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From Ingredients to PlatformsFrom Ingredients to Platforms

Showcase: Showcase: Planning for Platform Supply Chain QualityPlanning for Platform Supply Chain Quality

Mary Doyle Mary Doyle Director, Corporate Platform Office, Intel CorporationDirector, Corporate Platform Office, Intel Corporation

Ann-Marie Lamb Ann-Marie Lamb CPLG Quality & Reliability Researcher, CPLG Quality & Reliability Researcher,

Six Sigma Blackbelt Quality Engineer, Intel CorporationSix Sigma Blackbelt Quality Engineer, Intel Corporation

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ChinaChinanew markets, new challenges?new markets, new challenges?

– More than 350M subscribersMore than 350M subscribers– Rate of growthRate of growth

– Number of SMS sentNumber of SMS sent

– Cultural affordances & practices give Cultural affordances & practices give rise to unique applications, services & rise to unique applications, services & anxieties anxieties

– The lunar almanac every dayThe lunar almanac every day– A novella subscription service, Chinese A novella subscription service, Chinese

opera-like opera-like mobisodesmobisodes– Chinese govt. bansChinese govt. bans

– New work-arounds to unexpected New work-arounds to unexpected problemsproblems– Charging stations, pagers, codesCharging stations, pagers, codes

3

KoreaKoreanew models of connectivity?new models of connectivity?

– Korea is often held up as model Korea is often held up as model of technology uptakeof technology uptake

– Record broadband uptake Record broadband uptake – 80% of wired homes use high speed 80% of wired homes use high speed

data connectionsdata connections

– Korea also continues to have the Korea also continues to have the fastest growing cyber-café fastest growing cyber-café market in worldmarket in world– 20,000 PC-Bangs in Seoul alone, up 20,000 PC-Bangs in Seoul alone, up

from 13,000 4 years agofrom 13,000 4 years ago

– Korean homes are very privateKorean homes are very private– A long history of gaming & A long history of gaming &

socializing in public.socializing in public.

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Evolving Evolving User NeedsUser Needs

00’s +

Price / Capabilit

y

Usage Oriented Computing

PlatformsHolistic approach throughcoordinatedtechnology

80’s – 90’s

Price / Performanc

e StandardMicroprocess

or(MHz)

“One Size Fits All” Computing

60’s – 70’s

Performance

Mainframe

CustomTechnology

User value

User Oriented ComputingUser Oriented Computing

Analyze and Analyze and comprehend what comprehend what

end users will end users will desire, then desire, then

lead the industry lead the industry in developing in developing

capabilities and capabilities and solutions to solutions to

deliver these deliver these experiencesexperiences

From what we make to what we make possibleFrom what we make to what we make possible

Increasing Productivity Increasing Productivity

Reducing Total Cost of OwnershipReducing Total Cost of Ownership

Improved Access & ConnectivityImproved Access & Connectivity

Creating New IndustriesCreating New Industries

Reaching the Next Billion UsersReaching the Next Billion Users

Decreased PowerDecreased Power

The World Ahead ProgramMay 2, 2006 Intel Commits $1 Billion To Further Emerging Markets Strategy

5-year objectives– Extend broadband PC access to the world’s next billion users while training 10 million

more teachers on the use of technology in education and with the possibility of reaching another 1 billion students.

Accessibility– Development of fully featured, affordable PCs tailored to regional needs.

Connectivity– Expanding wireless broadband Internet access

Education– Preparing students for success in the global economy through education programs and

resources

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Reorganized Around PlatformsReorganized Around Platforms

Platforms for:

• Productivity

• Research

• Homecare

Platforms for:

• Unique needs of local markets Worldwide

• Digital Home

• Living Room

• Consumer Electronics

Platforms for:Platforms for:

• Notebook PCs

• PDAs & Phones

Platforms for :

• Client

• Servers

• Comms Infrastructure

• End-to-end biz solutions

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User Concerns in HealthcareUser Concerns in Healthcare

AccessAccess

QualityQuality

CostCost

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Healthcare Tablet Healthcare Tablet Concept PlatformConcept Platform

Healthcare rugged, ergonomic design, shift long usageHealthcare rugged, ergonomic design, shift long usage

Secure wireless access, connectivity to measurement devicesSecure wireless access, connectivity to measurement devices

Pen-enabled interface, “soft” keys, voice recognition, cameraPen-enabled interface, “soft” keys, voice recognition, camera

