Introduction to Global Supply Chain Management
Module Nine:
The Application of Technology to
Global Supply Chain Management
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Module Agenda
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Technology & SCM
– Goals & Objectives
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Supply chain technology frameworks
in the Internet Age
– Electronic Data Interchange
– Value Added Networks
– Cloud-based
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Enterprise Resource Planning
“Best-of-Breed” SCM software
– Forecasting
– MRP/DRP
– Warehouse Management Systems
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Supply Chain Technology:
Integrating Sales & Operations Planning Activities
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Using a combination of hardware, software and other technology
assets to integrate supply chain players, synchronize their activities
and create end-to-end visibility across the entire S&OP process.
MANUFACTURER
DISTRIBUTION
SYSTEM
MATERIALS
MANAGEMENT
DISTRIBUTION
MANAGEMENT
Buy Side
Sell Side
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The Application of Technology to Global SCM:
Goals & Objectives
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To automate tasks, activities and
processes
Integrate processes amongst business
functions and between supply chain
players
– Enable the “Cascade Effect” (send
the same data set once)
– Reduce redundancies
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Drive down costs
Enhance supply chain visibility
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The Application of Technology to Global SCM:
Goals & Objectives
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Create real-time access to information
– Improve decision making
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Accommodate multiple business
models
– Traditional vendor/customer
relationships
– B2B (Business-To-Business)
– B2C (Business-To-Consumer)
– Omni-channel
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Support customer service activities
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Technology & SCM:
Key Terms & Definitions
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Enterprise Resource Planning (ERP)
software
Best-In-Breed software
Electronic Data Interchange (EDI)
Value Added Networks
Cloud-based software (software as a
Service…Saas)
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Key Terms & Definitions:
Enterprise Resource Planning (ERP) Software
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ERP systems (or “suites”) consist of
multi-functional, integrated software
packages that enable companies to
manage all facets of their business
Examples of ERP capabilities may
include:
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Human Resources (payroll)
Forecasting
Master Production Scheduling
MRP/DRP
Purchase Order Management
Sales Order Management
Accounts Receivable/Payable
Trade Compliance
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Key Terms & Definitions:
Enterprise Resource Planning (ERP) Software
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ERP’s are normally customized for
specific industries (or customers)
– Fashion Retail
– Oil & Gas
– Pharmaceuticals
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Can be integrated with other systems
(internal and external to the company)
Can be purchased (and installed on a
company’s servers)
Can be used under a “Saas” Model
(Software as a Service)
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Key Terms & Definitions:
Enterprise Resource Planning (ERP) Software
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Tend to be very expensive
– Installation and ongoing use
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Long, complicated implementation
periods
Typically used by large, well-financed
multi-national companies
Most well known ERP companies
include SAP, Oracle, NetSuite,
Microsoft Dynamics
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Key Terms & Definitions:
Best-In Breed Software
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Software packages that are used for a
specific business discipline or
function
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Forecasting
Material Requirements Planning
Purchase Order Management
Sales Order Management Systems
Warehouse Management Systems
Transportation Management Systems
Accounting systems
Trade Compliance
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Key Terms & Definitions:
Best-In Breed Software
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Can be designed for specific
industries (or customers)
– Fashion Retail
– Oil & Gas
– Pharmaceuticals
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Can be purchased or used as SaaS
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Key Terms & Definitions:
Best-In Breed Software
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Not as expensive as ERP’s
Short(er) implementation time
Pricing model by subscription and/or
user licenses
May be integrated with other internal
and external systems (although
sometimes difficult)
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Key Terms & Definitions:
Electronic Data Interchange
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Electronic Data Interchange (EDI) is
the computer-to-computer exchange
of business documents in a standard
electronic format between business
partners
In the supply chain world, EDI is
used to automate and facilitate the
sharing of (electronic) documents
between various parties
– Purchase Orders
– Commercial Invoices
– Advance Ship Notices
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Key Terms & Definitions:
Electronic Data Interchange
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EDI documents (transaction sets) are
created by using standard formatting
for data elements, segments and
envelopes
– A field in a given document or
message is called a “data element”
– Multiple data elements that make up
a section of a document are called
“segments” (Buyer details, item
description, etc.)
