Ebfm Slides 2009


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You can decrease costs substantially in your organization by increasing the use of electronic transaction processing with an EBFM approach.

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Ebfm Slides 2009

  1. 1. Profit from Electronic Business Flow Management Skip Stein Management Systems Consulting, Inc. http://www.msc-inc.net Copyright © 2009   Management Systems Consulting, Inc.
  2. 2. Vision Statement <ul><li>EBFM – Electronic Business Flow Management </li></ul><ul><li>EBFM for electronic transaction processing can implement cost reduction and enhanced cash flow opportunities with it’s integration into business processes. </li></ul><ul><li>Apply enhanced electronic transactions to your business processes, to reduce expenses, decrease time to cash receipt, eliminate error prone data entry applications, and reduce the order to cash depository process. </li></ul>
  3. 3. EBFM Structure <ul><li>Electronic Business Transactions </li></ul><ul><li>Infrastructure is well founded upon open standards like EDI, LC (letter of credit), Open Purchase Order and VMI (vendor managed inventory) </li></ul><ul><li>Established standards (ebXML/EDI) and electronic infrastructure (Internet, VPN’s, secure networks) capitalize on existing processes and expand beyond paper and manual order processing techniques. </li></ul>
  4. 4. Business Process Model <ul><li>Global Transaction Integration </li></ul><ul><li>Alternate Sources of Supply - dynamically balanced through inventory, order entry, distribution & control systems. </li></ul><ul><li>AOT (always on time) replaces JIT (just in time). </li></ul><ul><li>Constant information flow from multiple sources of supply – 24 x 7. </li></ul><ul><li>Global in scale – uninterrupted by regional boundaries supported by worldwide networks and the Internet. </li></ul>
  5. 5. Purpose -> Profit <ul><li>It is NOT a dirty word! </li></ul><ul><li>Profit - The mechanism by which two or more business enterprises form enhanced trading partner relationships for the purpose of increasing revenue and reducing costs while in the business of producing a saleable product at a profit! </li></ul>
  6. 6. Yesterday’s Situation <ul><li>Supply Chain Processes </li></ul><ul><li>JIT – just in time is insufficient </li></ul><ul><li>Developed as an inventory control/reduction method </li></ul><ul><li>Focused on ‘key suppliers’ </li></ul><ul><li>Produced critical inventory shortages </li></ul><ul><li>Affected by strikes, weather, wars </li></ul>
  7. 7. New Model - EBFM <ul><li>More Efficient and Timely </li></ul><ul><li>AOT – always on time – supplies always available when and where needed </li></ul><ul><li>Supply forecast linked to variable sources – balanced by availability and lead times </li></ul><ul><li>Electronic orders based on projected manufacturing & distribution forecast </li></ul><ul><li>Flexible/adaptable in a constrained material supply situation </li></ul>
  8. 8. How Do We Get There? <ul><li>Business Process Change </li></ul><ul><li>Consolidate and focused business enterprise operations </li></ul><ul><li>Function focused business units </li></ul><ul><li>Autonomous operations linked Globally through dynamic networks </li></ul><ul><li>Workforce balanced by need and operational focus – not regional or centralized bureaucracy </li></ul><ul><li>Adaptive organizations with flexibility to implement change - rapidly </li></ul>
  9. 9. Electronic Transactions <ul><li>Open Up the Electronic Gateway </li></ul><ul><li>Electronic Data Interchange – EDI </li></ul><ul><li>Internationally recognized and adopted as a secure and functional business process </li></ul><ul><li>Supported by open standards </li></ul><ul><li>Updated and maintained on current basis by international standards groups </li></ul><ul><li>Evolving technology support – ebXML Standards, Internet Security enhancements and more </li></ul>
  10. 10. The Basics <ul><li>Electronic Transaction Flow Integration </li></ul><ul><li>Electronic transactions replace laborious, time consuming, and error prone movement and handling of paper </li></ul><ul><li>‘ Untouched by Human Hands’ – standard formats transmitted in seconds instead of days – routed and handled automatically </li></ul><ul><li>Order to Cash - process product orders and cash receipts in minutes, not days, weeks or months </li></ul>
  11. 11. Electronic Enterprise
  12. 12. Architecture
  13. 13. Components Overview
  14. 14. Technology – Underutilized <ul><li>Eliminate the Paper and Manual Processes </li></ul><ul><li>Fully implemented existing capabilities of electronic transactions - EDI & ebXML </li></ul><ul><li>Implementations must leverage the dynamic capabilities of machine to machine data transfer </li></ul><ul><li>Reduce/eliminate increasing costs of manpower to support old infrastructure </li></ul><ul><li>Filing cabinets, paper take up unnecessary and valuable space – electronicise records and documents </li></ul>
  15. 15. Available Solutions <ul><li>Utilize Available Technology </li></ul><ul><li>ebXML, EDI and electronic commerce is just the communication & document transport layer of a more complete infrastructure change </li></ul><ul><li>Electronic image processing, scanning, CDRW, EPR systems are available to support infrastructure demands </li></ul><ul><li>Available technology provides the ability to work anywhere with ‘COMPLETE’ information retrieval resources at hand </li></ul>
