Planning in context of Multi-Level vendors

What is Multi-Level Vendor Procurement Planning ? For a constantly innovative organization, managing inventory plans with niche suppliers at multiple echelons of supply chains is very critical. Suppliers manage different levels of Production Process Model due to complex structure of products. Ensuring consistent plans driven by true demand signals from the market is important to override isolated parochial views of different partners and entities. Hence a business case for a network wide MRP tool to integrate with a financial authorization procurement system.

Component Authorization Workflow SNP plan takes into account network wide parameters such as Bill-of-Material, Lead-times, Contractual capacity tooling constraints, existing deliveries and stock, Multi-modal transportation options and constraints, and finally a managed Forecast from the demand planners as an input. The Authorization workflow is crucial to constantly monitor financial “exposure” or commitment to vendor to buy from its vendor. The exposure is tracked to targeted and budget financial parameters important to get a feel of feasibility through simulations and expected component availability. Calc. Component Req Parent Prod. Forecast Calc. Proposed Auth. Run Supply Planning. Planner Confirmed Auth. Communicate Confirmed Component Auth. To Vendor Proposed Parts Auth Confirmed Auth Increment Component Exposure Runbook Confirmed Auth overrides Current Component Exposure as Supply for netting Parent Prod. Shipment Decrement Exposure Qty. in Runbook Overrides

Key salient features offered by Infosys solution

Suppliers’ suppliers do not exist as Plannable objects in SAP installation

Planners want to be able to Authorize Suppliers to buy components

Components are long lead time items crucial for Finished Items

Finished Item Forecasts are spiky and seasonal, sometimes unpredictable

Finished Items run the risk of obsolescence

There are lead-time and capacity constraints in the network

A constant need to manage Financial Risk in terms of Authorization and Inventory in-transit

Establish such unique Suppliers’ suppliers in APO

Present a dashboard for authorization by being able to provide planners with system-recommended information

Map procurement Lead-time into the tool

Integrate Component Planning with Demand Planning

Use standard functionalities for cannibalization and PLM

Integrate Component Planning with Supply Network planning

Dollarize the Authorizations for new and old planning cycle by netting the receipts from Suppliers

One consistent dashboard for planners to make effective and informed decisions by letting the tool propose procurements based on Supply Chain constraints Complexities in network Infosys Solution

Developed and designed an innovative Multi-level vendor planning solution

Highly seasonal and spiky demand pattern, coupled with very short product life cycles and high risk of obsolescence .

Managing Procurement of critical components having long lead-time .

Rigid R/3 design surrounding inter company stock transfers .

Integration challenges with SAP R/3 and other legacy systems.

Challenge

Implemented Innovative design of time bound inventory pre-build with dynamic safety stocking plan through Multilevel Material and Capacity planning module of APO (Capable To Match module).

Parts Authorization process for efficient management of critical inventories.

Addressed through mix of configuration and development, in APO and SAP R/3.

Addressed through custom objects in APO, and efficient execution of Project Management Plan

Solution

Helped client’s planners focus their limited bandwidth on more pertinent issues in supply chain.

Helped client by providing improved projected inventory visibility.

A running total of components consumed in a finished item through its lifecycle, financial dollarized exposure and projected shipment plans.

Integrated Forecasting, Supply Network Planning and Component Authorization processes with a consistent and common set of master & transaction data.

Supply chain decisions would be global with optimal fulfillment of regional interests .

Results Leading global imaging major

Thank You “ The contents of this document are proprietary and confidential to Infosys Technologies Ltd. and may not be disclosed in whole or in part at any time, to any third party without the prior written consent of Infosys Technologies Ltd.” “ © 2008 Infosys Technologies Ltd. All rights reserved. Copyright in the whole and any part of this document belongs to Infosys Technologies Ltd. This work may not be used, sold, transferred, adapted, abridged, copied or reproduced in whole or in part, in any manner or form, or in any media, without the prior written consent of Infosys Technologies Ltd.”