products, distribution channels, sales operations, and supply chain management at seagate ming chao,...
TRANSCRIPT
Products, Distribution Channels, Sales Operations, and
Supply Chain Management at Seagate
Ming Chao, Project Manager
Mike Ruggiero, Senior Sales Operation Analyst
Seagate Technology
April 29 2010
Agenda
• Seagate Corporate Overview
• Ming Chao: Distributor Management; Market Integrity Function
• Mike Ruggiero: Sales Operation, Supply Chain Management
Corporate OverviewApril 2010 2
Ming’s Bio
Undergraduate, UC Santa Cruz - Class of 2004
Information System Management
Graduate, Santa Clara Univ – Class of 2010
Master of Business Admin
Corporate OverviewApril 2010 3
Ming’s Bio Cont…
Career Path
2004-2006 Supply Chain
International Trade Analyst
2006-2008 Supply Chain
International Trade Sr. Supervisor
2008-Present Distributor Compliance
Market Integrity Program Manager
Corporate OverviewApril 2010 4
Seagate: Storage Leader
• Seagate is the world’s leading provider of storage devices.
– Q3 FY2010*: 50.3M drives shipped; revenue of $3.05B
• Provides storage devices for Enterprise, Desktop, Mobile Computing, Consumer Electronics and Retail Markets
– Builds Hard Disk Drives and Solid State Drives
– 31% overall market share
– Broadest product offering in the industry – largest customer base
• Ownership and vertical integration of critical technologies: heads and media
• 52,394** employees worldwide
Corporate OverviewApril 2010 5
* For third fiscal quarter ended April 2, 2010** Includes interns, contractors, and agency temps
Seagate Global Presence
Corporate OverviewApril 2010 6
Oklahoma City, OK Teparuk & Korat, Thailand
Paris, France
Longmont, CO
Springtown, N. Ireland
Wuxi, China
Shanghai, China
Tokyo, JapanBeijing, China
Delhi, India
Shrewsbury, MA
Suzhou, China
Taiwan
Amsterdam, Netherlands
Shakopee, MN
Bloomington, MN
Sunnyvale, CA
Santa Clara, CA
Fremont, CA
Scotts Valley, CA
Science Park, Singapore
Johor & Penang, Malaysia
Woodlands, Singapore
Ang Mo Kio, Singapore
HQs, Admin and/or Sales
Design
Customer Support
Drive & Component Mfg
Total Units Shipped
Corporate OverviewApril 2010 9
Source: Seagate Market & Competitive Intelligence
*
* includes all 3.5-inch ATA drives
Millions
Total GigaBytes Shipped
Corporate OverviewApril 2010 10
Source: Seagate Market & Competitive Intelligence
*
* includes all 3.5-inch ATA drives
Billions
Q3 Financial Highlights
Corporate OverviewApril 2010 12
EPS $1.00
Revenue $3.05 billion
Net Income $518 million
Shipments 50.3 million
Margin 29.6%
GAAP numbers
13
Revenue By Channel
100%
80%
60%
40%
20%
0%
Q3FY09 Q4FY09 Q1FY10 Q2FY10 Q3FY10
23232929 2525
1010
69696161 6565
OEMs Distributors Retail
2424
88
6868
881010
2121
7272
77
Corporate OverviewApril 2010
Corporate OverviewApril 2010 14
Revenue By Geography
100%
80%
60%
40%
20%
0%
Q3FY09 Q4FY09 Q1FY09 Q2FY010
Americas Asia Pac EMEA
5050
2424
2626
4545
2828
2727
4848
2222
3030
5353
2323
2424
5151
2323
2626
Q3FY010
Market Share Estimates
Corporate Overview April 2010 15
Growth
Y/Y = 44%
Q/Q = 1%Q3 FY10
162.9M Units
Total Market – All Form Factors - Preliminary
Q2 FY10 160.5M Units
Source: Seagate Market & Competitive Intelligence
Desktop Computing Products
• Barracuda XT – Industry’s first 2TB drive
with the blazing-fast SATA 6Gb/s interface
• High-performance PCs, entry-level
servers, PC gaming systems,
PC-based home media servers
• Barracuda 7200.12 – World’s first 2-platter
(500GB each) 1TB desktop hard drive
• Barracuda LP – Industry-leading ‘green’
low-power desktop hard drive
Barracuda®
17
Enterprise Products
News
• Constellation ES: Seagate Ships Industry’s First 2TB
6Gb/s SAS Enterprise Drive
• Savvio 10K.4: Seagate Ships World’s Highest-
Capacity, Most Reliable SFF Enterprise Drive
Review Awards and Accolades!
