transforming high tech supply networks
DESCRIPTION
Presented at a SAP industry conference, this deck talks about how High Tech companies can transform their supply networks via performance management, collaborative planning, and network planning & executionTRANSCRIPT
Transforming Supply Networks in the
High Tech Industry
Partha Bose
SAP Labs
© SAP 2009 / 1
1. High Technology Industry
1.1. Trends
1.2. Supply Chain Challenges
1.3. Role of SAP High Tech Solution Management
2. Transforming Your Supply Network – Collaborative Demand and Supply Planning
2.1. Collaborative Demand Management
2.2. Collaborative Supply Planning
2.3. Sales & Operations Planning
3. Transforming Your Supply Network – Manufacturing Network Planning and Execution
3.1. Manufacturing Network Planning
3.2. Production Planning and Execution
3.3. Outsourced Manufacturing
3.4. Material Supply & Replenishment
4. Supply Chain Performance Management
5. Demo
6. Wrap-up
Agenda
© SAP 2009 / 2
Powerful Trends in the High-Tech Industry
Serving new customers, new
markets
Growing product
and network
complexity leading
to supply and
demand volatility
and risk
Increased consumerization
Demanding
customers require
rapid response to
demand signals
Increased pricing and margin pressures
Increased
outsourcing to
reduce cost and
increase scalability
© SAP 2009 / 3
The Consumer Electronics sector will slow down
in 2009
Source: Consumer Electronics Association (CEA) Jan 2009, Gartner Mar 2009
Global consumer electronics sales will grow only 4.3% in
2009 to $724B. In 2008, global sales grew by 13.7%.
NA and Western Europe account for 37.7% of revenue
while BRIC countries contribute 24%
2.5B units to be sold worldwide in 2009
Growth in key product categories in 2009
Mobile phone: 2.1% (vs. 13% in 2008)
TV: 2.6% (vs. 10.5% in 2008), switch to
digital signal will contribute
PC: 11.9% decline (vs. 10.9% growth in
2008), 9% growth in laptops, 31.9% decline in
desktops (March 2009 data)
Strong growth expected in MP3/digital media players and
portable navigation devices
© SAP 2009 / 4
Worldwide Semiconductor Sales fell 9.9% year-over-year in
Nov 2008. The sector may shrink by as much as a third in
2009.
Source: World Semiconductor Trade Statistics
Industry expected to decline by 25% in 2009, large drop in memory sales
20-30% revenue decline expected in Foundry and Assembly/Test segments
Potential consolidation on the Foundry front
10% decline expected in EDA revenue
EDA companies possible takeover targets
5% decline expected in solar panel revenue
© SAP 2009 / 5
Summary of High Tech trends
The global downturn is more synchronized and more severe than originally predicted in Q4 2008. High Tech
has been adversely impacted in all segments. Overall, global High Tech revenue expected to decline by 3% in
2009. Assuming that major economies start to recover in the second half of 2009, High Tech revenue will grow
again by 9% in 2010+. Relative to other industries, High Tech and adjacent sectors (E-Commerce and
Entertainment) are expected to do better#.
Trends by Segment
OEM-Consumer Moderate growth (4.3%**) in 2009 driven by Smartphones, HDTVs, High Def DVD players, Bluetooth & GPS devices
Netbooks (sub-$400) will be the fastest growing segment within PCs
Micro-segmentation and marketing via social networking tools will be more common
Software Moderate growth expected in enterprise software revenue in 2009 (6.6% according to Dec ’08 Gartner report)
Business Intelligence and Enterprise Applications remain top 2 priorities (Gartner)
SaaS deployment will accelerate in 2009 and 2010 (IDC)
OEM-Business Decline expected in 2009 with rebound starting late in the year (segment leader Cisco lowered 2009 estimates-Feb ’09).
Storage expected to fare better (virtualization technology). More emphasis on measures like ROA and TEI* for storage.
