microsoft powerpoint - napmscmtrendsv6041905

Purchasing and Supply Chain Technology Trends 2005

Nad Bhatti, Noblestar SystemsApril 19th, 2005

www.noblestar.com 2

Introduction and Objective

• Nad Bhatti– Noblestar Strategist– Worked with many businesses to define

supply chain and IT strategy and implement technology

• Objective– To introduce Supply leaders to the

major innovations in business applications and to stimulate critical thinking about how information technology can influence your business

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• Context and Drivers– Socioeconomic– Technology Advances and Market Dynamics

• Key Applications and Trends– Document Management– Advanced Supply Chain Portals– Drop Ships \ Cross Dock \ Touch point elimination– Barcode \ RFID – Inventory Visibility– Web Services

• Sources of information• Q & A

Agenda

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Socio-economic drivers

• Wartime economy• Rising commodity costs• Globalization

– Manufacturing– Services

• User Computer and Device Literacy• Sarbanes-Oxley

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Information Technology Advances

• Moore’s Law– Computing power doubles every

year• Short Range Wireless IP 802.11

– WLan up to 300 feet• Long Range Wireless IP

– Wimax• Sensor technology

– GPS– RFID

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Technology Market Dynamics

• PC and Server prices falling• Telecom Cannibalization by VOIP• Bandwidth plentiful• Business Software vendors

consolidating• Chips and semiconductors devices

obsolescing rapidly

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• Context and Drivers– Socio-economic– Technology Advances– Technology Market dynamics

• Key Applications and Trends– Document Management– Advanced Supply Chain Portals– Drop Ships \ Cross Dock \ Touch point elimination– Web Services– Barcode \ RFID – Inventory Visibility

• Sources of information• Q & A• Additional information

Agenda

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Key Trends – Document Management

Document Management – DefinitionThe computerized management of electronic as well as paper-based documents. Document management systems generally include the following components:

•Optical scanner and OCR system to convert paper documents into an electronic form •Search Capability •File or Database repository•Version Control•Access control and audit trails

Rather than a belief in paperless office. DMS seeks to scan and attribute paper documents so they can be searched, stored, retrieved and version controlled.

Source: www.webopedia.com

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Key Trends – Doc Mgt Example

Integration betweenPeopleSoft And ImageNow

In this example,querying for a voucherIn PeopleSoft will render anicon in the Windows SystrayIf an image for the voucher exists In the ImageNow DB.

The user can click on the icon and the image will maximize to enable matching or other purchasing business processes requiring the voucher.

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Drivers: Data entry limitations, Data conversion from legacy systems, Supplier limitations, ERP systems offering limited formatting capability

A few leaders: Imagenow, 170 Systems, Optio

Limitations: tight integration between systems to achieve user friendliness, PC and Server hardware upgrades can be required

Solutions: SCM vendors adding document attachments, Document Management vendors integrating to ERP, SCM technology

Why is it a trend in 2005? Corporate investment in efficiency and Sarbanes-Oxley requirements for internal controls

Key Trends - Document Management


What does it replace?

Paper / filing of source documents

Data entry of all fields in source documents

Network or MS Exchange directory for sharing files.

Other content or Document management system not tuned to Purchasing business processes.

Key Trends - Document Management


Key Trends – Advanced Supply Chain Portals

Advanced Supply Chain portals are portals that offer content towards a supply chain user such as a vendor, a Purchasing user, a Supply Chain executive, a warehouse/receiving user, or the CFO. They usually contain information from purchasing, payment, requisitioning, budgeting, vendor management and electronic marketplaces.

Portal – A Web Page or Web Site that offers a broad array of resources or services and is personalized and tailored to a specific user or type of users

Portlet – A component of a portal-style web page consisting of an area of content within a web page that contains dynamically generated, specialized content such as a report, an alert, a message, or news.