• Constellation ES: 9/10 score, UMLan, February 2010
• Cheetah NS.2: 9.5/10 “Golden Bear Award,” Bjorn3D,
February 2010
• Cheetah 15K.7: “2009 Editor’s Choice Award,”
Benchmark Reviews, January 2010
• Savvio 10K.4: 9/10 “Golden Bear Award,” Bjorn3D,
April 2010
Cheetah®, Constellation™, Savvio®, Pulsar™
Corporate OverviewApril 2010
Mobile Computing Products
19
Momentus
• Market-leading technology
• Capacities up to 640GB and spin speeds up to 7200 RPM
• SATA 3Gb/s interface for fast data transfer
• Momentus Thin – World’s first 7mm-high 2.5-inch hard drive for netbooks and ultra-thin laptops
• Momentus® 5400 drive with full disk encryption (FDE) prevents unauthorized data access
• Free-fall protection for beefed-up laptop durability
Seagate FreeAgent® drives make your content available where and when you want it.
Save, Store, Simplify Store, Protect, Secure
Seagate BlackArmor® servers ensure mission- critical data security and availability.
Seagate Retail Solutions
One brand catering to two distinct audience needs
Small Business/Prosumers Looking
for Scalability, Continuity, Speed &
Protection
People Looking for
Convenience, Style &
Enjoyment
® ®
FreeAgent XTreme™: Access large amounts of your content with blazingly fast speed,
making music production, photo copying or editing a breeze
• Blazingly fast data transfer speeds with eSATA, USB 2.0 and FireWire 400 • Get up to 2TB to easily store all your large files and data. • Easily protect all your data with automatic file backup and software encryption.• Sleek, modern design that offers horizontal or vertical orientation • Save energy with environmentally smart utilities.
FreeAgent Go™: The smallest, thinnest portable device on the market, making it easy to
back up, protect and carry all your music, photos, data and memories
• Choose from a rainbow of attractive colors to reflect your style. • Access files with unprecedented convenience with a portable desktop dock. • Up to 1TB to take complete libraries of music, movies and photos with you• Synch content between home and other computers so you have most-recent version.
FreeAgent Desk™: The best place to gather and access all of your important photos,
games, movies, music and documents
• Keep your important files and folders private with powerful software encryption.• Synch content between your desktop and FreeAgent Go or other portable devices.• Sleek, modern design that offers horizontal or vertical orientation and up to 2TB of space • Experience fast data transfer via USB 2.0.
Seagate Retail Solutions (Continued)
21Corporate OverviewApril 2010
Seagate FreeAgent Go Dock+™: FreeAgent Go Dock+ connects directly to
your Mac OS X or Windows computer, allowing access to all the content stored on
a FreeAgent Go or FreeAgent Go for Mac external hard drive without fumbling
with cables.
• Features three additional powered USB ports so you can easily connect other USB devices
• Includes an ENERGY STAR-qualified power supply that can effortlessly power additional devices
Seagate Replica™: A revolutionary backup appliance that completely eliminates
the need to manually learn, manage or dedicate any time to the backup process
• Automatically and continuously stores up-to-date copies of everything on a PC, including installed applications, operating systems, e-mail, photos, etc.
• Integrates into Microsoft Windows, letting you work within a familiar environment should you need to recover a file
• Dock solution enables a one-time setup at your desk—no more fumbling with cords.
• Available in two configurations—either single PC or Multiple PC
Seagate Retail Solutions (Continued)
22Corporate OverviewApril 2010
The Seagate FreeAgent® for Mac suite of solutions is designed specifically for the Mac community and offers capabilities to meet the
unique performance needs of creative professionals.
Seagate Retail Solutions (Continued)
The FreeAgent Go, FreeAgent Go Pro™ and FreeAgent Desk for Mac drives are
Mac-ready out of the box.