  16. 16. Recommendation <ul><li>Identify Replaceable Manual Processes </li></ul><ul><li>- Walk the floor - </li></ul><ul><li>Order Processing – how much data entry </li></ul><ul><li>Invoicing and Receipts Processing – paper & postage </li></ul><ul><li>Procurement and Receiving – automatic inventory </li></ul><ul><li>Shipping & Distribution – BOM, lists and packaging </li></ul><ul><li>Stand by the printer – why do you need paper </li></ul><ul><li>See what’ being copied – why do need copies </li></ul>
  17. 17. Resources <ul><li>Electronic Transaction Standards </li></ul><ul><li>Complete business process support </li></ul><ul><li>Pre-existing transaction sets defined for virtually any business process </li></ul><ul><li>Open standards make communication across international boundaries (language, time zones and climate) possible </li></ul><ul><li>Tested and Proven methodology </li></ul><ul><li>With lower entry costs, available to even the smallest business enterprise today </li></ul>
  18. 18. Mandatory <ul><li>Electronic Document Exchange </li></ul><ul><li>Electronic Data Interchange –EDI – is becoming a mandatory mode of business operations </li></ul><ul><li>Available to even the ‘QuickBooks’ enterprise </li></ul><ul><li>Secure transaction exchange supported by a variety of methodologies, processes and service organizations </li></ul><ul><li>Government Contracts and HIPAA (healthcare) legislation requires it </li></ul>
  19. 19. Implementation <ul><li>Plenty of Implementation Options Available </li></ul><ul><li>Available as SAAS </li></ul><ul><li>Browser or enterprise/legacy system interface options </li></ul><ul><li>TCP/IP communication using FTP or SMTP </li></ul><ul><li>Internet or VPN access </li></ul><ul><li>Pass transactions to/from/through traditional VANs </li></ul>
  20. 20. Room to Grow <ul><li>Current Systems Support EDI </li></ul><ul><li>Many existing implementations only encompass the basics: Purchase Order & Invoice </li></ul><ul><li>Revision documents, Shipping Information, and Payment processing have yet to be implemented </li></ul><ul><li>True ROI begins HERE~! </li></ul>
  21. 21. Cost Reduction - Potential <ul><li>Electronic Transaction Expansion </li></ul><ul><li>Full implementation of EDI capabilities provide the basic framework for substantial cost reduction </li></ul><ul><li>Leverage existing workforce in more profitable activities </li></ul><ul><li>Reduce/Eliminate paperwork, forms, filing and filing cabinets </li></ul><ul><li>Machine to machine transaction processing at light speed </li></ul>
  22. 22. Profit Enhancement - Potential <ul><li>Make a Profit with Quicker Response Times </li></ul><ul><li>Process Orders & Cash Receipts faster </li></ul><ul><li>Automate order processing to manufacturing and distribution systems </li></ul><ul><li>Reduce on-hand inventory with AOT (Always on Time) assurances provided by multiple source of supply & distribution </li></ul><ul><li>Enhanced payment processing with EFT Order to Pay processing </li></ul>
  23. 23. More Profit Potential <ul><li>Shrink Supply Times </li></ul><ul><li>Automate requests for quote </li></ul><ul><li>Model/Forecast and manage bids/proposals </li></ul><ul><li>Interface with in-house procurement systems </li></ul><ul><li>Attach and publish specifications documents </li></ul><ul><li>Manage procurement activity </li></ul><ul><li>Integrate seamlessly with procurement communities and catalogs using EDI & ebXML-based architectures </li></ul>
  24. 24. Success Based Provisions <ul><li>You Can’t Do it Alone </li></ul><ul><li>Establish Trading Partner Relationships – beyond customer/supplier contracts </li></ul><ul><li>Open up organizations and business relationships to fuller, more complete information exchange </li></ul><ul><li>Deploy secure communications infrastructures to support ongoing linkages </li></ul>
  25. 25. Implementation Requirements <ul><li>Do it NOW Rather than Later </li></ul><ul><li>Select a set of tools – standards, translator, communicator, application interface </li></ul><ul><li>Obtain expertise during deployment – don’t re-invent the wheel!!! </li></ul><ul><li>Deploy structured and reliable application system interfaces </li></ul><ul><li>Offer enhanced career opportunities to available personnel with existing business knowledge </li></ul><ul><li>Make the process repeatable </li></ul>
  26. 26. Key Factors <ul><li>Standardize the Process </li></ul><ul><li>This is NOT brain surgery, although a rocket scientist would be an asset </li></ul><ul><li>The biggest expense is on initial deployment – don’t stop short </li></ul><ul><li>Train to maintain – support staff should maintain electronic based applications </li></ul><ul><li>TEST TEST TEST </li></ul>
  27. 27. Trading Partners <ul><li>Develop Business Partnerships </li></ul><ul><li>Share common goals – Profit </li></ul><ul><li>Define the relationship – contracts & agreements </li></ul><ul><li>Work together to improve business communications </li></ul><ul><li>Co-develop inter company standards for electronic information exchange </li></ul><ul><li>Share Ideas </li></ul><ul><li>Work together! </li></ul>
  28. 28. Summary <ul><li>Utilize EBFM to Enhance your Electronic Transaction Processing Relationships </li></ul><ul><li>Focus on Global Business Partner Relationships </li></ul><ul><li>Feedback is vital to success – Train to maintain </li></ul><ul><li>Charter involves the whole community – partnerships </li></ul><ul><li>Fulfill the Future, Build from Today </li></ul>
  29. 29. Thank You <ul><li>For more information on the EBFM electronic business process model, please visit our web site: </li></ul><ul><li>http://www.msc-inc.net </li></ul><ul><li>Thanks! </li></ul><ul><li>Management Systems Consulting, Inc. </li></ul><ul><li>800-856-3193 </li></ul>