Investment in internet infrastructure (US) may provide impetus towards second half of 2009 and 2010
Semiconductor & Components Semiconductor segment expected to decline by 20-30%~ due to overcapacity and impact of downturn
Foundry and Assembly/Test will be hit the hardest (this sector typically leads the overall cycle)
IDMs with strong cash positions will continue to invest in innovation. Photovoltaic only bright spot.
EMS & ODM Flat growth expected in 2009 with slow recovery in 2010++
Following OEM trends, contraction expected in telecoms, PC and automotive sectors
Continued shift in EMS to Asia region; in ODM, Asia share to fall slightly as share of Eastern Europe increases.
*TEI: Total Economic Impact + Source: Forrester (Jan 2009) # Source: The Economist (Jan 2009) ** Source: Consumer Electronics Association (Jan 2009) ~Source: WSTS ++ Source: TFI (Q4 2008)
© SAP 2009 / 6
Trends across Industries for 2009
Source: The Economist, Jan 2009 (http://www.economist.com/theworldin/forecasts/displayStory.cfm?story_id=12621592). IT and related industries are highlighted in Red
Cloudy Fair Sunny
Automotive
Consumer Goods
Defence
E-Commerce
Energy
Entertainment
Financial Services
Food and Farming
Health Care
Information Technology
Media
Property & Construction
Raw Materials
Telecoms
Travel & Tourism
© SAP 2009 / 7
Snapshot of Outsourced Manufacturing
The iPhone Value Chain
Software
&Design
Apple
Assembly
Foxconn,
Quanta
LCD
Sanyo,
Epson,
Sharp
Glass
Panel
Balda
Distribution
AT&T,
Vodafone,
SingTel
Semiconductors - NA
National Semi - 1
Broadcom - 1
SST - 1
Skyworks - 1
Triquint - 3
Linear Technology -
1
Semiconductors
- EMEA
Wolfson - 1
ST Micro - 1
Infineon – 4
NXP – 1
Numonyx - 1
Semiconducto
rs - Asia
Samsung - 1
Manufacturing – In house and Sub-con
USA, Germany, Netherlands, Germany, Taiwan, China, Malaysia,
Singapore, Korea
© SAP 2009 / 8
Component
Suppliers
& CMs
Manufacturing
Material
Mgmt
HQ
Sales
Ops
Challenge: Slow, Inaccurate Responses to Short
Term Demand Changes or Supply Disruptions
Slow network response results in poor customer service, inflated inventories and supply
chain costs
Poor Orchestration of
Outsourced Manufacturing
Internal Manufacturing: Poor
Visibility of Critical Orders,
Line Disruptions Complex Mix of Internal and
External Manufacturing
Lack of Material Supply Flexibility
SC
operations
© SAP 2009 / 9
Component
Suppliers
& CMs SC
Operations
Materials
Management
HQ
SC
Operations
Integrated planning and execution across the supply network leads to better customer
service, lower inventory levels and reduced write-offs
Better Visibility, Tight
Integration with Outsourced
Manufacturing
Internal Manufacturing: Agile
Rescheduling, Higher Visibility
Agile Re-Planning Across
Network
“Pull-Based” Material Supply
Benefits of Transformation
Quicker Response to Demand and Supply Variability and
Shorter Lead Times
Manufacturing
© SAP 2009 / 10
SAP Customers in the High Tech Industry
Industry Sub-
Segment Sample Customers
Top 10
Market Share
Total
Customers
High Tech OEM 90% 1315
Semiconductor 90% 223
Component 80% 1006
Contract
Manufacturing
(EMS/ODM)
80% 51
Software 70% 779
Total High Tech 3503
Source: SAP as of Jan 2008
© SAP 2009 / 11 11
High Tech Executive Advisory Council
Summary
The High Tech Executive
Advisory Council is an invitation
only advisory group comprising