Wherever, whenever, however you like it…
23
• Sleek design, with feet to complement consumers’ Mac desktop environments
• USB 2.0 FireWire 800 or 200
• Up to 2TB of storage
• Sleek design, with feet to complement consumers’ Mac desktop environments
• USB 2.0 FireWire 800 or 200
• Up to 2TB of storage
• Pre-formatted with HSF+ and TimeMachine Ready
• Offered in 5400 or 7200 RPMs for blazingly-fast performance
• Support for Apple power management for greater energy efficiency
• Pre-formatted with HSF+ and TimeMachine Ready
• Offered in 5400 or 7200 RPMs for blazingly-fast performance
• Support for Apple power management for greater energy efficiency
Corporate OverviewApril 2010
Wherever, whenever, however you like it…
The new evolution of Seagate FreeAgent Theater+™ HD media player allows consumers to instantly and easily access and enjoy their digital media libraries and favorite Internet content on their home entertainment systems with 1080p HD with DTS 2.0 + Digital Out
and Dolby Digital sound.
Seagate Retail Solutions (Continued)
FreeAgent Theater+ media player brings enjoyment of digital content
to the living room.
• 10/100 Ethernet port for media streaming and Internet access.
• Optional USB wireless adapter for 802.11n connectivity to home network
• Ability to access and stream content from Yahoo! Weather, Stocks Picasa and Flickr
• 10/100 Ethernet port for media streaming and Internet access.
• Optional USB wireless adapter for 802.11n connectivity to home network
• Ability to access and stream content from Yahoo! Weather, Stocks Picasa and Flickr
• DVD-like playback with surround sound
• Pair photo slideshows with music and array of transition effects.
• Intuitive, on-screen interface with easy-to-use remote
• 2 additional USB ports for accessories or additional USB devices
• DVD-like playback with surround sound
• Pair photo slideshows with music and array of transition effects.
• Intuitive, on-screen interface with easy-to-use remote
• 2 additional USB ports for accessories or additional USB devices
Stocks
Wherever, whenever, however you like it…
Seagate Retail Solutions (Continued)
FreeAgent DockStar™ is sharing made easy!
• Enables any PC in your home to see your FreeAgent Go drive as a folder on your network
• Access all your photos, movies and music from any PC inside or outside the home.
• Enables easy sharing with friends and family
• Access your content from any networked computer or iPhone.
Connect with your content!
25Corporate OverviewApril 2010
The new Seagate BlackArmor family of storage solutions delivers:
• High-quality storage to centralize and expand digital content for SOHO and Small Businesses
• MANAGEMENT utility for easy accessibility and sharing of digital content over the network and secure online access (Web)
• Reliable and available network storage solution using RAID technology to protect digital content
• High data protection and availability using auto backup applications
• 3-year warranty
• Superior user experience
• Easiest to install and manage
• Highest level of protection
• Wide-variety of solutions
• Grows with your business
Protect Your Business
Seagate Retail Solutions (Continued)
®
Consumer Electronics Products
Corporate OverviewApril 2010 27
Pipeline HD™ Family
Pipeline HD Mini:• World’s first 2.5-in. DVR hard drive; enables slim, sleek industrial
designs
• High-capacity with lower-power performance
• Slim form factor
• Available in 160GB, 250GB, 320GB and 500GB capacities
• Enhanced acoustics for near-silent operation, coupled with 24x7 operation capabilities
• Earth friendly and sustainable product
Pipeline HD.2: • One- and two-disk, cost-optimized solutions
• Available in 160GB, 250GB, 320GB, 500GB and 1TB capacities for content-hungry consumers
• Enhanced acoustics for near-silent operation, coupled with 24x7 operation capabilities
• Earth friendly and sustainable product
Seagate WW Distributor Presence
Corporate OverviewApril 2010 29
ARGENTINA CROATIA GUATEMALA LATVIA PAKISTAN SOUTH AFRICA
AUSTRALIA CYPRUS HONG KONG LEBANON PANAMA SPAIN
AUSTRIA CZECH REPUBLIC HUNGARY LITHUANIA PERU SWEDEN
BAHRAIN DENMARK INDIA LUXEMBOURG PHILIPPINES SWITZERLAND
BELARUS ECUADOR INDONESIA MALAYSIA POLAND TAIWAN
BELGIUM EGYPT IRELAND MEXICO PORTUGAL THAILAND
