2. MiG 25 Pilot Defects Soviet Union
Viktor Belenko - September 1976
March 4, 2011 Slide 2
3. MiG 25 – The Teardown
Reverse engineering has
been used by military
organizations since the
Second World War and
extensively during Cold
War
Used by militaries in
order to copy other
nations' technologies,
g ,
devices or information
Used by commercial
organizations for
competitive advantage
March 4, 2011 Slide 3
4. In a German Biergarten…
Gizmodo publishes photos
of Apple iPhone 4 prototype
found in Silicon Valley bar
March 4, 2011 Slide 4
5. Shanzhai Beats Apple to Market
The “HiPhone” and
HiPhone
“Blockberry” are very
popular in China
March 4, 2011 Slide 5
6. A Competitive Advantage?
Unit Sales in Millions Shanzhai can bring new
180
phone to market in as little
as 45 Days using System on
160 Exports
a Chip technology
140 In China 10% of Worldwide Mobile
120 Phone Sales
100 60% Exported from China
80
Advantages of Shanzhai
60
• No Market Research
40 • No Product Design
• No Testing & QA
20
• N Li
No Licensing or T
i Taxes
0 • No Inventory
2005 2006 2007 2008 2009 • No Sales Force or Stores
Source: http://www.shanzhaiji.cn/talk/20081202/6216.html
March 4, 2011 Slide 6
7. Tablet Explosion
Apple iPad Samsung Galaxy SONY VAIO The iPed
Motorola XOOM HP Slate RIM Playbook Cisco Cius
March 4, 2011 Slide 7
10. The Teardown Specialists
Services, consulting, and management Helping our clients improve performance in the
software for technology companies seeking electronics value chain by p
y providing facts and
g
to leverage and protect their technology and analysis for success
intellectual property assets
• Technology & Market Assessment • Market Research for Consumer
• Formulate IP Strategy Electronics, Telematics, Semiconductor
• Establish IP Position • Teardown Analysis
• Defend, Leverage IP Business • Device-Specific Application Forecasts
• IP Monetization
March 4, 2011 Slide 10
11. Competitive Analysis
Integrated
I t t d Packaging
P k i
Circuit Design Design
& Layout Analysis
Bill of Device or
Materials & System
Cost Analysis Functionality
Software Fabrication
Reverse Process
Engineering Analysis
March 4, 2011 Slide 11
13. Self-Repair
• Most consumer devices lack
repair instructions or parts
• Off step-by-step instructions
Offer t b t i t ti
with photos
• Wiki style approach to repair
manuals with co
a ua s community o
u y of
contributors edits
• Guides for Macs, PCs, game
consoles, phones, tablets,
cameras, appliances
li
• Storefront to sell parts - Apple,
Nintendo, Sony, Microsoft
March 4, 2011 Slide 13
14. Open Source Hardware
• Schematics, bill of materials, Printed
Circuit Board (PCB) layout and
software are released with free and
open source modeld l
• Allow for modification and
redistribution of design files
g
• Allow manufacture, sale, distribution
and use of devices from design
• Categories include video games,
microprocessors, computer systems,
home energy management
• Services to prototype, manufacturer
and distribute
March 4, 2011 Slide 14
15. Growth of Open Source Hardware
Number of Open Source Hardware Projects
• Open Source Hardware
350
market predicted to be
300 $1B i 2015
in
250 • Over 13 companies
with $1M in revenues,
,
200 many approaching $5M
150 • Over 200 projects
today passing 300 in
today,
100 2011
50 • Will it expand beyond
hobbies to commercial
0 hardware?
2006 2007 2008 2009 2010 2011
Source: Make Magazine
March 4, 2011 Slide 15
16. Contract Manufacturer Evolution
HTC - From Contract
Manufacturer to Competitor
Less than 10% of Revenues
are from ODMs
March 4, 2011 Slide 16
17. Flextronics Services
Printed Circuit Camera Power
Enclosures
E l Displays
Di l
Boards Modules Supplies
Provide design and manufacture or more components.
