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1、Supply Chain Visibility and Logistics Collaboration Point of View,David A. Hance, Northeast Region, Stamford, CT Naoji Takeda, Northeast Region, New York, NY M. Christopher Herrera, Northeast Region, New York, NY John Scott, Northeast Region, Roseland, NJ April 2001,Final Draft,Digital Markets and S

2、upply Chain,Table of Contents,Objective Introduction Supply Chain and Visibility Collaborative Logistics Solutions Major Attributes Value Propositions of Visibility/Collaborative Logistics Solutions Visibility and Collaborative Logistics Solutions Landscape Analysis Vendor Matrix Andersen Point of V

3、iew,Objective,The objective of the Digital Markets/Supply Chain Teams “Point of View” is to gain a comprehensive understanding of evolving Supply Chain Visibility and Collaborative Logistics solutions and how it will impact enterprise users. Focus will be on: Understanding solution from the entire S

4、upply Chain Management perspectives Articulating functionality and benefits Landscape of fragmented solution sets,Introduction,Introduction: Illustration,Today, 67% of supply chain executives conduct transactions with transportation providers manually (i.e., face-to-face, phone, fax, or mail). Less

5、than a quarter use EDI and less than one-tenth use the Internet. Morgan Stanley Dean Witter Research, August 2000,Logistics Challenges Are Real,Achieve 100% accuracy in all customer orders?,Get a real-time status visibility of all shipments from trading partners?,Optimize all modes of transportation

6、?,Receive shipments from Asia and Europe?,How can I?,What Do Users Want from B2B Connectivity?,According to AMRs interview of 152 executives on their views of the relative importance on the marketplace functionalities, SC Visibility and logistics-related functions (Order Status/Tracking and Transpor

7、tation management) were among the highest in importance.,Source: AMR Research November 2000,Supply Chain Visibility and Collaborative Logistics Solutions,Supply Chain Visibility and Collaborative Logistics Defined,Due to the advent of the Internet technology, B2B eCommerce and collaborative technolo

8、gy, a new category of much fragmented Supply Chain Management tool has emerged; Supply Chain Visibility and Collaborative Logistics. Supply Chain Visibility tools enable enterprise to monitor, track and control all executed order shipments across its extended supply chain. Typical this includes inbo

9、und logistics from suppliers and outbound logistics to customers. Real-time freight data from logistics service providers (Carriers, Freight forwarders, Customs brokers) as well as trading partners (suppliers and customers) are validated and aggregated to provide an end-to-end status visibility. Tra

10、cking of goods at various levels (Customer Order, BL#, Container and SKU level) are made possible by common data modeling. Collaboration happens at various levels of logistics service providers. Enterprise-Service Provider collaboration includes exception contract negotiations, tender/acceptance, al

11、erts messaging/workflow and scheduling. Also Supplier-Customer collaboration will also be enhanced by feeding real-time inventory visibility into APS module to provide Capable-to-Promise (CTP) information to customers.,Supply Chain Visibility,Collaborative Logistics,Supply Chain Management Layers,Su

12、pply Chain Planning (SCP) SCP is a system of applications that enables demand planning and forecasting, materials procurement and production scheduling. Typically, SCP systems are used for forecasting and preparation of manufacturing/assembly processes. Supply Chain Execution (SCE) SCE is a framewor

13、k of applications that enhance the productivity of the storage, preparation, logistics and delivery of completed products.,Adopted from AMR Research,Visibility / Collaborative Logistics Scope,Traditional View vs. New Supply Chain Management Tools,Supply Chain Planning (SCP) tools were developed sepa

14、rately from Supply Chain Execution (SCE) tools. As a result, they both require unique ERP interfaces. This “ERP centric” model often resulted in customer demand not fulfilled properlytheoretically perfect supply chain plans not executed properly due to missing linkages between planning and execution

15、 systems. Visibility and Collaboration components, however, began linking plans and results of various supply chain activities at or close to real-time basis. Also these components enabled enterprise to collaborate with trading partners and logistics service providers. Visibility component is the ey

16、es, and Collaboration is the mouth to communicate for an enterprise. With better visibility and communication, an enterprise can leap benefits from functionality from each component solutions (APS, ERP, TMS and WMS).,New View,Traditional View,Supply Chain VisibilityHow it Fits to Existing Sytems,Pla

17、nning,Execution,Data Interface,ITLS,Database,WMS,Database,TMS,Database,OMS,Database,APS,Database,ERP Application,ERP Application,Supply Chain Visibility,Collaboration,SCP System,SCE System,Source: AMR Research, 2000,Extended Trading Community,Single Interface Visibility Event Tracking Performance &

18、Compliance Management Distributed Data Mgmt Alert Mgmt Workflow Coordination,Financial Services,Suppliers,3PL & Transport,Hubs & Exchanges,Customers,Connecting Logistics Trading Partners,End-to-End Visibility Scope,Internet Collaboration Engine,Supplier,Ocean Carriers,Plants,Air Carriers,Assembly,Gr