Built on IntelBuilt on Intel®® architecture architecture

Investigational device, not presently available for commercial distribution

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Our homes …Our homes … share 6 core human values share 6 core human values

escape togetherness control

access advancement love & spirituality

INTEL® INTEL® VIIV™VIIV™ TECHNOLOGY TECHNOLOGY

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User Concerns for MobilityUser Concerns for Mobility

PerformancePerformance

WeightWeight

Battery LifeBattery Life

WirelessWireless

Ultra Mobile PC

The Next Step in PC MobilityThe Next Step in PC Mobility

LaunchedLaunchedQ1’06Q1’06

Entertainment/ProductivityNotebook

Sub-Notebook

Thin and LightNotebook

Low CostLow Cost

LocalizedLocalized

Connectivity Connectivity

Geo Specific Geo Specific CharacteristicsCharacteristics

User Concerns in the ChannelUser Concerns in the Channel

Ruggedized “Community PC” Platform for IndiaRuggedized “Community PC” Platform for India“Jaagruti” (“Awakening”) Initiative“Jaagruti” (“Awakening”) Initiative

Developed exclusively to meet the needs of rural villages and Developed exclusively to meet the needs of rural villages and communities in Indiacommunities in India

Used in Internet “kiosks” run by local entrepreneurs to provide Used in Internet “kiosks” run by local entrepreneurs to provide access to online services such as e-Government forms, access to online services such as e-Government forms, education and medical advice education and medical advice

Brings technology access where weather and unreliable power Brings technology access where weather and unreliable power compromise typical PCscompromise typical PCs

– Ruggedized chassisRuggedized chassis – CPSUCPSU – Low power consumptionLow power consumption – Access ControlAccess Control

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Exploration Phase StagesExploration Phase Stages

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SUPPLY CHAIN QUALITY METRICSSUPPLY CHAIN QUALITY METRICSFOR PLATFORM DRIVEN BUSINESSESFOR PLATFORM DRIVEN BUSINESSES

ME 317 – Design for Manufacturability 2006ME 317 – Design for Manufacturability 2006Stanford UniversityStanford University

Prof. Kos IshiiProf. Kos Ishii

STUDENT TEAM:

Alvin Arman

Karthik Manohar

Jonathan Paisley

INTEL LIAISON:

Ann-Marie Lamb

COACH:

Sun Koo Kim

Showcase:

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FMEA for General Supply ChainFMEA for General Supply Chain

Failure Mode Failure Mode Effects AnalysisEffects Analysis

Intel Q & R Intel Q & R employees… employees… “we’ve done “we’ve done 1000s of FMEAs, 1000s of FMEAs, we never thought we never thought to adapt tool for to adapt tool for whole SC view”whole SC view”

What supply chain What supply chain quality metrics quality metrics could be used to could be used to track causes of track causes of failurefailure

Failure Modes & System Name: Intel Supply Chain FMEA Number:Effects Analysis Major Function: Deliver parts to customers Page:

Prepared By: Team INTEL Date:

Function or Requirement

Potential Failure Modes

Potential Causes of Failure

Occurr

ence

Local EffectsEnd Effects on Product, User, Other Systems S

everity

Detection Method/ Current Controls

Dete

ction

RPN

Actions Recommended to

Reduce RPNRelevant SC Indicators

Planning Faulty estimation of forecast

Inadequate understanding of existing market

1

Inventory imbalance

Cost and possibly delay 3

Inventory turns

10 30

Inadequate understanding of

new market 6

Inventory imbalance

Cost and possibly delay

3

Inventory turns

10 180

Hire independent third party

consultants

Accuracy of forecasting techniquesSupply chain cost as percent of salesInventory turnsCash to cash cycle timeOrder lead timeSudden

unforseeable changes in

market 5

Inventory imbalance

Cost and possibly delay

3

Inventory turns

10 150

Hire independent third party

consultants. Additional customer

surveys

Accuracy of forecasting techniques; Responsiveness to urgent deliveries; Inventory TurnsCash to cash cycle timeSupply chain cost as percent of salesOrder lead timeFaulty Simulation

Model 1Inventory imbalance

Cost and possibly delay 3

Inventory turns10 30

Judgement Error

4

Inventory imbalance

Cost and possibly delay

3

Inventory turns

10 120

Hire independent third party

consultants

Accuracy of forecasting techniquesWorker standardsWorker qualityCash to cash cycle timeOrder lead time

