Supply Chain Management

&eCommerce Technology

presented by:

Nachiappan Annamalai

OverviewO Supply Chain Management - WhazzitO SCM today - ProblemsO Solutions - e-CommerceO Examples of present systems -

tradematrix.com - i2 TechnologiesO e-Commerce - Application to SCM -

FrameworkO Future of SCM & e-CommerceO Suggestions

World Internet Population 3/99O World Total 158.50 MILLION

O Africa 1.14 million

O Asia/Pacific 26.97 million

O Europe 36.55 million

O Middle East .88 million

O Canada & USA 88.33 million

O South America 4.63 million

Effective SCM involvesO Managing Supply Chain as a single

entityO Recognizing end user service

requirements Customer Utility = f(time, quantity, place)

O Recognizing time as basis of competitive advantage

O Effective use of InventoryO Continuos Improvement

Time Involved in the Process

Effects of Time Consuming SCM

O Excessive Inventory - $ 30 Billion ( Grocery Supply Chain alone)

O Poor Product forecastO Poor Capacity PlanningO Poor Customer ServiceO High Corrective Costs - Overtime,

Subcontracting, Trans. Prob.O Optimized Supply Chain as a Whole entity -

Not PossibleO Internationalization - Not possible

Distribution

Other Problems O Demand Forecast UpdatingO Order BatchingO Price FluctuationO Shortage gaming

Demand Forecast Updating

O Amplification of Fluctuation when ones goes up the Supply Chain

O Lead Time importance

Order batchingO Orders in Batches - Compulsion - Time & Cost Constraints - Transportation Problems - FTL -

Full Truck LoadO Overlapping of Order Cycles - Leads

to more variabilityO MRP Jitters

Price Fluctuations O Forward BuyO Role of Price Fixing - Erratic DemandO Variation in Buying Quantity is much

bigger than the variation of the Consumption rate

Shortage GamingO Phantom Orders - When & Why does

it OccurO Examples - Motorola and its Distributors Air touch Communication & Baby

Bells - IBM Aptiva Model - Assumption of

Retailers

CounteractionsO One and only best Solution

E-Commerce- Information Sharing- Channel Alignment- Operational efficiency- Intelligent Optimization Agents- Transaction Processing- Money Transactions

I2 Technologies - Tradematrix.com

an efficient SCM e-Commerce system

Services the System Provides

O Direct & Indirect ProcurementO RFQ - (Request for Quote)

CollaborationO Demand CollaborationO Holisitic Customer ManagementO Buyer & Seller ServicesO Service ProvidersO Marketing Services

Tradematrix.com - Framework

O Front end - Portal - Customer Management - Communication Systems - Money TransactionsO Back end - Optimization - Transaction Processing System

The Process of Commerce

O Buyers and sellers find each otherO Communication: advertising and

marketingO Intermediaries (dealers, distributors,

reps)O Negotiation

O Agents (buyers, lawyers)O Transaction

O ContractO Payment (or many payments)

The Process of CommerceO Order fulfillment

O ManufactureO Delivery

O Post-sale eventsO Customer service O Reorder, restock

O AccountingO Are we making a profit?

O Data analysisO Who’s buying the stuff?

The eCommerce ProcessO Transaction

O Transaction processing, DatabasesO Electronic Payment Systems,O Computer Security,O System Reliability

O Order fulfillmentO Manufacture (manufacturing systems)O Delivery (tracking systems)

eCOMMERCE TECHNOLOGY

O Networks • SecurityO Internet • Electronic paymentO Programming • Search enginesO Multimedia • Intelligent agentsO Databases • Data miningO Transaction

processing

The eCommerce Process

O Which of the steps are “bittable”?O Buyers and sellers find each other

O Communication (via Networks, the Internet, Programming and Information Retrieval)

O Human-Computer Interaction, MultimediaO Intermediaries

ODisintermediationO Negotiation

O Electronic Negotiation, Intelligent agents

The eCommerce ProcessO Post-sale events

O Customer Service and Help Facilities O Reorder, restock

O AccountingO Transaction processingO Interoperability between online and legacy

systemsO Data analysis

O Data Mining

Ideal e-Business SystemO Front End

- Portal - Communication Systems - Interface with Mobile

Devices & GPS - for access to real time info. - Money Transaction - Customer Management SystemsO Back End - Optimization - Decision Support Systems & Intelligent Agents - Transaction Processing System - Prioritizing Systems - Shows Contradictions - Forecasting System with Responder- Capability to match

System Dynamics

Manufacturing Services

O Front End System Functions

- Product Design & Quality Specification

- Customer Management & Communication System - Money TransactionsO Back End - Standard time & Least Cost - Supply Time - Optimization - CNC Machine Code Conversion

- Route data to CNC Machine would lead to total automation - paperless industry