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How CIOs Can Improve SCM with Tight  IT Budgets
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How CIOs Can Improve SCM with Tight IT Budgets

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Kinaxis | This presentation looks at one way CIOs can roll out significantly more powerful supply chain management functions at an affordable cost by extending existing systems with specialized ...

Kinaxis | This presentation looks at one way CIOs can roll out significantly more powerful supply chain management functions at an affordable cost by extending existing systems with specialized software delivered as a service (SaaS).

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    How CIOs Can Improve SCM with Tight  IT Budgets How CIOs Can Improve SCM with Tight IT Budgets Presentation Transcript

    • How CIOs Can Improve Supply Chain Management, Even with a Tight IT Budget (a white paper summary) www.kinaxis.com Copyright © Kinaxis 2009. All rights reserved.
    • Do more with less • CIOs must make careful investments in key areas that wring better business results from smaller IT budgets • The key is to understand what capabilities are fundamentally required – now and in the long term • Supply chain managers are looking for quicker response to fast-changing conditions, and stronger decision- support • With high needs and tight budgets, it is an ideal time for CIOs to roll out significantly more powerful supply chain functions at an affordable cost by extending existing systems with SaaS 2 Copyright © Kinaxis 2009. All rights reserved.
    • S&OP is mission-critical • S&OP is an essential process for every manufacturer • This is especially true because of today’s: • economic downturn, • demanding but fickle customers (= demand volatility) and • supply chains stretching right around the world (= supply chain complexity). 3 Copyright © Kinaxis 2009. All rights reserved.
    • The limitations of traditional tools Excel: not robust enough • Works best for a single user handling limited data • Excel cannot support many of the basic requirements of mature and effective S&OP: • Early alerts to support management by exception • Sophisticated what-if scenario planning based on numerous inputs • Quick, effective collaboration within or between enterprises 4 Copyright © Kinaxis 2009. All rights reserved.
    • The limitations of traditional tools ERP: focused on transactions • ERP systems lack the functionality to manage today’s complex supply chains • Software vendors acknowledge this, with a huge number of add-ons for business intelligence, data collection, optimization, planning & supply chain management • But with the extremely high costs of any ERP project, investing to extend, customize, or patch the system is not realistic in today’s economy 5 Copyright © Kinaxis 2009. All rights reserved.
    • The limitations of traditional tools Legacy planning: designed for yesterday • The ERP add-ons for optimization, planning, and SCM were designed to support an outdated business model • From their basic data structures through all their analytics, these systems were intended for a small team dealing with known numbers from inside the single enterprise • They were never designed to handle today’s global, outsourced, multi-tier supply chains where much of the cost, value, and decision-making reside outside the enterprise with third-party business partners 6 Copyright © Kinaxis 2009. All rights reserved.
    • S&OP: designed for the 21st century • Sophisticated forecasts • generate supply & demand forecasts by incorporating data inputs from supply partners and the analytics to process them • Real-time what-if scenarios • model various what-if scenarios to help balance supply & demand with fast-changing business conditions, including algorithms to weigh action alternatives against KPIs • Collaboration • support collaborative analysis and data sharing within or beyond the enterprise • Outside data • import data from supply chain partners without the risk of contaminating the enterprise’s financials 7 Copyright © Kinaxis 2009. All rights reserved.
    • Extending your S&OP with SaaS • More secure than your own LAN? • data centers have tight physical access controls, highly trained staff & routinely scan for malware with industrial-strength programs • Emerging industry standards hold hosting services to stringent security measures • More reliable than your in-house apps? • Service Level Agreements dictate very high availability, at least 99% or better. Can your in-house applications match that? • Better TCO for a tight economy • No initial capital expense • Little need for your IT • Little need for consultants resources • No annual maintenance fee • A low monthly operating cost 8 Copyright © Kinaxis 2009. All rights reserved.
    • A comparison: four types of software for S&OP Excel ERP Legacy S&OP planning (via SaaS) Class Desktop Enterprise Add-on SaaS Era 1980s 1980s 1990s 2000s Strength(s) Number- Accounting Optimizing 21st century crunching in-house SCM plans Drawbacks Not robust Transaction- Designed Security? enough based for Reliability? yesterday TCO $ $$$$$$$$$$ $$$$$$ $$$ $$$$$$$$$$ $$$$ 9 Copyright © Kinaxis 2009. All rights reserved.
    • The Benefits of Extending S&OP • More agile response to events • react much faster to external events, • move beyond reviewing monthly or weekly plans toward event- driven plans that can be updated as needed • Live collaboration with partners • online forum with human intelligence from many players that captures the nuances of business relationships • Flexible “what-if” scenario testing • weigh the consequences of various actions more precisely, and select the best from an array of possible outcomes 10 Copyright © Kinaxis 2009. All rights reserved.
    • The Benefits of Extending S&OP • Enhancing S&OP will help managers deliver more accurate forecasts, based on comprehensive data from supply chain partners, all consolidated automatically and available to decision makers anywhere, any time • A more responsive supply chain will help your enterprise adapt to the current short-term challenges, and be better positioned to thrive when the recession ends 11 Copyright © Kinaxis 2009. All rights reserved.
    • Download the white paper: How CIOs Can Improve Supply Chain Management www.kinaxis.com company /resource center /white papers Copyright © Kinaxis 2009. All rights reserved
    • Share your comments & ideas on the Kinaxis Blog http://blog.kinaxis.com Copyright © Kinaxis 2009. All rights reserved.