E-Business Supply Chain 2001 5 8 Page 1
We cannot solve problems by using the same kind of thinking we used when we created them. Albert Einstein 2
Technology: Key Business Driver Today Wireless Ease of Use Bandwidth Compatibility Intranet Java/XML Connectivity Information Portals Availability Processing Speed Application Service Providers 3
E-Business Page 4
E-Commerce E-Business E-Commerce E-Business, (Value Chain),, 5
E-Business E-Business 1999 to 2005 (US $ Billions) Source: "The Real Numbers behind 'Net Profits 2000, Copyright 2000, ActivMedia, Inc. 6
E-Business:.... (i.e. auction/exchange).,..... 7
E-Business Increasing Business Value 1996-1999 Presence Marketing Information Brochures 1997-2000 Interaction Intranet Apps Interactivity Personalization Basic Search Linked Sites e-commerce EDI Support Communities SCP Apps E-Business Integration 1998-2003 Transaction ERP Front End Customer Selfservice 2000-2005 Transformation SC Optimization CRM Apps, Common Platform Industryspecific Apps, Engines Functional App Customer Integration Real-time ATP Advanced Personalization Source: Gartner Group toward Business Transformation 8
Value Chain E-Business Employees Internal Processes Self-Serve e-mail Knowledge Management Integration Collaboration Partners/Suppliers Production Logistics Distribution Collaboration Exchanges Business Business to to Business Business Enterprise Production Collaboration Sales Marketing Service Business to to Consumer Business to to Business Digital Marketing Customers Customer relationship management Collaboration Enablement 9
Suppliers Enterprise Customers Supply Chain Management Electronic Procurement Stock Management Integrated Forecasting Quality Systems Management Manufacturing Distribution Financials Human Resources Electronic Commerce Customer Service Interactive Marketing Demand Marketing Order Management Businesses can now create an integrated supply chain which links the enterprise to both customers and suppliers, enabling customized bundled services to be created real time. 10
,, 24x7 front-office and back-office applications e-business Data Bandwidth 11
1990 s : ERP Systems Service Credit Engineering ERP Billing Distribution Production 12
2000 s: Service Credit Engineering Service Credit Engineering ERP ERP Billing Distribution Production Billing Distribution Production 13
E-Supply Chain Page 14
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Supply Chain Value Network Supply Chain Supply Chain 16
Supply Chain,. 17
Supply Chain.. Data.. Outsourcing, Supply Chain.. 18
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Supply Chain Benefit. Supply Chain, Supply Chain. 20
, ( ).,, Business Process. Business Process. E-Business, Business. 21
What Is E-Business? E-Business,. Today Tomorrow 22
. Communication... 23
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Private Exchange Horizontal Exchange Vertical Exchange Private Exchange 26
EDI Networks S S S S S B B Suppliers Buyers Information Distribution B B B S Closed, expensive, non-scalable B B B Website Sales B B S B B Information on-line, sales off-line Buyer Solutions S S S S B B2B e-marketplaces S S S S B2B Catalogs, procurement workflow Information, configuration, and Order-taking B B B B Aggregation of many-to-many transactions Time 1996 1997 1998 1999 2000 Time Source: Adapted from MSDW Internet Research 27
Next B2B - "private" network collaborative commerce When you re a highvolume guy like us, (public) exchanges don t add any value. We are the exchange, - James Vanderslice, Vice Chairman, Dell We don t see any reason to have another hand in the till. Why do you want anyone to stand between you and your supplier? - Joe Hogan VP GE Medical Systems Why let another party get between us and our customers? - James Bierkamp Trane Co. While we see much promise for public trading exchanges, we also see a need for private exchanges in everyone s future supply chain - Larry Lamide Analyst, AMR The market will be dominated by private e-markets - USBancorp Piper Jaffrey "We will see public marketplaces consolidate down to a few hundred, but we could see thousands, even tens of thousands of private trading networks," - Charles Phillips Morgan Stanley Dean Witter Giga estimates that as many as 1,000 private exchanges will be up and running in five years our vendor partners are among our keys to success, and that exchanging information with them creates a unique synergy that allows both companies to be successful. - Wal-Mart 28
Why E-Business? Survey Results Page 29
E-Supply Chain P - Production / N - Non-Production Tier N P P N Procurement & Supply Scheduling Manufacturing Engineering Sales & Marketing Dealers Fleets Consumers N e-procurement Exchanges 30 e-supply Chain
e-business Opportunities e-supply Chain -Yields potentially largest savings via synchronization of Supply Chains via reduced inventories reduced cycle time improved quality Effort Trade Exchange - Provides revenue from transaction fees - Increased shareholder value (IPO, etc.) e-procurement - Lowers transaction cost of purchase - Aggregated buy, catalogs, and auctions Value 31
