ONLINE FILE W6.1 Application Case LAND O’LAKES ...wps.prenhall.com/wps/media/objects/8362/8562891/additional_online/... · LAND O’LAKES COLLABORATES WITH COMPETITORS TO IMPROVE

Chapter Six: E-Supply Chains, Collaborative Commerce, and Corporate Portals 6-1

ONLINE FILE W6.1Application Case

LAND O’LAKES COLLABORATES WITH COMPETITORS TOIMPROVE ITS LOGISTICSThe ProblemLand O’Lakes, Inc. (landolakesinc.com) is a $6 billion nationalfood and agricultural cooperative owned by and servingthousands of producer–members, many of which are commu-nity cooperatives. It is the nation’s second-largest dairycooperative and has the largest market share of butter anddeli cheese.

In 2002, Land O’Lakes ran into trouble in every majorarea of operation. Sales fell $712 million from the previousyear, to $5.8 billion, partly due to smaller markets for brandeddairy products as a result of the slow economy. Land O’Lakesalso was burdened with debt from its 2001 acquisition ofPurina Mills.

Wal-Mart, which was moving further into the grocerybusiness, was another factor. Wal-Mart’s renowned distribu-tion system includes super-efficient regional distributioncenters across the country, where trucks that deliver anddistribute goods can “cross-dock” without having to keeplarge amounts of inventory in a holding area. Land O’Lakes(and its competitors) had to be able to accommodateWal-Mart’s demanding schedules by having trucks showup at precisely the required time.

Land O’Lakes also has to compete with huge competi-tors such as General Mills and Kraft Foods for space insupermarkets’ refrigerated sections. These giants use theirsize, clout, and relationships with supermarket retailers,paying slotting allowances (up-front payments that a foodmanufacturer must pay to a supermarket for access to itsshelves) and engaging in other practices that make thefight for shelf space extremely competitive. Therefore, LandO’Lakes must deliver more frequently in order to keepenough stock at the stores.

The SolutionLand O’Lakes truckers—some 50 different carriers—spentmuch of their time shuttling empty trucks down slow-movinghighways, wasting several million dollars annually. The deliv-ery trucks were empty approximately 25 percent of the time.

Land O’Lakes had to find ways to become more efficientin order to reduce costs. To address inefficiencies, Land

O’Lakes started using Web-based collaborative logistics. Thecompany turned to Nistevo, now part of Sterling Commerce(sterlingcommerce.com/nistevo.htm), a hosted software ser-vice that enables manufacturers, retailers, and carriers toplan and execute their inbound and outbound logistics.

Nistevo’s collaborative logistics system continuouslyupdates and consolidates information about routes, loads,and schedules from members’ in-house logistics schedulingsystems. Only Nistevo sees the whole picture. For example, ifGeneral Mills and Land O’Lakes are sharing a route, LandO’Lakes routes are not shown to General Mills, and vice versa.Nistevo scans the millions of possible route configurationsand route–load combinations to look for empty trucks andless-than-truckload product amounts. When it finds these sit-uations, Nistevo can merge loads from different companies,even competitors, bound for the same destination or destina-tions along the way.

The ResultsTo join Nistevo’s network, Land O’Lakes paid an initial subscrip-tion fee of $250,000, and the co-op incurred another $250,000in related startup costs, such as training its 10-person logisticsstaff to use the collaborative system. However, the companysays that savings from its logistics strategy covered those feeswithin the first 6 months of use. In fact, the new logisticsstrategy is cutting freight costs by 15 percent annually, for anannual savings of more than $2 million.

Now, thanks to the Web, the company can identifyempty trucks and the best carriers, and find the fastestroutes, piggybacking Land O’Lakes onto dozens of GeneralMills’ and Georgia-Pacific Corp.’s routes to gain savings.

Questions1. Enter sterlingcommerce.com/nistevo.htm and learn more

about how it serves the transport industry.

2. What role does EC technology play in the Nistevoapplications?

REFERENCES FOR ONLINE FILE W6.1Karolefski, J. “Driving Up Costs.” Food Logistics, February 1,

2005. foodlogistics.com/print/Food-Logistics/Driving-Up-Costs/1$101 (accessed March 2009).

Kerr, J. “Six Principles for Global Success.” LogisticsManagement, January 1, 2004. logisticsmgmt.com/article/CA374343.html (accessed February).

Nistevo. “Land O’Lakes Reduces Supply Chain CostsThrough Online Execution of Logistics Operations.”nistevo.com/v1/pdfs/LOL_Case_Study.pdf (no longeravailable online).

6-2 Part 3: Business-to-Business E-Commerce


NIKE’S SUPPLY CHAIN: FAILURE AND EVENTUALSUCCESSIncreasingly demanding customers and the consequentincreases in product sophistication lead to complex supplychains that are challenging to manage. Add increasingglobalization to this mix, and supply chain managementbecomes an even more critical issue. Nike, along withother leading global companies, faced the challenge ofa more complex and problematic supply chain in thelate 1990s.

Back in the 1970s, retailers placed orders with Nike6 months before the required delivery date. These orders werethen forwarded to Nike’s manufacturing units around theworld. Nike guaranteed that 90 percent of their orders wouldbe delivered within a set time period at an agreed-upon fixedprice. This system initially worked well.

However, during the 1980s and 1990s, Nike’s businessexpanded and became more and more global. Also duringthose years, customers became more demanding regardingquality, style, and comfort, and as a result, product sophis-tication and variety exploded, causing demand forecasting,manufacturing, and distribution to become increasinglycomplex. Nike’s supply chain managers were soon dealingwith thousands of styles of shoes, each offered in both alarge number of different color combinations and sizes.Thus, even without considering the apparel and equipmentsides of the business, Nike had an enormously complexglobal supply chain.

In 1999, supply chain problems, particularly demandand inventory forecasting, manifested themselves in thebottom line: Profits dropped by 50 percent. Nike manage-ment’s analysis and assessment of the situation led tothe launch of NSC, the Nike Supply Chain project. Thisinitiative was aimed at bringing about excellence insupply chain processes. The first element of the initiativewas an attempt to improve the somewhat fragmented andfailing demand forecasting and order management activi-ties in Nike. In 1998, 27 order management systems ledto poor demand forecasting and, hence, ineffective supplychain management overall. To overcome a number of sup-ply chain management problems, Nike decided to acquireand implement i2 Technologies’ demand forecastingsystem.

The i2 Technologies implementation was begun in 1999with a projected cost of $40 million. The objectives of theproject were ambitious and included detailed forecasting ofmore than 1 million stock keeping units (SKUs). Where thei2 Technologies’ software did not exactly meet Nike’srequirements, extensive customization was undertaken.Further, large amounts of data were fed into the i2Technologies’ system from legacy systems within Nike. From

this data, sophisticated and complex algorithms automati-cally generated thousands of forecasts that were used todrive Nike manufacturing. Due to the ambitious nature ofthe project and the complexity of the undertaking, problemsbegan to surface by June 2000.

