business intelligence and analytics: a command and control center for supply chain excellence -...

Business Intelligence and Analytics: C d d C t l C tCommand and Control Center 

for the Chief Supply Chain Officer 

Tom Dadmun 

VP, Program Management Office

ADTRAN – The Network Access Company

Session Agendap y

Challenges Abound!! In today’s ever changing business landscape

RCA – Root Causal Analysis – What is the Problem

The Vision Research & Benchmarking “ Best In Class “The Vision – Research & Benchmarking Best In Class

Establishing Proof Points, Gaining Mindshare

Incorporating BI into the Culture / DNA of the company

Lessons Learned – Take Aways

Corporate Statistics

• FY2011 Revenue: $717 Million

• Large established Presence in Telecom gEquipment Industry 

• Employees: ~1,800 total

• Headquarters: Cummings Research Park, Huntsville, Alabama

• Sales offices around the world

• In‐house and outsourced manufacturing

• Long Term Financial Strength

Broadband

5B Mobile Phones Globally

Mobility Demand Is Exploding Broadband

5B Mobile Phones GloballySmartphones Are PervasiveTrue Mobility Is No Longer ATrue Mobility Is No Longer A Convenience– Voice over Wi-Fi, Facetime

N D i R l O Wi l

Mobility

New Devices Rely On Wireless Connectivity– iPADs CloudiPADs

Mobile Data Traffic Is Growing ExponentiallyWi-Fi Data Offload To Fixed Network Is Necessary

Challenges Abound in Today’s Economy• Significant Growth in telecom industry

• Government programs for BBS Broadband Stimulus

E ll t h d• Economy overall staggers ahead

• Forecasting with historical algorithms??

• Suppliers, subcontractors, manufacturing, customers!!!

• In a recession you have frantic competition

Current Landscape of Problems

• Current data everywhere – spreadsheet mania

• The old “ islands of information “ still exist

How do you collaborate with disparate information?• How do you collaborate with disparate information?

• Spaghetti systems – Where’s the data?

• 80% - 20% Rule Reversal

Problem Statement

• Lack of ability to quickly provide y q y pvisibility into near time data

• Unable to quickly manage the business through KPI’s transactionalbusiness, through KPI s, transactional

reporting and analysis.

And… Get the Data Right!

• Multiple documented studies show Spreadsheets are prone p pto errors– KPMG found 91% of 22 spreadsheets 

taken from an industry sampletaken from an industry sample contained errors.

– Olson & Nilsen found a 21% cell error t i d d h trate among experienced spreadsheet 

users.

– The University of Michigan found an 11.3% cell error rate among inexperienced spreadsheet users.

Th t b i i f t t id li it d i ibilit & h i tiThe current business infrastructure provides limited visibility & synchronization

Suppliers Manufacturing Divisions Channels End Customer

Distributors

Carriers

CNS b ADTRANSubs

Distributors

EnterpriseEN

VARs

Suppliers Manufacturing Divisions Channels End Customer

Carriers

CN

Supply Chain Planning

S l C ll b tiOrder Allocation & Promising

Distributors

ADTRAN

Demand Planning

Supply Collaboration

Distributors

EnterpriseENCollaborative Sourcing

Ingram

Demand CollaborationTransportation Mgt. & Optimization

VARsExecutive Business Intelligent Dashboard

“ If h f h i id

Quotes worth mentioning……

“ If the rate of change inside your organization is slower than the grate of change outside…….. 

the end is near”Jack Welch

Jack Welch

Due Diligence• Evaluated 8+ vendors, narrowed field down to two:

– Feature & functionality matrix comparison

• Engaged Industry Experts for Analysis

– Aberdeen, Gartner, Forrester and others 

C d t d it b h k i it• Conducted on site benchmark visits:

