How to Achieve
Smart Business Network?
Li ZHENG
Department of Industrial Engineering
Tsinghua University
Outline
• Business Network in China
• How to Achieve Smart?
• Research in Tsinghua
Outline
• Business Network in China
• How to Achieve Smart?
• Research in Tsinghua
Business Network in China
• Global Procurement in China
– Most part of Fortune 500 Companies
have established their procurement
center in China
– Many parties are involved in the
procurement process
Case: Wal-Mart
• Smartness in the business network
– Parties in the business network
• Wal-Mart
• Supplier
• …
– Long term collaboration is established between different parties
• Product Design Support
• Information System Support
– The global procurement center is responsible for the coordination of the
business network
• Purchasing department coordinates the whole process
• Specific departments are charged of collaborating with different
parties
Case: ZHONGGUANCUN Science Park
• AS-IS Business Network
– Huge demand for transportation
– Huge supply for transportation
– Individual client deals with individual forwarder
• Smarter Business Network
– Resource of transportation is better allocated
– Demand and supply is aggregated
– The transportation process is tracked
Business Network in China
• Chinese Automobile Industry
– There are more than 100 automobile assembly
factories, more than 3000 part suppliers in China.
– Every automobile manufacturer has about 1000
part suppliers and every part supplier needs to deal
with several automobile manufacturers.
Case: Some Automobile Manufacturer
• Smartness in the business network
– Long term collaboration is established between different parties
• Part suppliers establish JIT warehouses near the automobile
assembly factory
• Whenever there is a demand created, part supplier is
responsible for delivering the parts to the production line
• Production planning of automobile manufacturer is shared
with part suppliers
• Inventory information of part suppliers is shared with
automobile manufacturer
– The automobile manufacturer is the driving force for the smart
business network
Business Network in China
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Electronic Industry
Automobile Industry
Logistics Industry
E-Marketplace
...
Business Challenges That Affect Manufacturing
• Number of globally distributed manufacturing locations
increasing
– causing new manufacturing visibility and collaboration needs
• Mass customization and events needs to be handled jointly
– causing manufacturing flexibility challenges
• Product life cycles dramatically shrinking
– causing manufacturing cycle times and productivity challenges
• Cost pressure continually increasing
– causing manufacturing controlling and automation challenges
• Quality requirements continually becoming more stringent
– to reduce mid-and long-term quality costs
Outline
• Business Network in China
• How to Achieve Smart?
• Research in Tsinghua
Business Network
• Point
– Every business entity has its
core competence, it needs the
supply from some business
entities to fulfill the demand
of other business entities
• Connection
– The operation of the business
network consists of the
collaboration between every
two business partners.
• Network Configuration
– The leading companies in the
business network dominate
the operation of the business
network
Smartness
• Smartness in the SBN
– Quick Connect & Disconnect
– Pick, Plug and Play
– Own Business Logic
• This is the objective! The question is how to
make a business network smarter?
Point
• Every business entity should be smarter
– Management Point of View
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Right Strategy
Core Competence
Agile Organization
High Execution Power
…
– Technology View
• Business connection could be established more easily
with the help of information technology
Case: Amazon
• Amazon Web Services
– Amazon Web Services provides developers with direct access to
Amazon's robust technology platform.
• Amazon E-Commerce Service
– Access product data from Amazon.com, Amazon.fr,
Amazon.ca, Amazon.de, Amazon.co.jp, and Amazon.co.uk
– Retrieve detailed item information, including prices, images,
customer reviews, and more
– Earn money using your Amazon Associates account
• Amazon Historical Pricing
• Amazon Simple Queue Service
• …
Connection
• Three Levels of Collaboration
– Information Collaboration
• Basic information sharing
– Process Collaboration
• Close process integration
– Decision Collaboration
• Collaborative decision making
Case: CPFR
• CPFR (Collaborative Planning, Forecasting and
Replenishment) is a business practice that
combines the intelligence of multiple trading
partners in the planning and fulfillment of
customer demand.
• CPFR links sales and marketing best practices,
such as category management, to supply chain
planning and execution processes to increase
availability while reducing inventory,
transportation and logistics costs.
Connection
• Kinds of connection
– Weak vs. Strong
– Short term vs. Long term
• Static and Dynamic View on the Smartness of
Connection
Network Configuration
• In the network, different points and connections have
different level of smartness
• The dominant companies in the business network
leads the smartness of the business network
– Toyota puts forward JIT (Just In Time)
– Wal-Mart puts forward CPFR (Collaborative
Planning, Forecasting and Replenishment)
–…
• Network as a whole
• Case by case evaluation!!!
What do we miss?
Social system
Outline
• Business Network in China
• How to Achieve Smart?
• Research in Tsinghua
Research in Tsinghua
• Theoretical research
– Process
modeling/mining
– Semantic Web
– Service orientated
architecture
• Application
– Market Place
– DS system for
Logistics
– Consulting system
The End
Thank you!
Dank u!
谢谢！