In the latter half of 2000, Nike was overmanufacturingsome products, while struggling to meet demand in others.For example, Nike overproduced poor-selling shoe lines suchas Air Garnett II by $90 million worth of product, whileunderproducing popular lines such as Air Force One by$80 million to $100 million worth of product. It took about6 to 9 months for Nike to overcome its inventory imbalanceand more than 2 years to make up the financial loss. Insetting things right, many shoes were sold at heavilydiscounted prices.

Nike analyzed its i2 Technologies’ demand forecastingapplication in an effort to correct the problems and moveforward. Immediate lessons learned involved the need formore adequate training of users, more comprehensive test-ing of the application as the implementation presented,better data cleansing, and more careful integration of theapplication with other extant systems. The extensive cus-tomization of the i2 Technologies’ software, which, amongother things, broke forecasts down to individual styles,added undue complexity to an already complex project. Thecustomization increased the taxing amounts of datarequired by the system. Furthermore, the data requirementswere made even more onerous by the decisions of the Nikeplanners and forecasters to require extensive historicaldata and to forecast too far ahead. Generally, the review ofthe project found that there was altogether too muchreliance on automatically generated forecasts rather than ajudicious blend of human judgment and intuition togetherwith the statistical analysis.

Looking back over the problematic project, Nike man-agement felt that the initial attempt to bring about supplychain improvements had been too ambitious. Deadlineshad been too tight, and the implementation had beenrushed. The complexity of the undertaking had beenincreased and focus had been lost because Nike had, inaddition to the i2 Technologies’ project, attempted toimplement the SAP ERP system and Siebel’s CRM system atthe same time.

Nike moved to take control of its supply chain project,eventually moving its shoe product lines forecasting applica-tion onto SAP, where the forecasting was based more heavilyon forward orders and planners’ judgment rather than relyingon statistical algorithms. After considerable improvements, i2Technologies’ system continued to be used for Nike apparel

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ONLINE FILE W6.2 (continued)

lines. By 2004, its implementation of i2 Technologies’ fore-casting system, SAP’s ERP system, and Siebel’s CRM systemwas complete, giving Nike an integrated and efficientsupply chain.

Nike had spent 6 years and $800 million on the pro-ject. Generally speaking, despite the early problems, Nikemanagement was well satisfied with the project. The projecthad enabled Nike to shorten its lead time for buildingfootwear from 9 to 6 months, and its enhanced capabilitiesin planning and tracking inventory resulted in a return oninvestment of 20 percent in 2004.

Questions1. What developments led to Nike’s supply chain being

such a challenge to manage?

2. What factors led to the i2 Technologies implementationbeing a highly complex project? Were the increasedcomplexities really necessary?

3. What was wrong with Nike relying heavily on automaticstatistical forecasts generated by the i2 Technologies’software?

REFERENCES FOR ONLINE FILE W6.2Chaturvedi, R. N., and V. Gupta. “SCM and ERP

Software Implementation at Nike—From Failure toSuccess.” ICFAI Center for Management Research,Hyderabad, India, 2005, OPER/049.

Datta, M. “Nike—Failure in Demand Forecasting.” ICFAICenter for Management Research, Hyderabad, India,2005, CLSCM004.

Koch, C. “Nike Rebounds: How (and Why) NikeRecovered from Its Supply Chain Disaster.” CIOMagazine, June 15, 2004. cio.com/article/32334/Nike_Rebounds_How_and_Why_Nike_Recovered_from_Its_Supply_Chain_Disaster (accessed February2009).

Online File W6.3 Examples of RFID Implementation

RFID at Harmon Hospital. Keeping track of relatively small, movable assets (such as wheelchairs, pulse oximeters, andother medical devices) in hospitals can be time-consuming and difficult. Equipment may be stored in cupboards, moved to otherwards and not returned, or sent home with patients and not returned. Studies also suggest that when hospital staff are unableto find the equipment they need, rather than instigating a full-scale search, they tend to place an order for more equipment.Thus, hospitals incur significant costs in both searching for equipment and in ordering equipment that is not actually necessary.Harmon Hospital in Las Vegas is addressing these concerns by attaching active RFID tags on various medical devices andinstalling RFID readers at various points throughout the hospital. This enables staff to locate any required item of equipment,with the system providing a text-based report or a map of the hospital indicating the location of the desired piece of equip-ment. Many other organizations in a variety of industries would clearly experience similar problems as those at Harmon Hospital.

RFID at Medway Maternity Unit. Security and safety in maternity wards is a priority, especially because of occasionalcases of babies being snatched from hospital wards by unauthorized persons. Using the ideas gained from the application ofRFID tags to released prisoners and asylum seekers at risk of absconding, Medway NHS in the United Kingdom became oneof the first to attach RFID tags to newborns to track the movement of the infants, tightening security in their maternitywards. Immediately after birth, an RFID tag is attached to the baby’s ankle. The tag enables staff to monitor the baby’slocation on the ward. Any attempt by unauthorized personnel to move the baby out of the ward will trigger alarms andcause the doors to lock, thus ensuring that the babies are kept secure at all times. By providing each mother with a match-ing wrist tag, it is easy to ensure that babies are not inadvertently swapped when they are handed to their mother for feed-ing. The mother’s tag can be activated to test match against the baby’s. This is particularly important in preventing theaccidental transfer of HIV or other infectious diseases through mistaken feeding of another mother’s baby (Carvel 2006).

RFID in Philadelphia Cabs. Taxicabs in Philadelphia, Pennsylvania, are equipped to accept payments using RFIDtechnologies. Passengers can use RFID-enabled credit cards, such as PayPass from MasterCard or similar cards from Visa or

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Online File W6.3 (continued)

American Express, to pay their cab fares. A terminal is located behind the front seat, facing the passenger. To activate thesystem, passengers wave their RFID-enabled cards near the reader. The driver can then complete the transaction usingeither credit or debit facilities. Payments are processed by sending payment information over wireless networks. Such tech-nologies are reducing the time taken to complete a transaction. This system also can be used by the cab driver for routingand navigational information, for work scheduling (signing on and off a shift), for keeping logs of trips, and for trackingitems left by mistake by passengers in the cab (O’Connor 2006).

RFID Use by CHEP. The Asia Pacific Division of CHEP (famous for its pallets and reusable containers, based in Florida)has developed an innovative use of RFID for the automotive industry in Australia. CHEP manufactures and then rents reusable,custom-made, plastic stacking crates for transporting parts and components along the automotive supply chain. In addition tothe traditional text tags and bar-coded labels, CHEP has now added RFID tags to the outside of these crates. CHEP is thus ableto easily determine which customer has which crate, while it gives the automotive companies much more precise insights intothe location of parts both within their manufacturing environment and along their extended supply chains.

RFID at Nokia. Security guards employed at Nokia facilities now carry a mobile phone handset with an RFID tag addedand an RFID reader in the outer casing. At the start of a shift, guards use the phone to read their RFID-enabled namebadges. RFID tags are installed at various points around the facility. As security guards do their rounds, they open the hand-sets to read the tags as they pass. Details of the phone number and the RFID tag just read are transmitted over cellularphone networks. Supervisors are thus given accurate information as to when a particular guard started and finished a shift,whether the guard patrolled all the required locations, and where the guard was at a particular point in time. In addition,supervisors can use the text and phone function to ask guards to recheck an area, vary their route, and the like.