– Vanderbilt University , Alabama Farmers Cooperative 

• Reference ConcallsReference Concalls

– Cisco, Alcatel –Lucent

• Academia

– Georgia Tech, UT, UAH

A l t R ti Ab d GAnalyst Ratings – Aberdeen Group

Process Methodology• Conducted demos to cross functional user group of 20 g p

members

• Presented business assessment of BI toolset to Steering C ittCommittee

– Business Case

– ROIROI

– Expected Results

– Timeline

– Measurement Criteria

– Program Management Reviews

– Contingencies

Quotes worth mentioning……

"There is nothing more difficult to take in hand,hand,

more perilous to conduct, or more uncertain in its success,or more uncertain in its success,

than to take the lead in the introduction of a new order of things"new order of things

Jean-Jacques RousseauJean Jacques Rousseau

Return on InvestmentSolutions reviewed had costs including:g

Initial InvestmentImplementation CostsOngoing Service CostsOngoing Service CostsTraining Costs

• This would support up to 175 users.• Based on anticipated cost savings, a 142% ROI will be realized in year one. (7.1 month payback)

l ll b $ d d l• IT savings alone will be approx. $150K.  Individual departments could pay for their own licenses based on their own projected usage / savingson their own projected usage / savings

B fit / Ri kBenefits / RisksBenefits:

– Abstracts reporting from underlying database allowing for easier plug in to different applications. (e.g. new ERP)

– Ability to understand rearrange and dig into results on yourAbility to understand, rearrange and dig into results on your desktop

– Provide a single data point for all metrics, eliminate need for re-working numbers through Excelworking numbers through Excel

Risks:– Oracle Portal is nearing EOL.– All reports will have to be rewritten if we replace/upgrade Baan– Excel is prone to mistakes and consistently provides different p y p

values from different perspectives.

Anticipated Cost Savings

Number of hours spent each week running reports and hand processing in Excel that could be saved each week:processing in Excel that could be saved each week:

Functional Area Hrs / Week7 Departments 102.98

In addition up to 80 hours/week could be saved developingIn addition up to 80 hours/week could be saved developing custom reports in ITThat is potentially 4.73 people or $355K / year

Project Milestones

ADTRAN’s Hierarchy of Supply Chain Metrics

Demand VisibilityForecastAccuracy

On TimeDelivery

SCCost

Performance Tradeoffs

Demand Visibility

Inventory Revenue Margin

HeadcountCapacityS&OPTurns /DOS

Supply ChainPerformanceManagement

Cycle CountAccuracy

Mat’l % of Revenue

LogisticsSpend

Mfg.CycleTime

Inv.Aging

Management

Inventory Weekly Purchase Negotiated RM/FG DC OTD

OperationalEffectiveness

yProjectionAccuracy

yFreightSpend

PriceVariance

gSavings Efficiency Root Cause

BuildPlan

PlannedFG

Deliveries

MaterialP.O. OTD

NPO OpenRequisitions

Turnkey vs.RMS %

QuarterlyMaterial $’s

Spend

ContractManufacturerPerformance

Roll out - DeploymentPhPhase one

Sales Portal

Executive DashboardExecutive Dashboard

Supply Chain AnalyticsO tiOperations

Procurement

Planning / ForecastingPlanning / Forecasting

S&OP Meetings

FinanceFinanceBOD Presentations

Quotes worth mentioning……

“ There is nothing so useless as doing efficiently that which should not be done at all”done at all

• Peter Drucker

Phase Two - Prioritization

• Manufacturing

• QualityQ y

• Inside Sales

• Transportation• Transportation

• Treasury

• Cost Accounting

• Human Resources

• Marketing

Results

• IT department stated that the project was able to reduce the effort by 50% on 10 people who spent 40% of their time currently developing reports. 

• In accounting and operations, it was identified that 100 hours per week was saved amongst early adopters. 

• With this success and the momentum growing we expect to utilize this tool across the entire enterprise. 

Wrap Upl “b h l h ” h dl• Normal “behavioral change” hurdles to 

overcome

• Training methodology needs to be managedg gy g

• Consistency versus “Out of Control!”• Consistency versus  Out of Control!

• Champions emerge 

Thank you yTom Dadmun, VP, PMO

ADTRAN

256‐963‐6872 

Tom.dadmun@adtran.com