Richard Shieh General Manager HP Technology Taiwan Implementation of e-Supply Chain
Agenda <ul><li>The Challenge of demand and supply </li></ul><ul><li>The enterprise core competence – e-Supply Chain </li><...
The Zero Factor   (from Napoleon to the Gulf War) Napoleon World War 1 World War 2 Gulf War Total participants Overall los...
Impact of New Economy GM Ford Chrysler
The Facts & Figures <ul><li>Volatility - Fortune 500 </li></ul><ul><ul><li>1955 - 70%   Gone </li></ul></ul><ul><ul><li>19...
Strategy Innovation  “  It’s not about technology, It’s everything about : - new business model - industry shake up”  -  J...
<ul><li>Not all are operating in an unified and consistent environment, contributing to difficulty in synchronizing with b...
Bullwhip effect <ul><li>Demend forecasting update </li></ul><ul><li>Order batching </li></ul><ul><li>Price fluctuation </l...
Leading companies are migrating their supply chains from sequential, “push” models  into “value networks” focused on the c...
Agenda <ul><li>The Challenge demand and supply </li></ul><ul><li>The enterprise core competence – e-Supply Chain </li></ul...
Procurement Planning Production Planning Inventory Planning Demand Planning Materials Management Factory Scheduling Invent...
Despite heavy investments in ERP, many of these problems remain unsolved due in part to limited connectivity within and ou...
Best SCM practice Model  :  Zero-latency <ul><li>Latency   = time it takes to respond to an input </li></ul><ul><li>Zero-l...
The Problem Statement <ul><li>Maximizing  Customer Satisfaction & Profits   through optimization of Inventory Level, Produ...
Squeezing the Model for Profitability & Customer Satisfaction Lead-time Re-order Frequency Product Mix Inventory + + + + -...
Agenda <ul><li>The Challenge demand and supply </li></ul><ul><li>The enterprise core competence – e-Supply Chain </li></ul...
Implementation of eSCM(1) – Planning among supply chain Internal/External Supplier Your Company Internal/External Customer...
Time to Respond to Market Changes - from Weeks to Minutes From Weeks/Days . .  . OEM ERP Contract Mfr. ERP Supplier ERP De...
Implementation of eSCM(2) – New Form Of Alliance <ul><li>Contractual Alliance   </li></ul><ul><ul><li>Buy/Sell relationshi...
A Simplified Supply Chain CPU  Alliance Partners Module Supply Logistics Providers Customers On-Site Material Hub Assembly...
Alliance Fulfillment Supply Chain Process Model Product Positioning Forecast Build/Shipment Release (Order Signal) Product...
Goal : Determine the relative importance of individual performance measures to a firm’s mission and objectives Growth and ...
Implementation of eSCM(4) – Innovation <ul><li>Build up the  culture of innovation </li></ul><ul><ul><li>Reassessment of c...
Agenda <ul><li>The Challenge demand and supply </li></ul><ul><li>The enterprise core competence – e-Supply Chain </li></ul...
PC/NB Industry Challenges <ul><li>Commodity and consumer-oriented market, fueled by the advancement in e-Commerce, is brin...
Objectives in Joining the MOEA Initiatives <ul><li>Extend Compaq Supplier eBusiness Collaboration to e stablish and implem...
Taiweb- Taiwan  eSupply Chain Initiative <ul><li>Relative Position of TaiWeb vs. B-Plan </li></ul>Second tier suppliers Tr...
Compaq e-Supply Chain Framework Supplier Rationalization <ul><li>Supplier performance </li></ul><ul><li>Allocation analysi...
The Situation Today… <ul><li>OEMs, contract manufacturers, and suppliers are coordinating NPD/NPI activities under extreme...
Design Collaboration Compaq Internet Intranet Alliance Partner Corp. Procurement: Consumer Alliance Commercial Alliance En...
Process Collaboration MANUFCATURER (Hub) EAI E-SCM ERM CRM E-mail ERP CMC/PDM ADP. ADP. ADP. ADP. ADP. Internet Warehouse ...