The ability to link mobile phone technologies and RFID opens many more possibilities. For example, JCDecaux is consider-ing using this Nokia application to track the installation and removal of billboard, posters, and rolling paid advertising displaysat bus stops, train stations, movie theaters, roadsides, and other public locations (Bacheldor 2006b). Another company,Gentag, is developing technologies that will utilize mobile phones as RFID readers in health care applications. RFID-enabledskin patches will allow the remote monitoring of pulse rates, temperatures, glucose levels, and the like (Bacheldor 2006b).

REFERENCES FOR ONLINE FILE W6.3Bacheldor, B. “CHEP RFID Enables Reusable Containers

for Auto Industry.” RFID Journal, December 1, 2006a.rfidjournal.com/article/articleprint/2859/-1/1 (accessedFebruary 2009).

Bacheldor, B. “Gentag Foresees Cell Phones as Thermo-meters, Glucose Readers.” RFID Journal, December 19,2006b. rfidjournal.com/article/articleview/2910 (accessedFebruary 2009).

Carvel, J. “Babies Given Electronic Tags to Beat Abductors.”The Guardian, June 16, 2005. guardian.co.uk/uk_news/story/0,,1507497,00.html (accessed February2009).

O’Connor, M. C. “Philly Cabs Taking RFID Payments onthe Road.” RFID Journal, November 29, 2006.rfidjournal.com/article/articleprint/2852/-1/1 (accessedFebruary 2009).


Online File W6.4 Benefits of RFID

The following are representative benefits of properly used RFID solutions to the various parties involved.

Benefits for ManufacturersRFID solutions provide the real-time information that’s necessary to improve operating efficiencies in a number of indus-trial applications. By automatically detecting product movements throughout the manufacturing process, RFID providesreal-time inventory visibility while minimizing the need for human intervention.

With RFID, it is possible for manufacturers to:

◗ Increase speed and efficiency, with fewer errors throughout the entire assembly process.◗ Take inventory and perform picking operations to update inventory levels in real time.◗ Improve efficiencies for work-in-process (WIP) reporting.◗ Improve inventory visibility to production employees who use just-in-time (JIT) systems.◗ Reduce stock levels, resulting from improved inventory management.◗ Automate reporting of all material moves both inbound/outbound and within your facility.

Benefits for RetailersRFID technology empowers retailers to increase inventory visibility, reduce labor costs, and improve profitability by deliv-ering the benefits of enterprise mobility to a variety of applications:

◗ Read/write RFID tags automatically at shipping and receiving doors to expedite loading and unloading processes.◗ Improve customer satisfaction by ensuring that products are stocked and available.◗ Reduce shrinkage, fraud, and spoilage.◗ Increase in-stock merchandise for higher sales volumes and increased profits.◗ Reduce human intervention and decrease labor costs.◗ Dramatically improve overall warehousing efficiencies.

Benefits for Transportation CompaniesRFID solutions can provide fast, accurate information to improve operational efficiencies in a variety of transportationapplications. By automatically tracking assets throughout the course of transit, RFID transforms the tracking processand yields unsurpassed asset management and visibility. RFID can:

◗ Enhance passenger and employee safety by virtually eliminating security risks.◗ Improve the efficiency of baggage-handling processes to reduce loss and theft, and increase customer satisfaction.◗ Streamline cargo processes and reduce labor costs.◗ Control cost by improving all facets of inventory tracking and management.

Benefits for Federal Government and Defense AgenciesRFID technology provides the solutions that government agencies need to improve security and inventory visibilitythroughout the world. With RFID, government and defense agencies can:

◗ Locate and track military personnel instantaneously.◗ Increase the speed and accuracy of deliveries by allowing items to be inventoried at the container level.◗ Augment available staff power by automating functions previously executed manually.◗ Access real-time inventory to improve visibility and reduce shrinkage.


Online File W6.5 Comparison of RuBee and RFID


LEIGHTONS OPTICIANS SEES THE VALUE OFCOLLABORATIVE HUBSLeightons Opticians was founded in 1928 in Southampton,United Kingdom. The business progressed throughout thedecades, and a number of branches were opened. In 1996,Leightons launched a franchise business aimed at attract-ing high-quality and business-focused opticians andoptometrists. Leightons now owns 25 branch stores and has15 franchisees. Leightons still maintains its traditionalfamily values of outstanding personal customer servicedelivered by highly professional staff offering excellenttreatment and advice and the best quality lens and frametechnologies. As the business expanded, however, the chal-lenge was to ensure that staff spent time serving customersand not on administrative issues, such as order tracking,filing, and the like.

Leightons decided to implement a collaborative hubfrom Supply Chain Connect (supplychainconnect.com), whichis now part of ChemConnect (chemconnect.com). All of thebranches, franchises, and suppliers are able to connect to asingle hub and seamlessly exchange information, irrespec-tive of the internal systems operated at the respective sites.Leightons pays a monthly subscription fee for Supply ChainConnect’s services, which made it possible to avoid paying asubstantial up-front investment in the technology.

Staff members at any of Leightons’ branches are ableto send orders electronically to a number of different sup-pliers. Because orders are sent through the hub, they cannow be tracked, so Leightons’ staff members are able tocheck the real-time status of any order at any time.

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RuBee RFIDSignal type Magnetic waves (99.9% magnetic, 0.1% radio) Radio waves (99.9% radio, 0.1% magnetic)Frequency Low frequency (below 450Khz, often 132KHz) High and ultrahigh frequency (HF =

13.56Mhz and UHF = 916MHz)Read speed Slower, 6–10 reads per second Faster, HF = 100 reads/second

UHF = 150–200 reads/secondBattery life of

active tagsLong (10–15 years) Short (1–4 years)

Suitable for visibility

Locating items in warehouse, medical, andhealth care applications, livestock applica-tions, obtaining real-time information onfull history of item via the Internet, errordetection, creation of smart store by reducinglikelihood of stock-outs, theft prevention

Tracking, high-volume scanningCounting inventory moving on conveyor

belts, ensuring inventory is movingalong supply chain as planned

Tagging Item-level tagging Pallet, crate, carton taggingAbility to

handle harshenvironments

Works under water, around metal, around corners

Does not always work effectively in harshenvironments

Safety issues Very safe, not absorbed through human tissues,lower field strengths than in airport metaldetectors

Relatively safe

Cost Infrastructure costs less than RFID; tag costsmay be higher, depending on amount ofintelligence built into tag

Infrastructure costs higher; tag costsdepend on whether active or passive



Leightons has been very happy with the direct cost savingsgenerated and also believes that its staff is now able tospend more time delivering excellent personal customerservice.

Leightons’ two major suppliers are Luxottica andMarchon; both are enthusiastic users of Supply ChainConnect. They receive hundreds of orders daily from a varietyof branches and franchisees, and the collaboration hubenables them to view all orders from a particular buyer veryeasily. The system is integrated with their back-office sys-tems, eliminating any need for rekeying data, thus saving thestatus of any particular order, meaning that they are betterable to monitor the performance of their critical suppliers.

Future expansion is planned to allow for automatedmatching of orders against invoices for payment approvals.

