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h_DA WS 2011 Logistical applications and optimizations slide 1
Matthias Mekschrat
Logistical applications and optimizationsLogistical applications and optimizations
h_DA WS 2011 Logistical applications and optimizations slide 2
Matthias Mekschrat
overview
Introduction
October 28 - definition of business processes
November 11 - overview of logistical business processes
December 02 - functionality of production processes
January 20 - special problems within the supply chain handling
December 16 - functionality of sales and distribution processes
November 18 - functionality of purchase and supply processes
h_DA WS 2011 Logistical applications and optimizations slide 3
Matthias Mekschrat
Review on the last session
You have learned about business processes and composed business process
You have learned1. that translating business processes into IT application processes is a very
challenging task which needs some experience2. That process integration is an important factor for an optimal IT application
system3. Why to avoid individual developed interfaces if ever possible
You have seen the different types of business processes 1. supply chain business processes2. logistical crossover business processes3. business support processes
You have learned about procedures and tools to 1. analyse business processes2. visualise business processes3. document business processes
You have seen the needed components to implement an IT application system1. customizing2. master data management3. user exits and modifications
h_DA WS 2011 Logistical applications and optimizations slide 4
Matthias Mekschrat
About this lecture
All sessions are split into 2 blocks: from 08:30 to 10:00 and from 10:15 to 11:45Each session starts with a short review of the last lectures subjects
Next I will give you a short theoretical overview of the days subject
Each group will then present the results of their discussions
I will present theoretical explanations for the discussed subjects
Then I will show a example solution for a potential written test question
Finally I will give a summary of the key messages for this session
Next you probably will develop 3 different subjects in a brainstorming session in 3 groups
h_DA WS 2011 Logistical applications and optimizations slide 5
Matthias Mekschrat
overview
Introduction
October 28 - definition of business processes
November 11 - overview of logistical business processes
December 02 - functionality of production processes
January 20 - special problems within the supply chain handling
December 16 - functionality of sales and distribution processes
November 18 - functionality of purchase and supply processes
h_DA WS 2011 Logistical applications and optimizations slide 6
Matthias Mekschrat
Overview of logistical processes
Supply chain processes
Business support processes
Short break
Part 1
Logistical crossover processes
Applications tasks to assure process integration
Part 2
h_DA WS 2011 Logistical applications and optimizations slide 7
Matthias Mekschrat
Overview of logistical processes
Supply chain processes
Business support processes
Short break
Part 1
Logistical crossover processes
Applications tasks to assure process integration
Part 2
h_DA WS 2011 Logistical applications and optimizations slide 8
Matthias Mekschrat
7%16%14%
63%
Usage of SCM Tools in chemical industry (November 2008)
none
In use planned
considered
Overview of logistical processes, Part 1Problems and potentials
h_DA WS 2011 Logistical applications and optimizations slide 9
Matthias Mekschrat
Overview of logistical processes, Part 1
As a consequence many companies do not use the potentials of an appropriate SCM
Very often suboptimal SCM processes are implemented by the IT application system
Problems and potentials
h_DA WS 2011 Logistical applications and optimizations slide 10
Matthias Mekschrat
Overview of logistical processes, Part 1
Understand the need for both external and internal collaboration processes
Understand the important inputs and outputs of each component
Understand the main component structure of a supply chain application system
Learning targets
Understand the involved acting logical business units
Understand the business support components, that are needed in assistance to run a supply chain application system
h_DA WS 2011 Logistical applications and optimizations slide 11
Matthias Mekschrat
Overview of logistical processes
Supply chain processes
Business support processes
Short break
Part 1
Logistical crossover processes
Applications tasks to assure process integration
Part 2
h_DA WS 2011 Logistical applications and optimizations slide 12
Matthias Mekschrat
Plant CustomerStore TransportSupplier
Supply chain processes
Supply chain processes represent all main logistical activities for creation of value according to the business definition
h_DA WS 2011 Logistical applications and optimizations slide 13