Supplier - Demand Collaboration CRM ERP PDM EAI MES CDP -  Collaborative Demand Planner CSP -  Collaborative Supply Planne...
From EDI into Web-EDI <ul><li>6-8 types of message </li></ul><ul><li>1.8-2.0 Million transactions/month </li></ul><ul><li>...
<ul><li>Compaq/Inventec –  Forecast Collaboration </li></ul><ul><li>  PIP4A4/4A5 </li></ul><ul><li>Compaq/Delta –  Order M...
<ul><ul><li>On line performance  management </li></ul></ul><ul><ul><li>Suppliers benefit:Real time performance measurement...
Taiweb Benefits (1) Increase IPO Volume Items Before Taiweb After Taiweb Growth Rate IPO in Taiwan 1999, US$ 7.4 Billion 2...
Taiweb Benefits(2) – Cost Saving
Taiweb Benefits(3) – KPI improvement
Taiweb Benefits(4) –  Financial Balanced Scorecard
A B C D E F G H I
 
A B C D E H G H I
 
A B C D E F G H I
 
A B C D E F G H I
 
Next Step
TaiLink Global Logistics Management Strengthen Taiwan’s Edges High tech product outbound logistics comparison: Logistics L...
Order Tracking and Logistics Visibility booking booking confirmation pre-alert local forwarder overseas agent shipper cons...
Factory Outbound Collaboration Ensure Compaq’s alliance factory to achieve “same day on board” in outbound logistics, i.e....
SCM Solution Component Relationships  Demand Planner Supply Chain Planner Factory Planner Scheduler Supply Chain Strategis...
Agenda <ul><li>The Challenge demand and supply </li></ul><ul><li>The enterprise core competence – e-Supply Chain </li></ul...
Key Success Factors of e-Supply Chain Implementation <ul><ul><li>Government Support </li></ul></ul><ul><ul><li>Start from ...
 
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The Implementation of e-Supply Chains

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  • In the next 50 minutes, I will discuss with you about the following 4 topics, At first, I will present to you the challenge of demand and supply balancing, we will state that the competition among enterprise are getting stronger and stronger, the speed are faster and faster from day to day. The critical success factor is the innovation by the technology. And then, the second session, we will discuss how we can leverage eSupply chain as the core competence of enterprise. After implementing a packaged enabled solution, ERP, you will still face lots of challenges. How will we use the Zero latency model to increase the supply chain efficience. And the thierd session, we aill discuss the implementation of eSCM, that will includes, (1) Put the plans among enterprise together, (2) change the alliance model, (3) identify the KDI thru baclance score card workshop.. Finally, I will share with you the experience for the Taiwan Taiweb project which is the biggest SCM/global logistics project in Asia Pacific.
  • Firstly, let’s see how will the technology change the competition and the world. From Napoleon, the war took 11 yeasr to the Gulf War,it took 1 month. Because they, the USA, used the best of art weapons, (1)the GPS (2) Auto communication and guiding system (3)Microwave encryption and decryption (4) Knowledge based war fare by technology innovation The competition in the business war are the same, the time for competition are getting shorter and shorte and decision should be made quicker and quicker. Let’s see the real enterprise competition.
  • 1997 Fortune 500 has announced. Two motor companies occupied the first and the second place. Chrysler Motor was the 7 th . The sale amount of the three motor companies is $40 billion. The result was not surprising. The most surprising fact is that the three motor companies stock amount is less than 3/4 of Microsoft which is the 137 th on the list. The market value Ford plus General Motor equals to the Intel’s. Industries in Taiwan are in the same situations that old companies are not as valuable as new enterprises. In 1998 TSMC market value is higher than Cathay Insurance, UMC market value is two times of Taiwan Foremosa( the biggest plastics’s company) market value. And in this year, TSMC’s market prices is already time of Cathey’s and UMC’s is also 3 times of Taiwan Formosa’s. Old companies save properties for decades or centuries. However, they easily got beyond by new enterprises. And the time for competition among enterpsises are getting shorter and shorter. We call the situation “new economy era”.
