oracle r12 supply chain management solution: cisco's business

Oracle R12 Supply Chain Management Solution: Cisco's Business Transformation Case Study

Saravanan N IT Systems Engineer

Cisco Inc

Sep 25, 2013

Rachna Mittal Lead Consultant (Consulting & SI)

Infosys Ltd

Agenda

Cisco Value Chain

Cisco’s Agile & Flexible Supply Chain Transformation

Supply Chain transformation using Oracle Value chain Enabler’s

Supply chain solution highlights

Recap

Questions & Answers

Customer Profile

About Cisco

• Worldwide leader in networking

• Founded 1984

• FY13 revenue of $48B

• ~70,000 employees

• >165 countries

• >150 acquisitions

Broad range of products, solutions

and services

Strategy

Solve our customers’ most important business challenges by delivering intelligent networks and technology architectures built on integrated products, services, and software platforms

Vision

Change the way the world works, lives, plays, and learns. To Lead Every Move We Make with Networked IT

Agenda

Cisco Value Chain




Recap

Questions & Answers

Customer Profile

Cisco Value Chain Evolution Through Market Transitions

Cisco Owned Manufacturing

Outsourced Manufacturing

Lean Manufacturing Customer Value Chain

1980s 1990-2000 2001-2009 2010-2013

Core vs. Context Separation

of Activities

Pull-Based Manufacturing

and

Inventory Reduction

Collaboration

Large Scale Services

Cisco Value Chain Is Complex and Global

CTO Partners

BTS Partners

3PL Partners

Key Stats

• > 1000 Suppliers

• ~ 35, 000 Components

• ~ 33,000 Products

• 5 Mfg Partners, Local sites in Brazil,

Russia

•

Offerings

• Hardware

• Software

• Services

• Bundles

Business Models

• CTO Fulfillment

• BTS Fulfillment

• Any Node Any Product distribution

• S/W Supply Chain

Agenda

Cisco Value Chain




Recap

Questions & Answers

Customer Profile

Imperative for Company Growth,

Revenue Uplift, Global

Consistency, Simplification,

Speed, and Scalability

Enable new business models such as Software as a Service (SAAS) and bundling

Capitalize on revenue opportunities through full buy and sell capabilities in emerging markets

Provide a single foundational platform mitigating current

resiliency issues and promoting scalability

Align with industry standards and best practices

Without a dramatic change in the way Cisco transacts business, Cisco risks leaving substantial revenue on the

table and increasing vulnerability to competitors.

Drivers of Supply Chain Transformation

Improve acquisition efficiency, accelerating Cisco’s time-to-value and time-to-monetization from

acquired entities

Enhanced business capabilities such as Build

to Stock (BTS)

Extended access to emerging

markets

Supply chain shift from Work Order

to Purchase Order based model

What is SC Transformation?

Ability to rapidly integrate acquired

companies

Supply Chain Transformation Initiative Simplicity. Scale. Speed.

Upgrade of Enterprise

Resource Planning (ERP) System

Foundational technology to

enable new business models

What business results are expected?

…to Operations

Reduced touches – estimated 25% reduction in manual touches

Quicker time to market – estimated 30% reduction in time to market

Scalability and agility

Enhanced acquisition efficiency

Dramatically improved system resiliency

…to Cisco employees

Shift from contextual to core work

Elimination of known inefficiencies and painful workarounds through increased automation

Enhanced international career opportunities

…to Customers and Partners

New Business Models

More self-service options

Increased satisfaction levels and ease of doing business

Up to a 73% reduction in cycle times

New ways to structure deals: enhanced contracting, progress-based billing, solutions selling, New Business Models

Increased global market share – BRICM and emerging market penetration

Increased profitability through a 12% target reduction in the cost-to-serve ratio

