Oracle Supply Chain Management

Introduction Supply Chain Management Cases

Harald Rneid ErgoGroup Information Age Applications

Traditional Supply Chain Pressures

Margin Pressure
Suppliers Suppliers

Intensified Global Competition Limited Pricing Power Economic Uncertainty Shorter Product Lifecycles
Your Company

Response:

Automation
Faster, Cheaper Processing

Customer Expectations

Product & Service Innovation Higher Quality, Rapid Delivery Channel Demand Variability Decreasing Customer Loyalty

Customers Customers

New Supply Chain Pressures

Margin Pressure
Intensified Global Competition Limited Pricing Power Economic Uncertainty Shorter Product Lifecycles
Your Company
Suppliers Suppliers

Supply Chain Complexity

Highly Customized Products More Global Supply Base Contract Mfg / Outsourcing Fragmented Supply Chains
Compliance & Risk Mgmt

Customer Expectations
Product & Service Innovation Higher Quality, Rapid Delivery Channel Demand Variability Decreasing Customer Loyalty

Customers Customers

Corporate Governance Industry Mandates Communication Standards Environmental Responsibility

Create New Challenges

How Do I
select the right balance between outsourcing and in-house production? structure pricing strategy to better shape product demand? deliver 100% perfect orders while still minimizing inventory? recall only contaminated lots while keeping good products on the shelf? deliver premium service to my top customers while containing cost? ensure service quality while relying on 3rd party service providers? comply with industry mandates such as RFID and still maintain margins?

Supply Chain Management

New customer demands New customer demands More reliable products <> less More reliable products <> less possibilities for service income possibilities for service income More complex products <> Higher More complex products <> Higher skilled people - higher costs skilled people - higher costs Develop new service products Develop new service products Better resource utilization and better Better resource utilization and better integrated value chains integrated value chains
Using Oracle planning tools for optimazing resources and spareparts

Information Promotes Collaboration

Product Specifications Sales & Order Forecast Negotiations, Contracts

Product Requirements Sales & Order Forecast Pricing & Promotions

Invoices & Payments Contract Manufacturing Carrier Bookings Drop Shipment Spares Replenishment Project Schedule
o o o

Promise Dates Delivery Status Bill Presentment Payment Product Warranties Service Requests
o o o

Customers

Suppliers

Delivery Commitment

Your Company

Orders

However, There Are Obstacles

Disparate Systems, Processes, Technologies Fragmented Data in Information Silos Limited Partner Communications

Broadvision Broadvision

Web Store
Product Info

Planning
i2 i2
Product Info

Procurement
Ariba Ariba
Product Info

Commerce One Commerce One

Product Info

Sourcing

C u s t o m e r

Call Center
Siebel Siebel
Product Info

Barcoding

Product/ Customer Info

Core ERP

ClearOrbit ClearOrbit
Product Info

Maintenance
Indus Indus
Product Info

Field Service
FieldCentrix FieldCentrix
Product Info

Transportation
G-Log G-Log
Product Info

Warehousing
IMI IMI
Product Info

S u p p l i e r

Market Changes New members in the Oracle Family

Ariba Ariba Broadvision Broadvision
Product Info

Procurement
Product Info

Web Store

Planning
i2 i2
Product Info

k te Re DE J
Barcoding

Commerce One Commerce One

Product Info

Sourcing

Call Center
Siebel Siebel
Product Info

s le op Pe
Maintenance
Indus Indus
Product Info

ft o

Product/ Customer Info

Core ERP

ClearOrbit ClearOrbit
Product Info

Warehousing
IMI IMI
Product Info

Field Service
FieldCentrix FieldCentrix
Product Info

Transportation
G-Log G-Log
Product Info

Oracles Approach to Business Applications

Unique Information Architecture
Develop Contracts Projects HR Finance Maintain Service Fulfill
Customers, Suppliers, Products,

Start with leading

Market Sell Order Plan Procure Make business practices

Build a robust suite of

applications on a common data model

Enable modular deployment

by business flow

Leverage open standards

to promote integration and low-cost deployment

Supply Chain Footprint

Product Development
Adv Product Catalog UCCnet Trading Connector CAD Sharing & Viewing Collaboration Suite Product Intelligence

Develop Contracts HR Finance Projects

Customers, Suppliers, Products

Market Sell Order Plan Procure Procure Fulfill Fulfill Make Make

SC Planning
Collaborative Planning Demand Planning Advanced SC Planning Constraint Optimization Inventory Optimization Global Order Promising Exception Management Planning Intelligence