  • Let’s review some statistics information, the Fortune 500 list, about companies’ strategy innovation, sustain the success or fail. Those fortune 500 companies are huge companies, they have strong capital, financial background, and good significant market share and influence in his industry. Even though, matching the Fortune 500 worldwide company list established for the first time in 1955 by &amp;quot;Fortune Magazine&amp;quot; with today’s list demonstrates that 70% of the original leaders simply disappeared. The same exercise with the 1979 list shows that 40% of the leaders disappeared in just 20 years. Some of them went into bankruptcy, others were merged or acquired. But most of them have been displaced by companies with better strategic innovation better business processes. Let’s going to more detail analysis about the speed of the turn over every ten years, it getting fast and fast ……….
  • So, the technology is not only been used for the process efficicecy, but the enterprise core-competience. Those companies who can fuel the technology and drive their business thru technology will be the winner
  • After discussing the technology influancing, let’s see the challenges faces by suppliers. But today’s supply chain is quite different from the one in early 1990’s. Our suppliers are facing the challenges like, Different level of information technology adopted by different suppliers Different capability of each enterprise application results in different supply chain efficiency and effectiveness Communication between Compaq and our suppliers is the key point.
  • One of the major reason caused the suppliers’ issues is the Bullwhip effect ???????
  • But the competition among electronic industries are get more and more and also the market and customer expectation changed. And the value network change the competition game rules……..
  • In the center of this chart, it show a complete zero-latency approaches but inter-organization only. They have efficient, integrated ERP systems and also the fabtory advanced planning, scheduleing system, but they still have lots of issues to be solved, such as …...
  • As the title described Thru the technology innovation, the inter-enterprises integration is possible, and it makes more competitive advantage thru the suppliers and customers we called it supply-chain collaboration or eSCM
  • The definition of Zero-Letency …... For using the Internet and e Ccommerce, it is possible to operating the enterprises in Zero-latency mode cross enterprises. Zero-latency means that to exchange information and response to customers-market needs in time in different area, with different technology and under different organization. The different organization mentioned here are no longer different department in one enterprise, but different departments in different enterprises. Enterprises’ Suppliers and Customers are included.
  • Concerning the benefit and customer satisfaction, we have to adjust the inventory, product, order planning, and produce time to the best situation. Theoretically, these four segment surfaces take fixed parts on four quadrants. (Please notice that the lead-time and product mix are minus, the lower it moves the smaller it gets.)
  • Global logistic aim to lower inventory, even down to zero inventories. The other three segments must adjust to fit this situation. (1)To lessen product mix is to use standard equipment parts, unfinished products and models more. (2) The Increasing re-order frequency part, which is the part IT could assist. Using Internet, combining the upper and down stream supply/demand information. The re-order frequency could be shortened from once or twice a month to once every hour or once every minute. (3)Using the enterprises SCM to shorten the production cycle time.
  • The first step for implementing the eSCM is to , conceptually, put the planning among supply chains together. The the real practice, you can use the information sharing, process collaboration, deman/supply collaboration, design collaboration, eC transport to implament this concept, that is, plan together
  • The second stage to implement eSCM is to change the appliance model, from contract alliance to Operational appliance, for the contract appliance,………
  • Let’s review the PC assembling process as the following flow -
  • In the new age of the alliance, please review the new PC assembly flow, please noticed that a lot of processes, material flows, products flows are replaced by the information flows- the white arrows.