Inadequate Capacity Planning

Lack of alternate production plans 3

Inventory imbalance

Cost and possibly delay 3

Inventory turns10 90

Simulation Error1

Inventory imbalance

Cost and possibly delay

3Inventory turns

10 30

Inadequate Human Resources Allocation

Erroneous Selection of employees

1

Manufacturing delay

Cost and delay

3

Inventory turns and Manufacturing

Delay6 18

Poor judgement of capacity

requirements1

Manufacturing delay

Cost and delay3

Inventory turns and Manufacturing

Delay6 18

Lack of skilled worker

availability1

Manufacturing delay

Cost and delay3

Inventory turns and Manufacturing

Delay4 12

Concept Design

Dimensional Error

Oversight2

Product not functioning

System failure 8 Design reviews or assembly/test

7 112 Strict peer reviews and design reviews

Worker Standards; Planned Process Time

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Platform/Product: Platform/Product: Functional or Innovative?Functional or Innovative?

Major Supply Chain Functions

Functional S.C. Features Innovative S.C. Features

Planning (demand & supply)

Simulation & modeling based on past sales data is effective due to predictable demand.

Less automation and more direct personnel involvement is required to keep up with changing dynamics. Market surveys and third party focus groups are utilized.

Design Oversight

Little design oversight is necessary due to established product success & longer life cycles.

More design oversight is necessary to ensure product flexibility is maintained. Late point differentiation/postponement is emphasized to increase downstream flexibility.

ManufacturingOversight

Automated insight into capacity utilization, statistical process control (SPC), and defect rates is important to maximize physical efficiency of supply chain.

Less emphasis is placed on manufacturing oversight as compared to functional supply chain, however automated SPC tracking may still be utilized.

Logistics (packaging,shipping, warehouse management)

Use of Third Party Logistics (3PL) company to ensure maximum efficiency of getting products into customer’s hands. 3PL represents a lower cost alternative to 4PL.

Use of Fourth Party Logistics (4PL) company to ensure an optimized delivery/logistics solution is developed for each product’s unique needs.

Order Mgmt Automated order collection and evaluation with Enterprise Resource Planning (ERP) software. Minimal personnel involvement is required.

Automated order collection, however more direct personnel involvement is required for order evaluation to ensure responsiveness & flexibility needs are met.

Customer Service

3PL provider handles return/repair requests with minimal direct Intel involvement. Refund/replace may be more attractive than repair for functional products.

4PL coordinates returns/repairs, with some Intel involvement. Decision to replace/repair/refund will vary depending on specific product characteristics.

[1] Fisher, Marshall L., “What Is the Right Supply Chain for Your Product?”, The Harvard Business Review, March-April, 1997.

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Cost Worth Diagram - Supply Chain MetricsCost Worth Diagram - Supply Chain Metrics

Delivery to requested dock date is seen to have Delivery to requested dock date is seen to have high worth but very low cost. It is therefore one high worth but very low cost. It is therefore one that should be furthered explored in order to gain that should be furthered explored in order to gain its full benefits. its full benefits.

QFD Cost - Worth Diagram(for Functional Products Supply Chain)

Time to respond to repair request

Request to ans time

Capacity utilization

DPMO

Inventory turns

Time from plant to customer

Level of info sharing

Responsiveness to demand changes

Responsiveness to schedule changes

SC cost as % salesOrder lead time

Delivery to requested dock date

Accuracy of demand prediction

POM

0%

10%

20%

30%

0% 10% 20% 30%

Relative Worth

Re

lati

ve

Co

st

QFD Cost - Worth Diagram(for Innovative Products Supply Chain)

POM

Accuracy of demand predictions

Order lead timeSC cost as % sales

Level of Info Sharing

Responsiveness to demand changes

Responsiveness to schedule changes

Delivery to requested dock date

Time from plant to customerDPMO

Capacity Utilization

Inventory turnsRequest to ans time

Time respond to repair request

0%

10%

20%

30%

0% 10% 20% 30%

Relative Worth

Re

lati

ve

Co

st

Order lead time is seen to have high worth but Order lead time is seen to have high worth but reasonably low cost, it is therefore one that should be reasonably low cost, it is therefore one that should be further investigated & explored. further investigated & explored.

On the other hand, SC cost as percent of sales has On the other hand, SC cost as percent of sales has relatively high cost but low worth - aligns with nature relatively high cost but low worth - aligns with nature of innovative products & how supply chain should not of innovative products & how supply chain should not focus too much on the cost side, but rather on the focus too much on the cost side, but rather on the agility, flexibility & service level to the customers. agility, flexibility & service level to the customers.