Matthias Mekschrat
A3
A2B
C
A1
Raw Material
Transport-unit
Production1. level
Entry Stores
Productionn. level
Plant CustomerStore TransportSupplier
Supply chain processes
h_DA WS 2011 Logistical applications and optimizations slide 14
Matthias Mekschrat
Supply chain processes
Plant BPlant A Transfer Prices A
Customer A
Prod. A
Customer B
Prod. B
Customer C
Prod. C Transfer PricesB
h_DA WS 2011 Logistical applications and optimizations slide 15
Matthias Mekschrat
SalesProduction
planning andscheduling
Shipment and distribution
Purchasing
Logistical crossover processesLogistical crossover processes
Business support processesBusiness support processes
Supply chain processes
h_DA WS 2011 Logistical applications and optimizations slide 16
Matthias Mekschrat
Core Business Processes and X-over Processes
PTP – purchase to pay
FFG – forecast to finished goods
OTC – order to cash
AE - asset effectiveness
FAC – finance & accounting
MITO CS APS BW
core process
cross process
mat
eria
l in
pu
t to
ou
tpu
t
chem
istr
y se
rvic
es
adva
nce
d
Pla
nn
ing
sys
tem
s
bu
sin
ess
info
rmat
ion
war
eho
use
h_DA WS 2011 Logistical applications and optimizations slide 17
Matthias Mekschrat
Purchase
requirements Materials requirements planning
(MRP)
Materials requirements planning (MRP)
Sales and operations planning(SOP)
Sales and operations planning(SOP)
Conversion of planned ordersConversion of planned orders
release of productionas process orders
release of productionas process orders
Actual productionActual production
ConfirmationConfirmation
Production controllingProduction controlling
MRP lists
Goods Receipt
Production Papers
Planned order
Goods Issue
Sales order Forecast
Time and Material
MES
Supply chain processes
DistributionDistribution
h_DA WS 2011 Logistical applications and optimizations slide 18
Matthias Mekschrat
Production Production DistributionDistribution Sale Sale Purchase Purchase
Network Design (ND)Network Design (ND)
Supply Network Planning (SNP)Supply Network Planning (SNP)
ProcurementPlanning
ProcurementPlanning
Demand Planning (DP)
Demand Planning (DP)
Global ATP Global ATP
Transport. Planning
&Vehicle
Scheduling (TP/VS)
Transport. Planning
&Vehicle
Scheduling (TP/VS)
ProductionPlanning
&Detailed
Scheduling (PP/DS)
ProductionPlanning
&Detailed
Scheduling (PP/DS)
Supply Chain CockpitSupply Chain Cockpit Monitor Monitor
Lo
ng T
erm
L
on
g T
erm
M
id T
erm
Mid
Ter
mS
ho
rt T
erm
S
ho
rt T
erm
DistributionPlanning
& Deployment
DistributionPlanning
& Deployment
Supply chain planning
h_DA WS 2011 Logistical applications and optimizations slide 19
Matthias Mekschrat
Demand Planning (DP)Demand Planning (DP)
Supply Network Planning (SNP)Supply Network Planning (SNP)
Transport Planning (TP/ VS)Transport Planning (TP/ VS)
Detailed Scheduling (DS)Detailed Scheduling (DS)
Production Planning (PP)Production Planning (PP)
DeploymentDeployment
Planning Horizon
Supply chain planning
h_DA WS 2011 Logistical applications and optimizations slide 20
Matthias Mekschrat
Plant A
Plant B Plant C
Plant E
Plant D
External customer
External customer
External customer
External customer
Supplier
Customer
Supply chain planning model
External customer
Internal customer
Plant
h_DA WS 2011 Logistical applications and optimizations slide 21
Matthias Mekschrat
2nd Supplier Manufacturer Retailer
From sequential supply chains...
One-to-one Communication Excessive Inventory (Bullwhip-Effect) Manual Communication Asynchronous Planning Cycles Assumption bases Planning
1st Supplier
h_DA WS 2011 Logistical applications and optimizations slide 22
Matthias Mekschrat
Collaboration One-to-many Communication Synchronous/asynchronous
Communication Synchronized Planning Cycles Automated Decisions Tracking and Tracing Technological Openness
….. to networked Supply Chains.
Retailer
2 nd Supplier
Carrier
Trade Exchange
TransportationExchange
Customer
1st Supplier
h_DA WS 2011 Logistical applications and optimizations slide 23
Matthias Mekschrat
Advantages of Collaboration
Customer Supplier
No safety stock More precise demand planning
No purchase ordersAutomated consignment fill-up and
consignment issue orders
No quality inspection No printing of CofA‘s
„Pay only what you have used“ No printing of invoices
No incoming invoice No invoice verification
h_DA WS 2011 Logistical applications and optimizations slide 24
Matthias Mekschrat
Overview of logistical processes
Supply chain processes
Business support processes
Short break
Part 1
Logistical crossover processes
Applications tasks to assure process integration
Part 2
h_DA WS 2011 Logistical applications and optimizations slide 25
Matthias Mekschrat
Business support processes
Business Support Processes represent all non logistical activities to support the main logistical activities
Controlling
Budgeting
Invoicing
h_DA WS 2011 Logistical applications and optimizations slide 26
Matthias Mekschrat
...