19、ound Carrier,Warehouse,Customer,Logistics Collaboration,Logistics Collaboration facilitates data exchange among all parties within fulfillment chain. This is not demand forecast collaboration between customers and suppliers such as CPFR (Collaborative Planning Forecasting and Replenishment). Logisti

20、cs Collaboration focuses on executed orders to be fulfilled as planned. CPFR focuses on demand forecast and fulfillment plans to be accurate.,Suppliers Carriers Customs Brokers Freight Forwarders Warehouses Customers,Manage purchase orders, ensure order compliance Procure services, monitor inventory

21、 movement, monitor performance Procure services, Expedite customs clearance, monitor performance Procure services, monitor inventory movement, monitor performance Procure services, monitor inventory level, monitor performance Fulfill orders, improve customer service,ASN, Packing Slip, Shipping infor

22、mation Service bid, Pick up information, Estimate time of arrival, route information, proof of delivery Service bid, service contract, document request, Estimate time of clearance, Service bid, Pick up information, Load information, Estimate time of arrival, route information, drop off information W

23、arehouse receipt, shipment confirmation Inquiries, expedite requests, delivery confirmation,Purchase Order Service tender, Pick up information, Planned time of delivery Service offer, Product information and import documentation Service tender, Pick up information, Planned time of delivery Pick, pac

24、k and ship orders ASN, Visibility information, Exception Alerts,Purpose of Collaboration,Collaboration With,Outgoing,Incoming,Information Exchange,Major Attributes of Supply Chain Visibility Tool,Global Multi-mode,International Trade,Connectivity and Content,Transportation Planning,Technology,Logist

25、ics Process Automation,Product Tracking,Collaboration Engine,Performance Management and Intelligence,Transportation Planning,Many of visibility solutions have been developed from traditional transportation management systems (TMS) and inherits many of their planning functionality. The most important

26、 benefit from integrating transportation planning with visibility functionality is the ability to simulate on real-time: supports decision maker in exception handling process by assessing what aftereffects may be (e.g., reject this order because a more important customers order would be delayed, or

27、attempt to transfer it to another facility because profitability level is high). Functionality Routing, rating and optimization (domestic and international) Order Consolidation Equipment Utilization Commingling of Orders Rate Analysis Continuous Movement Management Benefits Transportation Cost Reduc

28、tions Customer Service Commitments Enable complex merge-in-transits and multileg, multiroute transportation planning,Logistics Process Automation,This functionality supports day-to-day operations of logistic/traffic departments. Major processes include procurement of logistics services, contract man

29、agement, booking and tendering, payment and settlement. The automation of the logistics processes required to execute the delivery of goods helps reduce internal operating costs of logistics organization. Functionality Internet-based RFP to carriers and service providers Contract Management using ce

30、ntral data depository Shipment/Load Tendering process automation with carriers Automated payment support for freight payments based on actual carrier performance Support for freight audits and compliance reporting Benefits Reduced administration and operating costs Reduced Order Cycle times,Logistic

31、s Process Automation (Continued),The logistics processes automation should address end-to-end logistics activities.,Goods,Trans- portation plan,Strategic Plan (Contract Neg.),Tender,Carrier Pickups,Delivers,Invoice Match,In transit,Invoice to Shipper,Pay,Audit,EDI / XML,EDI / XML,EDI / XML,Carriers,

32、Fulfillment Process,Settlement Process,Planning Process,EDI / XML,Whse,Depot,Depot,Product Tracking,Track and Trace function enables an enterprise to locate key assets and associated contents instantaneously and precisely within the supply chain. An important aspect is the ability to Monitor: Many s

33、olutions provide real-time tracking of supply chain objects and events including visibility into actual inventory levels, orders, shipments, production and supplyeven down to ATP numbers of individual SKUs. Also the solution must support Multi-Mode and International geographic coverage. Functionalit

34、y Monitor orders, shipments, inventory at clientdefined supply chain milestones Data model to support linkages among various tracking units (i.e. orders, BL #, SKUs, serial numbers, ASN #) Event notification to alert diversion from planned performance (late shipments and partial shipments due to car

35、rier noncompliance or accidents) GPS integration and environmental monitoring (temperature, etc.) Benefits Improve order fill rates and customer service level by expediting supply chain events Reduce inventory and safety stock level,Collaboration Engine,Collaboration Engine facilitates communication

36、 and data exchange between an enterprise and customers, suppliers, transportation carriers and service providers. Collaboration takes different forms depending upon the partners, from a simple exception alerting to complex negotiation process support over the Internet. Functionality Notify: supports

37、 real-time exception management via message system, which can alert a decision maker that attention is required Control: allows in-process adjustment, such as shipment diversion or order expediting Business Rules: create predetermined business rules to expedite exception handling and inter and intra

38、-enterprise workflows Benefits Reduce cycle time by eliminating phone calls, fax and paper communication Ability to respond quickly,Performance Management and Intelligence,Using a common data model and analytical tools, most solutions offer functionality to Measure: provides various Key Performance

39、Indicators (KPIs) data so that decision makers can assess supply chain performance. Functionality OLAP tools are usually capable of creating various reports as well as any other ad hoc reports Service level analysis allows a company to perform its own scorecard analysis of on-time delivery for a cus

40、tomer or the entire customer base Carrier and service provider performance and history can be easily obtained Landed cost analysisa company can plan profitability of selling merchandise by summarizing all potential supply chain costs beyond FOB price Benefits Improve negotiation ability with carrier

41、s and service providers with concrete historical performance record Plan and manage own supply chain better with comprehensive information,International Trade Support,As Supply Chain Visibility solutions target large, multinational enterprises, it is critical to support international trade of goods.