  • The first step for implementing the eSCM is to , conceptually, put the planning among supply chains together. The the real practice, you can use the information sharing, process collaboration, deman/supply collaboration, design collaboration, eC transport to implament this concept, that is, plan together
  • The Implementation of e-Supply Chains

    1. 1. Richard Shieh General Manager HP Technology Taiwan Implementation of e-Supply Chain
    2. 2. Agenda <ul><li>The Challenge of demand and supply </li></ul><ul><li>The enterprise core competence – e-Supply Chain </li></ul><ul><li>Implementation of the e-Supply Chain </li></ul><ul><li>Case Study -Taiweb SCM project </li></ul><ul><ul><li>The biggest SCM project in Aisa Pacific - eSupply Chain Initiative in Taiwan </li></ul></ul><ul><li>Summary </li></ul>
    3. 3. The Zero Factor (from Napoleon to the Gulf War) Napoleon World War 1 World War 2 Gulf War Total participants Overall losses 2.8 m 1.4 m 68 m 9.5 m 92 m 20 m (Coalition forces) 700,000 1792-1815 1914-1918 1939-1945 1991 192 Duration Loss percentage 132 months 51 months 72 months 1 month 50 % 14 % 21.8 % 0.025 % (coalition)
    4. 4. Impact of New Economy GM Ford Chrysler
    5. 5. The Facts & Figures <ul><li>Volatility - Fortune 500 </li></ul><ul><ul><li>1955 - 70% Gone </li></ul></ul><ul><ul><li>1979 - 40% Gone </li></ul></ul><ul><li>Competitive - Fortune 500 </li></ul><ul><ul><li>1970 - 80 32% out of the list </li></ul></ul><ul><ul><li>1980 - 90 47% out of the list </li></ul></ul><ul><ul><li>1990 - 98 54% out of the list </li></ul></ul>
    6. 6. Strategy Innovation “ It’s not about technology, It’s everything about : - new business model - industry shake up” - John Naisbitt, author of Megatrend 2000, on New Economy
    7. 7. <ul><li>Not all are operating in an unified and consistent environment, contributing to difficulty in synchronizing with buyer in its global optimization </li></ul><ul><li>Missing and/or inaccurate commitments </li></ul><ul><li>Instances of performance degradation due to gap or void of its enterprise applications, or quality control due to incoherent enterprise applications </li></ul><ul><li>Lacking total commitment and determination to re-engineer its operation and/or critical business applications. Operation becomes reactive, missing competitiveness and opportunistic benefits. </li></ul>Challenges Faced by Suppliers
    8. 8. Bullwhip effect <ul><li>Demend forecasting update </li></ul><ul><li>Order batching </li></ul><ul><li>Price fluctuation </li></ul><ul><li>Ration and Shortage game </li></ul>
    9. 9. Leading companies are migrating their supply chains from sequential, “push” models into “value networks” focused on the customer and driven by real demand Traditional Supply Chain Value Network <ul><li>“ Pushes” product to customers </li></ul><ul><li>One-size fits all </li></ul><ul><li>Sequential; arm’s length </li></ul><ul><li>Rigid, inflexible </li></ul><ul><li>Slow, static </li></ul><ul><li>Analog </li></ul><ul><li>Products “pulled” by customer </li></ul><ul><li>Customer-centric </li></ul><ul><li>Collaborative; dynamic </li></ul><ul><li>Flexible; scalable </li></ul><ul><li>Fast flows </li></ul><ul><li>Digital </li></ul>High-tech companies such as Cisco are leading this transformation Providers Customers Company
    10. 10. Agenda <ul><li>The Challenge demand and supply </li></ul><ul><li>The enterprise core competence – e-Supply Chain </li></ul><ul><li>Implementation of the e-Supply Chain </li></ul><ul><li>Case Study -Taiweb SCM project </li></ul><ul><ul><li>The biggest SCM project in Aisa Pacific - eSupply Chain Initiative in Taiwan </li></ul></ul><ul><li>Summary </li></ul>