Questions1. Why is this considered to be a collaboration hub?

2. What are the potential risks associated with participationin this collaboration hub?

3. In what other ways could these players utilize thecollaboration hub?

4. Think of the various parties involved in this collabora-tion and identify the benefits that each derives from it.

REFERENCES FOR ONLINE FILE W6.6ChemConnect. “Leightons Opticians Sees the Business Case

for Electronic Ordering in the UK Optical Industry.”February 10, 2005. chemconnect.com/pdfs/case_ studies/OpticalHub.pdf (accessed February 2009).

Leightons Opticians. “A Family Business.” 2006. leightonsopticians.com/a_family_business (accessed February2009).


WEBCOR: SUPPLY CHAIN HUBWebcor Builders (webcor.com) builds apartment buildings,hotels, and office parks and earns revenues in excess of $1 bil-lion a year. For years, the company suffered from poor commu-nication with its partners (architects, designers, building own-ers, subcontractors) and struggled with too much paperwork.Reams of paper documents were sent back and forth via “snailmail.” In a very competitive industry, inefficiencies can becostly. Therefore, Webcor decided to introduce c-commerce intoits operations. Webcor’s goal was to turn its CAD drawings,memos, and other information into shared digital information.

Starting in 1999, to enable online collaboration,Webcor began using an ASP that hosts Webcor’s projectsusing ProjectNet software on a secured extranet. The soft-ware is complex; it was difficult to get everyone to acceptProjectNet, and some user training was necessary. However,Webcor found itself in a strong enough market position tobe able to say that it would not partner with anyone whowould not use ProjectNet.

With everyone on the ProjectNet system, Webcor’s busi-ness partners can post, send, or edit complex CAD drawings,digital photos, memos, status reports, and project histories.ProjectNet provides a central meeting place where users can

both download and transmit information to all parties.Everyone involved in a project is more accountable becausethere is a digital trail, and partners now get instant access tonew drawings.

One of the major benefits of ProjectNet is that employ-ees now spend more time managing their work and less timeon administrative paperwork. Several clerical workers werelaid off, and the saved cost of their salaries covers the soft-ware rental fees.

By 2005 Webcor’s goals included:

◗ Save time and money by providing high-speed dataconnections at every construction job; a 12-month job couldbe cut to 12 weeks, saving hundreds of thousands of dollars.

◗ Streamline approval of design changes by establishing aWeb site for each project where everyone on the projectcould log on; valuable time and money is saved on print-ing and courier deliveries.

◗ Better construction tracking and record-keeping byupdating schedules, weather reports, and change inplans on the Web site for field supervisors and subcon-tractors to access; time spent in meetings and on phone

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calls could be cut, making subcontractor schedulingmore efficient.

Currently, Webcor is leading the way in building informa-tion modeling, virtual design and construction, integrated projectdelivery, and high-speed data communications initiativesthrough collaboration with world-class academic and industryorganizations. The results include new methods and technolo-gies that push the margins of quality, value, and performance.

Questions1. Draw the supply chain of Webcor before ProjectNet.

2. What B2B model is this (e.g., sell-side, buy-side, etc.)?

3. What are the benefits of this c-commerce project toWebcor?

4. What are the benefits of this c-commerce project toWebcor’s clients?

REFERENCES FOR ONLINE FILE W6.7DiCarlo, L. “Case Study: Webcor Builders.” PC Computing,

December 1999, pp. 108–120.Propernet.com. “Success Stories: Webcor Builders.” 2005.

propernet.com/htmlsite/PO/successPO.htm (accessedApril 2009).

Webcor Builders. webcor.com (accessed February 2009).

Online File W6.8 Fila’s Collaboration Software Reduces Time-to-Marketand Product Cost

The sports-apparel company Fila uses a Web-based product data management and collaboration software, called Windchill,from Parametric Technology Corporation (PTC) to reduce time-to-market and product costs while improving product qualityand information exchange. Windchill requires only a Web browser to use. The product helps manufacturers streamlineprocesses to optimize the management of their supply chains. The capabilities and benefits of such a solution include thefollowing:

◗ Windchill connects with Arbortext Editor for SML authoring and Arbortext Publishing Engine for dynamic publishing.◗ It is a pure Internet architecture with embedded 3D visualization of product information.◗ The software interoperates with heterogeneous mechanical/electrical CAD solutions, and provides end-to-end process

support to other enterprise systems.◗ It supports distributed product development and enables real-time collaboration across firewalls.

The solution enabled Fila to better manage and control access to product data and images throughout its supplychain. Fila’s vice president of global product and general manager, Kristin Kohler, stated, “As the industry matures, con-sumer expectations increase in terms of brand and product, as well as the creation of a clear point of difference in themarketplace. Fila’s goal in repositioning the brand in this environment is to align various processes in the organizationto successfully deliver against this challenge.”

The software will help Fila gain greater transparency and collaboration in its product development process, support ahigher level of product analysis, and provide a better focus on delivering the right Fila product to the consumer. Fila willroll out the collaboration tool to its U.S., Italian, Hong Kong, and Guangdong operations in both the footwear and theapparel categories.


REFERENCES FOR ONLINE FILE W6.8PTC.com. “Fila Selects PTC© Retail, Footware and

Apparel Solution as Company-Wide PLM Standard.”January 9, 2006. internetretailer.com/internet/marketing-conference/42467-fila-selects-ptc-retail-footwear- apparel-solution-as-company-wide-plm-standar.html (accessed February 2009).

Time-Compression. “Fila Selects PTC Retail.” November/December 2005. time-compression.com/x/guide ArchiveArticle.html?id=8320 (accessed February 2009).


ZARA: FAST FASHION SUPPLY CHAIN INNOVATORThe fashion industry is notoriously challenging: Fashions andpeople’s tastes are fickle, fast to change, and difficult to pre-dict accurately. Achieving sustainability in this competitiveindustry is hard; market leadership almost impossible.

Zara (zara.com) traces its origins to La Coruna, Spain, in1925; since then, it has grown into the flagship brand of itsparent company, Inditex. Until 1987, Zara’s operations wereconfined to Spain. In 1988, it opened in neighboringPortugal and then went international, opening in New Yorkand Paris. By the end of the twentieth century, Zara wasoperating across Europe and Scandinavia, the United States,Japan, and South America. It now has expanded into a num-ber of Southeast Asian countries, Russia, the Middle East,China, and Northern Africa. At the beginning of 2009, Zaraoperated 1,500 stores in 65 countries; 24 of these stores arelocated in the United States. In this highly competitive mar-ket, Zara is now the third-largest apparel retailer in the worldin terms of revenues and has approached 20 percent annualgrowth rates in sales and net income. It launches 10,000 to12,000 new designs each year.

