Global SCM IT Application & IT Profession Hans Chen TestRite International Inc. May 31, 2007.
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Transcript of Global SCM IT Application & IT Profession Hans Chen TestRite International Inc. May 31, 2007.
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Global SCM IT Application&
IT Profession
Hans ChenTestRite International Inc.May 31, 2007
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Personal Background
• 6 years in Mechanical Engineering academic training (NTU + Cornell)• 11 years in 3D imaging research (UCSF)
– Technical staff
• 2 years in airport security equipment (GE)– Control Software Manager
• 2 years in semiconductor equipment (Apply Materials)– Control Software Manager
• 6 years in trading (TestRite)– Head of MIS (5 year)– Head of SIT business unit (1 year)
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Outline
• Global Retail SCM IT Application– 4 Retail Challenges
• Right product, right price, right time & right quantity
– Real time supply chain visibility is a must– Wal-Mart warehouse service case study
• IT Profession – IT Role & Responsibility– Key Characteristics
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4 Retail Challenges
• Right Product– Shopping is an entertainment
• Right Price– Value sell a product not price
• Right Quantity
• Right Time– Slim margin & short product life cycle– Inventory control is critical
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Global Sourcing Evolution
Supplier market researchSupplier identification & qualificationSupplier developmentIdentify saving opportunityProduct Quality InspectionSupplier database developmentExecute biddingLogistics managementProcurement transactionsInvoicing & paymentCategory managementDevelop supplier market strategiesInventory managementProcurement & sourcing training
Fundamentalcapabilities
Transactionalcapabilities
Progressive &sustainingcapabilities
Over 70% of China IPOs are focusing on the development of fundamental capabilities
To materialize identified saving opportunities, China IPOs needs to develop transactional capabilities
To maximize and sustain saving achievement, China IPO needs more sophisticated capabilities
0% 50% 100%*Source: Accenture and CSCC IPO Survey, 2005
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Global Sourcing Obstacles and Risks
Source: March 2006, “Sourcing in Low-Cost Countries” by eyeforprocurement
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Global Logistics Overview
SCMStrategy
SupplyPlanning
ExceptionManagement
Sales forecast management
Supply planning management
Order processing
Shipment Consolidation
Under Forecast Management
Over Forecast Management
Delay Shipment Management
Fulfill-ment
Order Processing
Inspection
Shipment management
Payment Management
Warehousing
Supply Chain Collaboration Platform
DemandPlanning
Logistics Master Plan
Implemen-tation Plan
Definition of Role and Responsibility of all parties
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Asia Buying OfficeHead Office
Asia WarehouseConsolidation Yard
US DC
Store
AsiaFactoryReplenishment
5 Day Lead Time
ASN
Factory PO Factory PO2W Lead Time
Facto
ry PO
Rec
eivi
ng
4W4W6W6W
FactoryOn WaterImportWarehouse
Store
4W
Inventory Production
Global Supply Chain Overview
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Retail System GSS*
Store
DC 3PL
•POS•Store Inventory
•Receiving•DC Inventory•Store Order
•Booking•Shipment•Container Loading•Freight Invoice
•Demand Forecast•Rebuy PO
•Supply Planning•Exception Alert
•PO Acknowledge•Factory Inventory
Asia Factory
Supply SpecialistDemand Specialist
Integration
AsiaHomeland
Supply Chain Visibility & Collaboration
* Global Sourcing Solution
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Complete Supply Chain Visibility
Weekly Store Sales
Monthly Store Sales
Monthly DC Demand
Monthly DC Demand Forecast
Monthly DC Supply
Monthly DC On Hand Qty Day On Hand
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Test Rite Experience
Test Rite Logistics Operation SummaryPeriod: August,05 ~ August,06
8+DC Inventory Yearly Turnover Rate
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Test Rite Experience
5.8
3.4
4.9
1.9
3.9
1.2
0
1
2
3
4
5
6
US Millions
Storage Tool Automotives
Inventory Reduction Management
Before GSS*
After GSS*
Test Rite Logistics Operation SummaryPeriod: August,05 ~ August,06
Store Count 2500 2500 2200
Average
In Stock %97.5% 95.6% 98.5%
Average Turn/Year 10.5 9.6 8.8
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Wal-Mart 2006 Storage Business Performance
2006 2005 Sales: $43.9M $31.4M 39.87% Instock: 95.17% 92.61% 2.76% Retail Turns: 6.49 5.60 15.98% Net Margin %: 46.46% 42.32% 9.80% Avg Lead Time: 3.33 4.80 31% Repl Order Fill Rate: 95.13% 89.73% 6.02%
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SCM DEMO
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Outline
• Global SCM IT Application– 4 Retail Challenges
• Right product, right price, right time & right quantity
– Real time supply chain visibility is a must– Wal-Mart warehouse service case study
• IT Profession– IT Role & Responsibility– Key Characteristics
![Page 16: Global SCM IT Application & IT Profession Hans Chen TestRite International Inc. May 31, 2007.](https://reader030.fdocuments.net/reader030/viewer/2022032704/56649d7a5503460f94a5ddec/html5/thumbnails/16.jpg)
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IT Application Development
• Application Analysist– BA/SA
• Application Architect – Frame work, design pattern, etc
• Database Architect– Data store, modeling, backup, restore, etc.
• GUI Designer– User interface, fool proof, online help, etc.
• System Engineer– Hardware sizing, performance tuning, etc.
• Report Manager– Management report design, access control, etc.
• Deployment Manager– QA, QC, configuration management, etc.
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IT Roles & Responsibilities
• From “What business wants IT to do” to
“What can IT do for business”
• From cost management to investment
management
• From operation support to business stra
tegy partner
• IT play a vital role in business evolution
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Key IT Profession Characteristics
• Business Orientation
• Communication
• Analytical
• Flexible
• Technical
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Business Orientation
• Industry overview
• Company competitive advantage
• Company challenges and weakness
• Short & long term business focuses
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Communication
• Proactive • Feel the pulse of business life line.• Propose a solution before it is asked
• Multidiscipline• Management view• Operation view• Technical view• IT Business view
• Confirm understanding is critical
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Analytical
• Understand history, support today business and ready for tomorrow challenges
• Assemble whole picture from segmented inputs
• See beyond the surface
• Never expect user give you the whole picture
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Flexible
• “Changes” is part of business
• Business survive by being able to catch up with the changes.
• Business succeed by being able to lead the changes.
• Foresee changes, prepare for changes and welcome changes
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Technical
• Timing is critical, schedule is the key
• Be as broad as possible
• Don’t have to be my way
• Fast learner
• Think twice before committing any in-house development project