of senior executives from SAP’s
High Tech customers and
industry analysts
• HTEAC Charter
a. Share experiences and practices
with other members
b. Influence SAP’s product direction
c. Influence SAP Go To market and
Partnerships
• 2 FTF meetings (2.5 days – Spring
meeting in Europe, Fall meeting in US)
• Monthly calls to share information and
discuss direction
Recent Themes from HTEAC FTF meetings
Manufacturing, ESOA 2008
Spring
Business User (Business Objects), CRM,
SCM 2008
Fall
Business Suite 7, Supply Chain 2009
Spring
Customers
• CIOs and senior
executives of
SAP’s select HT
customers
• Industry analysts
SAP
• Led by Head,
High Tech IBU
• Participation by
senior SAP
executives
© SAP 2009 / 12
OEM OEM
Foundry
Software
Provider
The High Tech Ecosystem (represented in
HTEAC)
OEM
Distributor/
Reseller
End
Customer
Service
Provider Electronic
Distributor
EMS
Provider
Component
Manu-
facturer
IDM
(Semi)
Fabless
Semi
Jabil
Business:
IBM, HP,
Pitney,
NSN,
Cisco*,
Lexmark
Consumer:
Apple, RIM,
Bose,
Panasonic,
Samsung,
Nokia
nVidia, LSI
Intel,
TI,
Infineon
SAP
Molex
* Scientific Atlanta
The High Tech
Ecosystem is
represented in the
High Tech Advisory
Council
© SAP 2009 / 13
High Level Scenario Level Product Definition Level
High Level Investigation
Knowledge Sharing focus
Detailed Scenario Workgroup
Key Process definition
Product Definition Workgroup
Describe Process details
Workgroups driven by HTEAC
Business User
…
Workgroups:
Distributed Manufacturing - Shipment & Quality Collaboration
- Production Control/Multi-step
subcontracting
- Supplier Connectivity
Collaborative Fulfillment - Fulfillment models
- Usage guidelines, metrics, T&C,
collaboration process
Workgroups:
Business User / Business
Objects - Knowledge Sharing
- Prioritization of needs
Solution Business - OEM focus
- Selling Hardware, Software,
Services, Financing as Solutions
IT Governance – IT Value
Management
Workgroups:
Channel Management - Semiconductor focus
- Channel inventory, revenue
recognition, rebate integration
Supply Chain for
Semiconductor - Collaboration processes
- Best Practices
Warranty & Reverse Logistics
- Consumer Electronic focus
- Warranty management, Claims,
Repair operations
Research Topics
Supply Chain focus
© SAP 2009 / 14
1. High Technology Industry
1.1. Trends
1.2. Supply Chain Challenges
1.3. Role of SAP High Tech Solution Management
2. Transforming Your Supply Network – Collaborative Demand and Supply Planning
2.1. Collaborative Demand Management
2.2. Collaborative Supply Planning
2.3. Sales & Operations Planning
3. Transforming Your Supply Network – Manufacturing Network Planning and Execution
3.1. Manufacturing Network Planning
3.2. Production Planning and Execution
3.3. Outsourced Manufacturing
3.4. Material Supply & Replenishment
4. Supply Chain Performance Management
5. Demo
6. Wrap-up
Agenda
© SAP 2009 / 15
Collaborative Demand and Supply Planning
Collaborative
Demand Management
Collaborative Supply
Planning Sales and
Operations Planning
How do I overcome my
inflexible and unbalanced
supply, improve demand
visibility and shape
demand?
How do I balance demand
and supply to grow the
business profitably?
How do I improve my
demand visibility to enable
the manufacture of the right
products at the right time?
How do I keep service levels
up and the inventory low by
accelerating my supply
response?
