SCM Adv Planning 1

8/2/2019 SCM Adv Planning 1

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Oracle Advanced Planning

Enabling the Demand Driven

Supply Network – An Overview



“This presentation is for informational purposes only and may not be incorporated into a contract or agreement.”

The following is intended to outline our general product direction. Itis intended for information purposes only, and may not be

incorporated into any contract. It is not a commitment to deliver anymaterial, code, or functionality, and should not be relied upon in

making purchasing decision. The development, release, and timingof any features or functionality described for Oracle‟s products

remains at the sole discretion of Oracle.




TRENDS ADAPT YOUR BUSINESS MODEL

Today: Tough Economic ConditionsBusiness trends forcing you to adapt new strategies

Higher degree of uncertaintyGet visibility to all demand

Manage to uncertainty by postponing inventory

Increased global competition Focus on core competency –

Increase outsourcing

Mass customizationMove point of differentiation

closer to customers

Focus on customer service toensure brand loyalty

Provide reliable and accuratecommitments to customers

Less money to invest in IT Lower cost of ownership of apps




Long planning cycles

Supply PlanningDemand Planning

Distributionplans

Sales

Marketing

Mfg.

Response 1:

Maintain Excess Inventory

Response 2: Reserve Production Capacity

Response 3: Expedite Everything!

Traditional ApproachMulti-step planning processes, high latency, limited collaboration

Fax

Tier 2

Tier 1

CUSTOMERS SUPPLIERS

Supply Chains built onINVENTORY

Productionplans

Manufacturingplans

Paper Paper

?

Manualreconciliation




Move to A More Competitive Model

Enable closed loopcollaborative planningprocesses across yourvalue chain

Have complete supplychain visibility

Make better decisions

React immediately todisruptions in supply chain

E-Business planning solution: zero latency, real-time collaboration

Supply Chains built onINFORMATION instead of

Inventory

Consensus forecast andproduction plan

Supply Planning

Demand Hub & Multi-dimensional analysis

Automated Exceptions

S&OP Process

Singleholistic plan

Business Intelligence

Sales

Marketing

Mfg.

Manufacturing

PortalPortal

Tier 2

Tier 1

CUSTOMERS SUPPLIERS




Oracle Advanced Planning

Solution




Oracle Advanced PlanningComplete e-business planning solution

Collaborative Planning CP

Sales and Operations Planning

From short-term to long-term

F r o m d

e t a i l t o s u m m

a r y

CPSC Exception Management

PSProduction Scheduling

ASCPDistribution Planning

GOPGlobal Order Promising

ASCPSupply Chain & Manufacturing Planning

IO

Inventory Optimization

DPDemand Planning

SCISupply Chain Intelligence

DevelopMarketSellOrder

Plan

Procure

Make

Fulfill

Service

Maintain

FinanceHRProjects

All Product,Customer,& SupplierInformation

SNONetwork Design




What Our Customers Say…

Reduced inventories by 20%, increased market share from 50% to 80%

“The most exciting feature of the system to a manufacturer is constraint-basedplanning. Oracle provides the ability to plan, including resource and materialconstraints, based on suppliers' inventories and capacities.”

– Mr. V. A. Raghu, Managing Director, Tube Investments Ltd.

Improved inventory turns by 37%

“With help from Oracle's Advanced Supply Chain Planning (ASCP), we cannow respond to customer change requests within 24 hours. The system alsohelps us check if our suppliers can supply us the components we need.Previously, we've had to collect this data manually using a lot of resources.”

– Tan Lai Tong , Business Management GM, TEC Ltd.

Replaced i2 and cut planning cycles from weekly to daily“With Oracle E-Business Suite 11i, we have moved from weekly to dailyplanning, which has significantly improved our response time.”

– Clair Walizer, Senior Developer and Analyst, Canon Virginia, Inc.




