces • Private Exchanges • Horizontal Aggregators

  7. Supply Chain • E-Marketplaces • Industry Vertical Marketplaces • Some industries - one major vertical e-marketplace - Trade-Ranger in Oil industry • Other industries - competition between groups of large multinationals to be the dominant e-marketplace - Food & Retail • Private Exchanges • easier to integrate a group of suppliers over which you have tremendous control • Cisco - eHub - Manugistics to co-ordinate production plans at multiple tiers of suppliers • Dell - Valuechain.dell.com - i2 Technologies to help co-ordinate the demand planning of their suppliers

  8. Supply Chain • E-Marketplaces • Horizontal Aggregators • Mostly involved in the fulfilment area • Freight - Elogistics.com - online road freight procurement exchange matches shippers requirements with carriers or truck owners

  9. Supply Chain • Collaborative manufacturing - redistributing production assets and forming tight collaborative partnerships to achieve greater manufacturing flexibility - Time-to-volume • Transactional Integration • Collaborative Integration • Networked Integration

  10. Supply Chain • Collaborative manufacturing • Transactional Integration • majority of outsourcing relationships are transactional in nature financial benefits are achieved but operationally supply chain remains the same • old problems still persist - buffer stock • Collaborative Integration • two-way collaboration is needed - joint decision making - e.g. substitute component • supply chain is so dynamic manual processes cannot keep pace - software is needed • AgileAnywhere (Agile Software) - design, prototype and ramp to full volume

  11. Supply Chain • Collaborative manufacturing • Networked Integration • To allow multiple partners to participate in the planning and execution decisions • still in the early stages of development • i2 Technologies - in supply chain planning • Ariba - in product content collaboration • standard information structures needed such as RosettaNet

  12. Supply Chain • Integrated fulfilment - Taking a holistic approach to managing the wide variety of Web-based or traditional fulfilment channels now available • Logistics Postponement • Resource Exchange • Clicks-and-Mortar model

  13. Supply Chain • Integrated fulfilment • Logistics Postponement • Taken up by 3rd party logistics providers • “rolling warehouse” concept - long haul truck loaded with well defined shipment quantities for each of its destinations • several days before reaching destination - demand change is communicated to driver - exact amount unloaded at each detination • Resource Exchange • many locations pooled into virtual resource • or Synchronet - e-marketplace - company A swaps empty/full containers with company B • Clicks-and-Mortar model • easily accessible retail outlets - customer travels for pick up

  14. Supply Chain • Synchronisation -The alignment of the supply chain into one logical enterprise and operating it as a fully-linked and optimised capability from suppliers to customers. • The following are key strategies to consider: • Know your best customers. • Beware of unobtainable synergies. • Make physical assets pull their weight. • Use the latest collaborative tools an processes. • Pick the right partners.

  15. Supply Chain • Synchronisation • Know your best customers. • 80/20 rule • Beware of unobtainable synergies. • Test complementary offerings • Make physical assets pull their weight. • Optimise inventory, warehouse & transportation

  16. Supply Chain • Synchronisation • Use the latest collaborative tools an processes. • draw up an information-sharing plan that details the most valuable information needed by your partners • Multi-Channel Order Flow Management - companies such as Yantra and Vigilance. It provides capability to customise availability and execute customer orders across myriad channels. • Pick the right partners. • Complex orders must be tracked and monitored as they move across the supply chain and metrics must evaluate customer-level revenue and profitability, not just traditional cost/service trade-offs