UNCEFACT SEMINAR

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UN/CEFACT SEMINAR Trends in Electronic Business
- a corporates view Tom McGuffog
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e.business the scope
business to business business to
consumer business to government to
citizen electronic process integration and
improvement collaborative event
management current and new products and services
and markets new value chains knowledge and data
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UKP.eb
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The leading bodies for best practice and
standards in electronic business working together
to enhance UK performance
APACS BSI-DISC CITU
DTI e.centre uk SITPRO
UKCEB
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E-business Successes in Industry

• E-business enables the Virtual Enterprise
• To win and sustain profitable business
• To create highly competitive global design,
  engineering and manufacturing
• To demonstrate superior and efficient customer
  support
• Resulting in ... Increased profitability

. . . an industry database provides a measure of
benefits under each of these headings . . .
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Range of Improvements - 149 companies
QUALITY ANDPERFORMANCE
COST TIME
Winning andSustainingBusiness

• Reduced Price
• Increased perceivedCustomer Value

• Reduced Timeto Market

• Improved productfeatures,functionality
  andquality

10-50

• Improved ManagementControl
• Improved Flexibility
• Reduced Risk

• Reduced DesignDevelopment cost
• Reduced ProdnEngineering cost
• Reduced buildcost
• Reduced scrapcost

• Reduced DesignDevelopment time
• Reduced ProdnEngineering time
• Reduced buildtime

10-80
2-16
HighlyCompetitiveGlobal Design, Engineering and
Manufing
35-89
12-30
10-83
10-80
5-50
1-2

• Reduction in Physical Mock-ups
• Reduction in Re-work

20-95

• Faster Responsiveness
• Improved Flexibility

• Improved ProductQuality Rating
• Improved CustomerSatisfaction
• Improved CustomerSupport Data

Superior andEfficient CustomerSupport

• Reduced Supportcosts

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Where will the growth occur? business to
business or business to consumer?
Business to business activity is going to dwarf
all business to consumer activity Hence we need
to focus on deliveringall the critical success
factors toensure that b2b e-businesscan
flourish inthe UK
1400
1200
1000
bn
800
600
400
200
0
1998
1999
2000
2001
2002
2003
Source Forrester Research
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Enterprises customers suppliers Agents Institutio
ns Authorities Governments
Networks EDI
Enterprises Agents Authorities

• automatic data analyses
• master data synchronisation
• automatic processing androuting of transactions

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value chain management
simple standard processes
speed, certainty reduced total cost
e.business
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Simple Standard Speedy Certain
value chain management processes
electronic business communications pre-aligned
plans, master data
SIMPL-I.T.
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DEFINING A COST-EFFECTIVE VALUE CHAIN
Objectives - quantified
Value Chain -
Key Performance
Process
Virtual
Indicators
Enterprise
- Activity
Based
Costs
Organisation
Communications
Procedures
Computer
Systems
Applications
Information
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International Supply Chain