Key Capabilities

Strategic network design

Sales and operations planning

Inventory postponement optimization

Holistic planning and optimization

Multi-tier collaborative planning

Zero downtime global order promising

Real-time production scheduling




Strategic Network Design





Optimize your supply chain network – Use demand scenarios as input

– Compare time-phased network configurations

Model all supply chain elements – Distribution centers, processing facilities, ship methods,

stores, suppliers, and customers

– Costs: transportation, operating, sourcing, facility ramp-upand shut-down, labor, and storage

Optimize sourcing – Output best sourcing strategy for downstream supply chain

and inventory planning

Simulate changing business conditions

– New businesses and new markets

– Outsourcing decisions

– Demand scenarios

Key capabilities





75% Inventory reduction 5% Capacity improvement

50% Inventory reduction Planning cycle reduced 86% 70% Inventory reduction

20% Capacity improvement

20% Inventory reduction $ 350M Inventory reduction

15% Inventory reduction 50% Inventory reduction

Planning cycle reduced 20%

50% Inventory reduction 25% Stock-out reduction

Carrier rationalization from 200 to 12

Proven deployment success and ROI: 300+ customers

BASS BREWERS COCA COLA - FEMSA

NABISCO FOODS

OWENS ILLINOIS

KIMBERLY-CLARK

KRAFT FOODS - EUROPE

DOW CHEMICAL

FORT JAMES









Balancing supply and demand

Synchronization of all operational plans

Key outputs – Consensus forecast

– Bookings forecast – new orders expected to be received

– Sales and allocations plan – expected shipments

–

Production plan Bookings forecast +/- changes in backlog = shipping forecast

Shipping forecast +/- changes in inventory = production plan

Definition




Sales and Operations PlanningComplete and integrated process

Demand Plan

Supply Plan

Inventory andservice levels

ManagementReports

Financial planBudget plan

Sales opportunitiesTrade promotions

Ship and book historyCurrent order backlog

Inventory historyProduction historyProduction backlogCustomer forecasts

Exceptionmanagement

Sales Plan

Production PlanBookings Forecast

Balance supply, demand, andbudgets:- Determine inventory targets- Determine supply plan- Determine allocations

Capture all demand in one place

Determine consensus forecast- Determine new product plan

Evaluate and adjust plans

INPUTS PLANNING PROCESS

OUTPUTS





Demand Hub

– Capture all demand data in a central place

– Collaborate internally and externally

Drive to a consensus forecast

– Use analytics and intelligence to achieve aconsensus demand

Balance demand, supply, and budgets

– Make allocation decisions while trading off servicelevels and cost

Adapt and adjust to changing businessconditions

– Adjust demand or supply plan as conditions change

– Drive continuous improvement

Integrated solution with built-in businessintelligence

Key capabilities






Tier 2

Tier 1

CUSTOMERS SUPPLIERS

S&OP – Demand Hub

Central repository for all demandinformation

– Customer and supplier forecasts

– POS data

– Sales and marketing forecasts

– Financial forecasts and budgets

– User-defined data (spreadsheets)

Configurable and extensible

– Meta data driven

– User-defined dimensions andhierarchies

Open

– Spreadsheets, XML, EDI, portal – Audit exceptions

Integrated

– Out-of-the-box loads for Oracle ERP

Capture all historic and future demand in a single data store

APIs

Sales

Demand

Hub

ERP Systems

Finance Marketing

Internet

PortalPortal

Manufacturing

ERP TransactionFlat file loadsEDI Transactions




Compare and consolidate disparate forecasts

– Sales, marketing, manufacturing, customers, suppliers,Point of Sale (in units or $$)

– Use multi-dimensional analysis to adjust, allocate, androllup

Improve forecast accuracy – Better statistical forecasts

– Forecast planning percentages for models and options

– Get visibility to customer demand changes

Improve demand planning cycle time

– Move from a regimented periodic to a continuousdemand planning process

– Get real-time visibility to demand adjustments viainternal collaboration

Improve sales promotion planning

– Forecasting integrated with promotion planning

– Measure effectiveness

S&OP – Demand PlanningDrive to accurate consensus forecast

Collaborativedemand plan

Automated exceptions

Consensusforecast

Sales

Demand

Hub

Finance Marketing

Tier 2

Tier 1

CUSTOMERS SUPPLIERS

Internet

PortalPortal

Demand Planning Process

Manufacturing




Manage product life cycles more effectively,with your trading partners

– Introduction of new products

– Phase-out of obsolete products

Improve delivery performance – Include customers in forecasting process

– Publish sales forecast to suppliers at any tier

Reduce non-value added costs and exceptionoverload

– User-defined exceptions

–

Proactive notifications – Automated exception handling via workflow

S&OP – Demand PlanningDrive to accurate consensus forecast

Sales/OrderForecast

Publish(optional)