To understand some of Zara’s success, it is important toremember a key mantra for Zara: Success relies on having“five fingers touching the factory and five touching the cus-tomer” (Ortega, cited by Ferdows et al. 2004). In otherwords, the decisions taken by Zara’s executives are driven bya belief in being responsive to consumer demand and chang-ing preferences and in meeting those needs by maintainingcontrol of nearly all aspects of the supply chain. Zara hasbecome famous for being able to go from the design phase todelivering the finished good to its warehouses in a 2- to 3-week time frame, compared with its competitors who mighttake 9 to 12 months. Zara’s stores around the world receivethese new designs 1 to 2 days after they reach the distribu-tion center. Zara rolls out some 12,000 new items per year,compared to its competitors who average 2,000 to 4,000.Zara’s customers visit their stores about 17 times per year,compared with about 4 visits per year to its competitors. Itdiscounts only 18 percent of its clothes, compared to theindustry average of about 35 to 40 percent. Zara spends a

miserly 0.3 percent of sales on advertising, compared to anindustry average of 3.5 percent. And, of interest here, itspends 5 to 10 times less on IT than its major rivals do. Sowhy is the company so successful?

It is generally acknowledged that Zara has a super-responsive supply chain. Rather than relying on sophisti-cated demand forecasting, Zara’s strength lies in its ability torespond rapidly to changing trends (see Exhibit W6.9.1 illus-trating Zara’s core business activities). Zara has identified afew critical processes (ordering, design and manufacturing,fulfillment) and gears those processes to meeting three dis-crete customer groups (men, women, children). Customerneeds, preferences, and behaviors are the starting point ofthe Zara supply chain. Customer demand patterns and quali-tative feedback from its stores drive much of the design andmanufacturing activity. So, too, does market research intokey fashion trends.

At a time when many other competitors are outsourcingmuch of the manufacturing, Zara outsources comparativelylittle, other than the actual machining of garments. Andunlike competitors who rely on low-cost producers in Chinaand India, Zara elects to have garments sewn locally in Spainand northern Portugal. Zara also controls its distribution net-work, at times engaging in relatively high-cost practices thatactually drive efficiencies elsewhere. Zara makes deliveries toits retail outlets twice weekly and in relatively small quanti-ties, thus encouraging customers to buy now or miss outlater. It also means that Zara carries much less in inventory.All clothes are tagged and priced in Spain, and many clothesare delivered on hangers and can be placed directly in thestore without ironing. However, this practice costs morebecause it increases the volume of goods to be transported.Trucks and planes are used for delivery—a higher-cost optionthan trains and ships—allowing for rapid fulfillment.

Zara’s supply chain is geared more toward maximizingrevenues than toward reducing costs, and the organizationappears to have uncanny insights into some of the more hid-den costs associated with some very low-cost supply chainpractices and activities.

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Cutting

Sewing

Design

Zara

Customer demands,behaviors, feedback

Market research,key trends

Distribution

In-Store Sales

In-Store Sales

In-Store Sales

In-Store Sales

EXHIBIT W6.9.1 Zara’s Core Business Activities

Although Zara may spend less on IT than others in thefashion industry, it would be a mistake to think that IT isnot regarded as being critical to business success. Rather,Zara appears to adopt a philosophy that says (1) invest inmission-critical IT as a priority; (2) do not try to automateall functions, but allow IT to support information and knowl-edge sharing and collaboration, and inform the decisionmaking; (3) simpler IT solutions that meet business needsare generally preferable to the more complex ones; and(4) ensure that all investments in IT (many are in-housecustom-built systems) are a very close match to requiredbusiness functionality. Zara has made little investment in theInternet for B2C EC for two good reasons: (1) its distributioncenters are not configured to support the picking and ship-ping of direct to consumer orders and (2) its research sug-gests that most mail-order businesses needed to deal withsubstantial returns, further complicating the management oftheir merchandise. The key to Zara’s success is appropriate,business-driven IT investments, geared at supporting andautomating parts of the critical core business processes.

Zara would appear to be a testimony to the successfuldesign and implementation of a market-responsive supplychain strategy.

Questions1. Why is the fashion industry so competitive?

2. Why do you think excellence in supply chain managementmay be an important ingredient in success in the fashionindustry?

3. What were the underlying reasons for Zara’s success?

4. What is the meaning of the expression “five fingerstouching the factory and five fingers touching the cus-tomer”? Would this be an appropriate mantra for asupermarket chain to adopt?

5. Discuss some of the risks you feel are evident in Zara’sapproach to supply chain management.


REFERENCES FOR ONLINE FILE W6.9Ferdows, K., M. A. Lewis, and J. A. D. Machuca. “Rapid-Fire

Fulfillment.” Harvard Business Review (November 2004).Indu, P., and V. Gupta. “Zara’s Supply Chain Management

Practices.” ICFAI Center for Management Research,Hyderabad, India, OPER/055, 2006.

Wikipedia. en.Wikipedia.org/wiki/Zara_(Clothing)(accessed February 2009).

Zara. zara.com (accessed January 2009).

Online File W6.10 The CPFR Process

As part of a pilot project, Wagner-Lambert (WL), now a Pfizer company, shared strategic plans, performance data, and mar-ket insight with Wal-Mart. The company realized that it could benefit from Wal-Mart’s market knowledge, just as Wal-Martcould benefit from WL’s product knowledge. In CPFR, trading partners collaborate on making demand forecasts. Using CPFR,WL increased its products’ shelf-fill rate (the extent to which a store’s shelves are fully stocked) from 87 percent to 98 per-cent, earning the company about $8 million a year in additional sales.

When implementing a CPFR process, the collaborators agree on a standard process, shown in Exhibit W6.10.1. Theprocess ends with an order forecast. CPFR provides a standard framework for collaborative planning. Retailers and vendorsdetermine the “rules of engagement,” such as how often and at what level information will be provided. Typically, theyshare greater amounts of more detailed information, such as promotion schedules and item point-of-sale history, and usestore-level expectations as the basis for all forecasts.

The idea is to improve demand forecasting for all of the partners in the supply chain and then communicate forecastsusing information-sharing applications (already developed by technology companies such as Oracle and JDA systems). For theretailer, collaborative forecasting means fewer out-of-stocks and resultant lost sales and less stored inventory. For the manufac-turer, collaborative forecasting means fewer expedited shipments, optimal inventory level, and optimally sized production runs.

Besides working together to develop production plans and forecasts for stock replenishment, suppliers and retailersalso coordinate the related logistics activities (such as shipment or warehousing) using a common language standard andnew information methodologies.

The CPFR strategy has been driven by Wal-Mart and various benchmarking partners. After a successful pilot between Wal-Mart and Warner-Lambert involving Listerine products, a VICS (Voluntary Interindustry Commerce Standards) subcommitteewas established to develop the proposed CPFR standard for the participating retailing industries (Wal-Mart’s suppliers).

Company decideson participating

suppliers

Agreement onscope of

collaboration

Selection ofsupporting software

(e.g., fromJDA Software)

Develop jointly theforecasts, resolve

forecasts’ exceptions

Use result tomake inventory andscheduling decision

Determinespecific project (e.g.,

demand forecast,logistics forecast)

Examine thevalue chain

EXHIBIT W6.10.1 The CPFR Process



CADENCE DESIGN SYSTEMS—DEPLOYING A CORPORATEPORTAL ON ITS INTRANETCadence Design Systems, Inc., is a leading supplier of elec-tronic design automation (EDA) software tools and profes-sional services for managing and accelerating the design ofsemiconductors, computer systems, networking andtelecommunications equipment, consumer electronics, andother electronics-related products. The San Jose–basedcompany employs more than 5,000 people worldwide tosupport the development requirements of the world’s lead-ing electronics manufacturers.

