Speaker Speaker

Shahpar IslamID:141205

Objectives

1.What is to be measured?

3. What is the base/tool of the

researchmethodology?

2. What is developed to measure the

Business Performance

Metrics?

4. What will be the result/effect of the

research?

Objectives

1.The impact of IT on performance metrics (time, productivity and

value)

3.MIT Process Handbook

(for both guidance and analysis)

2.The first systematic

methodology has been developed to asses the

business performance metrics

4.i) Measure the performance

metrics for investment in IT(case: RFID)

ii) Show the effectiveness of MIT process Handbook

Topics

7. Apply metrics to process decomposition

8. Calculate estimates for value and productivity performance metrics of

RFID process

9. Create executive report using estimates and Calculate

the NVP and ROI

10. Include findings in the MIT Process

Handbook

End

Time needed for one iteration of process has been compared before and after implementing RFID.

7. Apply Metrics to Process Decomposition

Time needed for

one process

Before using RFID

After using RFID

Show the analysis of “As-It” process

•Find out cost for each step

Show the analysis of “To-Be” process

•Find out cost for each step

Comparison between before and

after implementation of

RFID

• Highlights the steps that provide efficiency

7. Apply metrics to process decomposition

Do we know what is pallet?

Analysis of the metrics that is used for “As-Is” process. (Existing)◦ Receive Physical Resources – 240.00 sec◦ Move Pallets to staging area – 104.00 sec◦ Pick Pallets - 40.00 sec◦ Pick one pallet – 40.00 sec ◦ Drive through portal – 14.00 sec◦ Place forklift into container- 8.00 sec◦ Raise Container- 10.00 sec◦ Backup fork truck into distribution center- 8.00

sec

7. Apply metrics to process decomposition

Analysis of the metrics that is used for “To-Be” process.(Proposed)◦ Receive Physical Resources – 40.00 sec◦ Move Pallets to storage – 40.00 sec◦ Pick Pallets - 40.00 sec◦ Pick one pallet – 40.00 sec ◦ Drive through portal – 14.00 sec◦ Place forklift into container- 8.00 sec◦ Raise Container- 10.00 sec◦ Backup fork truck into distribution center- 8.00

sec

7. Apply metrics to process decomposition

8. Calculate estimates for value and productivity performance metrics of

RFID

Executive report will illustrate:◦ Estimated value and productivity process

performance metrics◦ Investment in RFID can be justified base on that

value generated To Compare with the “As-is” process:

◦ Modeling effort was broken up into 3 steps:

9. Create executive report using estimates

• Determine input variables1

• Create discounted cash flow model

2

• Run sensitivity analysis 3

9. Create executive report using estimates(Determine input variables)

For example, one process is represents 5% cost of all processes (system integration, maintenance/other, tag cost) then it should burden 5% of the warehouse wide costs.

Burden cost?

9. Create executive report using estimates(Determine input variables)

Because for every process the readerand antenna cost can be measured Specifically.

9. Create executive report using estimates(Created discounted cash flow model)

9. Create executive report using estimates(Created discounted cash flow model) NPV and

ROI

9. Create executive report using estimates(Run sensitivity analysis)

10. Include findings in the MIT Process Handbook for future use

1• Include the findings

how RFID can be introduced in the warehouse captured within a specialization tree.

2• Add findings (value,

productivity, performance metrics) to guide the modeling efforts.

3• Benefit is to get the

knowledge of justify, if people want to invest in RFID

The detailed numerical estimates of the value created by RFID is shown.

In the internal value metrics of the process:

4. Other areas of value opportunity enabled by RFID

Reducing the labor cost

Increasing the quality of the ship

orders

Decreasing the time for process

◦ The values encountered in the study but weren’t measured on all metrics:

4. Other areas of value opportunity enabled by RFID (Cont.)

Reduced transportatio

n costs

Improved sales

Reduced shrinkage in the supply

chain

Reduced material

costs

Improved sales due to lower out of

stocks

Introduced a methodology to estimate process performance metrics.

The methodology provides a systematic approach that can predict the impact of IT on business (Our case: RFID).

Built a guideline that can help anyone who wants to invest on RFID in the business.

Estimate the numerical calculations and proved that RFID can add significant to CPG companies.

Demonstrated that MIT Process Handbook can be used for detailed analysis and a good tool to capture business knowledge from any perspective.

Conclusion