Synchronize

SalesForecast

SalesForecast

Synchronize

Forecast Collaboration Process

CUSTOMERS

SUPPLIERS

YOU




S&OP – Alcoa

$20.3 billion in revenues 350 operating locations in 40 countries

127,000 Alcoans worldwide

4 Major Rolling Mills - Davenport, Iowa;Lancaster, Pennsylvania; Texarkana, Texas;San Antonio,Texas

Heat Treating and Blanking Center - Danville,Illinois

Customer service and distribution centers -Irvine, California;Hutchinson, Kansas

Extruded Tube for Heat Exchangers - St.

Louis. Missouri; Monterey, Mexico

Spreadsheets, not integrated with legacy system, nor withexecution systems

Manual forecast smoothing

No system supported sales and operations planning

Monthly planning cycle, insufficient accuracy in order promisedates

Determines allocation to produce most profitable product mix withinexisting constraints

Performs all planning at the family level

Powerful Integration of supply/demand picture

– Demand Planning & ASCP supply and inventory data

– Drill Down and roll-up capability

– Reporting tools and data analysis

– Export to excel or HTML pages

Supports the S&OP Process

– Demand planning analysis and pre-work

– Operations planning analysis and pre-work

– S&OP composite picture in real time during review sessions

Source: Alcoa Presentation at Appsworld 2004

COMPANY PROFILE BEFORE ORACLE

AFTER ORACLE

Benefits

• Reduced plan cycle time – Eliminated waste on spreadsheets

• Process integration with other modules resulted in technology pull for new systems

• Integrated sales and operations planning process resulted in one consensus forecast number






Inventory Postponement Optimization

Inventory levels and policies aresynchronized across the entiresupply chain

Manage to uncertainty – Demand, supply, and lead-time

variability

Pull model, driven by point ofpostponement

Higher customer service at lowerinventory cost

Time-phased safety stock buffersat all levels

Multiple target service levels

Manage to uncertainty, reduce inventory, improve customer service

Suppliers

ContractManufacturers

FinalAssembly

CentralDistributionCenters

RegionalDistributionCenters

Customers

Without Postponement With Postponement





Reduced inventory cost

Increased flexibility to handle supply and demanduncertainty

Rapidly handle product mix changes

Reduced average fulfillment lead times

Reduced material liability

Ability to absorb yield exposure

Business benefits





Reduce inventory without sacrificingcustomer service

– Postponement

– Risk pooling

Manage supply chain variability

Choose the best service level strategy

based on cost and revenue – Inventory budget constraints

Invest in profitable channels, products,and customers

Manage seasonality and product life

cycle characteristics – Recommend time-phased safety stock to supply

planning

Out-of-the-box optimization

– For planners, not programmers

Key capabilities

I n v e n t o r y I n v e s t m e n t

Service Level

10 30 50 75 80 85 90 95 100

Higher Service Level

LowerInventoryCost

WithoutOracle

WithOracle




Reduce inventorywithout impactingcustomer service




Simulate multiple

scenarios to find theoptimal trade-offbetween cost and

service level





Focusing on ‘class A’ parts for service business

Determining safety stock levels across finishedgoods and raw materials

Realizing significant benefits – Example: reduced inventory for one part by 10%

Customer example – GE Transportation Aircraft Engines, US




Holistic Planning and Optimization





Unified solution for supply chain andmanufacturing planning

Segment the problem as needed

Optimization for planners notprogrammers

Scalable and reliable

Short-term planning

Long-term planning

Semicon

Process

Discrete

Flow

ProjectPlants

Warehouses

Customers

Suppliers

DCs

Faster and better supply chain plans

Internet





Supply Chain Planning – Product family and item level planning

– Alternate components, resources,processes, suppliers, facilities, and shipmethods

– End-item substitution

– Critical items and resources

– Aggregate resources

– Bills of distribution and transfer rules

– Customer and supplier facilities

Manufacturing Planning – Simultaneous resources

– Batch resources

– Alternate resources

–

Minimum transfer quantities – Complex, network routings

– By-products and co-products

– Line rates and takt times

– Setup and run

One solution for comprehensive supply chain and mfg planning

One supply chain model, one planning engine, one setup




One holistic plan


Adapts to your current businessmodel

– Single plan or multiple plans

Evolve planning model at yourown pace

– Re-configure easily by modifying planoptions instead of re-implementing orre-modeling