In the late 1990s, Cadence recognized that the busi-ness model for EDA products was beginning to evolve from atools-oriented model to one where software and consultingservices held the potential for the greatest revenue growth.To address this changing model, Cadence identified twoareas of customer interaction: sales and logistics. The newsales strategy required the sales force to have an in-depthunderstanding of Cadence’s product line of almost 1,000products and services. With two separate organizations(sales and logistics) interacting with customers, coordina-tion and communication were needed to ensure an effectiveand consistent relationship built on a real understanding ofthe customers’ issues.

For almost a year, Cadence worked with a consultingfirm to create an intranet-based corporate portal to supportits sales organization. The system, called OnTrack, uses ahomepage with links to other pages, information sources,and custom applications to map each phase of the salesprocess with supporting materials and reference information.

With OnTrack, the sales representative now has a singleunified tool that provides all the information and dataneeded for the sales process, from finding new clients toclosing a deal to managing the account. In addition, globalaccount teams have their own homepages where they cancollaborate and share information. However, OnTrack is muchmore than a static road map. For example, information on acustomer or competitor is now available instantly throughaccess to an outside provider of custom news. The sales repalso can use a search engine to locate everything from finan-cial information to recent news articles and press releasesabout clients or competitors. In addition, the system is usedto disseminate Cadence news and other information.

All creators of information in the company, from salesreps to marketing and management personnel, are responsi-ble for maintaining the information contained in OnTrack.With a wide range of people entering data, a simple-to-useinformation submission process was needed. To avoid the

need to understand HTML, electronic forms were created toallow submission or modification of any part of the informa-tion in the OnTrack system. Anyone with appropriate accesscan now add a new message to the daily alerts, modify a stepin the sales process, or update a customer presentation byusing these custom tools.

Feedback is a key part of OnTrack. Reports highlightfrequently accessed pages and documents, and reviews offrequent searches identify new information to include in thesystem to make critical information even easier to access.

Managers who made the decision to implement theOnTrack system learned several lessons. First, although theuse of a browser and the navigation of a Web page requiredonly minimal employee training, the application of theOnTrack system to the daily activities of the sales reps wasnot as easy. A second lesson was the holistic approachCadence took in unifying the technology with the process.Rather than mandate a new process or install a new softwaresystem, Cadence did both. The combination of an easy-to-usetechnology, a refined process, and the appropriate supportsystems created a single coherent system that could supportthe new sales paradigm.

OnTrack was implemented at a relatively low cost.Cadence leveraged its existing infrastructure and wisely hiredoutside experts to create the application rather than devot-ing internal resources to it. This choice allowed the companyto focus its efforts on defining the process and tools neededto support the sales force rather than designing software.

Finally, the greatest impact of OnTrack has been theresult of the shortened training time for new sales reps. Anew salesperson stated that he had learned in 2 days fromOnTrack what it took months to learn at a previous company.With 40 new reps hired in the first year, and 40 planned foreach of the next 2 years, reducing the training time for newsales personnel has created additional profits for Cadence.Cadence calculates that OnTrack has achieved a high returnon investment, well over 100 percent!

Questions1. How does the corporate portal assist sales

representatives?

2. What were the major lessons learned by Cadence?Identify EC models and transactions used in this case.

3. How can the portal system accelerate training?


REFERENCES FOR ONLINE FILE W6.11Cadence. cadence.com (press releases January 21, 2002,

June 27, 2002, and July 22, 2002).EMC. “Customer Success Story: Cadence Design Systems.”

2002. emc.com/resource-library/resource-library.esp(accessed February 2009).

Online File W6.12 Seamless Integration of Business Partners’ Systems

In Chapter 5, we raised the issue of B2B integration and some of the methods and standards used. One also can use thesestandards and methods, as well as some special tools that we describe here, to facilitate integration.

Retailers such as Costco, Wal-Mart, QVC, Sears, Target, and Staples need to talk to their business partners in the“same language.” They want to do so without learning “foreign” languages that may be used by their partners’ systems.Those different languages are “translated” using special integration software and order management services fromCommerceHub (commercehub.com). The company’s translation platform enables retailers to electronically integrate with allof their suppliers, regardless of differing systems and incompatibilities. In addition to connectivity, the software providesreal-time visibility and control over transactions. This enables better performance at a reduced cost.

According to Seideman (2004), QVC and its 200 suppliers tap into CommerceHub’s universal translator instead of mak-ing separate links. The suppliers can be connected to QVC and to other retailers.

Companies that use traditional EDI have problems if their partners use different EDI standards or messages. Also, EDIruns on expensive VANs and is focused strictly on transactions. CommerceHub’s service overcomes traditional EDI deficien-cies. CommerceHub’s software runs on Web EDI (see Online File W5.3), which is much cheaper, more flexible, and morecapable than traditional EDI. The software also enables performance and expense monitoring, finds abnormalities, andsolves order fulfillment problems.

A food distributor, Michael Foods, is using Sterling Commerce’s (sterlingcommerce.com) Gentran Integration Suite toprovide communication and collaboration when it deals with retailers such as Wal-Mart. Michael Foods uses collaborationtools and data synchronization to provide retail partners with assurance that products flow through the supply chain effi-ciently. The Gentran suite works with the EDI that is used by Michael Foods and large retailers, but it also can accommo-date new integration standards (e.g., ebXML, Web Services). The business partners can maintain their existing businessprocesses and communication languages.

For example, in 2003 Michael Foods had to comply with Wal-Mart’s requirement of moving to AS2 Communication (anew B2B protocol). Gentran Integration Suite made the transfer easy and inexpensive. Here is how it works: When a retailcustomer sends a purchase order EDI data file to Michael Foods, Gentran pulls the order and “wraps” it with the properInternet elements to ensure security. It then translates the data file into the AS2 protocol and routes the order as a B2Bfile to the appropriate place at Michael Foods. There, the order is processed and fulfilled quickly and with fewer dataerrors. For details, see Amato-McCoy (2004).

REFERENCES FOR ONLINE FILE W6.12Amato-McCoy, D. “Michael Foods Dishes Out Superior

Service with Business Integration Solution.” Stores,February 2004.

Seideman, T. “QVC.com and Costco.com Talk to BusinessPartners in the Same Language.” Stores, February 2004.


Online File W6.13 Types of Workflow Applications

Workflow applications fall into three major categories: collaborative, production, and administrative workflow.

◗ Collaborative workflow. Collaborative workflow refers to those software products that address project-oriented and collab-orative types of processes. They are administered centrally yet are capable of being accessed and used by workers fromdifferent departments and in collaborative partner organizations and even from different physical locations. The goal of col-laborative workflow tools is to empower knowledge workers. The focus of an enterprise solution for collaborative workflowis on allowing workers to communicate, negotiate, and collaborate within a unified environment. Collaborative workflowapplications are generally a little less structured than some other application types. Some leading vendors of collaborativeworkflow applications are Lotus, JetForm, FileNet (an IBM company), Microsoft, and Action Technologies.