BRAZIL EL SALVADOR ISRAEL MOLDOVA QATAR TURKEY
BRUNEI ESTONIA ITALY MOROCCO ROMANIA UKRAINE
BULGARIA FINLAND JAMAICA NETHERLANDS RUSSIAN FEDERATION UNITED ARAB EMIRATES
CANADA FRANCE JAPAN NEW ZEALAND SAUDI ARABIA UNITED KINGDOM
CHILE GEORGIA JORDAN NORWAY SINGAPORE UNITED STATES
CHINA GERMANY KAZAKSTAN KOREA, REPUBLIC OF SLOVAKIA URUGUAY
COSTA RICA GREECE KUWAIT OMAN SLOVENIA VIETNAM
Corporate OverviewApril 2010 30
Market Integrity Function
Market Integrity Function
Ethics, Policies & Procedures
• Provides training to key stakeholders
• Includes GM policy
Grey Market PolicyEstablishes and identifies a policy for monitoring & managing risks related to the Grey Market and incentives including:
• Developing a grey market and incentives audit approach policy including consequence management
• Obtaining executive management buy-in
• Communicating the policy through series of planned road shows for all relevant regions
POS Support & Analysis Establishes a consistent method/process for analyzing POS data to identify “red flags” for follow up; often prior to incentives being paid
Partner & Deal QualificationEstablishes a consistent process for partner selection and deal qualification to ensure they meet Seagate requirements (e.g. SI’s)
Channel Controls Enhancement Review leading practices and establish processes, systems & controls for managing various channel programs
Proactive Reactive
Grey Market Buys &
Investigations
Risk AnalysisEstablishes a robust risk ranking process to enhance Seagate's channel partner compliance program, including:
• Analyzing internal quarterly data (e.g. POS, inventory, incentive program data) to provide a risk ranking of channel partners for review consideration Using other information (e.g. sales intelligence)
Channel Partner Reviews
Consequence Management(see slide # 6)
Feedback Loop
Model Highlights
© Seagate Confidential
The application was developed to enable scenario planning for next quarter Glass Media and Effective Test Time* constraints
Developed models to maximize profit for both 2.5” products (glass media supply constraint) and 3.5” products (test time constraint)
• Demand Plan input: Rev Plan from Dec/Jan Outlook/Manu forecast• Pricing input: Rev Plan from Dec/Jan Outlook• Cost input: CMC Update from PLM• Media and Effective Test time constraint data from Factory POR (Plan of Record)• Customer Priority from PLM• ESG uses dedicated Gemini while NSG and PSG share the remaining Gemini resource
Goal: Work with PLM to analyze different fulfillment opportunities for customer-product-linearity decisions that maximize profit
• Ability to rapidly alternate between different cost (Std/CMC/TVC/MLB) and pricing measures (ASP/AUP)• Quickly alter customer and product attribute priorities
* Effective test time = Test Time / Yield
33
Page 35
© Seagate Confidential
Objective: Max ProfitStandard Margin*Allocation Qty
Manipulate Variables
Scenario Modeling Application
Constraints
Manu Forecast Model Results
© Seagate Confidential
Manu forecast is higher than previous outlooks• OL1: 3.4M• OL2: 4.5M• Cur FW Manu: 7.9M
2.5” Glass media was constrained for the quarter• Supply for ESG and NSG = 1.2M discs• Demand for ESG and NSG =1.25M discs• Baseline Scenario (Retail = 100% ; all others filled based on profit margins)
ESG fulfilled 100%, NSG Wyatt XXXgb was unfulfilled due to lower margins• Min customer fulfill scenario (Priority = 100%, Opportunistic = 85%, Others = 50%)
Minimum requirements exceeded supply
3.5” Test time was constrained for the quarter for NSG/PSG
• ESG test times were unconstrained in all months• NSG/PSG were constrained in all months. By June was constrained by 10% of total demand
36
Granularity: per Customer, per tab number (9-digit)
Correlate Future Forecast (either Manu or Judged DS) to Build Plan (BP) data
Determine the anticipated Ending Hub Inventory on a weekly basis
Calculate the DOI (Days of Inventory) Delta, in units, available to the customer
Short term projection (13 weeks)
HeatMap – Objective
© Seagate Confidential
HeatMap – User Views & Interfaces
Drilldown
Configure Pivot DataMain Pivot Table
Limit Query DataConfigure Pivot Table
1
2
3
© Seagate Confidential
Take away this wks demand & what’s left is ending inventory.
