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Jan 19, 2016
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Information Driven Value Chains“Outside The 4 Walls”Presenter’s Name
Presenter’s Title
March, 2008
March, 2008
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SOX DISCLAIMER
• Information Driven Value Chains
- Demand Chain
- Design Chain
- Supply Chain
• How Oracle Delivers
Agenda
55
Supply Chains of the 20th CenturyTraditional Focus: Inside the 4 walls
Administrative Infrastructure
HR
Research & Development
Procurement
Source: Dr. Michael Porter (Harvard, 1985)
T R A D I T I O N A L S C M F O C U S
Su
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Acti
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Valu
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“The need to align customers, products and supply chains is too
often overlooked as a source of sustainable competitive advantage.”
Carter et al, Supply Chain Management Review, 2007
From Supply Chain
To
Value Chains…
77
21st Century Value Chains
Administrative InfrastructureHR
Su
pp
ort
ing
Acti
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ies
Su
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ort
ing
Acti
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Valu
e C
reati
ng
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Valu
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INNOVATIONINNOVATIONSUPPLIER RELATIONSHIP MGTSUPPLIER RELATIONSHIP MGT
Demand Chain
Demand Chain
Supply ChainSupply ChainDesign ChainDesign Chain
Design ChainDesign Chain Design ChainDesign Chain
Supply Chain Supply Chain Supply Chain Supply Chain Demand Chain Demand Chain Demand Chain Demand Chain
• Global, Complex, Dynamic
• Convergence of Chains - Demand, Supply, Design
• Multi-enterprise Orchestration “Outside-the-4-walls”
• Global, Complex, Dynamic
• Convergence of Chains - Demand, Supply, Design
• Multi-enterprise Orchestration “Outside-the-4-walls”
Where Are You Today? Survey of Supply Chain Progress: 5 Levels of Maturity
Source: Supply Chain Management Review, Survey of Supply Chain Progress: Still Waiting for the Breakthrough, Charles C. Poirier & Francis J. Quinn, Nov 1, 2006
IEnterprise Integration
IEnterprise Integration
VFull Network Connectivity
VFull Network ConnectivityIV
Value ChainConstellation
IVValue Chain
ConstellationIII
PartnerCollaboration
IIIPartner
CollaborationII
CorporateExcellence
IICorporateExcellence
Collaborative Commerce
Inter-Enterprise
Functional/Process
Intra-Enterprise
External TotalBusiness System
Most are working Most are working towards level II towards level II (Today’s market)(Today’s market)
Most are working Most are working towards level II towards level II (Today’s market)(Today’s market)
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“Information about the package is as important as
the package itself.”
Fred SmithCEO, FedEx
Information
Information
Data Proliferation
• More data created in last 2 yrs than in the past 40,000 yrs• Total data quadrupled in the last 2 yrs• Will continue to double every year
To
tal
Dat
a W
orl
dw
ide
(in
Ter
abyt
es)
21m
15m
57m
33m
Traditional Supply Chain Approach Perfect Internal Functions
Undefined, Ambiguous Information
External Processes & Information
Corporate Objectives
Unanticipated Events
Cross-LOB Programs
Predefined Processes
Disruptive Changes
Supplier StrikeNew Regulations
M&As
Demand Shocks
Competitor Plans
Price Flux
Rigid Processes Optimized for Static ConditionsA New Approach For a New Environment Is Needed …
A Better Approach: Information Driven Real-time Global Visibility Into
• Demand signals
• Supply network
• Market shifts
• Information contextualization
• Collaboration
• Process framework
Decisions, Planning, Execution All Driven
By Real Time Actionable Information
Decisions, Planning, Execution All Driven
By Real Time Actionable Information
Information Driven Approach For a Dynamic, Global Environment
NIMBLE PROCESSES
Open, Information-
centric Approach
DISRUPTIVE CHANGES
UNPLANNED SCENARIOS
EXTERNAL INPUTS
AMBIGUOUSDATA
CORPORATE OBJECTIVES
NEW PROGRAMS
InboundLogistics
OperationsOutboundLogistics
Marketing& Sales
Service
Use INFORMATION
to
Predict Market Requirements and
Risks
Adapt to Volatile Market Conditions
Align Operations Across Global
Networks
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“The successful business executive is a forecaster first,