Moving beyond just assembly.
Assembly Aftermarket
Design Procurement Logistics
& Testing Service
• Contract Design – • Forecasting & • Build-to-order • Supplier managed • Customer returns &
T&M engineering Demand Planning • Configure-to-order inventory repair
• Joint Development • Materials & • Just-in-time • Inbound freight • Refurbishment
Manufacturing
a u ac u g Components Manufacturing g management
a age e • Recycling
ecyc g
• Original Design & Purchasing • Defect analysis • Order fulfillment • Service parts
Manufacturing • Expediting • Environmental and distribution logistics
• Warehousing stress testing • Retail technical
services
Data gathered from Flextronics 10-K SEC Filing – May 2009
March 4, 2011 Slide 17
18. Hardware Brands in the Cloud?
There are no teardowns for public cloud platforms.
March 4, 2011 Slide 18
20. How to Compete
94% of
f
Respondents
Agree
Increasingly companies
will compete as much
through superior
processes and service
solutions as through
superior products
Martin Christopher Source: Enhancing Customer-Centric Supply Chains –
SCMWorld (October 2010)
Emeritus Professor
Marketing and Logistics
March 4, 2011 Slide 20
21. Competitive Advantage
Dell
• Just In Time • Vertical • Build-to- • Club Card &
Manufacturing Integration Order POS Data
Sharing
• Kanban • Nearshore • Direct to
Production Consumer • Cross-
• Supplier
pp
Docking
Relationship • POS-Based • Online
Management Replenishment Demand • Factory
Shaping Gate Pricing
Differentiation Comes from Process & Approach
March 4, 2011 Slide 21
22. Competing on Forecasting
Physical Supply Chain
Customer Vendor Late Stage Collaborative Build to
Self- Managed Configuration & Demand Order Inventory
Configure Inventory Postponement Planning (or Configure) Consignment
Retailer or Original Equipment Contract Component Semiconductor
Distributor Manufacturer Manufacturer Supplier Fab
Quotes & Sales Point of Sale Inventory Manufacturing Sales New Product
Activity Transactions Positions Consumption Forecasts Introductions
Information Supply Chain
I f ti S l Ch i
March 4, 2011 Slide 22
23. 2010 – Year of Shortages
Average Lead Times for Components (April 2010)
SRAM 8-16 Weeks
Flash NAND 8-16 Weeks
USB,
USB UART 4-20 Weeks
Capacitors 12-42 Weeks
Connectors 8-16 Weeks
Solid State relais 4 22
4-22 Weeks
Discrete 12-26 Weeks
Components
March 4, 2011 Slide 23
25. Kinect In High Demand
Top-selling accessory
item in terms of dollar
sales on a year-to-date
basis
8M units sold in 2010
as compared to 5M
forecasted
1M units sold in first
10 days
March 4, 2011 Slide 25
26. New Product Launches
Source: Morgan Stanley Research, Gartner, IDC, company reports (February 2011)
March 4, 2011 Slide 26
27. High Tech Channel Checks
Violations of non-disclosure
agreements to share secrets
Apple iPhone forecasts and plans
in exchange for cash
US SEC Arrests four employees of
high tech manufacturers and
expert network consultants for
Insider Trading
http://www.cnbc.com/id/40697535/Four_More_Arrests_Are_Made_In_Federal_Insider_Trading_Probe
March 4, 2011 Slide 27
28. US Infrastructure Failures
Credit Union freezes
C dit U i f
Airplane Control
bank accounts
Tower in-flight
communications
disruption
Signal & Control
systems disabled on
Union Pacific trains
130 cell tower
sites disabled
