2. Seagate Technologies Overview Largest disc drive manufacturer in the world $7.6B Revenues (FY05), 44,000 employees Vertically integrated manufacturer: Shipping ~100M drives / year Consuming ~90M parts / day 4 wks supply to hundreds of customer hubs 3. The Disc Drive Business The Extreme Sport side ofHigh-Tech Manufacturing - High Capital Costs - Demanding Quality - Seasonal Demand - Volatile Forecasts - Rapid Price Erosion - Narrow market windows- Bleeding edge technology 4. Supply Chain Building Blocks - 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 1QCY95 3QCY95 1QCY96 3QCY96 1QCY97 3QCY97 1QCY98 3QCY98 1QCY99 3QCY99 1QCY00 3QCY00 1QCY01 3QCY01 1QCY02 3QCY02 1QCY03 3QCY03 1QCY04 3QCY04 1QCY05 3QCY05 1QCY06 3QCY06 1QCY07 3QCY07 1QCY08 3QCY08 Desktop Enterprise Notebook Non-Mission Critical PVR Gaming Other CE/Non-Compute Handheld Note: % Growth/Qtr is compounded Source: Seagate market Research Minimize Labor Costs - Asia Operations
5. Seagates Four Steps to Demand-DrivenTransformation
6. Build-to-Forecast Model: 1999 Customer Suppliers Seagate Material Flow Information Flow HDD Factories Assy Factories DCs & OEM Hubs
7. Chasing the Forecast: 1997-2002 ~50%
8. Seagates Inbound Supply Chain Buy-Side Visibility, Efficiency, Agility DEMAND SUPPLY Customers Distributors EMS Suppliers VMI Hubs Customers - SQE Time-to-QualitySupplier quality issues, eventsReal-time visibility- Demand/Supply Visibility Real-time visibility, FP to E2open Forecast, Hub Inventory, Pulls - Process Automation Transaction, document, task and process integration with Partners - Lean Replenishment -iKanban, eKanban material kitting - Collaboration Manager, Event Manager iProcurement, eSourcing Real Time document, task management.Integrated global indirect procurement, and sourcing 9. Hybrid Build-to-Forecast Model: 2000-01 VMI Hub HDD Factories Assy Factories DCs & OEM Hubs
Demand Pull Demand Pull Forecast scheduled Customer Suppliers Seagate Material Flow Information Flow 10. Inbound Supply Chain Completing the Demand Driven Journey 11. Demand / Supply Architecture(via E2open Network) Singapore China 7 Seagate Sites
Web UI B2B Server-to-Server 36 Suppliers SC Process Manager (Order, Forecast, & Inv.) Information Manager - Doc Archive & Reports RosettaNet EDIFACT
Excel Thailand Customers RosettaNet (4) Distribution22 AsiaPac 11 EMEA 04 Americas EAI Hub 42 Customers Distribution POS,OEM PO, (PO Changes, Forecast, Commit) Information Manager - Doc Archive & Reports 7 3PL Hubs Customers EDI Direct Top Tier
212 Suppliers Server-to-Server 42 Customers
12. Why Use RosettaNet PIPs RosettaNet Traditional EDI
versus 13. The Web based VMI Management Collaboration Report 14. VMI DDSN Metrics
15. Inbound Supply Chain Results
VMI Hubs SUPPLY EMS Suppliers Foundry 16. Hybrid Build-to-Demand Model: 2002-03
Customer Suppliers Seagate Material Flow Information Flow 17. Seagate eKanbanDrive clean room Assembly
18. eKanban Factory Replenishmentto Cleanrooms Vertiveyor System
Production Clean Room Kitting Area
Empty tote bin Fulltote bin Parts Received In Transit Parts In Demand 19. VMI Hub Replenishmentto Factory Dock Seagate Kitting Area UPS Hub
Demand Signal In Demand In Preparation Production Received In Transit Ship parts to Seagate within the required time 20. Demand Pull Process:Machine line triggering
21. Demand Pull Process: Receiving 3PL 1. Electronic DO 2. Parts delivery 3. UPS scan parts into Seagate system and segregate parts by lines 6. Receipt transaction by scanning thebarcoded DO 5. Production collects parts 4. System perform DO data Matching 22. Demand Pull Process: Ekit system Electronic NotificationOf Shortages/Deliveries and color coded delivery status SEAGATE MachineLines Demands Request Ekit Status Confirm www B2B UPS Integratedwith WMS Auto picklist generation Kitlists Signal Closed-Loop Integration with Fritz 23. Outbound Supply Chain Beginning the Demand Driven Journey 24. Outbound Supply Chain Results
DEMAND Disty OEMs VARs Implementation Detail Users Integrators Retail 25. Channel Synchronization
26. The Future of B2B:Multi-Tier Visibility SigmaTrak Integration Router B2BClient ERP Print Driver Integration Platform B2BServer RNIF Printer Emulator Send Receive B2B Client Seagate Trading Partner Process API API API - Low cost, pre-configured hardware appliance (router) that appears as a LAN printer device - The embedded E2open B2B Client manages the secure connection to the E2open Integration Platform WIP and POS Reporting
Back to 27. The bottom line: Supply Chain Success through Results Real-timeinformation flow: Re-plan twice/week, execute daily 90M parts Global businessvisibility:212 Suppliers, 7 JIT Hubs, 100% Direct, 35 POS Secured datadelivery:Encrypted, Redundant, Guaranteed Delivery, SLA Integrationto disparate systems: 19% server-to-server B2B vs. 1% CE, 3% EMS, 4% Semiconductor companies.Scalableinfrastructure: 3x increase in transaction volume last 18 mos. Coverageof B2B components:Most companies only get to ~50% of suppliers (80/20 rule by spend).Shortages occur on low cost parts too. Cost-effectivefor 100% connectivity: 28. 1999 2000 2001 2002 2003 2004 FP-Single plant planning Technology Enablers of Seagates Demand-Driven Journey ECNet-VMI signals to suppliers eKit-PCBA suppliers on Demand Pull IDM-Feeder Plants on Demand Pull AR-Customer JiT Hubs on Demand Pull E2open-VMI Process, RN PIPs2-D Barcode-Supplier Part Tracking eKanban-Shop Floor Demand Pull 3PL-Move Suppliers into common Hub 2005 E2open -Channel Synchronization 29. Results of Seagates DDSN Transformation
Seagate is out in front on implementing flexible and responsive supply chains. Lora Cecere, AMR Research - 114% inventory turn improvement - 37% reduction in manufacturing cycle times - 50% reduction in global inventory - 53% reduction in Asian inventory - 500% productivity improvement (drive production per HC) 30. Seagates Demand-Driven Journey: Lessons Learned
31. Summary
Supplier Seagate Customer Partners
Partner 1 Partner 2 Partner N
Seagate SE Asia Seagate China Seagate
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