Ability to focus on high-value customers through a tiered engagement model

…to Cisco’s Growth & Profitability

Approach And Methodology Common process flow and global design adherence

Adopt Standardization and best practices

Apply Localization Rules if applicable

Out of Box processes

Change Management

Program Management for lane enablement

On-time shipment, SLA measurement

Load testing, Data generator

Fine Tuning supply chain Processes

Monitoring tools, Seamless transactional flow

Industry Tailored Business Flows pre-built

Template & Questionnaire approach

Integration with upstream / downstream / other products

EDI /Rosetta net Integration Pack for most common industry

requirements

E2OPEN integration with trading partners

Documentation standards -Oracle A.I.M Naming Standards

Configuration, documents and templates

Self Service Solution Videos

Global Design

Partner Enablement

Performance and Monitoring

Pre-Built Industry Processes

Integration Framework

Toolkit

Supply

Chain

Solution

Agenda

Cisco Value Chain




Recap

Questions & Answers

Customer Profile

Final Config, Pack & Ship

Target Landscape

Logistics Partner / Cariers

Inventory

receipt Stage

shipment

Ship Label

Manufacturing Partner

Backlog

Build

Pack & Ship

Manufacturing & Distribution

Inbound Signal & Ship Instructions

Master Data Sync Up

Billing Advices & Returns

Rcpt Confirm Ship Confirmation

Forecast & Build Signal

Fleet

Information Milestone

Report

B

2

B

I

n

te

rf

a

c

e

Order Scheduling Payables

Order Management Supplier Returns

Master Data Management Cost Management

Procurement Flow Manufacturing

Sourcing & Negotiation Work In Process

Shipping LPN Track & Trace LPN

Flexible Routing Return to Mfg

Pick Release Ship Confirm

Shipping Control Route Options

Rate Shopping Freight Pricing

Event Management Change Plan

• Procurement

• Order Management

• Bills Of Material

• Flow Manufacturing

• Oracle Transportation

Management

• Inventory Management

• Shipping Execution

• Costing

Transportation Management

Port Supplier

Hub Destination

3PL ODM

Mfg

Partner Origin

3PL CISCO

Static Route to Flexible Route Options

Single Leg

Domestic

Direct Ship

Single Leg

International

Multi Leg

International

Manufacturing

Partner 3PL Origin

Warehouse

3PL destination

Warehouse Customer

Oracle Transportation Management & Oracle Shipping Execution

Customer

Cisco’s Logistics Optimization Solution

Agenda

Cisco Value Chain




Recap

Questions & Answers

Customer Profile

Customer

3rd Party Logistics / Carrier

Mfg Partner

Manufacturing

Partner Site

Quality

Inspection

Assemble Test

Purchase Order

Creation (Partner Systems)

Cisco’s Order Flow

Purchase Order

Procurement Material Sourcing

Customer

Pack-out and

Label Print

Ship/Deliver

Service Rep

Multiple Channels

Oracle

PO Creation Order

Booking & Scheduling

CISCO

Supply Chain Solution C

isc

o

3P

L W

are

ho

us

e

Receive shipment

Plan

PO

Receipt

Receive

Inbound

Change

(in OTM)

PR to CM

w/OTM IB Ship

Instructions Qualify for Full

ShipSet / Create

Delivery

AR Integration

Ca

rrie

r/B

rok

e

r

Pick up

Import & export

filling

Confirm Arrival

Stage product

( Level SID)

Milestone Updates

CM

WAIT for

Carrier

Update

Y

N

Move inv SLC

subinventory

OTM Plan OB Order

Update

Plan

Generate

Docs

Print Docs

Handover to

Carrier Ship Confirm

Ship Confirm

Deliver

Rec

eip

t

Sh

ip P

lan

Sh

ip

Co

nfi

rm

Ship to WH/ASN

Pick

Release

Delayed

RR

Mil

es

ton

es

OTM Shipping

Controls

Receive Shipment

Plan

Prepare Shipment

4B2

3B18

3B2 3B3 In

bo

un

d

3B2

OTM Inbound

Send

Plan

3B18

3B18

PDF

Build

Integration Architecture

Data

Source/

Destination

Business

Process

Orchestration

AS2

Gateway Partner

AS2

GW

Logging

DB

CCIX(J2EE Env)

Errors/Logs

CISCO Environment Partner Environment

Backend

System

AS2 Document JMS Request Queue

JMS

Response

Queue

Response

(Sync MDN)