InfoCube
InfoCube
CC-CC-CubeCube
Cluster A
CC-CC-CubeCube
CC-CC-CubeCube
CC-CC-CubeCubeInfo
CubeInfo
CubeInfo
CubeCluster Business Warehouse
Business support processes, strategic planning and reporting
Cluster B Cluster C Cluster D
ERP Systems
h_DA WS 2011 Logistical applications and optimizations slide 27
Matthias Mekschrat
Practical part: developing the subjects
Group A: Please design the SC Model for 1. 4 Plants A,B,C,D 2. A, B, D have own Customers3. C, B have own Suppliers4. A supplies C and B, B supplies C and D5. Please design as an sequential model6. Please design as a network model
1. you have 20 minutes for group discussion and writing down your ideas2. afterwards each group has 5 minutes for the presentation of your ideas3. your are free to use any presentation medium
Group B: Please design the SC Model for 1. 4 Plants A,B,C,D 2. A, C have own Customers3. C, B, D have own Suppliers4. A supplies C and B and D, C supplies B and D5. Please design as an sequential model6. Please design as a network model
h_DA WS 2011 Logistical applications and optimizations slide 28
Matthias Mekschrat
Example solution for a potential test task, Part 1
design the SC model for 1. 4 Plants A,B,C,D 2. A, B, D have own Customers3. A, C, B have own Suppliers4. A supplies C and B, C and B supply D
Plant A
Plant C Plant D
Plant B
h_DA WS 2011 Logistical applications and optimizations slide 29
Matthias Mekschrat
Summary and key messages, Part 1
The SC components are sales, purchase, production and distribution
Literature1. Stadtler, Kilger – Supply chain management and advanced planning,
Springer Verlag, Berlin Heidelberg, 20002. Dangelmaier, Busch (Hrsg.) – (in german) Integriertes Supply Chain
Management, Gabler Verlag, Wiesbaden, 5/2004
There are models and tools to describe SC processes
SC planning processes effect all SC components
SC networks are the basis for collaboration
Business support processes are mainly calculation, budgeting and reporting
h_DA WS 2011 Logistical applications and optimizations slide 30
Matthias Mekschrat
Overview of logistical processes
Supply chain processes
Business support processes
Short break
Part 1
Logistical crossover processes
Applications tasks to assure process integration
Part 2
h_DA WS 2011 Logistical applications and optimizations slide 31
Matthias Mekschrat
Overview of logistical processes
Supply chain processes
Business support processes
Short break
Part 1
Logistical crossover processes
Applications tasks to assure process integration
Part 2
h_DA WS 2011 Logistical applications and optimizations slide 32
Matthias Mekschrat
Overview of logistical processes, Part 2
There are many logistical processes, which do not belong to the main SC processes, but effect all those components
Problems and potentials
The integration of these components assure the most effective use of the supply chain
Distribution of information in case of disturbances is a challenge a high potential
h_DA WS 2011 Logistical applications and optimizations slide 33
Matthias Mekschrat
Overview of logistical processes, Part 2
Understand the important inputs and outputs of each component
Understand the structure of logistical crossover processes
Learning targets
Understand the involved acting logical business units
Understand the applications tasks to assure process integration
h_DA WS 2011 Logistical applications and optimizations slide 34
Matthias Mekschrat
Overview of logistical processes
Supply chain processes
Business support processes
Short break
Part 1
Logistical crossover processes
Applications tasks to assure process integration
Part 2
h_DA WS 2011 Logistical applications and optimizations slide 35
Matthias Mekschrat
Logistical crossover processes
Logistical crossover business processes represent all logistical activities to support the main logistical activities
h_DA WS 2011 Logistical applications and optimizations slide 36
Matthias Mekschrat
Life-Cycle Data Management
Document ManagementProduct Structure
ManagementRecipe Management Integration
Change and Configuration Management
Asset Life-Cycle Management
Technical Assets Management
Preventive and Predictive Maintenance
Maintenance Execution Work Clearance Management
Program and Project Management
Program Management Project Planning Project Execution Interfaces
Life-Cycle Collaboration and Analytics
Design CollaborationCollaborative Project
ManagementQuality Collaboration
Enterprise Portal Content
Analytics
Quality Management Quality Improvement
Environment, Health and Safety
Basic Data and Tools
Product SafetyHazardous Substance
Management
Dangerous Goods
Management
Waste Management
Industrial Hygiene and
Safety
Occupational Health
Audit Management Quality Control
Quality management in the SC
h_DA WS 2011 Logistical applications and optimizations slide 37
Matthias Mekschrat
Quality management in the SC
Q Info
Technical delivery terms and conditions
Inspection lots
Fault reports
In-process inspection
Batch classification
Quality control charts
Quality reports
Inspection lots/Delivery
Certificates
Customer reports
Service reports
Procurement Production Sales Service
h_DA WS 2011 Logistical applications and optimizations slide 38
Matthias Mekschrat
Quality reports can be evaluated according to different criteria.
