E-Business and the Networked Economy
Ho Nai Choon
President
IDS-Gintic Pte Ltd
Email: ncho@gintic.gov.sg
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Agenda
 Introduction to E-Business
 Organizational Trends
 New concept of ECM: Enterprise Commerce Management
 The needs for standardisation
 Examples of successful implementation
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Introduction to
eBusiness
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E-Business ?
Conducting Core Business Processes on Internet
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The new network economy will be driven by 3 forces --
Connectivity, Speed and the Growth of Intangible Values.
“ Blur : the speed of change in the connected economy “
by Stan Davis and Christopher Meyer
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Organizational Trends
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Two Major Trends in Organizations
 Networked Organization
 Learning Organization
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Networked Organization
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Learning Organization ( Virtual Corporate University)
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The new concept of ECM :
Enterprise Commerce Management
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ECM is the blueprint
for the next generation of corporate systems:
ECM provides the model for the next generation of business systems,
comprising process-oriented applications and services tied together
by the Internet to support intercompany commerce.
-AMR Research
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By 2005, AMR Research believes that ERP, as we know it today,
will be completely transformed. This trend is already underway:
Supply Chain Planning (SCP) applications are replacing the
Enterprise Resource Planning (ERP) function.
E-procurement and strategic sourcing applications are gnawing
away at the purchasing functions.
CRM has obliterated ERP’s rudimentary customer service
functionality.
Web-based order management applications are moving from
simple self-service capability to full-fledged order fulfillment
systems, replacing ERP order entry.
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Content of an ECM model
 The different business partners and their business processes
 Exchange of products and services between the business
partners
 Information flow between the business partners
 Financial flows between the business partners
 e-business applications to support the interenterprise
business processes (e-Business Processes)
 Roles to define the process responsibilities
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Implementation of e-Business Solutions
ECM -Buisness
Models
ECM-Business
Processes
ECM-Business
Applications
E-Business Tools
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The needs for standardization
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Rosettanet
RosettaNet is a consortium of major Information Technology,
Electronic Components and Semiconductor Manufacturing companies
working to create and implement industry-wide, open e-business
process standards. These standards form a common e-business
language, aligning processes between supply chain partners on
a global basis.
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Rosettanet Standards
RosettaNet Partner Interface Processes™ (PIPs™) define
business processes between trading partners.
RosettaNet dictionaries provide a common set of properties
for PIPs™. The RosettaNet Business Dictionary designates
the properties used in basic business activities. RosettaNet
Technical Dictionaries provide properties for defining products.
The RosettaNet Implementation Framework (RNIF) provides
exchange protocols for quick and efficient implementation of
PIPs™.
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Two Myths…
One Reality
 Myth One

RosettaNet (and standards in general) are on the fast path to
general acceptance.
 Myth Two

Moving quickly to adopt RosettaNet provides you with a
competitive edge in the marketplace.
 Reality

Quickly and intelligently adopting RosettaNet and other strategic
standards will increase your success in the networked economy.
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So why RosettaNet?
 Standards are critical to conducting e-business worldwide.
 XML standards enable you to conduct business in real-time.
 RosettaNet is emerging as a leading XML standard for B2B.
 Early adoption enables you to blaze the trail.
 Leveraged properly RosettaNet can help you gain true competitive
advantage.
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If Everyone Adopts a Standard

Fulfill the promise of one to many and enables you to conduct e-business
with multiple partners.

Real-time transactions via XML instead of batched EDI.

Standard messages on interoperable platform enables worldwide ebusiness.
Security
Back-end
Integration
Application to Application
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B2B Process Integration Benefits
Typical Benefits Realized by Integrating the Supply Chain
Delivery Performance
16-28%
Product Cost Reduction
15%
Channel Returns & Scrap Reduction
40%
Inventory Reduction
25-60%
Fulfillment Cycle Time Reduction
30-50%
Lowered Supply Chain Costs
25-50%
Overall Productivity
10-16%
Source: PRTM/Supply Chain Management benchmarking study
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Fast ROI through
B2B Process Integration
 Leading Network Infrastructure company achieves ROI for various supply
chain business processes in six months (average).