Revenue Growth
Operating margin
Customer Satisfaction
Total Revenue
Perfect Order Rating
Profitability
Revenue Objectives
Customer Satisfaction
Forecast Accuracy
Delivery to Customer
Request Dates
Inventory Levels
Supply Chain Costs
Effective Demand and Supply Planning requires alignment between several stakeholders with
differing objectives
VP Supply Chain VP Sales COO VP Operations
© SAP 2009 / 16
Demand and Supply Planning is
an end-to-end, cross-functional process
Collaborative Demand and Supply Planning connects processes across departments to enable a
timely, profitable response to customer demand
Collaborative
Demand Management
Collaborative Supply
Planning
COO
Demand Shaping/
Promotion Planning
Sales
Supply Chain
Manufacturing
Procurement
Production
Capacity
Planning
Material
Planning
Sales
Forecasting
Collaboration Demand
Analysis &
Update
Finance
Inventory
Optimization
Production
Capacity
Analysis &
Update
Marketing
Supply
Analysis &
Update
Demand
Signal
Capture
Demand
Planning
Replenish
ment
Planning
Supply
Network
Planning
Budgeting and
Financial Analysis
Trading Partners Supplier
Managed
Inventory
Customer
Collaboration
Vendor Management
Inventory/Consigne-
ment Stock/CPFR
Supplier
Collaboration
Demand
and Supply
Alignment
VP Supply Chain VP Sales VP Operations
Sales and
Operations Planning
© SAP 2009 / 17
End-to-end collaborative demand management process including
various sources of information like customer forecast, channel,
inventory data as well as actual customer demand
Objective: Improve demand visibility and responsiveness across
the network
Consolidation of all relevant demand data and processes across enterprise and
functional boundaries on a single platform
Standard integration of demand signal repository into supply chain management solution
Specific forecasting algorithms for use with POS data to drive short-term forecasting and
replenishment
Supply Operations
Benefits: Better demand visibility and forecast accuracy
Collaborative Demand Management
Objectives, Capabilities and Benefits
© SAP 2009 / 18
Supply planning across distribution, manufacturing and partners
synchronizing delivery schedules both for finished products and
materials
Objective: Plan supply to have the right product at the right time across
all levels of the network
Integration of production planning, distribution and procurement planning across the
network
Advanced Safety Stock planning methods and multi-echelon Inventory optimization (as
needed)
Enable optimized or heuristic-based distribution planning and multiple deployment
strategies
Supply Chain
Benefits: Better responsiveness to demand and supply variability while minimizing supply
chain costs
Collaborative Supply Planning
Objectives, Capabilities and Benefits
© SAP 2009 / 19
Types of Supplier Managed Inventory Models
The customer sends a discrete purchase order (PO) to the supplier to trigger a product shipment. The
purchase order describes the lead times (ETA, ETD) ship to, ship terms, bill to, quantity, price and SKU.
The customer does not share a forecast with the supplier.
Supplier does not provide customer with visibility into supplier’s inventory buffer, just a commitment to ship
per the terms of the purchase order.
The customer sends a discrete purchase order to the supplier to trigger a product shipment within a
negotiated lead time, typically reduced, per the terms and conditions of the contract.
The customer sends a forecast to the supplier – both inside and beyond negotiated lead time.
The supplier does not provide the customer with visibility into supplier’s inventory buffer; just a
commitment to ship per the terms of the purchase order.
The customer sends a blanket purchase order.
The customer sends a forecast to the supplier for an agreed upon horizon at the agreed upon granularity.
There are flexibility terms and conditions built into the collaboration model; typically with a frozen horizon.
Shipments to customer are based on discrete Just in Time (JIT) signals (often embedded in forecast).
Purchase Order
(PO)
Forecast and PO
Forecast and
Release
The customer maintains a dedicated inventory buffer at the customer’s site or customer agent’s site.
The customer owns the inventory buffer, but replenishment of the buffer is planned by the supplier.
The customer sends a forecast (gross demand) and on-hand inventory information to the supplier.
The supplier plans and replenishes the inventory buffer based on agreed upon replenishment policy.
Standard Vendor
Managed Inventory
(VMI)
1
2
3
4
The supplier maintains a dedicated inventory buffer at the customer’s site or customer’s agent site.
The supplier owns and plans the inventory buffer.
