Supply Chain Management & eCommerce Technology presented by: Nachiappan Annamalai

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

World Internet Population 3/99 World Total MILLIONWorld Total Africa 1.14 millionAfrica Asia/Pacific millionAsia/Pacific Europe millionEurope Middle East.88 millionMiddle East Canada & USA millionCanada & USA South America 4.63 millionSouth America

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

Time Involved in the Process

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

Distribution

Other Problems Demand Forecast Updating Order Batching Price Fluctuation Shortage gaming

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

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

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

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

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

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

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

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

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)

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

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

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

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

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

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

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