– Individual documents are called
“transactions sets”
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Transaction Set:
Purchase Order
Fields
Segment
Key Terms & Definitions:
Electronic Data Interchange
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EDI uses standards (specific rules) for
how to format documents
Standards deal with the information
required for a document and the way
the document must be structured so
the sending and receiving parties can
translate the transaction set
There are many standards that can be
used, such as:
– ANSI ASC X12, EDIFACT, et al
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Every type of transaction set
(document) is assigned a number to
identify it
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Electronic Data Interchange:
ANSI ASC X12 Transactions Set Numbers
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Purchase Order: 850
P.O. Acknowledgement: 855
P.O. Change Request: 860
Commercial Invoice: 810
Remittance Advice: 820
Advance Ship Notice: 856
Shipment Status Message: 214
Freight Invoice: 859
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Mapped EDI Data Example (XML Format):
Purchase Order
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Key Terms & Definitions:
Value Added Networks (VAN)
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A Value Added Network is a private
service provider that facilitates EDI
communication between supply chain
parties
VANs receive, translate and forward
messages containing EDI transaction
sets
VAN’s have become less attractive in
the Internet Era, but are still a big part
of the technology landscape
In response, today’s VAN’s offer
hosting capabilities that support EDI,
XML and other web-based document
formats
Pricing involves set-up fees and
monthly pricing based on volume
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How A Typical VAN Works…
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Key Terms & Definitions:
Cloud-Based Software (Saas)
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The user does not “buy” the software
or install it onto his/her server(s)
Software modules are “hosted” by the
service provider on their own servers
The user accesses the software via an
Internet connection
This model is known as “cloudbased” “on-demand” or “Software as
a Service” (Saas)
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Key Terms & Definitions:
Cloud-Based Software (Saas)
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Pricing model is based on
subscriptions, licenses (number of
users) and/or number of transactions
Does not require complex or time
consuming installations
Does not require a lot of hardware
(servers, etc.)
ERP models can be installed on a
user’s server(s) or accessed via the
Internet
NetSuite is a good example of an ERP
suite offered via a SaaS model
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Supply Chain Technology:
Enterprise Resource Planning Software
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ERP software allows an organization
to use a system of integrated
applications to manage its business
and automate multiple functions
In the software world, “integrate”
means data that is used for multiple
purposes is input into the system once
ERP systems can be customized by
industry, but there are many standard
features that most systems offer
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ERP Software:
Common Features
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Supplier Collaboration
Production Planning & Master
Production Scheduling
Sales Order & Billing Management
Logistics & Transportation
Inventory Management
Warehouse Management
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ERP Software:
Common Features
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Real-time supply chain visibility
Accounting & Finance
Forecasting
Contract Management
Supply Chain Analytics
Shop Floor Management
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ERP Software:
Other Features
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Multi-Country, Multi-Currency,
Multi-Legislative (trade compliance)
Tax Management
Asset life cycle
Fixed Asset Management
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ERP Software:
Oracle
https://www.oracle.com/applications/supply-chain-management/index.html
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ERP Software:
SAP
http://go.sap.com/solution/lob/supply-chain.html
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Best-In-Breed Global Fashion Retail SCM Software:
Just Enough
http://www.justenough.com/
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Best-In-Breed P.O. Management Software:
Log-Net
http://www.log-net.com/
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Best-In-Breed Global Trade Management Software:
Amber Road:
http://www.amberroad.com/
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Best-In-Breed Warehouse Management Software:
HighJump
http://www.highjump.com/
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End of Module Nine
Congratulations!!!
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