Multiple models can co-exist

Highly adaptable; segment the problem as needed

One DRP, multiple MRP

DRP for all Orgs

MRP Org 1 MRP Org 2 MRP Org 3

SCP for all Organizations

Multiple MPS, multiple MRP

MPS for BU 1

MRPOrg 1

MRPOrg 2

MRPOrg 3

MPS for BU 2

MRPOrg 4

MRPOrg 5

MRPOrg 6





Interceramic

– 91 Distribution centers, stores, andfranchises

– 4 Plant warehouses

– 7 Manufacturing plants

– 3000 BOMs, 100,000 SKUs

–

Run DRP, constrained MPS, and rawmaterial MRP

Knowles Electronics

– Global planning instance

– 2 Locations in the US

– 1 Location in Europe

– 5 Locations in Asia

– Mixed mode manufacturing

– Make to stock – Make to order

– Configure to order

– Global order promising against 1 centralplan

Highly adaptable – Customer examples

Knowles Electronics hasreduced inventory by $1M permonth after implementingAdvanced Planning

SuppliersManufacturing

plantsDistribution

chain Customers

ConstrainedSC plan

DRP plan

ConstrainedMPS plan for

all facilities

Collaborativedemand

plan

Inventorypostponement

plan





Make better decisions faster

– Level load

– Choose alternatives

– Make/buy decisions

– Late demand diagnosis

Out-of-the-box optimization – Use costs or decision rules

Start quickly

– Planners define the problem to solve

– Flexible defaulting

Reduce planner workload

Optimization “For planners, not programmers”

GE AE has moved from running separate plans in 36 facilities to runninga single holistic plan across their DCs, end-assembly, contractmanufacturing, and component shops, and as a result has reduced theirplanning organization significantly





Patented memory-based architecture – Multi-threaded snapshot

– Optimized end-to-end run time

Database centric – All plan information resides in the database

– Leverages high performance database capabilities

Flexible plan scope – Telescoping granularity

– Apply constraints selectively

– Subset planning

Scalable

High volume customers: Agilent Technologies, Sony SNC, GE AE, NCR, Panasonic, Alcoa…




Multi-Tier Collaborative Planning




Multi-tier Collaborative Planning

Plan your extended supply chain

– Share forecasts and supply commits withcustomers and suppliers

– Get visibility to supplier capacity

– Reallocate key components

– Make alternate sourcing decisions

Reduce inventory cost and improvefulfillment

– Suppliers manage your inventory

– Manage your customers‟ inventory

React quickly to supply chainexceptions

– Waterfall analysis

– User-configurable exceptions

– Automated exception handling via workflow

Full visibility and synchronization across the extended supply chain

Run plan

Optional

Forecast ‘memory’

Supply commit

‘boards’

Supply commit ‘memory’

Demand ‘boards’ Run plan

Demand‘systems’

Supplyforecast

Consensusforecast

SUPPLIERCUSTOMER YOUCONTRACT

MANUFACTURER




Automate inventory replenishment with suppliers and customers

Receive items

Pay on receipt/use

Check

inventorystatus

Ship items

VMI Agreement(with supplier)

VMI AgreementVMI Agreement

Receive items

Pay on receipt/use

Ship items

VMI Agreement(with customer)

Send consumptionadvice

VMI and Consigned Inventory

CUSTOMER YOU SUPPLIER




Customer Example: Alcatel eND

Enabled 100% virtual enterprise

Plan virtual supply chain

– Planning cycle time reduced by 75%

Reduced inventory by more than 65%

Reduced material liability by 80%

Established global closed-loop process controls

Improved supply chain visibility

Projected annual savings of $15M




Zero Downtime Global Order

Promising




Zero Downtime Global Order Promising

Promise orders based on: – Material availability

– Manufacturing capacity

– Transportation capacity

– Supplier capacity

Global statement of availability – All facilities, material, resources, and suppliers

Drive fulfillment decisions based ondemand and supply plans

– Promise based on optimal supply decisions

Allocate available supply and capacity

– By channel, customer, or product – Priority and stealing rules

Manage commitments to key customers – Re-schedule and re-sequence your backlog




Run new plan


Zero downtime

– No order promising downtime whenunderlying supply chain plan isrefreshed

– No sales order is lost, automatically re-

promise sales orders against new plan

Open, reliable, and scalable

– Engine runs inside the database

– No memory models to load!

