E-Supply chain management

Presented byParit AhujaAshish Jain

Prabakaran N

Agenda

What is e-SCM Why use of technology Issues in implementation Research Methodology for Evaluation Various Researches on E-SCM adopted be

different business sectors

e- SCM

The flow of material, information, money, and services from raw material suppliers through factories and warehouse, to end customer.

The collaborative use of technology to improve the operations of supply chain activities as well as the management of supply chains.

Supply chain for Denim Jeans

Why use technology

Inventory levels: Firms keep track of their existing and needed inventory levels as the system can provides early warning signs when that product is running low.

Minimizing Bullwhip effect: The collaboration present with electronic supply chain management can go a long way in minimizing the “bullwhip” effect, the distortion of demand forecasts along a supply chain resulting from inaccurate or inadequate information.

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Long-term relationship: As firms open themselves, and their information, up to each other they are forced to align their own strategies and goals.

Speed: Speed and ability to communicate can be seen throughout the supply chain.

Cost: Decrease in cost of communication, carrying inventory and customer service.

Other: improved customer relationship, eliminates stock outs, encourages customer driven demand, and efficiency in tracking of delivery

Issues

Commitment: A firm must be committed to using the system, foregoing past methods of conducting business, such as phone, fax, and written record, and instead relying on the automated supply chain system.

Involvement of all parties: The benefits of technology must be conveyed to all parties involved.

Data accuracy: The benefits can only be accrued through the accuracy of the data entered into and the consistent usage of the system.

…….

Sharing of information: The more information is shared among organization, the more it will be beneficial.

Over reliance: Many have found that their supply chain strategies do not work when forced to respond to unexpected events. As inventory levels are minimized, there is less safety stock to handle emergencies. This emergency can come in many forms; a delayed shipment, a broken down truck, a jump in demand, a natural disaster. Unable to adapt to change, these supply chain systems are inaccurate and put their firm at a disadvantage.

Critiques:

Research Model

• L• S

• Focus • C• S• B

• L• S• PR• A

• L• M• N

Company Orientation

PagesFocus &Function

B2B

&B2C

• Marketing • Catalog and Product information

B2B

• Inventory• Logistics

B2C

• Customer personalization• Order tracking

Contd…

Functions

Effective Communication between Customers and Suppliers

Valid for companies under consideration Not a comprehensive guide Extent of public information (X or PW)

Free Premium

Research Assumptions

Little correlation between firms’s revenues and expectations.

Size Advantage Insight on how smaller firms could effectively

Summary – Findings of Research

Key Factors Considered: Consistent among all players. Focus on both parties of business Pricing Model Information on all dealers and inventories No online purchase

Automotive manufacturers

Key Factors Considered: A broad network where the exchange of past

problems and resolutions as well as scorecards on supplier performance in obtained.

Ability to build contracts and current production information.

Employees to access company’s intranet from remote location.

Supplier websites also provides link to third party sites to serve them better

Automotive Suppliers

Build to Forecast and Build to delivery

Supply chain management in toyota

vendor manufaktur dealer customer

1. Local parts

2. Import parts(3)Receiving dock pc storeproduction

(4)dealer (5)customer

PC store ProductionReceivingDock

Dealer

Local Parts

Local Parts• 1 and 2 Linked between internal and vendor STOCK REDUCTION USING KANBAN ( Kanban Cyclic ) & SEQUENTIAL PARTS DELIVERYKANBAN:- A small time that is the key cotrol for JIT production

Topology of Systematic SCM management

Cumulative Research Results

Key Factors considered: Plenty of content designed for consumer

including product and pricing information. Degree of customization and personalization. Pricing and promotions differ for different

users. HP – Hard Deck, for authorized dealers and

sellers. Gateway - e-Marketplace, provides virtual

exchange for buyers and sellers.

Technology – E-commerce

Gateway’s Business model shift paradigm

Gateway’s Business activities

Cumulative Research results

Design—web, HTML etc. E-commerce application development Application support Operations—mainly managing the relationship

with Exodus, which hosts Gateway.com Quality assurance Strategy R&D group—Their job is to track new

technologies and develop strategies to take advantage of new capabilities.

