Professional Documents
Culture Documents
CENGAGE LEARNING
Monczka Handfield Giunipero Patterson
Chapter Overview
Evolution of e-SCM systems An overview of the e-supply chain Drivers of new supply chain systems and applications Enterprise resource planning systems Purchasing databases and data warehouses
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Chapter Overview
Technology for electronic communication between buyers and sellers E-sourcing suites E-sourcing basics Supplier relationship management E-sourcing and supply: fully integrated systems
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Decision Making
CRM Internal SCM
Strategic Decision Making Supply Chain Planning Tactical Decision Making Routine Decision Making Transaction Processing
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SRM
Transaction Processing
Information flows record and retrieve critical data Execute and control physical and monetary flows Little or no human intervention Bar code system to track location
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Need for flexibility for data manipulation and presentation Decision support systems (DSS)
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Central Database
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SRM/CRM Applications
SRM Applications
Design collaboration Sourcing decisions Negotiations Buy process Supply collaboration
CRM Applications
Market analysis Sell process Order management Call and service center management
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Execution Systems
Kick off and control movement of materials between supply chain partners
Where to store Where to go pick items up How many to pick
Strategic Integration
Internal
Use of common information between various sites and functional areas Enterprise resource planning systems
External
Need to link suppliers, distributors, and customers Forecast demand Balance supply and demand
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ERP Systems
Integrated transaction processing and reporting system Tracks organizational resources, including people, processes, and technology Creates a process logic for functional interaction
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Customer contact
Sales order
Inventory sourcing
Delivery
Customer billing
Customer payment
MPS
MRP
Planned order
Production order
Requisition
Supplier selection
PO
Goods receipt
Invoice verification
Supplier payment
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Implementation Steps
1. Define the current process as is 2. Define what the best-in-class business process should be 3. Develop the system 4. Work through all final bugs and then flip the switch
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Discovery
Design
System build-out
Testing
Training
Cutover
Postcutover support
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Purchasing Databases
An integrated collection of computer files capable of storing operational data essential for managing a department
Minimal overlapping of information between files Allows different systems to use data contained in the database Efficient cross-referencing of data
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Communication Technology
Electronic data interchange (EDI)
Standard form (EDI standards) Translation capability (EDI software) Mail service (EDI network)
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Internet-Based EDI
Internet
Virtual Private Network
Router at HQ
Local ISP
Remote Client
E-Sourcing Basics
Sell-side systems
Contain products or services from one or more suppliers
Buy-side systems
Controlled by buyers and tied into their intranets and extranets
Third-party marketplaces
Facilitate electronic purchasing process without buying or selling
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Sell-Side Systems
Typically free registration to users Supplier guarantees site security No investment by buyer Ease of access to many suppliers Inability to track expenditures or to control expenditures Offer varying degrees of security
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Buy-Side Systems
May be either self-designed or provided by e-sourcing suite suppliers Allow supply manager to manage the sourcing cycle, track spend, and exert control of contract management Requires initial investment and periodic updates
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Third-Party Marketplaces
Independent firms who neither buy nor sell goods and services Vertical portals
Narrow range of commodities
Horizontal portals
Broader range goods or services
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SRM Systems
Focused on decision support around a broad group of transactions
Using both data and structured mathematical modeling
Contract management and compliance Supplier performance measurement and control Total cost reporting
Price forecasting
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Spend Analysis
Determination of the dollar amount and volume of expenditures
What goods and services purchased Which suppliers purchased from Where internal demand originates
Spending reduction
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Spending Reduction
Consolidation of similar purchases Reduction in the number of suppliers Reduction of maverick spend Reduction of spend by other departments Increased use of more efficient contracting methods Development of methods to reduce risk and increase supply assurance
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Reverse Auctions
Electronics processes where multiple sellers vie for the business of a single buyer Results in price reductions Regular reverse auctions vs. rank reverse auctions Can often alienate suppliers by focus on price only
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Reverse Auctions
Buyer-initiated bidding event Utilizes electronic software that allows price or rank visibility to sellers Secure, online environment within a specified timeframe Goal is rational market price for the chosen commodity Reduces bidding time
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Offer phase
Explaining the rules
Execution phase
Select appropriate form of contract
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E-Bid Optimization
Permits suppliers to configure bids in any number of alternative ways Flexible bidding or expressive bidding Increases buyers ability to analyze and review bids optimally Uses mathematical algorithms in evaluating different supply and cost scenarios
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Other Considerations
Price compliance Changes in terms Volume discount thresholds Payment schedules Due dates Contingencies for nonperformance
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Performance Measurement
Visibility to open-item status Measures and analyzes supplier performance Use of electronic scorecards
Automatic inquiry of item status Monitoring of order due dates Analysis of supplier performance
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Performance Measurement
Capability to monitor planned receipts against due dates Provide immediate visibility to past-due items Flag those items likely to become past due Generate summary reports and compare to predetermined criteria
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Benefits of Measurement
Input into supplier selection considering total cost, not just price Isolating supplier process inefficiencies Improving total cycle times Providing suppliers with reliable feedback on historical performance
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Price Forecasting
Length of items product life cycle Current life cycle phase Items price history
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Information Visibility
Sharing critical data required to manage the flow of products, services, and information in real time between suppliers and customers
Share forecasts Manage inventories Schedule labor Optimize deliveries
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