RSS (Really Simple Syndication) – a standard format for publishing news and blog oriented creating web pages. Using a common way of placing descriptive tags in the web page source code. An RSS reader can automatically render web pages about the topic. (For example, tracking news about a key supplier)Source: www.webopedia.com


Key Trends – ASCP COO Portal Example

This is the PeopleSoft COO Portal. In this example, the key information for a department leader in a hospital is combined and appears on the page. This can eliminate requests to purchasing for transaction summaries.

KPI’sshowing company performance

E-mail

Pay and leave

Company News


Drivers: Single-Sign On systems enabled, IT complexity, eliminate vendor requests

A few leaders: Plumtree, Oracle 10g, SAP, PeopleSoft, Microsoft Sharepoint, IBM, BEA Systems

Limitations: JSR 168 compliance in legacy technology, access to real-time requires business process engineering, latency when accessing reports

Solutions: application layer portals, technology layer portals.

Why is it a trend in 2005? # of systems reaching critical mass




Navigating to several web pages.

Remembering several user ids and passwords.

Printing and navigating through large paper reports.

Searching and querying major news sites or waiting for news to spread.

Setting reminders in MS-Outlook or other calendaring.

Answering phone and sending e-mails looking up information for vendors



Key Trends – Drop Ship Supply ChainsDrop Ship is a transaction in which a customer places an order with a distributor. The distributor’s supplier fulfills the order with the vendor never taking possession of the ordered item.

Distributor’s supplier ships to customer with Distributor’s invoice

Distributor takes sales order and builds supply chain by placing Purchase order with supplier that contains customer’s shipping ship-to.


Key Trends – Drop Ship Supply Chains– JIT ExampleThis is an example of a Just-in-Time supply chain. A customer places a sales order with a distributor. The distributor places a PO with a supplier the receives and fulfills the order to the Customer

Distributor receipt and put away can add .5 to 3% to total item cost

Extra transportation can add 2-10% to total item cost.


Key Trends – Drop Ship Supply Chains

Drivers: Fuel costs, Just-in-time and lean manufacturing, outsourcing, data integrity in inventory systemsPlayers: SAP, Oracle, UPS, EPC GlobalSolution: upgrade ERP system, improve data quality with regards to your sales orderable inventory, build trusted supplier network, train and certify employees in NAPM, APICS style thinkingChallenges:Integration between trading partners and across Customer Service, Inventory, and PurchasingDanger of exposing your customer to your supplierDanger of your customer learning your marginsWhy is it a trend? Transportation and fuel costs



Key Trends – Web Services

Web Services: The term Web services describes a standardized way of connecting applications across organizations over the internet without intimate knowledge of each other's IT systems behind the firewall.

Unlike traditional client/server models, such as a Web server/Web page system, Web services do not provide the user with a GUI.

Web services instead share business logic, data and processes through a programmatic interface across a network. The applications interface, not the users.

Developers can then add the Web service to a GUI (such as a Web page or an executable program) to offer specific functionality to users.



Key Trends – Web Services: Example

Amazon, eBay, and Yahoo have implemented the the transaction of placing an item up for auction as a Web Service. The company Liquidate Direct has written an application that allows a user to place their obsolescing inventory for auction at all three sites from one application.




Web Services replaces older technology for communicating with suppliers and trading partners such as EDI and Fax

Replaces navigating to a web page to conduct supply transactions such as verifying shipment, obtaining quotes, checking availability

Replaces data entry into purchasing systems of information contained in e-mails, voicemails, mail, faxes, and conversations

Web services allow organizations to conduct machine to machine transactions and eliminate human interaction.