Maintain Service Service

Procurement
Sourcing Procurement Contracts iProcurement Services Procurement Purchasing Supplier Collaboration Oracle Supplier Network Payables Purchasing Intelligence

Order Management
Order Management Configurator Advanced Pricing Release Management Receivables Order Intelligence

New in 11i.10

Supply Chain Footprint

Manufacturing
Mfg Scheduling Discrete Manufacturing Flow / Lean Mfg Process Manufacturing Project Manufacturing Shop Floor Mgmt Mfg Intelligence

Logistics
Inventory Management Mobile SC Apps Warehouse Mgmt Transportation Planning Transportation Exec Sensor Based Services Fulfillment Intelligence

Develop Contracts HR Finance Projects Maintain Service Service Fulfill Fulfill

Customers, Suppliers, Products

Market Sell Order Plan Procure Procure Make Make

Service
iSupport TeleService Field Service Mobile Field Service Advanced Scheduler Spares Management Depot Repair Service Contracts Interaction Center Service Intelligence

Maintenance
Enterprise Asset Mgmt Self-Service Work Reqs Property Manager Maintenance Intelligence

New in 11i.10

Information Drives Decision Making

Identify and Act Upon Improvement Opportunities

Real-time updates on key
performance indicators summary to detail

Complete information from Information across all

supply chain domains dashboards

Presentation via role-based Internet browser-based Compare performance

delivery to your desktop against different time periods and organizations

Oracle Advanced Planning

Complete e-business planning solution
Supply Chain Intelligence Sales and Operations Planning Demand Planning

SCI DP

From detail to summary

Inventory Optimization Supply Chain and Manufacturing Planning Global Order Promising Deployment Planning* Manufacturing Scheduling

IO ASCP

GOP ASCP

MS TP CP
Collaborative Planning From short-term to long-term
* Future

Maintain Service Fulfill Make

Finance

HR Projects

Transportation Planning SC Exception Management

All Product, All Product, Customer, Customer, & Supplier & Supplier Information Information

CP

Procure

Plan

Develop Market Order Sell

Copyright Oracle Corporation, 2005. Private and confidential. All rights reserved.

Traditional Approach
Multi-step planning processes, high latency, limited collaboration
Customers Suppliers
Tier 2

Tier 1

Response 1:
Maintain Excess Inventory

Response 2:
Marketing Forecast Distribution Plans Production Manufacturing Plans Plans

Reserve Production Capacity

Sales Forecast Mfg Forecast

Demand Planning Process

?
t = weeks
Supply Planning Process

Supply Chains Built on INVENTORY

Move To A More Competitive Model

E-Business planning solution: zero latency, real-time collaboration
Customers Suppliers
Tier 2

Enable closed loop

Portal
Internet

Tier 1
Portal

collaborative planning processes across your value chain

Automated Exceptions Marketing Manufacturing Sales Demand Hub & Multi-dimensional analysis Consensus forecast and prod. plan Single holistic plan

Have complete supply chain

visibility

Make better decisions React immediately to

disruptions in supply chain

Mfg

S&OP Process

Supply Planning

Business Intelligence

Build a responsive Supply Chain on INFORMATION not inventory

Copyright Oracle Corporation, 2005. Private and confidential. All rights reserved.

 Powec Norwegian based company bought by Power One Sell and produce power supplies and energy systems Started to implement a new manufacturing solution Focus changed to implement a new global Supply Chain Solution

Supply Chain Management Vision Statement

Provide Power-One with a competitive advantage by driving to

the lowest cost and the shortest lead times.

Building a cost effective Global Supply Chain by using Oracle

planning tools, techniques and the right people.

Be a part of our Customers Supply organization.

Energy Solutions Supply Chain in Action

Move production from Norway to Far East

Global System Integration

Deliver global products for global customers The customer shall not see the difference Using Oracle Forecasting and Supply Chain Planning for Optimization One database for traceability One tool for recording serial numbers on deliveries Global distribution of documentation Can deliver from anywhere through our 3PLpartner

Power One using Oracle Advanced Planning for the Global Supply Chain
Complete e-business planning solution
Supply Chain Intelligence Sales and Operations Planning Demand Planning

SCI DP

From detail to summary

Inventory Optimization Supply Chain and Manufacturing Planning Global Order Promising Deployment Planning* Manufacturing Scheduling

IO ASCP

GOP ASCP

MS TP CP
Collaborative Planning From short-term to long-term
* Future

Maintain Service Fulfill Make

Finance

HR Projects

Transportation Planning SC Exception Management

All Product, All Product, Customer, Customer, & Supplier & Supplier Information Information

CP

Procure

Plan

Develop Market Order Sell

Copyright Oracle Corporation, 2005. Private and confidential. All rights reserved.