For instance, an overview of problems occurring with one material can be provided.
Questions such as what happened during production or have complaints been received from customers can be answered easily.
Quality management reporting in the SC
h_DA WS 2011 Logistical applications and optimizations slide 39
Matthias Mekschrat
Quality management reporting in the SC
h_DA WS 2011 Logistical applications and optimizations slide 40
Matthias Mekschrat
Sample management in the SC
h_DA WS 2011 Logistical applications and optimizations slide 41
Matthias Mekschrat
Goods receiptOutward stock
movement
Periodically Deadline monitoringbatch
In-process
Create inspection lot
Print inspection instruction/labels/labels
Record results
Usage decisionsubsequent acsubsequent action
Manually
Inspection orders in the SC
h_DA WS 2011 Logistical applications and optimizations slide 43
Matthias Mekschrat
A manufacturer of chemicals has to
comply with the respective laws>
be able to provide seamless information about the properties of the products that leaves no room for doubt>
provide foresighted information about handling>
take preventive action against emergencies>
have clearly structured development routines, production procedures and supply chains
>
R & D in the supply chain
h_DA WS 2011 Logistical applications and optimizations slide 44
Matthias Mekschrat
Regarding R&D, the product life cycle management consists of
Strategic R&D planning
Compliance of R&D requirements in the running system
Operational R&D handlingPha
ses
Core Phase
R & D in the supply chain
h_DA WS 2011 Logistical applications and optimizations slide 45
Matthias Mekschrat
Implementation of subsequent settings in the ERP environment
IT support of the total actual R&D process>
>
Requirements for an Operational R&D handling
Document the results of the R&D activities >
R&D handling is more than writing down structures and recipies>
R & D in the supply chain
h_DA WS 2011 Logistical applications and optimizations slide 46
Matthias Mekschrat
Overview of logistical processes
Supply chain processes
Business support processes
Short break
Part 1
Logistical crossover processes
Applications tasks to assure process integration
Part 2
h_DA WS 2011 Logistical applications and optimizations slide 47
Matthias Mekschrat
Applications tasks to assure process integration
Lacking exchange of information is one of the main problems, why business processes do not run optimal. Very often you will find human factors as a reason
JIT manufacturing and outsourcing are creating many more shipments to a wider variety of destinations. The likelihood of breakdowns increases.
h_DA WS 2011 Logistical applications and optimizations slide 48
Matthias Mekschrat
Which logistical consequences emerge through a missing Process integration?
Work Arounds
Badly designed Process flows
Additional Manual effort for coordination
Which costs arise through a missing Process integration?
Costs for individual Interfaces
Costs for necessary modifications
What should already be considered during a project planning ?
Cost analysis for the Process Integration
Detailed functional Process analysis
Preliminary Study
Applications tasks to assure process integration
h_DA WS 2011 Logistical applications and optimizations slide 49
Matthias Mekschrat
Process Integration is surely not given by creating interfaces between individual
solutions afterwards, Process Integration is part of the System planning process
Process Integration is more than a try to connect two different Plugs,
but rather a complex Challenge where the interactive details of a lot of components have
to be identified and where the following implementation has to be kept in mind
Applications tasks to assure process integration
h_DA WS 2011 Logistical applications and optimizations slide 50
Matthias Mekschrat
What is Supply Chain Event Management (SCEM)?
SCEM is a solution to
MONITOR and CONTROL
Supply Chain Processes.
It enables to react to events
immediately,over heterogenious systems,over company boundaries.
h_DA WS 2011 Logistical applications and optimizations slide 51
Matthias Mekschrat
SC Event Management consists of four steps:
Define: Event Profiles for business processes Monitor: Event MessagesNotify: Actual and coming Problems by As-Is Comparison Control: by manual Interference, automatically,
SAP AG 2001, SCEM, Andreas Otto 51
What is Supply Chain Event Management (SCEM)?
h_DA WS 2011 Logistical applications and optimizations slide 52
Matthias Mekschrat
Summary and key messages, Part 2
Literature1. Stadtler, Kilger – Supply chain management and advanced planning,
Springer Verlag, Berlin Heidelberg, 20002. Dangelmaier, Busch (Hrsg.) – (in german) Integriertes Supply Chain
Management, Gabler Verlag, Wiesbaden, 5/2004
QM and material management are the most important crossover processes
Distribution of information in case of disturbances is an important success factor
A supply chain event manager (SCEM) is urgently recommended for an optimal SC organisation
h_DA WS 2011 Logistical applications and optimizations slide 53
Matthias Mekschrat
Thank you very much for your participationThank you very much for your participation
…… and see you on Friday, 18th of November…… and see you on Friday, 18th of November
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