Begin with the build from the week before last & add-in last wk’s ending inventory
Take away this wk’s demand & what’s left is ending inventory
This wk’s inventory begins with On-Hand & In Transit from COB the previous Friday
Begin with what was at the factory (to be shipped) from COB the week before last & add-in last wk’s ending inventory
Take away this weeks demand (FC) and what’s left is ending inventory
As well as Future Demand & Supply
Estimates
The remaining wks are calculated the same as wk-3
Now lets calculate the wk-to-wk Ending
Inventory
Begin with
Known Dedicate
d Product
HeatMap – Hub Inventory (CM-Customer Math)
OnH Last Wk (100)InT Last Wk (100)AtF Last Wk (100)
COB Last Wk (Wk 0)
BeginningInv (200)
+
FC ThisWk (100)
-
Ending Inv (100)=
AtF Last Wk (100)+
Beginning Inv (100)+
FC NextWk (150)-
End Inv (50)=
End Inv (50)=
BP This Wk (200)+
Begin Inv (50)+
FC 2nd
Wk (200)-
FC ThisWk (100)
BP This Wk (200)
FC NextWk (150)
BP Next Wk (150)
FC 2nd
Wk (200)
BP 2nd
Wk (100)
Current Wk(Wk 1)
Next Wk(Wk 2)
Wk After Next (Wk 3)
. . .
. . .
OnH: On-handInT: In-transitAtF: At-FactoryFC: ForecastBP: Build Plan
Hub Inventory
© Seagate Confidential
HeatMap – Hub Inventory (Seagate Math)
OnH Last Wk (100)InT Last Wk (100)AtF Last Wk (100)
COB Last Wk (Wk 0)
BeginningInv (300)+
FC ThisWk (100)
BP This Wk (200)
FC NextWk (150)
BP Next Wk (150)
Current Wk (Wk 1)
Next Wk (Wk 2)
. . .
. . .
OnH: On-handInT: In-transitAtF: At-FactoryFC: ForecastBP: Build Plan
Hub Inventory
BP This Wk (200)+
FC ThisWk (100)-
Ending Inv (400)
=
+
+
FC NextWk (150)-
BP Next Wk (150)
Beginning Inv (400)
Ending Inv (400)
=
Start with all of WWFGI from previous week
Add this weeks build
Subtract this weeks forecast, what’s left is ending inventory
Start with last week’s ending inventory Add this week’s build, Subtract this week’s forecast
© Seagate Confidential
Add last week’s build to last wk’s ending inventory, subtract this week’s forecast and … you get the picture
First week’s inventory begins with everything in WWFGI from previous Friday’s COB
HeatMap – Hub Inventory (IM-Intermediate Math)
OnH Last Wk (100)InT Last Wk (100)AtF Last Wk (100)
COB Last Wk (Wk 0)
BeginningInv (200)
+
FC ThisWk (100)
-
Ending Inv (100)=
FC ThisWk (100)
BP This Wk (200)
FC NextWk (150)
BP Next Wk (150)
FC 2nd
Wk (200)
BP 2nd
Wk (100)
Current Wk(Wk 1)
Next Wk(Wk 2)
Wk After Next (Wk 3)
. . .
. . .