The customer sends a forecast (gross demand) and inventory pulls to the supplier.
The supplier plans and replenishes the inventory buffer based on agreed upon replenishment policy.
The supplier maintains a dedicated (either virtually or physically segregated) inventory buffer at the
supplier’s site or supplier’s agent site. The supplier owns and plans the inventory buffer.
The customer sends a forecast (gross demand) to the supplier.
The supplier plans and maintains the inventory buffer based on agreed upon replenishment policy.
The supplier may rebalance inventory buffers across multiple customers as customer forecasts change.
Consigned Vendor
Managed Inventory
(VMI)
Dynamic Vendor
Managed Inventory
(VMI)
5
6
© SAP 2009 / 20
Objective: Provide all required information in an accurate and timely
manner to run an efficient cross-functional S&OP; avoid latency from
manual steps
Supply Chain
Benefits: A unified demand and supply plan that are both feasible and in line with company’s
financial goals and customer expectations
Provide all relevant demand and supply information in an unified environment with complete
visibility for all stakeholders
All stakeholders can view the data from their own perspective and make financially and
operationally sound decisions
Sign-Off balanced demand and supply plan for execution
Adjust the frequency and granularity of your S&OP process based on
demand and supply variability
Sales and Operations Planning
Objectives, Capabilities and Benefits
© SAP 2009 / 21
1. High Technology Industry
1.1. Trends
1.2. Supply Chain Challenges
1.3. Role of SAP High Tech Solution Management
2. Transforming Your Supply Network – Collaborative Demand and Supply Planning
2.1. Collaborative Demand Management
2.2. Collaborative Supply Planning
2.3. Sales & Operations Planning
3. Transforming Your Supply Network – Manufacturing Network Planning and Execution
3.1. Manufacturing Network Planning
3.2. Production Planning and Execution
3.3. Outsourced Manufacturing
3.4. Material Supply & Replenishment
4. Supply Chain Performance Management
5. Demo
6. Wrap-up
Agenda
© SAP 2009 / 22
Manufacturing Network Planning and Execution
Production
Planning &
Execution
Outsourced
Manufacturing
Manufacturing
Network Planning
How do I orchestrate alignment across supply chain functions to increase responsiveness while maintaining margins?
How do I coordinate
the supply network to
reduce lead times to
improve service and
reduce inventory?
How do I enhance flexibility and responsiveness at internal sites?
How do I enhance
flexibility and
responsiveness at
outsourced sites?
Revenue
Operating Margin
Customer Service Level
Customer Service
Level
FG Inventory Turns
Inventory Write
offs/Write Downs
Lead Times
Delivery to Commitment
Manufacturing Costs
Lead Times
Delivery to
Commitment
Competitive Costs
Chief Operating
Officer
COO
Material Supply &
Replenishment
How do I ensure material availability for maximum flexibility while reducing cost?
Manufacturing Supply
Service Level
Material Inventory Turns
Material Cost
Supply Chain Manufacturing Procurement
Supply Chain
Quicker response to demand and supply variability and shorter lead times lead to lower
inventory levels and improved customer service
© SAP 2009 / 23
Manufacturing Network Planning and Execution -
an end-to-end cross functional process
Chief Operating
Officer
Supply Chain Manufacturing
Supply Chain
Planning
Materials
Management
Internal
Production
Operations
Raw Material
Supplier
Contract
Manufacturer
Performance Management
Cross-Functional Supply Chain Performance Management
Production Execution &
Visibility
Outsourced Materials Visibility
Outsourced Materials Visibility
Production Planning & Scheduling
Outsourced Workorder
Process
Subass’y & Component Inventory
Optimization
Outsourced Workorder
Process
Plan/Source to Demand Signal
Plan/Source to Forecast
Collaborative Procure to Forecast
Supplier Managed Inventory
Collaborative Procure to Forecast
Supplier Managed Inventory
Process co-owned with Business Network Partner
Production Planning & Execution
Outsourced Manufacturing
Manufacturing Network Planning
Material Supply & Replenishment
MNPE integrates supply chain, manufacturing, and procurement to orchestrate a
responsive supply network.