Five storm sirens failed to
warn of incoming tornado
March 4, 2011 Slide 28
29. Rare Earth Element Shortage
Critical to Hybrid Vehicles, Clean Tech Appliances
March 4, 2011 Slide 29
31. Corporate Social Responsibility
Greenhouse Gases Equal Opportunity Practices
Conservation and Biodiversity Environmental Supplier Small Businesses
Waste Management Local Sourcing
Responsibility Diversity
Product Corporate Fair Labor
Social
Quality Responsibility
Practices
Reporting
Consumer Product Safety Child/F
Child/Forced L b L
d Labor Laws
Product Recall History Occupational Safety
Traceability Procedures Maximum Work Hours
Ethical
Financial
Business
Annual & Quarterly Results
Transparency Antifraud Controls
Practices
Corporate Governance Know Your Customer
Political Activity Disclosure Incident/Legal Disclosure
March 4, 2011 Slide 31
33. Labor and Human Rights
• Recruitment - foreign workers
who pay excess fees
• Underage - minimum
employment age was 16
• Waste – non-certified hazardous
non certified
waste disposal companies
• Overtime –workers exceeded
maximum work weekly limits
• Wages – paid less than
minimum wage for regular
working hours
• B
Benefits – d fi i t payments
fit deficient t
for sick leave, maternity
• Deductions –of wages for
disciplinary purposes
• Discrimination –pregnancy
tests prior to employment
• Safety – not wearing p
y g protective
equipment
March 4, 2011 Slide 33
34. Apple Supplier Code of Conduct
Source: Apple Supplier Responsibility Progress Report 2011
March 4, 2011 Slide 34
35. Conflict Minerals
Tin, Tantalum, Tungsten, Cobalt widely used in computers,
airplanes, automobiles, cell phones, consumer electronics
i l bil ll h l i
Now prohibited in US Dodd-Frank Legislation
March 4, 2011 Slide 35
36. Importance of CSR
Source: Eye for Transport - High Tech & Electronics State of the Industry Report (2010-2011)
March 4, 2011 Slide 36
38. The Customer Relationship
Customers are Growing Larger
and More Powerful
dM P f l
Buyer Suppliers
March 4, 2011 Slide 38
39. The Key Challenge
Every Large Company Approaches
Supply Chain Processes &
Technologies in a Different Way
Suppliers Must Contend with Rising
Complexity and Customization from
Large Accounts
March 4, 2011 Slide 39
40. Purchase Orders in High Tech
Source: EIDX/CompTIA - Purchase Order Business Fundamentals
March 4, 2011 Slide 40
41. Customer Process Variability
Forecasting
F ti Orders
Od Logistics
L i ti Settlement
S ttl t
Planning Forecast Catalog Order Ship to Factory Supplier Invoice
Confirming Order Ship to Warehouse Self-Billing
Simple Forecast
Spot-Buy PO Ship to Store
Invoice Discounting
Material Release
Blanket PO Drop Ship Receivables Factoring
Schedule
Evergreen Order Home Delivery Supply Chain Finance
Consumption Standing PO
Merge-in-Transit Open Account
O
Schedule
Build-to-Order Consolidation Letter of Credit
Order Forecast Configure-to-Order Documentary
Cross-Docking
Collection
Mix/Aggregation Drop Ship Order
Late S
L Stage
Forecast Debit Transfer
Internal Order Configuration &
Credit Transfer
Delivery Forecast Postponement
Work Order Wire Transfer
Rolling Forecast Job Order Procurement Card
Service Order Cheque
Build Plan
Repair Order
Warranty Order
March 4, 2011 Slide 41
43. B2B Integration Technologies
How Do You Integrate with Customers?