OnH: On-handInT: In-transitAtF: At-FactoryFC: ForecastBP: Build Plan
Hub Inventory
Beginning Inv (100)+
FC NextWk (150)-
End Inv (50)=
+ BP Last Wk (200)
+
End Inv (50)=
Begin Inv (50)+
FCWk (200)-
BP Last Wk (150)
Take away this week’s forecast, what’s left is ending inventory
© Seagate Confidential
HeatMap – Database
3_DS_Grpd_Cols 3_FC_Grpd_Cols3_BP_Grpd_Cols
0_FYFW_Period_All
4_BDFI_Union_Cols
3A_BDFI_Union_Cols
5_BP_Merge5_FC_Merge5_DS_Merge
BuildDelta_PivotData
2_DS_wCustRename 2_BP_wCustRename2_FC_wCustRename
3_DS_Grpd_Cols_MT 3_BP_Grpd_Cols_MT3_FC_Grpd_Cols_MT
5_DS_Merge_MT 5_FC_Merge_MT 5_BP_Merge_MT
SMADBA_Product_Attributes
SVP_CUSTNAME_UNION
4A_BP_FGI_Merge
3_FGI_Grpd_Cols
4_BDFI_Union_Cols_MT
2_FGI_wCustRename
1_BP_NameChg_FWfilt
0_Manu_Planner_FC_FWfilt
1_FGI_NameChg_AVfilt
0_DS_ESG_FWfilt
1_DS_byMS_Union
0_DS_NSG_FWfilt
0_DS_PSG_FWfilt
FC-DS_ESG
FC-DS_NSG
FC-DS_PSG
0_FYFW_31Short_Num
PLANNER_DEMAND_FOR_JUDGED_V
WWWFGI_COB_ PivotData
© Seagate Confidential
Page 45© Seagate Confidential
Objectives
• Analysis of distribution forecasts with respect to business goals, backlog and supply
• Entry of distribution forecast and opportunity data into the Manugistics (Manu) data repository
• Analysis and entry are performed for all region sub-groups across all market segments
• Analysis updates must be completed within one day for both current quarter and next quarter
Page 46© Seagate Confidential
Tool Components
• User Instrument Correlates FCST and Opportunity with Supply and Backlog
Facilitates entry of forecast quantities
Creates CSV file for use with the loader
• SMC Loader Provides mechanism for batch loading Manu data
Quantities loaded by Sub-group, PSP, PN and Fiscal week
Page 47© Seagate Confidential
DFAT- Goals
• Incorporate current, company supported data
• Improve analysis of forecast data, including supply component
• Simplify the build of the user instrument
• Provide rapid and accurate updating of forecast and opportunity values
• Provide integrated end-to-end process including report generation of results
Page 48© Seagate Confidential
DFAT - Improve forecast analysis
• Assemble all relevant data sets in one place
• Ability to compare forecasts to available supply and identify opportunities for revenue improvement
• Ability to rapidly identify gaps between forecast and backlog
• Built-in linearity analysis, by week and month
• Automated algorithms for roll-forward of weekly forecast misses
Page 51© Seagate Confidential
DFAT - Time, Accuracy, Output Improvement
Accuracy• Able to match regional forecast to supply/backlog on a weekly basis
• Includes Opportunity complexity not in original process
• Initially possible once or twice a quarter and took 2-days to complete
Page 53© Seagate Confidential
Logistics Freight Estimator
• Goal: Ability to estimate freight cost per drive by customer and product
Page 54© Seagate Confidential
Logistics Freight Estimator - Shipment Summary by Carrier Code
Freight Carrier Code Total Gross UnitsShipment %
UPSSCS (CONSOLIDATION) 9,562,079 54%DHL DANZAS (CONSOLIDATION) 3,735,278 21%Feili-TL-Ground 1,955,757 11%UPSSCS (DEFERRED) 730,440 4%DHL DANZAS (DEFERRED) 687,609 4%BIFORST LOGISTICS 448,911 3%UPSSCS (OCEAN) 180,000 1%UPS FWDG-LTL-GROUND 177,480 1%CTS 95,810 1%KWEI 77,306 0%UPS CVEN-FTL-GROUND 26,360 0%UPS CRPS-FTL-GROUND 10,000 0%JIT PULL 8,425 0%UPS FWDG-AIR-2 DAY 2,960 0%UPS EXPRESS 1,963 0%UPS FWDG-FTL-GROUND 900 0%INTEGRATED SHUN HING LOGISTICS 880 0%SHANGHAI LONG DISTANCE Ground 780 0%UPSSCS (EXPRESS) 540 0%UPS CNWY-LTL-GROUND 310 0%UPS 2DAY PM 240 0%DHL DANZAS (OCEAN) 250 0%DHL DANZAS (EXPRESS) 396 0%Others (17) 2,633 0%Total Q2 17,707,307 100%
Inclusion Q2 17,302,037 98%