UK to North Africa. 1 Order - 360 nette tonnes,
1 SKU
Added value
Payment by customer
and cost
Retail sale
Payment of
Unload and store
transport
and FOB
charges
Delivery to customers warehouse
Inwards clearance
Main vessel off-loading
Proof of export
Sea Crossing
Refund payment and administration
Main vessel loading
Exit clearance from community
Delivery to port
Unload, re-
pack
Dehire GKN pallets
Delivery to customs warehouse
Documentation
Refund claim
Invoice and order administration
Load and despatch
Customs formalities (Inland)
Pre-shipment Inspection
Manufacture
Short Lead Components
Documentation
Export Licence
Request Health Certificates, Licences
Artwork
Order receipt and administration
Long Lead
items
Credit Arrangements
Enquiry Validation
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15
16
19
21
Weeks
(approx)
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Government Trade Statistic
Government Trade Statistic
International Trade Process Model
Frontiers and Transit
Export Activities
Movement and Activities under Export Customs
Authority
Movement and Activities under Import Customs
Authority
3. Export Licensing Authority
20. Import Licensing Authority
21. Import Intervention Board
4. Export Intervention Board
13. Customs (Export)
16. Customs (Import)
5. Export Health Authority
5. Export Health Authority
6. Chamber of Commerce
31. Standards Institute
7. Consulate
8. PSI Company
Rail
15a. Import Agent (Customs)
11a Export Agent (Customs)
12a Export Agent (Customs)
30a Import Agent (Customs)
Road
1. Seller
Sea
2. Buyer
11b Freight Forwarder (Agent)
12b Carrier (Agent)
30b Freight Forwarder
15b Carrier (Agent)
Air
Post
11c Internal Transport
12c Haulage to Vessel
15c Haulage to Vessel
30c Internal Transport
9. Sellers Warehouse
23. Buyers Warehouse
10. Insurer
24. Insurer
28. Duty Free Warehouse (Export)
26. Duty Free Warehouse (Import)
14. Receiving Authority (Export)
27. Receiving Authority (Import)
10a Credit Insurer
29. Banks in Third Countries
18. Sellers Bank
18. Buyers Bank
19. Central Bank (Export)
19. Central Bank (Import)
Frontier
Physical Movement
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SITPRO The Simpler Trade Procedures Board
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Volumes
Consumer Demand
Time
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Volumes
Time
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Volumes
Time
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Volumes
Time
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SILO SYNDROME
î
poor availability to consumer loss of sales
poor plans crisis management high cost
- production
buying write-offs
inventory capacity
í
Uncertainty Delay
ì
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BUSINESS PROCESS RESTRUCTURING
1. Value Chain Participants - Functions Internal
- External Buyer, Seller, Agent, Authority,
Individual Decision-Taking Process 2. Timescale
3. Exchange Knowledge - C.E.M. Agree
Plans Pre-align Master Data before
Transactions Integrate with Applications 4. Bala
nce of Internet EDI Internal I.T.
Applications 5. Pre-Plan - Fill
Pipeline 6. Flexible and Responsive Manufacturing
and Supply 7. Feedback From Consumer
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COLLABORATIVE EVENT MANAGEMENT CEM
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The Partner Link Pre Web Based Collaborative
Planning
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Typical view for Sales Account Manager
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Typical view for Customer Service
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Typical view for Supply Chain Planner
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Getting it right gives-

• Improved Service product availability
• Customer/consumer loyalty
• Increased sales
• Better capacity utilisation
• Reduced overheads/administration
• Lower inventory
• Reduced operating costs
• Less waste, write-offs
• Improved cash flows

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NESTLÉ UK EDI STATUS
NO. OF SUBSTANTIAL CUSTOMERS
ORDERS INVOICES PRICE DEMANDRECEIVED
SENT FILES FORECAST 20
24 4 4
CREDIT/DEBIT REMITTANCE ORDERS NOTE
ADVICE SENT 1
1 12 OF TOTAL SALES
RECEIVED BY EDI 70 OF TOTAL SALES COVERED BY
PRICE FILES ETC 40 TELESALES PORTABLE
TERMINALS NON-ELECTRONIC SALES 5
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ESSENTIALS
1. Agreed Processes - High Level
Model 2. Standard Data Definitions Syntax
Independent Internet - EDI - I.T.
Applications 3. Structured, Pre-aligned Master
Data 4. Simple, Standard Transactions,
Messages 5. Standard Codes - Products/Services
- Trading Locations/Participants 6. Detail
ed Models - UML - Change Management
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Simpl.eb
SIMPLEST, STANDARD VALUE CHAIN MESSAGE
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EFFECTIVE VALUE CHAINS and ELECTRONIC BUSINESS
BARRIERS SOLUTIONS POOR PROCESSES VALUE
CHAIN MGT NON-INTEGRATED HIGH AND LOWER
LEVEL MODELS NON-STANDARD
DATA COMPLEX, DIVERSE EDI SIMPL-eb WEB-EDI
NOT LINKED NON-INTEGRATED PLANS COLLABORATIVE NO
N-ALIGNED DATA PLANNING EXTRANET/EDI DIF
FERENT CODES EAN CODING



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STANDARD DATA ACROSS THE VALUE CHAIN
Internal Applications Data Processing and
Routing
Transaction Messages EDI
Alignment of Master Data Catalogue or EDI
Collaborative Plan Internet Screen
BUSINESS ACTION
BUSINESS NEED
DATA
DATA
DATA
DATA
CONSISTENCY OF STANDARD BUSINESS MEANING
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SPEED KILLS !
OLD COMPANIES, OLD VALUE CHAINS, OLD SERVICE,
OLD PROCESSES