    11. 11. Procurement Planning Production Planning Inventory Planning Demand Planning Materials Management Factory Scheduling Inventory Deployment Order Management Inbound Materials Production Replenishment Distribution Accounts Payable General Ledger Inventories Cash/ Accounts Receivable S U P P L I E R S C U S T O M E R S Ignoring the impact of uncertainties Simplistic inventory stocking policies Discrimination against internal/external customers No Strategic Sourcing Programs Incorrect assessment of inventory costs Separation of supply chain design from operational decisions Product-process design without supply chain consideration Wrong shipment methods analysis Parts shortages Inaccurate delivery status data Miscommunication with suppliers Products do not match market demand Inefficient information systems Companies typically face a myriad of problems with their supply chains that - when combined – can have a significant impact on profitability High Inventory Levels and Supply/Demand Imbalances Key Issues For Many High-Tech Manufacturers
    12. 12. Despite heavy investments in ERP, many of these problems remain unsolved due in part to limited connectivity within and outside of the enterprise [ Our Perspective on eSCM ] eSCM eSCM Total Interconnectivity S U P P L I E R S Procurement Planning Production Planning Inventory Planning Demand Planning Materials Management Factory Scheduling Inventory Deployment Order Management Inbound Materials Production Replenishment Distribution Accounts Payable General Ledger Inventories Cash/ Accounts Receivable C U S T O M E R S Enterprise Processes and Systems Traditional focus of ERP Implementation PROVIDERS
    13. 13. Best SCM practice Model : Zero-latency <ul><li>Latency = time it takes to respond to an input </li></ul><ul><li>Zero-latency = Immediate exchange of information across geographical, technical and organizational boundaries </li></ul><ul><li>Divisions, departments even groups in external business partners are treated as cooperating subsystems, regardless of where they are located </li></ul><ul><li>As soon as new information is captured by any application system in any workgroup, it is made available to all other interested parties </li></ul>
    14. 14. The Problem Statement <ul><li>Maximizing Customer Satisfaction & Profits through optimization of Inventory Level, Product Mix, Re-order Cycles & Production Lead-time </li></ul>Lead-time Re-order Frequency Product Mix Inventory + + + + - - - -
    15. 15. Squeezing the Model for Profitability & Customer Satisfaction Lead-time Re-order Frequency Product Mix Inventory + + + + - - - - Shorten total Production Cycle Standard Parts & Modules At daily or hourly FG = Zero
    16. 16. Agenda <ul><li>The Challenge demand and supply </li></ul><ul><li>The enterprise core competence – e-Supply Chain </li></ul><ul><li>Implementation of the e-Supply Chain </li></ul><ul><li>Case Study -Taiweb SCM project </li></ul><ul><ul><li>The biggest SCM project in Aisa Pacific - eSupply Chain Initiative in Taiwan </li></ul></ul><ul><li>Summary </li></ul>
    17. 17. Implementation of eSCM(1) – Planning among supply chain Internal/External Supplier Your Company Internal/External Customer Source Make Deliver Source Make Deliver Source Make Deliver Plan
    18. 18. Time to Respond to Market Changes - from Weeks to Minutes From Weeks/Days . . . OEM ERP Contract Mfr. ERP Supplier ERP Demand Commitment 1 Week Days 1 Week Days <ul><li>At each stage </li></ul><ul><ul><li>Run MRP </li></ul></ul><ul><ul><li>Generate WO </li></ul></ul><ul><ul><li>Generate PO </li></ul></ul><ul><ul><li>Send EDI </li></ul></ul><ul><li>No “what if” capability </li></ul>1 6 2 5 3 4 ERP ERP ERP . . . To Hours/Minutes OEM Contract Mfr. Collaboration Collaboration Supplier Collaboratio n Supply Chain Mgmt Collaboration Hours Min. Hours Min. Demand Commitment <ul><li>Seamless inter-change with partners </li></ul><ul><li>Easy “what if” capability </li></ul>Supply Chain Mgmt 1 6 2 5 3 4 8 7 9 Collaboration Supply Chain Mgmt Collaboration Source: i2 Technology