Fastest ROI: Two weeks

Longest ROI: Two years
 Major Networking Company shows $14 to $28 million per year cost
savings by integrating New Product Introduction business processes.
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Steps to Competitive Advantage
 Get in the game

Adopt RosettaNet and other emerging standards early
 Affect the rules of the game

Leverage your understanding of the standards and your
business processes
 Win the game

Align business processes to integrate your supply chain
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Example of successful implementation
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Common Vision at Intel
Be the Leader in Supply Network
Management
Operate the right multiple supply networks
driven by business needs
Execute each network as a single, virtual
enterprise enabled by the Internet
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… and Supply Network Goals
Drive Cycle Time Reduction in all our
businesses across the Supply Networks
Design & Implement Agile/Flexible Supply
Networks
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To support the SCOR Model/Methodology

Provides structure and common language including
definition of process steps and metrics to model
supply chain

Reference Model provides a framework to configure
supply chain

Consistency of definition allows for effective
evaluation

With appropriate Tool, Time invested can yield value
added results
To explore integration with other planning and
business process modeling activities
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ARIS EasySCOR utilized for SCOR Modeling
Level One in EasySCOR Modeler
Plan
Source
Make
Deliver
Deliver
Level Two in
EasySCOR Modeler
D1 Deliver Stocked Products
D2 Deliver Make-to-Order Products
D3 Deliver Engineer-to-Order Products
D0 Deliver Infrastructure
Level Three in
EasySCOR Modeler
D1.7
D1.6
D1.8
D1.5
D1.9
D1.4
D1.3
D1.10 D1.11
D1.2
D1.12
D1.1
D1.13
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SCOR Metrics Assessed at Level I & II
Performance
Attributes
LI
Tie
Metric for P1, Plan Supply
Chain
Metric for P2, Plan Source
Metricfor P3 Plan Make
Metric for P4, Plan Deliver
Cycle Time
PF,
TLC,
CCT,
DP,
AT
Cumulative Source/Make Cycle
Time
Cumulative Source Cycle Time
Cumulative Make Cycle Time
Order Management Cycle Time
Source Flexibility
Make flexibility
Replan Cycle Time
Supplier Cycle Time
Number of End Products/SKU’s
PF,
TLC,
CCT,
DP,
AT
Total Order Management Costs
D/S Planning Costs
Raw Material Inventory Carrying
Costs
Work-In-Process Inventory
Carrying Costs
Finished Goods Inventory
Carrying Costs
Inventory Carrying Costs
Number of Supply Sources
WIP Shrinkage
Finished Goods Shrinkage
Value-Added Productivity
Raw Material Shrinkage
Order management costs
Obsolete Inventory
Commodity Management Profile
Material Overhead Cost Per
Dollar of Material Expenditure
Forecast Accuracy
Supplier Delivery Performance
to Customer Request Date
Production plan adherence
Fill rate
Actual to Theoretical Cycle
Time
Forecast Accuracy
Total WIP Inventory DOS
Total Finished Goods Inventory
DOS
Cost
Service/Quality
PF,
TLC,
CCT,
DP,
AT
Cash-to-cash Cycle Time
Delivery to Customer Request
Date
Supplier Fill Rate
Fill Rate
Total Logistics Costs
Delivery to Customer Request
Date
Product & Process Data
Accuracy (Bills of Material,
Routings, Planning Factors, etc.)
Assets
PF,
TLC,
CCT,
DP,
AT
Return on Assets
Capacity Utilization
Total Raw Material Inventory
DOS
Inventory Obsolescence
Total Inventory DOS
PF = Production Flexibility, TLC = Total Logistics Cost, CCT = Cash-to-Cash Cycle Time, DP = Delivery
Performance; AT = Asset Turns; xx = no tie; xx = tie
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SCOR applied to B2B e-Commerce
 Leverage SCOR to develop around e-business scenario
modeling

Start with supply chain models

Refine the model representation of B2B scenarios

Drill down to the interchange process specification level

Perform SCOR-based simulation
 Explore mapping of SCOR to the Rosettanet

Work with both the Supply Chain Council and RosettaNet

Siemens is committed in a joint effort

Currently developing a Value Proposition statement and pilot plan

Internal review process will precede SCC/Rosettanet proposal
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Drill into Interchange Specification
OEM
Importer
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E-Business Scenarios
will be used to
visualize the flow of
communication between
business participants
Dealer
Vehicle Specification/
Search Request
via Internet
Vehicle Locating
and Allocation
Reservation
Planning
Order Processing
Order Tracking
Production
Seller
Subcontractor
Shipment
Tracking
Transport Control
Goods Receipt
Processing
Sales
Order
Order
Managerment
Shipping
Export/
Transport
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Perform SCOR-based Simulation
Use eSCOR for tpt/cost analysis
Run
simulation
Define
products
Transfer
ARIS Model
into Gensym
eSCOR
Define
resources
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Potential Big Wins for SCOR
 Facilitate mapping of Level II & III metrics to Level I
indicators
 Provide a “how-to” guidelines for applying SCOR beyond
configuration analysis
 Drag and Drop SCOR modeling
 Cost/Time analysis through simulation
 SCOR-based B2B modeling
 Visualize SCOR metrics through integrated performance
monitoring
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Conclusion:
New Economy, New Processes, New
Standards
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