e-supply Chain e-supply Chain is a new way for the entire organization to coordinate the entire supply base P - Production / N - Non-Production Tier N P P N Procurement & Supply Scheduling Manufacturing Engineering Sales & Marketing Dealers Fleets Consumers N 32
E-Business collaboration relationship Collaboration with design partners Collaboration with Suppliers Intelligent Demand Fulfillment Design Partners Strategic Supplier Collaboration Supply Chain Management Inter Process Planning Product Lifecycle Management Planning Customer Management Customer processes linked to intelligent fulfillment processes Personalization, Valid configurations, real availability, multienterprise fulfillment Consumers and Channels Customer-driven product design Collaboration with customers 33
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Integrated Solution (Oracle) vs. Best-Of-Bread Solutions (SAP) E-Business (e-supply Chain) implementation without ERP implementation Big-Bang vs. Phased Approach Change Leadership Consulting Partners 41
42 Deloitte Consulting Recognized as an E-Business Market Maker Ability to Execute E-Business ESP Magic Quadrant for Large Service Providers, North America Challengers Unisys CSC Evolving AMS CGE&Y KPMG PwC EDS IBM Completeness of Vision Market Makers DC DC = Deloitte Consulting AC Visionaries As of 10/00 In a 2000 Gartner research report, Deloitte Consulting was categorized as a Market Maker for its ability to execute and completeness of vision as an e-business consultant Market Maker is the highest designation in the report and was based largely on extensive reference checking and client interviews Gartner defines Market Maker as external service providers that demonstrated leadership through their positioning with new and existing client bases. They have made tangible and substantiated investments in their strategy and have penetrated new markets. The providers in the Market Maker segment have embarked on many innovative relationships that extend their reach beyond the traditional consulting role. Source: Gartner, E-Business ESP Magic Quadrant: A Look at Large Providers November 7, 2000, authors: F. Karamouzis and L. Scardino Disclaimer: The Magic Quadrant is copyrighted November 2000 by Gartner Group, Inc. and is reused with permission. Gartner s permission to print its Magic Quadrant should not be deemed to be an endorsement of any company or product depicted in the quadrant. The Magic Quadrant is Gartner s opinion and is an analytical representation of a marketplace at and for a specific time period. It measures vendors against Gartner-defined criteria for a marketplace. The positioning of vendors within a Magic Quadrant is based on the complex interplay of many factors. Well-informed vendor selection decisions should rely on more than a Magic Quadrant. Gartner Research is intended to be one of many information sources and the reader should not rely solely on the Magic Quadrant for decision-making. Gartner expressly disclaims all warranties, express or implied of fitness of this research for a particular purpose.
Deloitte Consulting Listed as an IT Strategy, Planning and Architecture Leader IT Strategy, Planning and Architecture Magic Quadrant (Large Service Providers, North America) Ability to Execute Challengers Niche AMS IBM Unisys KPMG Completeness of Vision DC PwC Accenture DC = Deloitte Consulting Leaders CSC Visionaries CGE&Y As of 01/01 Source: Gartner, IT Strategy, Planning and Architecture Magic Quadrant January 4, 2001, author: L. Scardino. In a 2001 Gartner research report, Deloitte Consulting was categorized as an IT Strategy, Planning and Architecture Leader. Leaders are performing well today, have a clear vision of market direction and are actively building competencies to sustain their leadership position in the market Gartner's Magic Quadrant process involves primary research with direct client references supplied by each service provider as well as the service provider's representation of its organization. The analysis involves a weighting of both sources of information with a heavy emphasis on direct feedback from clients. Gartner defines Leaders as those that have made significant strides in developing reusable frameworks, adaptive architectural points of view and solution sets to address consistent requirements across their client base. Disclaimer: The Magic Quadrant is copyrighted January 2001 by Gartner Group, Inc. and is reused with permission. Gartner s permission to print its Magic Quadrant should not be deemed to be an endorsement of any company or product depicted in the quadrant. The Magic Quadrant is Gartner s opinion and is an analytical representation of a marketplace at and for a specific time period. It measures vendors against Gartner-defined criteria for a marketplace. The positioning of vendors within a Magic Quadrant is based on the complex interplay of many factors. Well-informed vendor selection decisions should rely on more than a Magic Quadrant. Gartner Research is intended to be one of many information sources and the reader should not rely solely on the Magic Quadrant for decision-making. Gartner expressly disclaims all warranties, express or implied of fitness of this research for a particular purpose. 43