© SAP 2009 / 24
Executes on a frequent cycle and integrates automatically and in real time
with internal plant scheduling and execution systems, as well as electronically
with outsourced manufacturing partners
Issues
Objective: Determine and source production requirements across a network
of internal and external sites to meet demand with minimum lead times
Fast capture of demand signal, translation to build requirements, and communication of
requirement to production
Visibility to internal and outsourced execution processes (with common underlying data
and assumptions)
Visibility to internal execution processes and outsourced collaboration processes
Balanced scorecard supply chain performance measures
Supply Chain
Benefits: Shorter lead times, better capacity utilization, lower inventory costs, higher service level
Manufacturing Network Planning
Objectives, Issues, Capabilities and Benefits
© SAP 2009 / 25
Benefits: Shorter lead times, rapid response to demand with minimum impact on cost and capacity
Planning integrated with scheduling and execution with consistent inventory, capacity, and
product data
Finite Capacity, optimal scheduling
Automated dispatch of released order to plant floor
Real-time visibility to production and resource status available for alerting and rescheduling
Production Planning and Execution
Objectives, Issues, Capabilities and Benefits
Manufacturing
Objective: Improve manufacturing flexibility through visibility and speed
New demands are released to a plant, scheduled, and dispatched to the plant floor in a seamless, integrated process, with production and resource status visibility to trigger exception handling if necessary
© SAP 2009 / 26
Automated electronic collaboration to rapidly communicate workorders as new
demand is received to negotiate and make adjustments necessary for
responsive execution
Objective: Orchestrate responsive execution of outsourced manufacturing
to shorten lead times without increased procurement cost
Supply Chain
Electronic publication or workorders, negotiation of delivery quantity and dates
Timely visibility of workorder progress updates execution systems and triggers alerts if
necessary
Notification of product shipment and generation of Advance Shipment Notice (ASN)
Benefits: Accurate commitments, early detection of exceptions, lower lead times, lower administrative
costs
Outsourced Manufacturing
Objectives, Issues, Capabilities and Benefits
© SAP 2009 / 27
Supply Chain
Enables suppliers to get automatic notifications of requirements and/or to get
real-time visibility of inventory and consumption plans for supplier-managed
replenishment
Objective: Manage materials availability to enhance manufacturing
flexibility while reducing cost
Component and sub-assembly multi-echelon inventory optimization
Collaborative Procure to Forecast automates and accelerates the process of communicating component requirements to suppliers
Automatically generated ASNs and material transactions
Benefits: Manufacturing flexibility, lower lead times, lower total inventory
Material Supply and Replenishment
Objectives, Issues, Capabilities and Benefits
© SAP 2009 / 28
1. High Technology Industry
1.1. Trends
1.2. Supply Chain Challenges
1.3. Role of SAP High Tech Solution Management
2. Transforming Your Supply Network – Collaborative Demand and Supply Planning
2.1. Collaborative Demand Management
2.2. Collaborative Supply Planning
2.3. Sales & Operations Planning
3. Transforming Your Supply Network – Manufacturing Network Planning and Execution
3.1. Manufacturing Network Planning
3.2. Production Planning and Execution
3.3. Outsourced Manufacturing
3.4. Material Supply & Replenishment
4. Supply Chain Performance Management
5. Demo
6. Wrap-up
Agenda
© SAP 2009 / 29
Supply Chain Performance Management
Key Challenges
Missing metrics that matter
Operations and corporate strategy not in tune
Lack of visibility
Unfavorable trade-off decisions
© SAP 2009 / 30
Supply Chain Performance Management
Business Need
© SAP 2008 / Page 30
4) Pick metrics that matter
1) Strategize and prioritize
2) Maintain visibility
3) Understand impact
© SAP 2009 / 31
1) Strategize and Prioritize
SCOR
Material
Acquisition Cost
Planning and
Finance Cost
+
Perfect Order
Fulfillment
Supply Chain
Management Cost - +
Outbound
Transportation Cost
Finished Goods
Warehouse Cost
Customer
Service Cost
Order
Management Cost -
Cascading hierarchies
Linking finance with operations
Driving accountability
“How does sourcing affect my supply chain cost?”