– Multi-threaded

– Integrated with OM, iStore, and CallCenter

– Easily integrate with legacy systems

Guaranteed uptime and consistency via patent-pending architecture

Current plan

Promise Orders Promise Orders

Copy Run Copy

? ? ? ? ? ? ?

New planDowntime or

Inaccurate orders

Typical Approach

Oracle Approach

Current plan

Promise Orders Promise Orders

Run new plan

Copy RunSync &

Re-promise

New plan

Swap




Agilent Technologies Performing multi-level capable-to-promise

Greatly reduced expedite orders with accurateorder promising dates

Moved from batch to online order promising

Increased customer satisfaction of key

strategic customers by using allocated ATP 24x7 worldwide order operation with „zero

downtime‟ CTP

Meet customer requirement by utilizingsubstitute components

Cisco Every order for every router sold worldwide goes

through GOP

Complex order promising problem

– Product and channel allocation rules

– Extensive use of ship sets in an assembly to orderenvironment

– High volumes

Intersil Using material and resource constraints (CTP)

across virtual supply chain

Sales people promise orders online in seconds

Customer examples





Real-Time Production Scheduling





Maximize production throughput – Optimize your shop floor; detect floating bottlenecks

– Reduce WIP inventory by rapidly synchronizing multi-stageproduction schedules

– Account for complex setup and change-over scenarios,machine breakdown, supply and resource shortages , co-and by-products, alternate resources, routings, and

operations

Model all elements of your shop floor – Work centers, resources and resource groups, shift capacity,

operating costs

– Lead times: setup, change-over, and run

– Sequence dependent setups, contiguous operations,production campaigns, batching

Implement most optimal schedule – seamlessintegration with Oracle EBS

– Output best schedule for process (OPM), discrete MFG), andsemi-conductor (OSFM) manufacturing (available 2006)

Key capabilities





GE Energy Improved schedule accuracy and confidence

by reflecting real time shop floor constraints

Finite machine, crew and tool resourceconstraints

Floating resource bottlenecks due to demand

mix variability Operation sequence dependent setup times

Operation buffering to avoid intermittent gluegun usage

Alternate resources with preferences

Simulations of hot order impact on existingschedule

Complex demand priorities

Toyota Racing Division Reduced schedule creation from 3 weeks to < 2

hours

Support re-planning based on constant designchanges during production

Respect for crew specialization

Optimized use of un-manned operations duringdowntime

Nampak Reduction in time lost due to sequence dependent

press setups for container styles and sizes

Customer examples




Integrated Performance Management

andProcess Automation




Integrated Performance Management

Define targets

Measureperformance

Executetransactions

ManagementReports

Notify on “out

of tolerance”

Analyze exceptions based on

facts; take immediate corrective

action

Identify key performancemeasures and set targets

Calculate KPIs and compare to

plan; notify decision makers of

exceptions

Perform trend analysis and

adjust business plan and targets

Role-based portals

DP• Forecast accuracy• Margin analysis• Promotion effectiveness

ASCP• Planned utilization• On-time delivery• Planned margin

IO• Service level analysis• Plan versus profit• Postponement savings

TP• Carrier contract utilization• Cost per unit weight• Cost per unit volume

CP• Supply commit variability• Order forecast variability

PLAN TO PERFORMANCE PROCESSBUSINESS INTELLIGENCE

OUTPUTS

Closed-loop plan-execute-measure-adapt process




Automated end to end planning process – Completely integrated business process flows

across all products

Automated plan execution – Auto-release orders and reschedule

recommendations

Configurable exception management – Workflow enabled exceptions

– User-defined exceptions

– Configurable thresholds

Kyocera has workflow-enabled their planning process tothe extent where their planners manage all the planexceptions by responding to email notifications

Increase planner productivity

Process Automation




Scalable and Open Architecture




Scalable and Open Architecture

High performance – In-memory only when needed

– Multi-threaded snapshot

– Leverages key database features likematerialized views, partitions, andanalytical workspaces