42、 Many of this functionality are provided by partnering with best-of-breed providers such as Nextlinks and Vastera. Functionality Import and Export Customs Compliance process management Customs compliance contents Trade Document Management Benefits Expedite customs clearance process Save administrati

43、ve costs and cycle time Proof of “reasonable care” for potential customs audit and penalty risks,Connectivity and Content,Connectivity is the most important foundation of visibility applications. Most solutions offer an ASP model data aggregations service. The various data form (EDI, XML, Web) from

44、logistics partners are aggregated, validated and cleansed prior to be made available as visibility information. Also it offers logistics contents such as carrier records, availability, spot transactions, as well as tariff and customs compliance contents via connections with specific content provider

45、s and B2B marketplace. Functionality Data management service EDI/XML translation Partner connectivity services Benefits Low-cost connectivityConnect with all trading partners without building a custom EDI link with each partner,Technology,As Visibility applications will be used by many different par

46、ties and deployed globally in most cases, it is important that the application architecture is Internet-enabled and scalable. Many of Visibility tools developed by 3PLs did not survive largely due to its proprietary technology and inflexible data modeling. Many vendors use EAI such as Tibco and Webm

47、ethods for enterprise integration. Functionality Internet-Enabled Database ASP/Hosted environment for connectivity layer Secure environment Use of EAI (Enterprise Application Integration) to easily integrate with various enterprise applications Benefit Scalability Adaptability Security,Value Proposi

48、tions of Visibility/Collaborative Logistics Solutions,Revenue Opportunity Reduce Stockouts Cost Savings Inventory Cost Transportation Cost Warehousing Cost Administrative Cost,Reduce Time Order cycle time Lead time Planning cycle time Event response time,Customer Service Improve order fill rate Resp

49、ond customer inquiry Enable ATP (Available to Promise) Enable CTP (Capable to Promise),Value Propositions of Visibility/Collaborative Logistics Solutions,Visibility/Collaborative Logistics Solutions offer similar value propositions to most of SCM applications. The solution acts as a conduit to link

50、all disparate SCM applications and trading partners to deliver higher level of integrated benefits. Visibility/Collaborative Logistics Solutions can not deliver all the benefits by its own.,Financial Value,Customer Service,Time,Financial Value,Visibility/Collaborative Logistics Solutions offer a sig

51、nificant financial value when properly integrated and implemented with planning systems. A company can benefit from improved availability, transportation cost reduction in short term,Revenue Inventory Cost Transportation Cost Warehousing Cost,Improve forecast accuracy and fulfillment capability Impr

52、ove supply chain planning capability Improve forecast accuracy and fulfillment capability Plan distribution network so shipment skips warehouse Improve carrier management and negotiation by better information Consolidation, load/container optimization, route optimization Automate communication with

53、logistics partners and manage logistics data Improve warehouse management operation via improved inbound/outbound planning,Assist accuracy via fulfillment capability improvement Direct contribution from fulfillment visibility, planning and simulation capability Assist accuracy via fulfillment visibi

54、lity and planning improvement Direct contribution from fulfillment planning/ simulation capability Direct contribution from logistics process automation and intelligence capability Direct contribution from transportation planning capability Direct contribution from logistics process automation and c

55、onnectivity Assist accuracy via fulfillment visibility improvement,Medium Large Small Medium Large Large Medium Small,Objectives,Category,Impact,How does it help?,Impact of Visibility/Collaboration,Stockouts reduction Improve inventory availability Lower safety stock level Increase direct shipment R

56、educe freight and service rates Optimize transportation Reduce logistics administration costs Reduce handling cost,Overall Approach,Financial ValueHow It Can Translates into ROC,Customer Service Value,Financial Value,Customer Service,Time,Customer service is one of the most important objectives of S

57、upply Chain Execution initiatives. Visibility tools offer significant customer service improvement opportunity from fulfillment capability enhancement. The opportunity to improve customer service should be evaluated at both tactical and strategic levels.,Order Management Planning,Trace orders within

58、 extended supply chain Plan and replan fulfillment plan based on customer request (i.e., rush orders) Improve fulfillment planning and control executed orders and transportation Shipment documentation, packaging requirements using WMS functionality Provide availability of inventory at hand and curre

59、nt production plan Provide availability of inventory based on constraints, production and sourcing capabilities Collaboratively plan demand-based forecast and replenishment with customers,Visibility tool will provide order status. Customer self-service is also possible Direct contribution from fulfillment planning/ simulation capability Direct contribution from fulfillment planning and intelligence capability Assist from logistics process automation

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