Organisation of E-commerce

Performance of E-commerce

Provides personalized shopping experiences for customers - Customer Focus

Large amount of information and data. Excellent response time – Reflection of

efficient supply chain. Account and access through secured

credentials. Amazon.com

Technology -dot-coms

Make the right offer at the right time  Optimize your up-sell and cross-sell success  Fully customize the checkout Utilize a complete history of customer

interactions

Volume on conversions• Generate more online revenue• Elevate stickiness• Increase brand awareness

Shopping – Experience

More Visitors to Customers Track and optimize Easily test and refine content Optimize conversions Identify and target visitors

Contd…

Amazon.com User Personalized page

Cumulative Research results

Financial Services - Banking

Offered services for individuals, small businesses and large corporations Some form of Account Accessed by password Access financial Information

Wells Fargo offered a spectrum of financial services including e-brokerage , business portal (accounts receivables , financial software)

Goldmann Sachs & Co. offered high volume E-trading through brokerages via FIX

Financial Services – Banking (Contd..)

Bank One and National City Offered the usual personal banking services Highly diversified in the amount of options that

they provide to their customers Means to further eliminate paper from the

world of international trade Electronic facilitation of the process – use of

imaging and workflow engines , not paper and checks

Axis Bank – eSCM

The Bank provides holistic funding solution to the supply chain of corporates

Products cater to the funding needs of supply chain members

Increased efficiency of the entire chain Service delivery is through a technology

platform to increase transactional convenience for the corporate

Axis Bank – eSCM Model

Dealer Financing

Factoring of Receivables

Purchase Invoice

financing

Rent receivable Financing

Model

Axis Bank – eSCM Model(Contd..)

Dealer Financing : provide financing facility to the dealers exclusively for their purchases made from that corporate

Factoring of Receivables : helps the corporate in boosting its sales and managing receivables

Purchase Invoice Financing : provide financing to the vendors of a particular corporate against supplies made to that corporate . It helps in developing a strong and reliable vendor base

Rent Receivable Financing : designed for companies involved in renting out goods . The loans are advanced against future rent receivables

Financial Services – Investment

Offered spectrum of services Discount trading Variety of financial services to private investors and

employers Secured data transfer Customer accounts ( offered by all ) Discount brokerages

Ameritrade and Etrade concentrated on providing services to individual investors and stock info

Ameritrade makes a 10 second guarantee

Cumulative Research results

Retail – General Merchandise

Many web sites offered tremendous e-commerce ability but little in the realm of services for their suppliers

Wal-Mart offers : Normal range of retail items Online pharmacy Order tracking Vacation packages Internet Service provider

Wal-Mart Supply Chain Management

Finest example of supply chain management Prices are low and their shelves are well

stocked Legendary Inventory Replenishment system

triggered by point-of-sale purchases

Retail Clothing

Primarily customer driven Most have some e-commerce capability Very little provided for the suppliers Aside from the type of clothing, there was

very little differentiation among these clothing websites

ZARA SCM Model

Short Lead time = More fashionable clothes Lower Quantities = Scarce supply leads to

higher demands More Style = More choice , and more

chances of hitting it right Zara Fact : Consumers in London visit the

average store four times annually , but zara’s customers visit its shops at an average of 17 times a year

ZARA SCM Model(Contd..)

The company spends almost nothing on advertisement and uses the savings to support higher cost of production

The tight integration of design , planning , merchandising and production enables the company to be flexible

By forecasting demand accurately , it has led to well managed inventories , higher profitability and value creation for shareholders

Retail Electronics Websites

Offered tremendous e-commerce ability Product information, promotions and order

tracking were readily available highly promotional offering usual weekly

coupon flyers as well as special online deals Circuit City – Express pick up option

Best Buy SCM Model

Set out to change its logistics strategy by offering small , more intimate shopping environments with a cleaner look

Reduced its transportation expenses by 30 percent per shipment in the stores that were remodeled

The changes helped the store work more efficiently and effectively

Named Nasstrac’s shipper of the year

Cumulative Research results

Transportation – Air Websites

Highly focussed on their customers None of the sites held supplier information Offer flight availability, flight and baggage

tracking , and logistics information for travel agents

Consistent with each other , offering similar features and services

American Airlines

Transportation – Rail Websites

Offered extensive logistics and tracking services for their customers

Union Pacific – the only railroad offering web services for its suppliers

The Company offered web invoicing, routing information, and information on how to become a supplier.

Union Pacific Railroad SCM

Transportation – Package delivery

Companies examined offered e-commerce, order tracking and logistics services

UPS offered wireless solutions and web services along with some basic services

Western Union was primarily customer focused

the site did offer online payment options and information for its nationwide agents.

Union Parcel Service

Conclusion (e-SCM)

Supply chain management has been growing in importance with firms concentrating on internal processes to the web-linking of supply chain partners.

Firms have been pressed to increase their operational efficiencies to stay competitive.

Some of the benefits include lower inventory levels, quicker response to problems higher quality levels higher customer satisfaction more diverse product offerings

THANK YOU