Event Pull

Delivery Status

Update

Request

1 3A4

2

3 3B2 ASN 4

Supply Chain Flow- An Example Order booking and PO to Contract manufacturer

Cisco Order Flow Starts with

customer order booking which

interacts with OTM and derives

the Route Code based on the

Order information

3A4 is sent to the contract

Manufacturer with the PO

number, route and item

information

On completion of the order CM

sends Advance Shipment

Notice to the 3PL Logistics for

build completion via 3B2

message

Purchase Order is created with

the Contract Manufacturer

6 4B2 Inbound

5

7

8

Shipment receipt and LPN assignment

The Logistics Partners receives

the goods and sends a 4B2-

Shipment Receipt Message

Workflow depicts the supply line

eligibility for the order line. The

Order with reservations and

LPN assignment goes to

awaiting shipping

The LPN DFF for the cartons is

used for tracking the movement

of the Goods

The reservations are now intact

for the order line in Intransit

Subinventory and LPN assigned

to the delivery

9

10

11

Inventory movement and delivery creation

12

Validation process seamlessly

create delivery and interface to

OTM through middleware

The LPN Subinventory Status is

changed to FG Subinventory

The delivery creation takes

place after Subinventory

Transfer

The Subinventory Transfer

takes care of the movement

from Intransit to Finished good

Subinventory

OTM: Planning and Supply chain event management

13

15 16

14

OTM Shipment plan creates the

trips and stops in EBS

OTM helps in planning the

order so that it can optimize the

movement of the order from the

origin to the end customer

Supply Chain events like the

carrier picking up the goods and

leaving the origin etc. sent by

3PL and Carrier can be tracked

in the system

The delivery is Now picked

after Trip creation with

reservation at Staging

Subinventory and 3B18 is

sent

3B2 Ship Confirm 3B18

Order Ship confirm

17 18

After customs and trade

compliance validations, The

3B18-Shipment Plan is sent to

the carrier and 3PL partners

Once the goods are picked up

and shipped out for customer

delivery a 3B2 Ship confirm

notification is sent to Cisco

Based on 3B2 SC Received ,

the delivery gets shipped along

with associated trip and stops

closed

E2E workflow of Typical Cisco Sales order

19

20

Implementation Challenges

People

Process

Partnership

System

Program Management

Implementation Challenges

SME Coverage Industry Standards

Simplicity, Speed, Scale

Vanilla Theme

Partner Enablement

Process

Harmonization

Change Management

Agenda

Cisco Value Chain




Recap

Questions & Answers

Customer Profile

CTO BTS

Any Node Any Product Distribution Direct Customer Ship

Purchase Order Based Fulfillment Model Flow MFG and Consigned Inventory

Process

Heavy Assembly and Test Operations Light Postponement and VMI

G-Hubs, Fulfillment & Logistics Center Consolidated to 3PL Node

Footprint

Fulfillment Lead Time 17 Days Fulfillment Lead Time 3-5 Days

Cycle Time to Replenish 52 Days Cycle Time to Replenish 36 Days

SLA

Final Configuration based Payment Periodic Consumption based Payment

Critical Component (PCBA) Planning Top Assembly based Planning

Cisco’s Flexible Fulfillment Models

Accelerators Technical Know How Functional Value

Adds What it means for

Partner & Customer • Playbooks comprising of pre-

configured process flows,

configuration documents

• Partner message simulator

• Design Templates and Test

Scripts

• Training guides

• System Performance,

scalability for high volume

• Standardize the Partner

Integration Processes and

messages

• Integrating OTM with Third-

Party systems based on

Industry standards processes

• Global rollout strategy for

partner enablement

• Best practices and Oracle OOB

solution

• Standard B2B communication

• Business Process Re-

engineering & Automation

supported by business benefits

• Faster time to market for new

business models

• Pre-built accelerators reduces

time and cost to enable new

partners

• 10-15% reduction in TCO

• Accelerate Cisco’s ability to

bring products to new

geographies

Value Proposition

Industry Benchmark As per Gartner Study, Cisco is well-positioned to

capitalize on major trends driving increased long-term

IT investment. In close partnership with IT, its supply

chain team is focused on proactively enabling Cisco to

break into new markets for its hardware, software and

services-based solutions. Cisco is now thinking about

supply chain as a menu of service offerings and taking

a segmented approach to delivering the right

services for each business at the right cost structure.

Source: Gartner (May 2013)

Agenda

Cisco Value Chain




Recap

Questions & Answers

Customer Profile

If you have any questions, please contact

Saravanan N [email protected]

Rachna Mittal [email protected]

TOMORROW

starts here.

oracle r12 supply chain management solution: cisco's business

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