everything else follows”
Peter Bernstein‘Against the Gods – The Remarkable
Story of Risk’
Predict
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PREDICT Markets and RisksWorld Class Demand Chain & Risk Management
Requirement Enabler Value
Mitigate Risk
Risk metrics, link to strategic supply chain design & ongoing optimization
Minimize write-offs, optimize response to disruptions, grow returns from assets
Predict and Shape Demand
Demand Mgmt, Predictive analytics, Pricing & promotion optimization
Maximize revenue and achieve best returns on marketing spend
Improve Value Chain Visibility
Collaborative systems for partner and internal visibility
Minimize uncertainty; improved ability to identify issues
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Predict and Shape DemandUse real-time data & advanced statistics for closed loop
• Real-Time Information from
all Demand Signals
• Synthesize information into holistic forecast
• Accurately Predict Demand via Automated Analytics
Real-time Channel Data & Causal
Factors
SENSE
• Use predictive analytics to optimize promotions
• Manage price erosion in all phases
• Use Analytics to determine optimal pricing
List
Rev
enue
150
Con
figur
ed L
ist R
even
ue
165
Seg
men
t Rev
enue
132
Invo
ice
Rev
enue
102 Poc
ket R
even
ue
93 Gro
ss M
argi
n
107
Poc
ket M
argi
n
67
Netlift
Baseline0
500
1000
1500
2000
2500
3000
Week 1 Week 6 Week 11
SHAPE
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• Demand Management• Real-time Sales and Operations Planning
Solution:
• Generates forecasts from customer POS data • Increase in stock of fast moving, short life cycle video games• Improve leverage with major retail customers• Increased order fill rate • Reduce out-of-stocks
Business Results:
• Lost sales due to retail stock-outs• Lost revenue opportunities from poor retail product mix• Returns and write downs from obsolete inventory
BusinessChallenges:
Take-Two InteractiveStarting with a better prediction of demand
Publisher, developer,
and distributor
of interactive
entertainment software, hardware,
and accessories worldwide.
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“The world is changing very fast. Big will not beat small anymore.
It will be the fast beating the slow.”
Rupert MurdochChairman & CEO, News Corporation
Adapt
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ADAPT to Drive LeadershipIntegrate Product Development with Supply Chain
Requirement Enabler Value
Flexible Business Processes
Standard integrations, modifiable, extensible business process platform
Effectively respond to dynamic business changes
Rapid Profitable Product Innovation
Product Lifecycle Mgmt with Demand-Driven Lean Mfg
First to market & grow market share
Optimize Supply Globally
Global material planning, sourcing, & logistics
Leverage global markets in a cost effective and responsive manner
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Accelerate Innovation – Maximize ProfitsReduce Time to Market with Product Lifecycle Management
• Accelerate product innovation to maximize product profitability
• Manage product information, collaborative processes and decisions
• Streamline product lifecycle process across the global value chain
Cross-Enterprise & Value Chain Coordination
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• Deployed Agile PLM to over 6,500 external and internal users in all 6 business units worldwide
• Global deployment of Oracle E-Business Suite including Supply Chain products, Siebel CRM and PeopleSoft HCM
Solution:
“Agile provides us with the advanced
engineering and collaboration features that
will ensure we continue to be at the forefront
of wireless technology.”
Norm FjeldheimSr. Vice President
and Chief Information
Officer
• Reduced cycle time from days to minutes for data iterations with contract manufacturers
• Saved money and time by eliminating suspect data, failures and errors with one true source for all product information
• Provided global, 24/7 accessibility to product information
Business Results:
• Slow product development due to scattered product information across global manufacturing sites
• High costs of data integration failures and errors• Lack of user-specific secure, regulated, global access to data
BusinessChallenges:
Qualcomm“QUALCOMM develops its technologies and solutions for the purpose of enabling key participants in the wireless value chain.”
