Supply chain management system and e-commerce technology

1. Supply Chain Management
&
eCommerce Technology
presented by:
Nachiappan Annamalai

2. Overview
• Supply Chain Management - Whazzit
• SCM today - Problems
• Solutions - e-Commerce
• Examples of present systems -
tradematrix.com - i2 Technologies
• e-Commerce - Application to SCM -
Framework
• Future of SCM & e-Commerce
• Suggestions

3. World Internet Population 3/99
• World Total 158.50 MILLION
• Africa 1.14 million
• Asia/Pacific 26.97 million
• Europe 36.55 million
• Middle East .88 million
• Canada & USA 88.33 million
• South America 4.63 million

7. Effective SCM involves
• Managing Supply Chain as a single entity
• Recognizing end user service requirements
Customer Utility = f(time, quantity, place)
• Recognizing time as basis of competitive
advantage
• Effective use of Inventory
• Continuos Improvement

8. Time Involved in the Process

9. Effects of Time Consuming SCM
• Excessive Inventory - $ 30 Billion ( Grocery Supply Chain alone)
• Poor Product forecast
• Poor Capacity Planning
• Poor Customer Service
• High Corrective Costs - Overtime, Subcontracting, Trans. Prob.
• Optimized Supply Chain as a Whole entity - Not Possible
• Internationalization - Not possible

11. Distribution

12. Other Problems
• Demand Forecast Updating
• Order Batching
• Price Fluctuation
• Shortage gaming

13. Demand Forecast Updating
• Amplification of Fluctuation when ones goes
up the Supply Chain
• Lead Time importance

14. Order batching
• Orders in Batches - Compulsion
- Time & Cost Constraints
- Transportation Problems - FTL - Full Truck
Load
• Overlapping of Order Cycles - Leads to more
variability
• MRP Jitters

15. Price Fluctuations
• Forward Buy
• Role of Price Fixing - Erratic Demand
• Variation in Buying Quantity is much bigger
than the variation of the Consumption rate

16. Shortage Gaming
• Phantom Orders - When & Why does it Occur
• Examples
- Motorola and its Distributors
Air touch Communication & Baby Bells
- IBM Aptiva Model - Assumption of Retailers

17. Counteractions
• One and only best Solution
E-Commerce
- Information Sharing
- Channel Alignment
- Operational efficiency
- Intelligent Optimization Agents
- Transaction Processing
- Money Transactions

18. I2 Technologies - Tradematrix.com
an efficient SCM e-Commerce system

30. Services the System Provides
• Direct & Indirect Procurement
• RFQ - (Request for Quote) Collaboration
• Demand Collaboration
• Holisitic Customer Management
• Buyer & Seller Services
• Service Providers
• Marketing Services

31. Tradematrix.com - Framework
• Front end
- Portal
- Customer Management
- Communication Systems
- Money Transactions
• Back end
- Optimization
- Transaction Processing System

33. The Process of Commerce
• Buyers and sellers find each other
– Communication: advertising and marketing
– Intermediaries (dealers, distributors, reps)
• Negotiation
– Agents (buyers, lawyers)
• Transaction
– Contract
– Payment (or many payments)

34. The Process of Commerce
• Order fulfillment
– Manufacture
– Delivery
• Post-sale events
– Customer service
– Reorder, restock
• Accounting
– Are we making a profit?
• Data analysis
– Who’s buying the stuff?

35. The eCommerce Process
• Transaction
– Transaction processing, Databases
– Electronic Payment Systems,
– Computer Security,
– System Reliability
• Order fulfillment
– Manufacture (manufacturing systems)
– Delivery (tracking systems)

36. eCOMMERCE TECHNOLOGY
• Networks • Security
• Internet • Electronic payment
• Programming • Search engines
• Multimedia • Intelligent agents
• Databases • Data mining
• Transaction
processing

37. The eCommerce Process
• Which of the steps are “bittable”?
• Buyers and sellers find each other
– Communication (via Networks, the Internet,
Programming and Information Retrieval)
– Human-Computer Interaction, Multimedia
– Intermediaries
• Disintermediation
• Negotiation
– Electronic Negotiation, Intelligent agents

38. The eCommerce Process
• Post-sale events
– Customer Service and Help Facilities
– Reorder, restock
• Accounting
– Transaction processing
– Interoperability between online and legacy
systems
• Data analysis
– Data Mining

39. Ideal e-Business System
• Front End
- Portal
- Communication Systems - Interface with Mobile Devices & GPS
- for access to real time info.
- Money Transaction
- Customer Management Systems
• Back End
- Optimization
- Decision Support Systems & Intelligent Agents
- Transaction Processing System
- Prioritizing Systems - Shows Contradictions
- Forecasting System with Responder- Capability to match System
Dynamics

40. Manufacturing Services
• Front End System Functions
- Product Design & Quality Specification
- Customer Management & Communication System
- Money Transactions
• Back End
- Standard time & Least Cost
- Supply Time
- Optimization
- CNC Machine Code Conversion
- Route data to CNC Machine
would lead to total automation - paperless industry