© SAP 2009 / 32
2) Maintain Visibility
Accurate
Timely
Collaborative
© SAP 2009 / 33
3) Understand Impact
Impact analysis
What-if scenarios
Simulations
© SAP 2009 / 34
4) Pick Metrics That Matter
Regulated
Best practices
Self-defined
© SAP 2009 / 35
SAP Supply Chain
Performance Management
Foster strategic alignment and accountability across your entire
supply chain network
Effectively balance risk, financial and operational goals for
optimal outcome
Link supply chain execution to financial and strategic
corporate targets and results
© SAP 2009 / 36
1. High Technology Industry
1.1. Trends
1.2. Supply Chain Challenges
1.3. Role of SAP High Tech Solution Management
2. Transforming Your Supply Network – Collaborative Demand and Supply Planning
2.1. Collaborative Demand Management
2.2. Collaborative Supply Planning
2.3. Sales & Operations Planning
3. Transforming Your Supply Network – Manufacturing Network Planning and Execution
3.1. Manufacturing Network Planning
3.2. Production Planning and Execution
3.3. Outsourced Manufacturing
3.4. Material Supply & Replenishment
4. Supply Chain Performance Management
5. Demo
6. Wrap-up
Agenda
© SAP 2009 / 37
1. High Technology Industry
1.1. Trends
1.2. Supply Chain Challenges
1.3. Role of SAP High Tech Solution Management
2. Transforming Your Supply Network – Collaborative Demand and Supply Planning
2.1. Collaborative Demand Management
2.2. Collaborative Supply Planning
2.3. Sales & Operations Planning
3. Transforming Your Supply Network – Manufacturing Network Planning and Execution
3.1. Manufacturing Network Planning
3.2. Production Planning and Execution
3.3. Outsourced Manufacturing
3.4. Material Supply & Replenishment
4. Supply Chain Performance Management
5. Demo
6. Wrap-up
Agenda
© SAP 2009 / 38
Resources
www.sdn.sap.com/irj/sdn/go/portal/prtroot/docs/library/uuid/10b2616a-5a37-2b10-58be-f4d0455cc55b
Richard Howells, “Don’t Just Survive, But Thrive, in a Networked Economy: Transform Your Static Supply Chain into Responsive Supply Networks” (July-September 2008).
www.sap.com/community/events/2008_07_28_LSC/index.epx
SAP Webcast – The Crucial Link in your Supply Chain
www.sap.com/community/events/2008_04_10_HTOM/index.epx
High Tech Outsourced Manufacturing Webcast
www.sap.com/usa/industries/hightech/large/businessprocesses/semiconductor/index.epx
SAP Executive Insight Report – Successful Manufacturing
www.sap.com/usa/industries/hightech/large/businessprocesses/oem/index.epx
Optimize Distributed Manufacturing White Paper
© SAP 2009 / 39
7 Key Points to Take Home
Respond quickly to demand and supply variability with shorter lead times and lower total supply chain costs
by:
Integrating internal and external forecasts, demand shaping inputs, and actual customer demand into the
demand management process
Implementing multi-echelon inventory management of components and sub-assemblies
Adjusting the frequency and granularity of your S&OP process based on demand and supply variability
Consolidated and fast planning/re-planning across your internal and outsourced manufacturers and
component suppliers
Supplier Managed Inventory to enable “pull-based” procurement – based on actual plant demand
Implementing automated electronic collaboration with outsourced entities to rapidly communicate
requirements to see WIP and to make adjustments
Linking KPIs across functions to get alignment and manage by exception!
© SAP 2009 / 41
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