Functional Platform/ProductsFunctional Platform/Products Innovative Platform/ProductsInnovative Platform/Products

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Project QFD - Intel Digital Health PlatformProject QFD - Intel Digital Health Platform

Quality Function DeploymentQuality Function Deployment

From this QFD phase II, three From this QFD phase II, three critical actions/tasks in the project critical actions/tasks in the project implementation were identified. implementation were identified. These top three tasks are:These top three tasks are:

– Robust design/FMEA/QFDRobust design/FMEA/QFD– Efficient manufacturing/ QA processEfficient manufacturing/ QA process– Understanding FDA regulationsUnderstanding FDA regulations

These three activities scored These three activities scored significantly higher than the others significantly higher than the others in the QFD Phase II scoring in the QFD Phase II scoring

For the Digital Health platform in For the Digital Health platform in particular, activities associated particular, activities associated with creating robust design, with creating robust design, developing efficient manufacturing developing efficient manufacturing & understanding FDA regulations & understanding FDA regulations are critical phases to a successful are critical phases to a successful program & must be looked at for program & must be looked at for monitoring with supply chain monitoring with supply chain quality indicatorsquality indicators

PHASE II QFD Project QFD

r Engineering Metrics Ph

ase

I R

elat

ive

Wei

ghts

Und

erst

andi

ng F

DA

Reg

ulat

ions

Eng

agin

g F

DA

Rob

ust

Des

ign/

FM

EA

/QF

D

Eff

icie

nt M

anuf

actu

ring

/QA

Pro

cess

Eff

icie

nt l

ogis

tics

Mar

keti

ng C

ampa

ign/

lobb

y do

ctor

s/T

V a

ds

Mar

ket

Dem

and

Res

earc

h

Eff

icie

nt S

ervi

ce

Ope

rati

ons

Pla

nnin

g/R

esea

rch

Preliminary Design Duration 15% 9 3 9 3 1# of features 18% 3 1 3 9 3 9 1Manufacturing Duration 4% 1 3 9 9Clinical Trials Duration 6% 9 3 1 1% failures during trials 6% 9 3# recorded user failures per year 14% 1 9 3 3 1Industry Product Ranking 19% 1 9 3 1 9 3# of insurance company approvals 18% 9 3 3 3

Raw score 4.2

0.8

4.9

4.6

0.7

2.8

2.1

1.2

0.7

0.0

0.0

Relative Weight 19

%

4% 22%

21%

3% 13%

10%

5% 3% 0% 0%

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Cost – Worth for Potential Digital Health Cost – Worth for Potential Digital Health Platform Project TasksPlatform Project Tasks

Understanding FDA Understanding FDA Regulations is one of Regulations is one of the most critical steps the most critical steps while the cost is while the cost is relatively low, so relatively low, so

Resources should be Resources should be more focused on this more focused on this areaarea

The other important The other important tasks are very much tasks are very much aligned with the cost aligned with the cost or time input or time input

QFD Cost - Worth Diagram

Robust Design/FMEA/QFD

Efficient Logistics

Efficient Manufacturing/QA

Understanding FDA Regulations

Marketing/Lobbying CustomersEfficient Service

Engaging FDA

Market Demand ResearchOperations Planning

0%

10%

20%

30%

40%

50%

0% 10% 20% 30% 40%

Relative Worth

Re

lati

ve

Co

st

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Wrap Up: Intel Corporation Key Challenges Wrap Up: Intel Corporation Key Challenges

– CollaborationCollaboration• Internal cross-functional collaboration is critical to successInternal cross-functional collaboration is critical to success• External cross-industry collaboration: new influence points, new insightsExternal cross-industry collaboration: new influence points, new insights

– Cross-Platform and Disruptive Opportunities Cross-Platform and Disruptive Opportunities • Cross-platform impact is critical and challengingCross-platform impact is critical and challenging• Valuation must be concrete to impact platform decisions (e.g. units)Valuation must be concrete to impact platform decisions (e.g. units)• Good opportunities can still fall through the cracks: challenge existing businessesGood opportunities can still fall through the cracks: challenge existing businesses• Determine by product/platform if it is functional or innovative for planning purposesDetermine by product/platform if it is functional or innovative for planning purposes

– Adoption ChallengesAdoption Challenges• Metrics drive behaviorMetrics drive behavior• Change is ‘sticky’ when implemented through near term deliverablesChange is ‘sticky’ when implemented through near term deliverables• The level of adoption can vary wildly The level of adoption can vary wildly

– ResourcingResourcing• Demand on usage modeling is very high, user centered resources are critical pathDemand on usage modeling is very high, user centered resources are critical path

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