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Align
“Vision without execution is hallucination”
Albert Einstein, Scientist, Visionary, Nobel Laureate
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ALIGN the Value Chain to Business GoalsGlobal Alignment Across Demand, Product & Supply Chain
Requirement Enabler Value
Common information with analytics; flexible ways to connect
Comprehensive information mgt. platform; Embedded collaborative tools (eg. Web 2.0)
Eliminate confusion and conflict. Create a sense of community. Make better business decisions at all levels
Synchronize plans and actions across functions aligned w/ goals
Real time Sales & Operations Planning Integrated Business Planning
Focus concerted action on achieving goals from all organizations
Align the global extended Value Chain
Multi-Enterprise business process orchestration
Better manage responsiveness by moving to pro-active stance
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Real-Time Sales & Operations Planning
• Utilize real time demand visibility to quickly sense and respond to changes
• Synchronize plans across Finance, Sales, Marketing, and the Supply Chain
• Monitor performance and drive continuous improvement
Align Plans with Actions Across the Value Chain
Sales and Operations Planning Process
Product ReviewDemand Review
Supply ReviewExecute and Measure
Management Review
Sense
Respond
Shape
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• Demantra Real-Time Sales & Operations Planning• Generates forecasts from customer POS data • Compares customer and generated forecasts and routes
exceptions to planner, sales representative, or customer
Solution:
• Increased order fill rate from 55% to 95%• Increased inventory turns by 100%• Reduced price protection claims by 40%• Reduced logistics costs by 65%
Business Results:
• Improve service levels and on-shelf availability of products at large retailers in order to increase revenues
• Keep inventory levels and logistics costs to a minimum • Improve ability to predict sales volume
BusinessChallenges:
V-TechAchieves Alignment Through S&OP $1 billion in revenues,
operating worldwide
Manufacturing in China
Leading provider of cordless phones and electronic children’s
toys“A 1% out-of-stock rate at a retailer is not just a 1% loss in revenue. It represents a higher multiple, as it is always the high volume stores that will go out of stock first. Our goal is to keep these stores in stock all the time. We want to grow revenue by improving our ability to sell products through consumer-driven planning processes with our customers.” − Nick Delany, Senior Vice President, VTech
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How Oracle Delivers…
Information DrivenValue Chains
Oracle Invests in Best-in-Class “Outside-in” solutions
Oracle AcquiresSiebelBest in Class:Trade MgmtCRMServiceHelp DeskAnalyticsiSupportMktg AutomationSFA
Oracle AcquiresDemantraBest in Class:Demand Forecasting, Trade Optimization, and S&OP
Oracle AcquiresRetek, 360 Commerce,Profit LogicBest in Class: Retail Applications
Oracle AcquiresG-LogBest in Class:Logistics and Supply Chain Execution
Oracle AcquiresHyperionBest in Class:Analytics, Consumer Insight
Oracle AcquiresAgile/ProdikaBest in Class:Product Lifecycle Management
Build-Buy-Integrate strategy enables…Build-Buy-Integrate strategy enables…
Oracle Value Chain Solutions Complete, Integrated, Open
Financials / HR Master Data Management
Global Business Intelligence: Visibility / Analytics
Colla
bora
tion
Colla
bora
tion
Colla
bora
tion
Colla
bora
tion
Demand Chain
Management
Demand Chain
Management
Supply Chain
Management
Supply Chain
Management
Design Chain
Management
Design Chain
Management
CustomersCustomers DistributionDistribution ManufacturingManufacturing SuppliersSuppliers
Financials / HR Master Data Management
SUPPLY
MANAGEMENT
Purchasing
Settlement
Supplier Mgt
Contract Mgt
SUPPLY
MANAGEMENT
Purchasing
Settlement
Supplier Mgt
Contract Mgt
SUPPLY
PLANNING
Sales & Operations Planning
Planning & Scheduling
Order Promising
Network & Inventory Opt.
Service Parts Planning
SUPPLY
PLANNING
Sales & Operations Planning
Planning & Scheduling
Order Promising
Network & Inventory Opt.
Service Parts Planning
DEMAND
MANAGEMENT
Forecasting
Promotions Mgt
Demand Collaboration
VMI
DEMAND
MANAGEMENT
Forecasting
Promotions Mgt
Demand Collaboration
VMI
PRODUCT LIFECYCLE MANAGEMENT
New Product Introduction, Quality, Cost, Compliance, Design for Supply
PRODUCT LIFECYCLE MANAGEMENT
New Product Introduction, Quality, Cost, Compliance, Design for Supply
SO
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SO
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Pricin
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OR
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Pricin
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MANUFACTURING
Mixed-mode
MANUFACTURING
Mixed-modeLOGISTICS & DISTRIBUTION
Warehouse, Transportation
LOGISTICS & DISTRIBUTION
Warehouse, Transportation
SERVICE
Planning & Execution
SERVICE
Planning & Execution
Industry’s Best-in-Class Footprint
Business Intelligence: Visibility / Analytics
Integrated Business IntelligenceRole-Based Intelligence Dashboards
Slice and Dice Data by
Different Time Periods
Stop Lighting Indicators
Scrolling Status Grids
Multiple Chart Types
and Views
Multiple Chart Types
and Views
Successful Customers
High Technology
Industrial Mfg
Automotive
Aerospace & Defense
Consumer Goods
CPG – Food & Bev
Medical Devices
Chemicals
Retail
Only Oracle… Best-in-Class, Complete, Integrated
• Demand Chain Management Best-in-Class Demand Management Real time Sales & Operations Planning Collaborative Demand Planning & Advanced Analytics
• Design Chain Management Best-in-Class Product Lifecycle Management Real time Product Design Collaboration Single Product Information Repository
• Supply Chain Management Best-in-Class Logistics & Transportation Management Best-in-Class Supplier Relationship Management Collaborative Planning, Optimization & Intelligence
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Reserved.
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