Inventory Postponement Optimization

Inventory Optimization
Region 1
Cust 1 Cust 2

Utilize Postponement to Support the Lean Enterprise

Region 2
Cust 1 Cust 2

Determine Where to Hold Inventory to Guarantee a Desired Service Level

Manufacturing plants Distribution centers Central warehouses

Determine What Stage of Production to Hold Inventory

Distribution Center 1

Distribution Center 2

Finished goods Die bank Wafers

Postpone Value-Add Activities

Test

Until Actual Demand Pull

Initial Safety Stock Levels Fab Shop

Safety Stock with Postponement

Inventory Postponement Optimization

Key capabilities
Without Oracle

Reduce inventory without sacrificing customer service

Postponement

Manage supply chain variability

Inventory Investment

Choose the best service level strategy based on cost and revenue
Lower Inventory Cost With Oracle Higher Service Level 10 30 50 75 80 85 90 95 100

Invest in profitable channels, products, and customers Manage seasonality and product life cycle characteristics

Recommend time-phased safety stock to supply planning For planners, not programmers

Out-of-the-box optimization

Service Level

Reduce inventory without impacting customer service

Copyright Oracle Corporation, 2004. Private and confidential. All rights reserved.

Simulate multiple scenarios to find the optimal trade-off between cost and service level

Cambrigde Silicon Radio

Revenues
2001 2002 2003 17 28 68 2004 253 (1000$)

Revenues 4times 2003 Market share of 50% Shipped 50 million single chips Bluetooth devices

A Fabless Company

Slide 27

Turnover
2001 2002 2003 112 - 168 - 400 2004 1300 (MNok)

Project started Aug. 2004, go live Apr. 2005

Cambrigde Silicon Radio

Slide 28

A brief introduction to CSR: CSR designs and manufactures single-chip wireless devices. Our business started with a focus on solutions for the 2.4GHz Bluetooth personal area networking standard; in November 2004, we entered the IEEE 802.11 marketplace - a family of wireless standards also referred to as 'Wi-Fi' or 'Wireless LAN' - with devices capable of operation in both the 2.4 and 5GHz frequency bands. CSR's leading position in the Bluetooth business has been won by a unique approach to IC design based on extremely high levels of integration, providing compelling performance and cost advantages to OEMs. This brand ethos has been carried through to 802.11 applications, with an IC architecture that integrates a new level of functionality embracing all three major variants of the protocol (802.11a, b and g), and IC choices that offer solutions for both current applications, and emerging embedded applications in portable consumer electronics devices (including mobile phone handsets) and home appliances. In the Bluetooth market, CSR is ranked #1 in every Bluetooth market segment with a unit market share in excess of 50%.

Industry Solution - High Tech: Semiconductor

o lic Si n In go t d he W r afe Fa d te ica br er af W o Pr d be er af W ie /D er f ed bl m se As ice ev D d te es T ice ev D

w Ra

lis Po

a W

Front-end Process

Back-end Process

Customers

Suppliers
Secondary Lead Frame Gold Wire Die Molding Compound

Portal Collaborative Demand Plan

Portal

Internet Collaborative Supply Plan Automated Exceptions Automated Exceptions

Collaborative Planning Process Automated Exceptions Single Holistic Plan

Marketing Consensus Forecast Forecast Sales Forecast Mfg Forecast Demand Planning Process

t = hours Supply Planning Process

CSR is using Oracles Sophisticated Planning tools to get full visibility of all goods in the whole and outsourced Global Supply Chain
Supply Chain Intelligence Sales and Operations Planning Demand Planning

SCI DP

From detail to summary

Inventory Optimization Supply Chain and Manufacturing Planning Global Order Promising Deployment Planning* Manufacturing Scheduling

IO ASCP

GOP ASCP

MS TP CP
Collaborative Planning From short-term to long-term
* Future

Maintain Service Fulfill Make

Finance

HR Projects

Transportation Planning SC Exception Management

All Product, All Product, Customer, Customer, & Supplier & Supplier Information Information

CP

Procure

Plan

Develop Market Order Sell

Copyright Oracle Corporation, 2005. Private and confidential. All rights reserved.