After several tough quarters, the economy is springing back. Operational managers have very high hopes that new investments in software and other technology will score some much-needed points for supply-chain performance.
But any supply-chain managers who expect flashy, new technologies to blow away the competition overnight are going to be disappointed. The supply-chain game over the next few years will be more about fundamentals, both for the technology vendors and for the users.
Vendors know they must finally deliver on the unfulfilled promise to enable end-to-end, seamless supply chains. Integration will be made easier, so applications will be truly interoperable. The ability to collaborate among extended supply-chain partners is becoming an integral part of nearly every application. Web-enabled trading networks are going to become as easy to create as an e-mail list. To accomplish these tasks, vendors are rewriting their applications to meet the needs of today's highly distributed supply chains. Languages and platforms are becoming less proprietary, if not completely open.
|"RFID is the most over-hyped technology in the supply-chain world."|
- Andrew White of Gartner Research
|A Total Inbound Solution for EMS Provider|
|Solectron, the $16bn electronic manufacturing services (EMS) provider, is using Arzoon's LIFE Logistics Resource Management applications to improve service and to reduce logistics costs for inbound shipments from its 7,000 suppliers. Solectron's manufacturing operations span five continents and flow more than $20bn in raw materials inventory through the company's supply chain each year.|
As part of a larger internet initiative, the EMS provider is implementing Arzoon LIFE to manage its entire logistics network to include inventory visibility, transportation management and international trade logistics. The implementation is expected to reduce logistics costs by $20m over three years, which is significant in an industry that operates on margins of 2 or 3 percent.
By automating its carrier selection process, Solectron expects to reduce costly expedited shipments, labor costs and errors common with manual operations. Using information from a purchase order, the LIFE solution optimally selects a carrier based on defined business rules and tenders the load. The system notifies the carrier, or intermediary if appropriate, to schedule a pickup. The system accurately and automatically prepares all required documents. To assure supplier routing compliance, Solectron managers can monitor each shipment using Arzoon reports.
With over half of its suppliers and customers based outside the U.S., Solectron is tightly focused on complying with customs regulations to avoid border delays, liability and costly fines. Arzoon's Global Trade LIFE provides a centralized rules database that includes government trade advisories, license requirements, denied parties screening, controlled-country screening, documentation determination, tariffs and duties for more than 25 countries. Arzoon Global Trade LIFE helps Solectron comply with international trade restrictions by screening shipments and purchase orders prior to execution. If the screening indicates potential non-compliance, the solution sends alerts to all designated parties.
Using the Arzoon Global Trade LIFE total landed-cost calculator, Solectron generates scenarios detailing all costs involved with the importation of goods, including transportation, duties, taxes and import/export fees. For instance, where the company has a number of different suppliers for a particular component, Global Trade LIFE identifies the most cost-effective supplier based on the true, total landed cost.
Because of the complexity of its trade network, Solectron has thousands of components and finished goods in transit at any given time. The company needs a solution that provides visibility and information about all shipments and inventory in transit. Solectron also monitors the fulfillment of purchase orders down to the part number or SKU level. Arzoon's purchase order and freight tracing tools give Solectron visibility into both domestic and international inbound shipments. The Arzoon system issues proactive alerts when requested delivery dates are in jeopardy of being missed, so managers can bring the inbound supply chain back into synch with manufacturing schedules
|Sprechen Sie RFID?|
|When Wal-Mart and its top vendors launch their radio frequency identification (RFID) initiative in November 2005, Germany's top retailer, the METRO Group, already will have had its program in operation for one year. In November 2004, 100 suppliers to METRO will affix RFID tags to their pallets and packages and deliver them to 10 central warehouses and around 250 stores within the METRO Group, which includes Metro Cash & Carry, Real hypermarkets, Extra supermarkets and Galeria Kaufhof department stores. Since late 2003, at its showcase "Future Store" in Rheinberg, Germany, METRO has been testing RFID transmission of product information such as price, manufacturer, expiration date and product weight. These tests were conducted using technology and expertise from SAP, Intel, IBM and around 40 other leading vendors.|
METRO is initially testing RFID in warehouse management to enable the automatic inspection of incoming goods. Delivery of goods to the Future Store in Rheinberg are fitted with RFID tags in the central warehouse and read in upon arrival at the store. During transport from the store's warehouse to the salesroom, goods are read in again, and identified as items to be moved to the front of the store. The tests in Rheinberg have shown that RFID offers retailers and their customers enormous advantages: more effective processes and, consequently, lower costs, which benefits both parties. Using RFID, goods will be able to be located along the entire process chain--from production all the way through to the shelf in the store. Managing orders can be optimized, losses reduced and out-of-stock situations avoided, assuring an even more consistent availability of goods for the customer.
Based on its experience with tests such as the METRO project, SAP has launched the first packaged RFID solution for supply-chain management. SAP says the system allows companies to leverage data captured through RFID tags in their business processes by integrating ERP and SCM functionalities with RFID-enabled applications. Examples include packing and unpacking, shipping and receiving and tracking and tracing across the supply chain.
|Enabling Global Drop Shipping With Live Data|
|JDS Uniphase (JDSU) is reducing its inventories while dramatically improving order cycle time by enabling its outsource manufacturers to ship directly to customers on a global scale. The fiber-optics components maker is using ClearOrbit's Advanced Contract Manufacturing module to seamlessly collaborate in real time with six contract manufacturers, suppliers and their suppliers, around the globe. The ClearOrbit module is an extension to JDSU's hosted Oracle ERP system. JDSU retains complete visibility and control over the disposition of inventory during the staging and shipment processes at supplier locations, including the printing of shipping documents, commercial invoices and barcode labels, with all of the necessary customer information printed in JDSU's format, using JDSU's ERP data. JDSU also remains the single point of customer contact, and the brand the customers associate with the products delivered. The contract manufacturers interact directly with a single JDSU data model via real-time web pages and web service protocols. |
The contract manufacturers always have the latest customer information because they link directly to JDSU's constantly updated database of its trading partners in its Oracle 11i system. The ClearOrbit collaboration software suite allows all the trading partners to access the same database, which is housed, hosted and controlled by JDSU, the originator of the purchase order and the sole point of customer contact. The trading partners interact with that data where it resides naturally, and they can access component inventory, part status, shipping status, datasheets and more all through the web.
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