SCM Optimization By Leveraging Technology

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SCM Optimization By
Leveraging Technology
Aroon Mehta for IIMM-Pune
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Agenda. SCM Concepts SCM Road Map SCM
Technology SCM innovations SCM
Illustrations SCM Open session
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SCM-gt ALL ABOUT LEVERAGE.
Consider how to turn an aircraft. Aircrafts
are steered through the use of a system of
ailerons on the wings and the rudder at the tail
of the aircraft. In comparison to the
aircraft, the ailerons and the rudder are very
small however, leverage allows them to turn the
large aircraft. In other words, putting the
right combination of a little leverage on the
right places allows incredible
PERFORMANCE SCMS FOUNDATION IS ON THIS SIMPLE
BASE.
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SCMS Foundation Layer
To Deliver
Optimize your companys
Services, Products,
Communications, Support ,
Partnering Integrating .
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RECAP
. 4 C SCM Formula. C Customer C
Competition C Cost C Connect
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. What is a Supply Chain ? Supply chains are
linkages of partially discrete, yet
interdependent entities-processes that
collectively transform raw materials into
finished products. Supply chains connect the
functions of inbound activities (such as
purchasing) with outbound activities (such as
logistics and place activities). Highly
Customer Centric
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Formal Definition- SCM A supply chain is a
network of facilities and activities that
performs the functions of product development,
procurement of material from suppliers, the
movement of materials between facilities, the
manufacturing of Products , the distribution of
finished goods to customers, and after-market
support for sustainment Highly Customer
Centric
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. SCM- KEY UNTILITIES/DPS
PLACE
TIME
DELIVERY
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SCMS GOALS

• Reduce cost
• Improve ROA
• Enhance visibility
• Build actionable competencies.
• Backend Iintegration
• MICRO MACRO Transperancy
• Simplify the supply chain

Source Global Supply Chain Associates (GSCA) 1999
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A typical SupplyChain Driven Organization

• A supply chain organization is a relatively
  enduring interfirm cooperative that uses
  resources from all participants to accomplish
  shared and independent goals of its members.

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WHY VALUE CHAIN IN SCM. The term
value chain means that at each stage of the
ORDER-TO-DELIVERY SYSTEM, value is added to
the product or service, for customer centric
norms.
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SCM NW Theory
Actor Bonds
Resource Ties
Activity Links
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CompetitiveAdvantage
Firm Strategy, Structure, and Rivalry
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Factor Endowments
Demand Conditions
Related and Supporting Industries
Source Porter 1990
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Primary SCM KRAs

• Primary activities are the SIX basic functions
  needed to physically produce a product or
  service, deliver and market it to buyers, and
  support it after the sale.
• Inbound logistics
• Outbound logistics
• Support function.
• Technology leverage.
• Monitoring infrastructure
• QOHR.

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Support Function

• Support Activities provide inputs or
  infrastructure in support of primary activities.
  These supporting activities stretch
• Across the entire value chain of SCM
• impact each primary activity.
• MOST IGNORED AREA IN SCM.
• Leveraging IT For total value chain- a MUST

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. CONCEPT 1. STARTUP
DRIVER Challenge the Legacy

STATUS QUO as an
Organization
not as an
Individual
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. CONCEPT 2. Creation of a virtual
Organization with, Vendors,
Customers, Employees as a
partnering entities in a truly
transparent Mode, at all levels of
operations, both in Strategy
Implementation.
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. CONCEPT 3 Transparent workflow
cycle. Database driven. Escalation triggers
Tracking metrics Redundancy removal.
Lean SCM/SCP
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. CONCEPT 04 SCM dependency is heavy on
Real Time integrated backend systems and
organizations transperency
Requires State of the Art Technology
its fullest
implementation.
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Competencies Needed for Efficient SCM
Source Michigan State University (1995)
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SCMS IMPACT DRIVERS

• Cut Cost Drivers
• Reduce Downtime
• Compliance no compromise
• People restructuring
• MENTORING MONITORING
• Spares/Logistics thru systems
• Communication
• SCM revamp IT (Real time)

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Leveraging IT

• SCMS Technology Map

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IT-BACKBONE
Enterprise Portal
CRM
SCM
ERP WITH 100 SPREAD
B2B
RFID BAR CODING
Leveraging IT
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Re Strategizing/Reinovating
TECH PATH
People Technology
Processes CHALLENGES
Enterprise Portal
B2B
ERP
eCOM
SCM BASIC--- INNOVATION MODEL
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THE REAL/LIVE SCM_at_INDIA.

• KEY Excellence/Innovation in SCM
• ITC e-choupal
• GE-SCM MODEL
• TVS Logistics
• SAP OSS
• LG
• IIMs Programs thru DTH satellites

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SCM CHALLENGES

• SCM targets thru innovation
• Reaching to customers
• Innovating to exceed customer expectations
• Adding layer of operating convenience
• Affordable COST
• Enhancing product/services value
• Has a Mass level effect
• Models involving
• customers/vendors/Partners employees
• - WIN WIN FOR ALL STAKE HOLDERS

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SCM- faqs

• Manufacturing Strategy
• How many plants do I need?
• Where should each plant be located?
• What products should each make?
• What process technologies should each have and
  how much of each process is needed?
• What part of the world should each plant serve?

Source Global Supply Chain Associates (GSCA) 1999
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Scm-FAQS

• Supply Base Design / Vendor Consolidation
• How do I simultaneously perform supplier
  selection for all the parts in the same commodity
  group?
• How many suppliers is best and which suppliers
  should send which parts to which plants?
• Am I missing opportunities by sourcing one part
  at a time?
• Outsourcing
• What parts of my supply chain should I keep
  "in-house" and what parts to outsource?
• What if a third party has a higher variable cost
  but a lower fixed cost than in-house production?

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Supply Chain Structure Before Reorganization
Source Global Supply Chain Associates (GSCA) 1999
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Supply Chain Structure After Reorganization
Source Global Supply Chain Associates (GSCA) 1999
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THE REAL/LIVE SCM_at_INDIA.
All SCMs across all industries/verticals Star
t with Customers End with Customers.
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TAKE PRIDE AS AN INDIAN
The BEST INDIAN SCM IN TRUE ACTION WITH NO
TECHNOLOGY IS TOTALLY
INTENT
DELIVERY CENTRIC
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SCM AT ITS BEST THE DABBAWALA TIFFINS
Inspiring SCM BY OUR OWN DABBAWALA _at_ MUMBAI.
Customer Ahead of Everything Else . NO
TECHNOLOGY ... NO AUTOMATION... NO RFID.. NO
BARCODE.

JUST PURE UNDILUTED
INTENT WITH COMMITTMENT.
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Reccomendation

• Intent will drive technology SCM Innovation
• technology will never drive the Intent at any
  cost.
• Hence build innovative intent to drive SCM at
  large .
• Best Wishes
• Aroon Mehta.
• Head- IT
• Serum Institute of India
• Pune.

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Thanks to the IIMM Executive Committee Wishing
all the IIM members the very best to attempt
with a intent , all your Innovative Initiative
in SCM Aroon Mehta aroonmehta2_at_gmail.c
om