Drivers: eliminate routine tasks requiring human\web interfaces, replace EDI with more robust and open systems

Players: Microsoft, IBM, WebMethods, BEA Systems

Challenges: Determining granularity of Web Service, marketing web service, business process changes



Key Trends –Inventory Visibility – RFID\Barcode

Inventory Visibility: For all of the inventory items you track, knowledge of how many, what location, and who the owner is (can be person, a sales order, or manufacturing job)

Drivers: Sarbox, Lean and JIT initiatives, Rapidly obsolescing products, Mass customization, customer initiatives (DoD, Wal-Mart, Target, Best Buy, Albertson’s)

Solutions: Barcodes enabled inventory, RFID enabled inventory

Key Players: Symbol, Alien technologies, Zebra, Intermec, Cougaar, Manhattan, Sun, SAP, Oracle

Challenges: high startup costs, RFID technology is immature, must baseline inventory


Key Trends – Barcode\RFID – Inventory Visibility•Barcode: A system of representing a small amount of information (usually a number of 7-19 digits) with black and white bars of varying thickness and space. Barcodes are read by a scanner that translates the code into a value that can be interfaced to an inventory or asset management system. •Typical use is to encode UPC inventory item and reference UPC database to decode the item’s UPC code and translate for receipt.

•Invented in 1949, first used in commercial supply chains in 1975

•Advantages: Speed and accuracy, barcodes required by major retailers

•Limitations: line of sight, UPC membership requirement, constitution of item

•Why Now?: Lean initiatives, declining cost of hardware


Key Trends –Inventory Visibility – RFID\Barcode

RFID (Radio Frequency Identification): RFID is a technology of small, inexpensive smart tags that can store a small amount of information (usually 10-25 digit code)The Tag is read by a reader that emits a small, harmless amount of radio waves towards the tag and interprets the returned signal

A unique identifier can be encoded to the tag and mapped to the inventory item within the materials management systems.

This type of RFID tag read transaction can be integrated to Purchasing, Asset, and Inventory systems for automating cycle counts, receipts, and other business processes within the inventory site.

Wal-Mart, Target, DoD, Best Buy, and Albertson’s, are among the major inventory organizations that are running limited trials of RFID tagged inventory moving through their supply chains.

EZ-Pass and the Metro Smart Card are also examples of RFID technology.


Reader/Antennae Form Factors

• Stationary– portal– gateway– fixed mount

• Hand held– tethered– wireless

• Forklift mounted

• Cart


Printer/Encoder

• Generate “smart label”

– barcode with human readable text

– RFID tag inlay

• EPC commissioning with field programmable tag

• Support write operation with immediate verification


1) Host controller instructs reader to interrogate tag2) Reader pings tag to activate it3) Tag becomes excited and emits unique identifier4) Reader decodes identifier and forwards to host

enterprise integration

PC

1

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4

RFID Tag reader

RFID System – Common Configuration

tag

3

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ERP

Sys

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Barcode\RFID-Enabled Supply Chain


• Context and Drivers– Socio-economic– Technology Advances– Technology Market dynamics

• Key Applications and Trends– Document Management– Advanced Supply Chain Portals– Web Services– Drop Ships and touch point elimination– Inventory Visibility – Barcode\RFID

• Sources of information• Q & A• About Us

Agenda


•WWW.Webopedia.com: Internet dictionary of computer terms•WWW.mbtmag.com: Manufacturing business technology website•www.ittoolbox.com: Website of vendor specific IT information•www.optimizemag.com: Website of IT strategy articles•www.barcodemill.com: print your own barcode

Sources of Information


Nad [email protected] Sunset Hills RoadSuite 600Reston, VA 20190www.noblestar.com

Questions


Noblestar is an innovative professional services firm known for effectively applying strong technological expertise, as well as process and architectural rigor to promising digital business technologies. We have a reputation for “doing the hard stuff”, and consistently leverage best practices to assure the delivery of high quality work products, on-time and within budget – driving high levels of client satisfaction.

Pioneering emerging technologies for over 17 years, Noblestar rigorously engineers successful digital business today, to power the classic businesses of tomorrow. The company, which specializes in high-end custom software engineering, enterprise package solutions, and mobile & wireless strategy and development, is headquartered in Reston, Virginia, and also has branch offices in Austin, Boston, Houston, London, Vilnius, and Warsaw. Information about Noblestar can be found at www.noblestar.com.

About Noblestar


The End

microsoft powerpoint - napmscmtrendsv6041905

Technology

supply chain technology

key information

supply chain user

document management

purchasing user

supply chain executive

supply leaders

key supplier source