sap supply chain performance · pdf file · 2016-02-26sap supply chain performance...

SAP Supply Chain Performance Management

Matthias VogelSCM Solution Principal, SAP EMEA

© 2011 SAP AG. All rights reserved. 2

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Agenda

What Impacts Supply Chain Performance

Linking Operational Measures to Corporate Objectives

SAP Supply Chain Performance Management (SCPM)

SAP SCPM Customers – Example

Q&A


Agenda





Q&A


What Constitutes High Corporate Performance?Being very profitable with little investment in inventories

REVENUES_

_____________COST

ASSETINVESTMENTS


What Impacts Your Supply Chain Performance?

External factors

Corporate Supply Chain factors

Management of the extended Supply Chain

While successfully managing the corporate Supply Chain promises the

highest absolute benefits a lack of understanding threats from external

and negligence of related risks can peril the entire operation.


What Impacts Your Supply Chain Performance?External Factors

Unpredictable external risks...

Earthquake / Desaster

Cyber Attacks

Strikes

Economic Disruptions

... require risk mitigationstrategies where visibility intoSupply Chain dependenciesis highly beneficial


What Impacts Your Supply Chain Performance?Corporate Departments often act as silos

Finance

Sales

Production


Need for Performance Management

Demand PerfectOrder

Cost

Finance

Sales

Production

What should wedo?

Why is thishappening?

How arewe doing?

Clear focus, and alignmentFull insight into supply chain performanceKnow how to optimize, when to take action


Agenda





Q&A


Functional Metrics Are Important

Source Design Make Deliver

Measures

Supplierperformance

Contractcompliance

Cost per unitpurchased

Number ofchange orders

On-time design

Documentationaccuracy

Setup times

Capacityutilization

Waste and scrap

Carrier utilization

Inventory turns

Express freightpercentage

Most commonly-deployed type of metric

Fosters local optimization

Great for diagnostic purposes


Functional Metrics Are Not Sufficient


Measures

Supplierperformance

Contractcompliance



On-time design


Setup times

Capacityutilization

Waste and scrap

Carrier utilization

Inventory turns


Results

Low unit cost Incompatibility

High utilization High express %

On-time design Excess scrap

Reinforcing functional silos

Resulting in surprise trade-offs

Don’t drive supply chain performance


Need for Process-Based Metrics


Measures

Supplierperformance

Contractcompliance



On-time design


Setup times

Capacityutilization

Waste and scrap

Carrier utilization

Inventory turns


Measures

Supply chain cost

Perfect order rate

Forecast accuracy

Tied to strategic objectives

Measuring (end-to-end, inter-enterprise) process effectiveness

Using functional metrics for diagnostics


Why Measurement MattersDealing with Information Overload

Right measures drive right behavior

Right behavior drives performance

Pick metrics that matter

Tie metrics to action (and processes)


Putting It All Together360º View for Better Control Along Processes

OutboundTransportation Cost

Finished GoodsStorageCost

CustomerService Cost

VP Supply ChainVP of Logistics


Putting It All TogetherStrategic Focus for Better Collaboration

Supply ChainEffectiveness

MaterialAcquisition Cost

Planning and FinanceCost

+

Perfect OrderFulfillment

Supply ChainManagement Cost

-+


Finished GoodsStorage Cost


OrderManagement Cost

-COO/CEO


Putting It All TogetherDiagnostics Functions Driving Optimization

SCOR

MaterialAcquisition Cost

Planning and FinanceCost

+

Perfect OrderFulfillment

Supply ChainManagement Cost

-+


Finished GoodsStorage Cost


OrderManagement Cost

-

Fuel Cost Express Freight Returns

Analyst and Planner

Invoices Outstanding


Agenda





Q&A


Improving Supply Chain Effectiveness

SAP BusinessObjectsSupply Chain Performance Management

Standards based end to end process supportAt any time, know your operational and related

financial performanceComply with leading industry standards for

performance management (e.g. SCOR)

Automated data collectionTimely insights, with tight operational application

integrationRelevant information, derived from actual business

processes

Proactive diagnosticsFully understand operational drivers affecting

performanceDeliver alerts about deviations from performance

targets

DEMO Supply Chain Performance Management

© SAP 2010 /


Receive pro-active alerts about deviations forperformance targets, and better balance trade-offdecisions for improved supply chain performance

EvaluateandImprove

Identify andAnalyze

At any time, know your operational and relatedfinancial performance, and understand operationaldrivers affecting performance

Comply with leading industry standards fromperformance management (e.g. SCOR), focusing onmetrics that matter

Model andUnderstand

From Data to Continuous Improvement

CollectCollect and collate data directly from operationalprocesses, such as order-to-cash, from SAP- or non-SAP systems


Agenda





Q&A


SAP SCPM Customers

Customers from a variety of industries have signed up forSAP Supply Chain Performance Management


Example: Coca-Cola Project as Echoed by Press


Motivation and Goals for Coca-Cola

GOAL: Effectively align supply chain goals with business goals, providingvisibility into end-to-end supply chain processes.

Drive process consistency efficiencies across a complex network of plants,bottlers, warehouses and customers

Aggregate data on the fly that is being captured in SAP NetweaverBusiness Warehouse

350 pre-defined KPIs based on the Supply Chain Council’s SCORFramework providing consistent definition of metrics

Avoid building new metrics reporting tools again and again when thebusiness re-organizes


Prioritized KPIs

Coca-Cola is focusing on metrics

...that need little manual intervention

...that help drive process consistency

...that are in line with industry standards

KPIs were prioritized based on business benefitOrder Management KPIs*

Orders Shipped on TmeLine Fill RateCase Fill Rate

Production KPIs*Production Schedule AchievementProduction Units

Planning KPIs*Forecast Accuracy

* Data based on Coca-Cola presentation at SAP Insider conference 2011

Over 17m records

Over 1m records

Over 84m records


Project Duration and Roll-Out

Project was implemented by ITC Infotech and SAP Consultingduring the second half of 2010

Project duration was 4 months3 months blue print / design1 month technical realization

It leveraged specialist Supply Chain domain expertise for ConsumerProducts, an SCPM business expert and technical expertise on SCPM andSAP Netweaver Business Warehouse

Coca-Cola is now planning a global rollout of the application in its bottlersnetwork, which will help it map, manage and monitor supply chain strategy

Questions…Questions…


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sap supply chain performance · pdf file · 2016-02-26sap supply chain performance...

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