IBM Order Management for Communications Inventory and Supply Addendum

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Communications providers have long put the physical fulfillment solutions on the back-burner compared to their network service counterparts – and while network performance and consistency is critical – CSPs are neglecting the cost and operational savings enabled by streamlining their CPE and accessory sales. Too often CSPs are tying up millions of dollars in inventory to ensure no stock out situations instead of streamlining and understanding their inventory picture to better allocated that capital elsewhere. Slow, inefficient, & costly supply chain responses to changing market dynamics Too many resources allocated to costly error-prone manual supply chain processes & poor customer service levels Knowing where to best place inventory; Over/under utilization of supply chain assets Lack of visibility and certainty over supplier spend and performance; Limited business intelligence for decision making However, its one thing to understand the need to change supply chain processes, its yet another to implement them successfully. Companies today still struggle with some significant challenges, and these challenges have substantial impacts financially. We already previously identified the fact that Retailers today see lead times as long as six to ten months, forcing vendors to make significant bets on inventory, consumer trends and distribution methods—bloating supply network with a stockpile of $1.2 trillion in excess merchandise. At the same time, retailers lose a staggering $93 billion in missed sales every year, simply because they don’t have the right products in stock to meet customer demand. Value of excess merchandise stockpiled in supply chains configured to account for those long lead times is over a trillion dollars.

Transcript of IBM Order Management for Communications Inventory and Supply Addendum

  • 1. Smarter CommerceOrder Management for Communications Supply ChainInsight1 2012 IBM Corporation

2. Communications services providers, like all retailers, face significantchallenges in meeting modern multi-channel supply chain needs$1.2 Trillion 70% 60%Value of excess Of supply chain Of retailers lackmerchandise officers state thethe control overstockpiled in lack of visibilityshipment statusretail supply has a significant and cost for theirchains configured impact on their inbound freight tofor long lead supply chainbe cost effectivetimes health2 2012 IBM Corporation 3. The evolution of the supply chain in communications is largely thesame as in most other industriesTechnology is the Enabler of the Supply ChainInsourced (In House): Low core competency in management of people and resources High overhead and physical plant costs, inability to efficiently scaleOutsourced (3rd Party Logistics Provider): Efficiency in scaling and providing over the top services extending beyond simply shipping the product or providing the service Lack of control of the value in the supply chain difficult to switch suppliersHybrid: Outsourced physical fulfillment and commodity services - Insourced control over the value of the supply chain Fulfillment partner provides the physical resources to fulfill product using the software solutions provided by the CSP where all the customer experience value lies. Relatively easy to add and/or switch suppliers3 2012 IBM Corporation 4. CSPs and other multi-channel retailers are constantly having tosupport new and more varied fulfillment methods Multiple Enterprises BrandsMultiple Catalogs Divisions Products Multiple Product Business UnitsServices Choices Acquisitions ConfigurationGuided SellingMultiple Fulfillment Methods Multiple Customer OUTSOURCED Multiple ChannelsWarehouseStore / Retail SegmentsLARGE PARTNER Big Box RetailersConsumerCatalog / Call CenterVENDOR SuppliersDistributionCommercial / ContractorSMALL PARTNER Drop-shipCorporateWebsiteOUTSOURCED 3PL NetworksKiosk INSOURCED Corporate Stores 2012 IBM Corporation 5. Advantages of owning the value of the supply chain and lettingthe commodities of the supply chain go No longer dependent upon a single point offailure in the supply chain multiple sourcesfor fulfillment mean less downtime andbacklogs to customers Allows organization to push downrequirements to its suppliers / partners andeliminate those partners that cannot meetorganizational standards Receive commodity services from 3PL andcarrier partners such as backorder, shipmentand delivery notification allowing theorganization to make operational decisionsbased upon that data Ability to control the software and associatedoperating procedures used by supply chainpartners thus driving up efficiency and drivingdown cost to an even higher degree.5 2012 IBM Corporation 6. Order management gives all participants in the supply chain haveequal access to all supply and demand information at all timesCHANNELS: all channels, whether SUPPLY: global levels, status, detail andorganic or third-party have real-time insight is available across all locationsaccess to all sourcing information andregardless of the enterprise physically inlogic, whether through native mobilepossession of the inventory.integration or an extensive set of APIs appallowing simple integration to legacychannel sales systems.direct shipwarehouse call center /retail catalogstock set top provider / partnerorder inboundmanagementdistribution supply centersupply channels reseller kiosk on vehicleonline / white labelretailretailstorefront6 2012 IBM Corporation 7. Actionable insight into the global supply chain allows providers tomake smart choices that better support their customers experience Inventory insight, analytics and intelligent sourcing allows order management to sourceoptimally in real time from any supply to most optimally meet the customer need. Buy online, pickup in the store; drop-ship direct from partner or vendor; buy in onestore, pickup in another store; etc. and more.Order Management Intelligent Sourcingorder managementglobal supply issupply is sourced andrecognizes an issueevaluated for bestfulfillment fulfillment optioncommitments are keptGlobal Supply Locations Vendor SupplyCustomer Direct Regional Flow-Through Back-of-StoreVAS CenterCenters & EnrouteWarehouse Dist. Centers Dist Centers StockroomsReturns/Repair Supply7 2012 IBM Corporation 8. Order management pipelines graphically manage entire fulfillmentprocess Series of transactions and statuses that guide andocument through fulfillment Rapidly incorporate fulfillment process changes withoutany programming effort Control and monitor external activity data flow andcommunication with partner fulfillment systems Real-time visual business process and fulfillment eventmanagement to minimize customer impact Quickly adapt to changing fulfillment models 2012 IBM Corporation 9. Global inventory visibility creates awareness into available inventory Consolidate inventoryinformation from multiplesystems inside or outsidethe four walls of thecompany Flexible views of InventoryViews by type of supply and demand Real-time promising ofinventory owned or un-owned Choose alternate location(s)when inventory notavailable 2012 IBM Corporation 10. Intelligent sourcing engine determines complex fulfillment Splitting order as needed Fulfill: By Line By suppliers etc. By different internal systems Source from: Multiple locations Drop ship from partners Service partners Source by:X Priority Geographical location Intelligent sourcing engine determines the most Inventory costoptimal location Handling cost Enable transfers in stock-out situations Transportation cost Select new location if inventory is not available Reduced no. of shipments (merge Source or drop ship from channel partner in transit etc.)10 2012 IBM Corporation 11. Analytics-led intelligent applications will help CSPs to evolve beyondcatalog-driven order management Intelligence ON the process Enable users to respond to trends through dashboards and key performance indicators Example: Backorders against the order promise date and alerting analysts ahead of time if backorder date may be missed so that service representatives can offer alternatives to the customer11 2012 IBM Corporation 12. Reverse logistics improves efficiencies of managing the returnsprocess Central Order Repository Return to supplier Buy, pick-up and return anywhere Component put-away Directed Workflow Return to stock Exchange process Inspection Stockroom / Sales Floor WarehouseCatalog SalesRecordsCustomersShipping Customer Service Returns Returns Staging Web Sales DestroyRecords 2012 IBM Corporation 13. IBM provides Comprehensive & Integrated solutions into supplychain insight which allow companies to Optimize Supply chain planning by identifying the best options for sourcing, production, and inventoryAutomate Supply chain executionthrough extended supply chain visibility, collaboration and logisticsAnalyze Supply chain performance with insights from real-time and predictive analytics13 2012 IBM Corporation