◗ Production workflow. Production workflow tools address mission-critical, transaction oriented, high-volume processes.They are generally highly structured applications and clerical in nature. They usually are deployed in a single departmentor to a certain set of users within a department. These applications often include document imaging and storage andretrieval capabilities. They also may include the use of intelligent forms, database access, and ad hoc capabilities. Thegoal is to improve productivity and the quality of business processes. The leading vendors of workflow applications areFileNet, TIBCO, IBM, and Global 360. An example of production workflow that is mixed with collaborative workflow is pre-sented in Online File W6.13.1. For other applications, see SoftNet (2007), Torode (2004), and Staff (2004).

◗ Administrative workflow. Administrative workflow deals with administrative tasks such as routing and approval functionsfor such things as travel requests, purchase orders, and leave requests. Some of these applications extend enterprisewide,such as recruitment, procurement, and expense reporting. Administrative workflow are usually based around electronicforms and documents and serve to automate parts of these previously paper-intensive processes. The major vendors areLotus, TIBCO, and InTempo.

In conclusion, the benefits of workflow management systems include the following:

◗ Cycle time reduction achieved through improved control of business processes, with far less management intervention andfewer chances for delays or misplaced work than in other systems. Reductions in cycle times can also be achieved throughminimizing reworks, using business rules to catch problems at their course, and so on.

◗ Productivity gains by helping individuals prioritize their activities, providing them with the necessary information to com-plete tasks, and balancing workloads across the entire workgroup.

◗ Improved process control, enabling the organization to improve quality and consistency.◗ Improved quality of services through quicker response times with the best person available.◗ Lower staff training costs because the work can be guided through complex procedures.◗ Lower management costs, enabling managers to concentrate on nurturing employees and handling special cases rather

than on routine reporting and distribution issues.◗ Improved user satisfaction. Users typically have greater confidence that they are doing the best they can, and they enjoy

greater satisfaction when completing their work with fewer conflicting requirements.◗ More effective collaboration and knowledge sharing, especially the sharing of best practices.

A major area for EC workflow applications is the aggregation of sellers or buyers, which was described in Chapters 5and 6. When large suppliers or buyers are involved, a workflow system is needed for both the collaborative efforts and forsupply chain and production improvements.

For information on workflow management, see computerweekly.com/Home/research/tech-topics/232912/workflow-management.htm. Additional information can be found at wfmc.org, aiim.org, BPM Focus (waria.com), and omg.org.

The functionalities of workflow management systems (WFMSs) support the automated coordination and control ofwork processes. In supporting coordination, these systems initiate activities, determine the flow of work, assign staff totasks, route work items, schedule completion dates, send reminders, and manage complex transactions. Some WFMSs willprovide all the necessary data (e.g., files, images) to employees in various departments who work on a given job. In con-trolling work, they monitor progress, detect delays, enforce deadlines, ensure proper authorization, escalate work, measureperformance, and provide feedback to performers.

Implementations of WFMSs differ, depending on the vendor and the product. For example, messaging-based systemsadd workflow capabilities to e-mail (e.g., Microsoft Exchange; InTempo from Jetform). Document-oriented WFMSs add work-flow capabilities to document management (e.g., Lotus Notes/Domino; EMDocumentum Corp). Finally, production WFMSssupport complex workflows and communicate with the corporate database, legacy systems, Web-based systems, and so on(e.g., IBM FlowMark; Ensemble from Filenet).

(continued)



ONLINE FILE W6.13.1Application Case

POSTE ITALIANE GAINS EFFICIENCY AND COMPLIANCE THROUGH IMPLEMENTINGWORKFLOW SYSTEMSPoste Italiane (Italian Post) is a large, distributed organi-zation with 146 branch offices, 14,000 postal offices, andabout 158,000 employees, largely in Italy but alsothroughout Europe. In addition to the traditional postalservices, it offers communications services, logistics, andfinancial services, including consumer banking services.

Banking is subject to substantial regulation, andItalian Post lacked the necessary infrastructure to ensurethat important documents associated with banking rulesand regulations, policies, reporting requirements, and thelike were appropriately created, distributed, stored, andretrieved by authorized personnel. Most of these docu-ments were created centrally and needed approval fromdifferent divisions before distribution across the networkof postal offices, all within a strict time frame. The origi-nal distribution method had been to manually fax docu-ments to each of the post offices, an extremely ineffi-cient, time-consuming, and labor-intensive activity.Furthermore, it was not possible to guarantee that thedocuments had been received, verify the delivery date,confirm that the documents had been read and enactedas required, or ensure that the documents were storedwith appropriate levels of privacy and security.

A solution was found in a document managementand workflow management system that is able to auto-mate and simplify the creation, review, and distribution ofthese sensitive corporate documents. The system is alsoable to track a document’s history; restrict access to par-ticular documents; assign expiration dates, where appro-priate; and archive documents.

Using components of Microsoft Office 2007 andMicrosoft Windows Workflow Foundation, Italian Postemployees now have access to a centralized portal wherethey can navigate through and review a large number ofdocuments.

In addition, collaborative functions enable staffat the widely distributed offices to share, approve, andstore these documents, using a procedure embedded inthe software that ensures compliance with bankingregulations and business rules. By restricting access tocertain sensitive documents, document security isassured.

Italian Post benefits through a reduction in timespent on administrative tasks due to the automation ofthe workflows associated with the management of sensi-tive policy documents. In addition, collaboration andthe management of corporate knowledge are improvedthrough this system; documents are more accurate; andthe process of creating, disseminating, storing, andsecuring these documents can be completed in a moretimely manner.

Source: Compiled from Microsoft (2006).

Questions1. Briefly describe the major problems faced by

Italian Post.

2. What was nature of the solution provided by doc-ument management and workflow managementsystems?

3. Draw the Italian Post process of document cre-ation, dissemination, and storage outlined at thestart of this case. Draw the same process follow-ing the introduction of the new technologies.Where are efficiencies being achieved?

4. Explain how the system has improved workflow.

5. In what ways do the new systems improve collab-oration among the distributed postal offices?


Online File W6.14 Group Decision Support Systems

First-generation group decision support systems (GDSSs) were designed to support face-to-face meetings in what is calleda decision room. Today, support is provided over the Web to virtual groups (group members who are in different locations).The group can meet at the same time (e.g., using teleconferencing) or at different times by using e-mail, sending docu-ments, and reading transaction logs face-to-face. GDSS is especially useful when controversial decisions have to be made(such as resource allocation or determining which individuals to lay off). GDSS applications require a facilitator when donein one room or a coordinator or leader when done with virtual meetings. The current generation of GDSS is geared tovirtual meeting when the participants are in different locations.

GDSSs can improve the decision-making process in various ways. For one, GDSSs generally provide structure to the plan-ning process, which keeps the group on track, although some permit the group to use unstructured techniques and methods foridea generation. In addition, GDSSs offer rapid and easy access to external information needed for decision making. GDSSs alsosupport parallel processing of information and idea generation by participants and allow asynchronous computer discussion.They make possible larger meetings that would otherwise be unmanageable; a larger group means that more complete informa-tion, knowledge, and skills will be represented in the same meeting. Finally, voting can be anonymous, with instant results, andall information that passes through the system can be recorded for future analysis (producing organizational memory).