Reliable – All plan information resides in the database

– Hot backup and recovery

– Leverages grid computing infrastructure

Open and standards based – Runs against all versions of Oracle EBS

11.0, 11i

– Deploy against legacy systems – XML, flat file, EDI support

Database-centric architecture

APIs

Oracle ERP

Legacy Systems

XMLEDI

Flat file

Order PromisingEngine

AnalyticalWorkspaces

KPIs Workflows Plans

Internet

PortalPortal

Legacy DeploymentsCochlear, Embraer, FXAP, NCR, Interceramic, Perkin Elmer,GE Transportation Aircraft Engines, Xilinx, …

TRADING PARTNERS INTERNAL USERS

Advanced Planning




Momentum




Ongoing Momentum

1000+ Advanced Planning customers

– Both new installs and upgrades, several legacy systemdeployments

– 50% same instance, 50% distributed architecture

– Broad use of modules

– Worldwide deployments US, Brazil, Mexico, UK, France, Italy, Spain, Switzerland, Belgium, Turkey, Israel, South

Africa, Singapore, Japan, India, Taiwan, Indonesia, Australia, New Zealand, Korea,China, Malaysia, Netherlands, Denmark, …

– Large-scale, complex deployments across all industries




A Few Live Customers …

Intersil - ASCP, DP, GOP

Fuji Xerox Asia Pacific - ASCP, DP

Perkin Elmer - ASCP, GOP

NCR - ASCP, DP

Namitech - ASCP, GOP

Emerson – ASCP, DP

BMW – SNO

Xilinx - ASCP

UPS Logistics - ASCP, GOP

Agilent - ASCP, GOP, DP

Mykrolis - ASCP

Knowles Electric - ASCP, GOP

Panasonic - ASCP

Honeywell S&C - ASCP, DP

Embraer - CP, DP

Tube Investments - ASCP

Toyota – PS Eaton Trucks - ASCP

Kyocera – ASCP

Nampac – PS, SNO

Hoffman - SNO

Cisco - ASCP, GOP

Alcoa - ASCP, DP, GOP

Canon Virginia – ASCP, CP

GE Energy Power Systems - ASCP, GOP

GE Transportation Aircraft Engines - ASCP

GE Energy - PS

Silgan Plastics - ASCP

Qualcomm - ASCP, DP, CP

McGraw-Hill - ASCP, DP

Alcatel eND - ASCP, DP, CP

Intersil – ASCP, DP

Cervecería Quilmes - SNO

Mango - CP

Rockford - ASCP, DP

Quantum - ASCP, DP

GrafTech International - SNO

Boeing - ASCP Anugra Argon Medica - ASCP, DP

Cochlear - ASCP, DP

Inventec - ASCP, GOP, CP

Dow Chemical – SNO, PS




Adding Value and Assuring ROI

Intersil reduced inventory by 50%, reduced response time for criticalproducts from 336 to 24 hours, 246% ROI

Xilinx achieved a 98% delivery performance to promise date

Alcatel eND moved to virtual supply chain model and reducedinventory by more than 65%

Anugrah Argon Medica improved on-time delivery to 98%

TEC Electronics improved inventory turns by 37%

Tube Investments reduced inventories by 20%, ramped upproduction by 20%, increased market share from 50% to 80%

Dow Chemical reduced inventories by $350M, rationalized carriersfrom 200 to 12

GrafTech reduced inventories by 40% and lead times by 20%




• Large contract manufacturer of voice and digital imaging,and voice and data transmission products

• $360M revenue

• End-to-end planning run = 2 hrs

• Collaboration with 150 suppliers

• Full CPFR implementation

• Uni-directional planning process (Cisco > Inventec > Suppliers)

• No supply-demand allocation process• Excess inventory, extensive expediting

• Supplier bottlenecks – late delivery of critical components

• No support for CPFR

• No constrained based order promising – inaccurate order dates

• Spreadsheet based tools, disconnected systems

• 4 month implementation

• Operates complete collaborative planning process using ASCP, GOP, andCP

• Collaborative supply-demand planning with key customers

• Collaborative supply planning with 150 suppliers

• Constrained multi-org plan, weekly; used to publish order forecast tosuppliers, who provide supply commits as input

