1. The INTERNET VALUE CHAIN

2. Improve Planning, Delivery, Customer Service
BUILDING A VALUE CHAIN
@ HERMAN MILLER
Improve Planning, Delivery, Customer Service
Herman Miller eStore

3. Lean and Green Herman Miller Performance System
Based on Toyota Lean Manufacturing System
More Inventory Turns, Reduction in Assets
Greening of Supply Chain Ongoing Process
Corporate Vision Statement Sets Goals
2020 Perfect Vision Statement

4. Products designed for the Environment
Only 4%
Non-Recyclable
Parts

5. FROM CHANNEL OF DISTRIBUTION TO VALUE CHAIN

6. CORE MARKETING PROCESSES
SUPPLY CHAIN MANAGEMENT
Product Development And Management
Customer Relationship Management

7. VALUE-CREATING ACTIVITIES

8. Outcomes-Driven Supply Chains
Cost: Minimize While Ensuring Customer Service
Responsiveness: To Changes in Demand
Security: Protect Against External Threats
Sustainability: Minimize Environmental Impact
Resilience: Identify, React Quickly – Risks, Disruptions
Innovation: New Products and Distribution Methods to Meet Customer Needs

9. Supply Chain visualization
Better when seen live

10. Managing The Supply Chain

11. Zara = Fast Fashion
Zara’s website doesn’t reflect their supply chain activities.
This is an excellent video, but 21 minutes long
This one is only about 1:30 and it makes important points

12. Reducing Supply Chain Costs
Information Search Costs
Transaction Costs
Fragmentation of Customer Markets
Standardized Products

13. Dell’s Direct Model is Lean
But No Longer
Build to Order

14. Customers Part of Dell Process

15. HOW DOES DELL DO IT? Manage Supply Chain as Single Organization
Close Customer Relationships
Customer Segments
Customer Experience and Relationships
Cost Control Creates Customer Value
Speed and Agility
Extensive Metrics in Real Time
Targeting Global Growth
Above All, Listen to Customers in Many Channels

16. Benefits Integrated Value Chain
Customer Centric
Include both Demand Chain, Supply Chain
Compete as Extended Enterprise
Add Value for Customer
Information, Customer Service & Support
Specialized Value Propositions for Customers, Segments

17. Service-Centered paradigm
Goods Distribution Mechanisms for Service
All Economies Are Services Economies
Customer Always a Cocreator of Value
Enterprise Can Only Make Value Propositions
Service-Centered View Is Customer Oriented and Relational

18. Do You Agree That All Products, Tangible or Intangible,
Are Services In Eyes of Customers?
Yes No
Don’t Know

19. Service, Speed & Green

20. Virtual Value Chain Visibility, Mirroring, Customer Value

21. INTEGRATING BUSINESS PROCESSES
Electronic Data Interchange (EDI)
Enterprise Resource Planning (ERP)
Web Services

22. Edi – Paperless Transaction processing
Order Entry Generates Electronic PO
Order Electronically Transmitted to Seller
Order Moves into Seller’s Electronic System
Electronic Acknowledgment Sent
System Generates Instructions to Ship from Warehouse
Electronic Invoice Sent to Purchaser
Payment Made by Secure EFT

23. EDI is ‘OLD TECHNOLOGY’
Pre-dates Internet
Requires Proprietary Systems and Value-Added Networks
Expensive, Difficult To Use
Internet Has Made Somewhat Easier, Less Expensive To Use

24. ERP- INTEGRATING INTERNAL SYSTEMS
Internal Business Process Integration Necessary To External Systems Like EDI
Automation and Integration Of All Internal Systems
Order Processing, Production Planning & Scheduling, Inventory Control, Distribution, Customer Relationship Management

25. REASONS FOR ERP Integrate Financial Data into Single Database
Customer Order Data Moves Electronically/ Seamlessly Through System
Standardize and Speed Up Manufacturing
Reduce Inventory Levels
Standardize and Make Accessible Human Resources Information

26. Web services - Software as a service
eBay
Can Implement Affiliate Relationship, Build Storefront Without Purchasing Software
Other Examples of Using Online Software
Doing Income Tax Online
Using Small Business Accounting Package Online
Using CRM (or other) Software on Vendor’s Site

27. Web Services Offered ‘In the Cloud’
In Addition to eBay, Others Offer Apps in the Cloud
Amazon Has Many Web Services Products
Salesforce.com CRM and Other Products
Cisco Offers Data Management and Other
IBM Offers Cloud Development
Public and Private
There is a lot of good material and the fulfillment video on the Amazon web services site
If you want another example, Cisco has good info and videos
If you want an egov example, try IBM
Great interactive site at

28. ACCORDING TO ONE EXPERT
“We don’t compete as individual businesses any more; we compete as supply chains.
The winners aren’t necessarily the companies that have the best products and services, but the ones that have the most efficient supply chains.”

29. The RFID Future

30. RFID IN MANY INDUSTRIES
Tek Vet has an interesting animal application
Click on Installation > Facility Installation for a good image of a reader
The Future Store Initiative, IE 2.2 is still has a good site, but it’s slow to load and full of static images.
The most recent video I can find is. You may find it worth the 6 min.
Cow With RFID Chip

31. BENEFITS OF BUSINESS PROCESS TRANSFORMATION
Velocity (speed)
Visibility (transparency)
Variability (choice)
Volume (scale)

32. Summary Customers > Performance, Reliability, Speed, Convenience
Want All of These, But Not Necessarily in that Order
Outcome-Driven Integrated Value Chains Provide
Lower Cost, Responsiveness, Security, Sustainability, Security, Innovation to Meet Customer Needs
Supply Chain Management-Core Marketing Process
Multiple Activities in Managing Supply Chain
Services Centered Paradigm – All Products > Services
Process Integration – EDI, ERP, Web Services (In Cloud)
RFID – Old Technology, Multiple New Applications
Supply Chain Excellence > Key Competitive Advantage