    19. 19. Implementation of eSCM(2) – New Form Of Alliance <ul><li>Contractual Alliance </li></ul><ul><ul><li>Buy/Sell relationship based on contract </li></ul></ul><ul><ul><li>Contract manufacturing </li></ul></ul><ul><li>Technology Alliance </li></ul><ul><ul><li>Prevalent in IC and LCD </li></ul></ul><ul><li>Strategic Alliance </li></ul><ul><ul><li>Compaq and Microsoft </li></ul></ul><ul><ul><li>IBM and Dell </li></ul></ul><ul><li>Operational Alliance </li></ul><ul><ul><li>Collaboration in Supply Chain </li></ul></ul><ul><ul><li>Extended Enterprise </li></ul></ul>Act in Concert to demand Total Supply Chain Efficiency Lifecycle Competitiveness
    20. 20. A Simplified Supply Chain CPU Alliance Partners Module Supply Logistics Providers Customers On-Site Material Hub Assembly and Configuration Configuration Center Compaq Logistics Customer Extranets Call Center EDI Compaq. com Channel Systems Single Order Mgmt/ Config Process & System Retail Customer Demand Sources Order Management Supply Distribution Raw Modules/ Options (Modules/ Options) Alliance Partners Finished Goods Options Configuration (Direct and Indirect) Compaq Logistics Network Service Center DC Partner #1 Complex Config Partner #2 Options Partne rs
    21. 21. Alliance Fulfillment Supply Chain Process Model Product Positioning Forecast Build/Shipment Release (Order Signal) Product Flow Signal Flow Merge Center Product Definition Ship Commit / Acknowledgment Delivery Delivery Customer Shipment Release Order Signal Invoice ASN Alliance Supplier Ship Notice Module Assy Delivery Regional CTO Centers Product Supply Position Commit
    22. 22. Goal : Determine the relative importance of individual performance measures to a firm’s mission and objectives Growth and Market Share Probability Customer Satisfaction Employee Satisfaction Financial Customer Internal Business Innovation and Learning Cash Flow Operating Income Number of Customer Partnerships Customer Satisfaction Survey Product Development to Market Cycle Time Percent of Sales From New Products Manufacturing Yield Company Mission Objectives Balanced Scorecard Performance Measures Manufacturing Cycle Time Cost Per Normalized Unit New Product Actual vs. Planned Introduction Employee Satisfaction Survey Order Fulfillment Cycle Time Ship to First Commit Order Fill Rate Line Fill Rate ROE Market Share Sales Growth Implementation of SCM(4) - Setting KPIs
    23. 23. Implementation of eSCM(4) – Innovation <ul><li>Build up the culture of innovation </li></ul><ul><ul><li>Reassessment of company core-competence </li></ul></ul><ul><ul><li>Extend to management to your partners </li></ul></ul><ul><ul><li>Re-engineer the supply chain processes </li></ul></ul>
    24. 24. Agenda <ul><li>The Challenge demand and supply </li></ul><ul><li>The enterprise core competence – e-Supply Chain </li></ul><ul><li>Implementation of the e-Supply Chain </li></ul><ul><li>Case Study -Taiweb SCM project </li></ul><ul><ul><li>The biggest SCM project in Aisa Pacific - eSupply Chain Initiative in Taiwan </li></ul></ul><ul><li>Summary </li></ul>
    25. 25. PC/NB Industry Challenges <ul><li>Commodity and consumer-oriented market, fueled by the advancement in e-Commerce, is bringing a totally new paradigm to how we compete. It is a revolution of supply-chain management and e-Business collaboration </li></ul><ul><li>Traditional Taiwan advantage and excellence in build-to-stock or build-to-order is gradually losing its importance and being replaced by the configure-to-order business model </li></ul><ul><li>Competitive differentiation is reducing and profit margin is fast diminishing </li></ul><ul><li>Market and profit competition are centered on three key areas: (1) velocity and visibility of supply-chain, (2) quality and product development strategy, and (3) supply-chain cost </li></ul>
    26. 26. Objectives in Joining the MOEA Initiatives <ul><li>Extend Compaq Supplier eBusiness Collaboration to e stablish and implement a specific eSupplyChain “A-Plan” project, named TaiWeb </li></ul><ul><li>Incorporate advanced and open technology, Supply-chain processes, and applications </li></ul><ul><li>Provide consulting, training, and assistance to targeted Suppliers, facilitating better and more efficient Supplier eBusiness collaboration efforts </li></ul><ul><li>Work jointly with MOEA campaign in promoting the Compaq eSupplyChain benefits and advantages </li></ul>