GDSS Products. More general GDSS products, such as Microsoft NetMeeting, Gotomeetings, WebEx, and LotusNotes/Domino, provide for some of the functionalities just discussed. A more specialized GDSS product is Think Tank fromGroupSystems, which is a complete suite of electronic meeting software (both for one-room and virtual meetings). (Visitgroupsystems.com and view the demo there.) Another specialized product is eRoom (now owned by EMC EMDocumentum atdocumentum.com). This is a comprehensive Web-based suite of tools that can support a variety of collaboration scenarios(see Exhibit W6.14.1). A third product is Team Expert Choice, which is an add-on product for Expert Choice

EXHIBIT W6.14.1 Characteristics of eRooms (Now anEMDocumentum Company)

Feature DescriptionCalendar • Easy-to-use, effective mechanism for picking people to invite to a meeting.Database • Convenient way to store data without having to create SQL server tables and generate a front-end

user interface for those tables.• Includes several predefined databases.

Discussion • Very functional.• Different from traditional news-reader products (e.g., Microsoft Outlook, Forté Agent).• Not as easy to read as Lotus Notes/Domino’s discussion database template.

Folder • With plug-in, you can drag files from your desktop or Microsoft Explorer directly into the folder.• Integration with routine Windows desktop interaction.

(continued)

REFERENCES FOR ONLINE FILE W6.13Microsoft. “Italian Postal Provider Modernizes Document

Workflow and Improves Efficiency and ComplianceUsing the 2007 Microsoft Office System.” 2006.microsoft.com/casestudies/casestudy.aspx?casestudyid=1000003951 (accessed February 2009).

SoftNet. “Lotus Domino Workflow.” 2007. softnet.ro/product.domino_apps.Domino_Doc.jsp (accessedApril 2009).

Staff. “Canadian Firm to Debut New Workflow Manage-ment System.” Operations Management (2004).

Torode, C. “Kronos Plans Web-Based Workflow Manage-ment.” Mass High Tech, 22, no. 35 (2004).



(expertchoice.com). It has limited decision-support capabilities, mainly supporting one-room meetings. Facilitate(facilitate.com) and Meetingworks (entsol.com) are both Web-based GDSSs designed to improve meeting productivity andsupport collaboration. WebIQ (webiq.net) offers similar functionality but includes a Web-based JAD tool. Grouputer(grouputer.com) offers the traditional GDSS functionality of supporting meetings and collaborative decision making butalso offers tools specifically geared to support business process improvement initiatives, including Six Sigma. A number ofthese products can be used on an ASP basis in addition to being purchased and installed on a company’s network.

Feature DescriptionInbox • Can be linked to a POP3 account on your enterprise server or external server.

• Need not belong to an individual; a project can have its own inbox.• Easy for archiving projects.

Link • User can group all information about a project, including relevant URL links, within the project’seRoom.

• Helps consolidate project knowledge for staff.Poll • Like voting machines.

• Helps gather and count the group’s opinions.• Can be stand-alone or contained within other items, such as notes or discussion.

How It Works

• Facilitator creates eRoom Facility and assigns all security permissions for the individual items.(Security is effective, yet unobtrusive.)

• Individuals can read an item, participate within an item, or create their own items to share withthe group.

• Bring staff into eRoom by sending invitations, using enterprise’s Lightweight Directory AccessProtocol (LDAP) server to identify people to be invited, using Intercom (chat function) or e-mail.

• Configure the server to monitor changes within eRoom items and to send a summary e-mail(includes subject and URL link to the right item) when it detects changes.

Other Advantages

• OK and Cancel buttons are at the top of the screen; they are easy to find without scrolling.• Icons for links can be customized; easily identify the subject.• Error messages.

Extensibility

• Still some limits.• Ways to increase functionality.• Provides connector for Microsoft Exchange; can archive project information to Exchange folders for

easier access.• Separate connector for Lotus Notes/Domino and Documentation EDMS.• Includes a Microsoft Component Object Model (COM) interface for its server components.


Online File W6.15 Interactive Whiteboards

Whiteboards are another type of groupware. Computer-based whiteboards work like real-world whiteboards with markersand erasers, except for one big difference: Instead of one person standing in front of a meeting room drawing on thewhiteboard, all participants can join in. Throughout a meeting, each user can view and draw on a single document“pasted” onto the electronic whiteboard on a computer screen. Users can save digital whiteboarding sessions for futureuse. Some whiteboarding products let users insert graphics files that can be annotated by the group. Interactive white-boards also enable the display of video clips, which can be frozen, then annotated and “cut” into PowerPoint presentationsand the like.

Take, for example, an advertisement that needs to be cleared by a senior manager. Once the proposed ad has beenscanned into a PC, both parties can see it on their screens. If the senior manager does not like something, she highlightswhat needs to be changed using a stylus pen. This tool makes communication between the two parties easier and clearer.The two parties also can share applications. For example, if party A works with Excel, party B does not have to have Excelin order to work with it in the whiteboarding tool.

Besides being used to support people working on the same task, whiteboards also are used for training and learning.Two examples of whiteboarding products are Digital Wall Display and Intelligent Whiteboard.

◗ Digital Wall Display from 3M Worldwide (3m.com) is a multifunction whiteboard. It shows whatever is written on it, aswell as anything—text, charts, still and moving pictures—that is stored in a computer and loaded onto the whiteboard.With a remote mouse, presenters or teachers can edit and move the material around on the touchscreen board. All of this,including audio, can be transmitted instantaneously to any connected board, anywhere in the world, making it useful forvirtual, long-distance teaching or training. The system also is used for sharing research among colleagues.

◗ Intelligent Whiteboard from SMART Technologies (smarttech.com) was designed to support teaching. It has a “write” featurein electronic ink, a “touch” feature for controlling applications, and a “save” feature to save work to computer files. A modelnamed Camfire is equipped with digital cameras that photograph what is written on the whiteboard. The images are thentransferred to a Web site or e-mailed to students. The system also can connect to devices, such as a microscope, for presen-tation of hard-to-see information.

Another innovation to support group work collaboration involves the combination of intelligent whiteboards withBridgit conferencing software. Bridgit allows users to share real-time voice, video, and data. Users can take over applica-tions on another participant’s computer or write notes in digital ink for all conference participants to see (SMARTTechnologies 2006).

REFERENCE FOR ONLINE FILE W6.15SMART Technologies. “SMART Launches Highest Resolu-

tion Rear Projection SMART 4000i Interactive White-board.” December 6, 2006. smarttech.com/st/en-US/

About+Us/News+Room/Media+Releases/2004+Media+Releases.htm?guid={11C5ACC8-7DD2-4F6B-A5E3-1B75132259F7} (accessed February 2009).

Documents

ONLINE FILE W6.1 Application Case LAND O’LAKES ...wps.prenhall.com/wps/media/objects/8362/8562891/additional_online/... · LAND O’LAKES COLLABORATES WITH COMPETITORS TO IMPROVE