Electronic Order Direct
E-Mail, Fax, Exchange/ EDI
Procurement Management Internet
Phone Marketplace VAN
Application Portal Connection
cXML PunchOut S-FTP SOAP cXML SAP IDOC
OCI RoundTrip FTPS SMTP ebXML Oracle XML
TapOut FTP RNIF GS1 GDSN Microsoft AIF
VPN SOAP GS1 eCOM QAD SNF
PEPPOL AS1 HTTP/S UBL
Achats AS2 REST SPEC 2000 Connect:Direct
Zanzibar AS3 ebXML CIDX HULFT
Acquistinretepa AS4 OFTP PIDX ENX
March 4, 2011 Slide 43
44. Selling to Government
Spain France Germany UK
Direccion General Ixarm e-Vergabe Zanzibar
Del Patrimonio Achats Kaufhaus des OPEN
Del Estado Marches-publics
Marches publics Bundes - KdB xChangeWales
PETM-BCS e-bourgogne
Denmark Belgium Norway Italy
DOIP .be-Procurement Ehandel.no Acquistinretepa
ETHICS
March 4, 2011 Slide 44
45. You Try to Standardise IT…
Small and Midsize Customers Large Customers
Common,
canonical XML
Single, global formats defined
portal for for information
customers. exchange inside
AS2 and VAN Web Portal VAN RNIF the enterprise
interfaces for RosettaNet XML
B2B integration
B2B Customer B2B Integration
Web Portal Gateway
OAGi XML
Standardized,
Middleware (Application-to-Application) Global ERP
suite used
Modularized, SAP IDOC Oracle TIF across brands,
ALE FTP
reusable geographic
services provide regions and
access t ERP
to
Supply Order Warehouse Transport Service
functions from Chain Manage Manage- Manage-
Accounts
various internal Receivable Parts
Planning -ment ment ment Planning
and external operating
customers Common ERP Application companies.
p
March 4, 2011 Slide 45
46. Compromised by Customers…
Small and Midsize Customers Large Customers
Phone, fax, e-
mail, spreadsheet
are required to Proliferation of
support smaller EDI, XML and
customers or Web E-Mail Ariba GXS FTP AS2 RNIF B2B comms
e2open
emerging markets Portal w/CSV Punchout VAN EDI XML XML must be
supported to
satisfy customer
needs
Web B2B Integration
Portal Gateway
Middleware (Application-to-Application) ERP
Middleware customised to
customized to meet the needs
provide services of specific
provide access customer
to ERP accountst
Supply Order Warehouse Transport Service
functions from Accounts
Chain Manage Manage- Manage- Parts
various internal Receivable
Planning -ment ment ment Planning
and external
customers Common ERP Application
March 4, 2011 Slide 46
47. Quest for Efficiency
Buyer’s View
y Supplier’s View
pp
Electronics Retailer
One Many
Standardised Customized
Supply Chain
pp y Supply Chain
Processes & Processes &
P
Technology Technologies
OEM 1 OEM 2 OEM 3
For each How many
Supplier Supplier Supplier Supplier Supplier
Euro of
E f are l t on
lost
costs saved customer
on standard- facing
isation complexity?
Lower Tier Suppliers
March 4, 2011 Slide 47
48. The Options?
Give Up Negotiation
Battle
B ttl Escape
E
March 4, 2011 Slide 48
49. Two Views on Complexity
Challenge Opportunity
March 4, 2011 Slide 49
50. Differentiating with B2B
89% of Respondents
Agreed that
Flexibility of our B2B e-
Commerce program Enables
us to Differentiate from
Competitors on Service
p
March 4, 2011 Slide 50
51. Can the Cloud Solve
Manufacturer’s
Customer A ERP Systems
OAGi Galia/VDA SAP IDOC OFTP
EDIFACT SANNA
XML
ANSI EDI AS2 Zengin
Tradacoms
T d RosettaNet
R tt N t
Customer B
Cloud-Based
B2B e-Commerce
Service
S i Data Sync
CPFR
Customer C ASN E-Invoicing
E-Mail E-Marketplace Fax-to-EDI
March 4, 2011 Slide 51
52. Questions
Steve Keifer
Vice President
Product Marketing
Work +1.301.340.4454
E-Mail:
E Mail: steve.keifer@gxs.com
www.gxs.com
Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.
March 4, 2011 Slide 52