    27. 27. Taiweb- Taiwan eSupply Chain Initiative <ul><li>Relative Position of TaiWeb vs. B-Plan </li></ul>Second tier suppliers Transportation Banks Plan B Plan B Plan B Information Flow) Internet + Internet EDI, WebEDI + EDI, WebEDI 2,500 suppliers Taiwan Suppliers 1st tier suppliers (40 suppliers) A Plan Supply Chain Cash Flow Supply Chain Product Flow
    28. 28. Compaq e-Supply Chain Framework Supplier Rationalization <ul><li>Supplier performance </li></ul><ul><li>Allocation analysis </li></ul><ul><li>Strategic relationship management </li></ul><ul><li>Supplier Relationship Management (SRM) </li></ul>Supply Collaboration <ul><li>Supply / demand balancing </li></ul><ul><li>Supply chain logistics analysis </li></ul><ul><li>Inventory balancing and visibility </li></ul><ul><li>Supply execution </li></ul><ul><li>Operational execution / order fulfillment </li></ul>Commodity Management <ul><li>Corporate contract management </li></ul><ul><li>Global leveraged pricing </li></ul><ul><li>Cost savings and measurement </li></ul><ul><li>Quotation and analysis </li></ul><ul><li>Auctioning </li></ul><ul><li>AP management </li></ul>Design Collaboration <ul><li>Preferred part & supplier mgmt </li></ul><ul><li>New part work flow </li></ul><ul><li>AVL management </li></ul><ul><li>Early involvement & industry standard parts </li></ul><ul><li>Specifications and PCNs </li></ul><ul><li>BOM Management </li></ul>Supplier Relationships & Collaboration Supplier’s Suppliers Alliance, Options, Subcontract, Component, and Indirect Suppliers + Building blocks of other Solutions & Middleware + Compaq Business Information & Internal Solutions Operational Data Store, Security, Data eTransport & Standards, Messaging, Content Management, eServices , Dashboard, Inbox/Outbox, eReporting EAI Solutions
    29. 29. The Situation Today… <ul><li>OEMs, contract manufacturers, and suppliers are coordinating NPD/NPI activities under extreme time-to-market pressures (and to make matters worse…) </li></ul><ul><ul><li>Business processes are fragmented </li></ul></ul><ul><ul><li>Technology platforms and tools can’t talk </li></ul></ul><ul><ul><li>Phone, Fax, Email is the predominate communication and collaboration vehicle </li></ul></ul><ul><li>80% of the product/supply chain costs is determined in the design phase </li></ul>Product life cycle e.g., Manufacturing / Tooling Costs e.g., Engineering Expenses Cost incurred Cost committed 60% Design 5% Production 5% 85% 20% 3% 10% 2% 5% 5% Process Planning Development Testing
    30. 30. Design Collaboration Compaq Internet Intranet Alliance Partner Corp. Procurement: Consumer Alliance Commercial Alliance Engineering/ Prod Mgmt. BOM Database Detailed Costed BOM Report Hierarchical BOM w/many SKUs Alliance Partner Responds to RFQ with component pricing Agile Anywhere Agile Buyer Current & forward price data Reporting Software Detailed Costed BOM ECN BOM Control Collaborative BOM Management Engineering/ BOM Change Vendor side Detailed Csoted BOM RFQ
    31. 31. Process Collaboration MANUFCATURER (Hub) EAI E-SCM ERM CRM E-mail ERP CMC/PDM ADP. ADP. ADP. ADP. ADP. Internet Warehouse Distributor Supplier SUPPLIER (Spoke) XML/Rosettanet EAI Private Process Public Process
    32. 32. Supplier - Demand Collaboration CRM ERP PDM EAI MES CDP - Collaborative Demand Planner CSP - Collaborative Supply Planner CEP GRA - Global Real-Time ATP SCP - Supply Chain Planner MCP - Material and Capacity Planner RDS - Reactive Dynamic Scheduler GSP - Global Strategic Planner PDP - Product Development Planner SCC - Supply Chain Controller CSP - Collaborative Supply Planner CDP - Collaborative Demand Planner Supplier Customer
    33. 33. From EDI into Web-EDI <ul><li>6-8 types of message </li></ul><ul><li>1.8-2.0 Million transactions/month </li></ul><ul><li>NT$0.75~1 Million/month VAN charge </li></ul><ul><li>Tremendous increase in CTO business </li></ul>Past EDI factoid for System Supplier <ul><li>Multiple types of message & format </li></ul><ul><li>Internet speed information update </li></ul><ul><li>No VAN charge – save NTD 30 millions per year </li></ul>Web EDI in Place
    34. 34. <ul><li>Compaq/Inventec – Forecast Collaboration </li></ul><ul><li> PIP4A4/4A5 </li></ul><ul><li>Compaq/Delta – Order Management </li></ul><ul><li> PIP3A4/3A7 </li></ul>Implementation of Rosettanet
    35. 35. <ul><ul><li>On line performance management </li></ul></ul><ul><ul><li>Suppliers benefit:Real time performance measurement for improving </li></ul></ul>Supplier Management
    36. 36. Taiweb Benefits (1) Increase IPO Volume Items Before Taiweb After Taiweb Growth Rate IPO in Taiwan 1999, US$ 7.4 Billion 2001, US$ 9.0Billion 10% CAGR 2001, 33% % of Compaq IPO 1999, 24%
    37. 37. Taiweb Benefits(2) – Cost Saving
    38. 38. Taiweb Benefits(3) – KPI improvement
    39. 39. Taiweb Benefits(4) – Financial Balanced Scorecard
    40. 40. A B C D E F G H I
    41. 42. A B C D E H G H I
    42. 44. A B C D E F G H I
    43. 46. A B C D E F G H I
    44. 48. Next Step
    45. 49. TaiLink Global Logistics Management Strengthen Taiwan’s Edges High tech product outbound logistics comparison: Logistics Lead Time Logistics Cost Taiwan As-is Singapore Korea China 1-2 day 1 day 2 days > 3 days $$ $ $$$ $$$$ with TaiLink Logistics Infrastructure Need Improvement OK Excellent Good Taiwan $ Excellent <=1 day Source: Compaq BPL
    46. 50. Order Tracking and Logistics Visibility booking booking confirmation pre-alert local forwarder overseas agent shipper consignee Customer Order Cycle Host Company Consumer OEM Supplier Freight Forwarder Carrier Customer/Hub/ Distribution Center Local Shipment Pipeline Foreign Shipment Pipeline booking confirmation Booking pre - alert
    47. 51. Factory Outbound Collaboration Ensure Compaq’s alliance factory to achieve “same day on board” in outbound logistics, i.e., to shorten lead time by achieving “ 一單到底 ” . Compaq Supplier Freight Forwarder/Integrator Warehouse @Airport Carrier Inventec Arima HTC Optoma Quanta ASN ASN Booking Request Pick-up Schedule & Status Goods Status Unistar                       CCS Custom Clearing Opportunity to compress lead time
    48. 52. SCM Solution Component Relationships Demand Planner Supply Chain Planner Factory Planner Scheduler Supply Chain Strategist Scenario Analyzer Merchandise Planner Replenishment Planner Value Chain Planner Demand Plan Demand Plan Forecast Variability Network Design Production Plan Workstation Plan Pronto Production Plan Demand Plan Load Consolidator Transportation Manager Transportation Optimizer Carrier Bid Optimizer Warehouse Management System Transportation Requirements Loads Distribution Shipments G L O B A L L O G I S T I C S M O N I T O R
    49. 53. Agenda <ul><li>The Challenge demand and supply </li></ul><ul><li>The enterprise core competence – e-Supply Chain </li></ul><ul><li>Implementation of the e-Supply Chain </li></ul><ul><li>Case Study -Taiweb SCM project </li></ul><ul><ul><li>The biggest SCM project in Aisa Pacific - eSupply Chain Initiative in Taiwan </li></ul></ul><ul><li>Summary </li></ul>
    50. 54. Key Success Factors of e-Supply Chain Implementation <ul><ul><li>Government Support </li></ul></ul><ul><ul><li>Start from buyers </li></ul></ul><ul><ul><li>Identify KPI </li></ul></ul><ul><ul><li>From supply-chains views not enterprise </li></ul></ul><ul><ul><li>Thought leadership </li></ul></ul><ul><ul><li>« Today, it's supply chain against supply chain, </li></ul></ul><ul><li>not manufacturer against manufacturer. </li></ul><ul><li>And the company who can organize that supply chain </li></ul><ul><li>is the one who is going to win. » </li></ul>
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