• Daily plans as a basis for material constrained ATP

• VMI with suppliers – full visibility to stock levels and in-transit

Benefits

• Reduced order promising lead-time from 3 days to minutes

• Achieved real-time visibility to supply and demand

• Reduced planning cycle time through an integrated forecast-to-plan model

• Highly automated planning processes versus previous use of spreadsheets

Inventec Multimedia & Telecom, TaiwanCOMPANY PROFILE BEFORE ORACLE

AFTER ORACLEPLANNING BENCHMARK




• Retail Services Division (RSD) and Financial ServicesDivision (FSD)

• Manufacturer of point of sale and high-end scanningequipment, and service provider of complete storeautomation, ATMs, and self-service kiosk solutions

• $5.6B revenue FY02

Demand Planning

• 500,000 demand planning composites

• 12+ month forecasting horizon

• 20Gb memory model

Supply Chain Planning

• 20 orgs

• 1,000,000 items

• 2,5 hours end-to-end planning run

• Each organization ran individual MRP, 54 ERP instances• Integration between orgs was based on buy-sell relationship

• Forecast accuracy < 50%

• Sales and operations planning cycle time: 21 days

• No system supported sales and operations planning process

WITH ORACLE

• Runs worldwide manufacturing and sales operations using ASCP, DP,and GOP

• Single, global plan for 20 orgs, including worldwide distribution centersand manufacturing plants

• Runs daily constrained enterprise plan (EDD)

• Complex procured configurations

• Using real-time material constrained, multi-org, multi-level ATO orderpromising process

Benefits

• Synchronization of entire worldwide supply chain with complete global visibility

• Strongly reduced planning cycle time

• Strongly increased forecast accuracy

• System supported sales and operations planning process

NCR Corporation, US


AFTER ORACLEPLANNING BENCHMARK




Orcl 11.0

Orcl 11.0

Orcl 11i

Toshiba TEC, Worldwide

$3.1B manufacturer of documentprocessing equipment

Previous process

– Multiple regional ERP instances

– Decentralized planning process

Current process

– Global centralized planning model – ASCP is cornerstone of Global SCM project

– Uses ASCP to make global productionallocation decisions

– Uses material and resource constrainedplanning

Benefits

–

Moved from a monthly planning cycle to aweekly cycle

– Reduced manufacturing cycle times

– Optimized worldwide inventory levels

Read their online testimonial

Global planning deployment – Multi Instance

US

Europe

Advanced Planning 11i

China

Japan

Malaysia

Resource and materialconstrainedProduction Plan (MPS)

Manufacturing SitesDistribution Sites

Toner Mfg Plant

Japan – Distribution Sites

Forecast

Forecast

Forecast

MRP

MRP

MRP

Orcl 11i

Orcl 11.0

Orcl 10.7

http://www.toshibatec.co.jp/joho/copier/english/info/topics2.htm

http://www.toshibatec.co.jp/joho/copier/english/info/topics2.htm



Highly complex, large scale model

• $1.586B net revenue (FY03)

• Legacy order promising using ATP

• Disparate planning tools across supply chain

• Reactive, manual, and time consuming plan analysis

• 1 week planning cycle

• Manual forecast generation• No system supported S&OP process

• Runs worldwide manufacturing and sales operations using ASCP, DP,and GOP

• Runs optimized enterprise plan, twice/week• Plan includes tier-3 supplier organizations• Low cost, high volume and high mix demand• Using real-time CTP to promise orders 24x7, with use of complex

allocation rules• Using complex network routings

• Scheduling 2 million operations• 6-8 BOM levels, ~25 components per BOM• >50,000 items, 6 month planning horizon• < 50 ASCP and 10 DP users• >20 orgs• 25Gb memory model, end-to-end 15 hrs run

• $2.53B and $0.76B net revenue (FY03)

• Legacy order promising using ATP

• Manual order promising with fixed lead-time

• Weekly, cascaded MRPs (4 wk propagation)

• No system supported S&OP process

• Multiple, divergent systems/process statistical forecasting, newproduct introductions, or promotions

• Runs worldwide manufacturing and sales operations using ASCP,DP, and GOP

• Runs weekly unconstrained enterprise plan

• High value, low/moderate volume demand; using 32 sub-plans, newproduct introductions, and promotions

• Using real-time ATP to promise orders

• Using multi-level ATO and PTO models

• Planning ~1,500,000 forecast entries

• 6-12 BOM levels, ~1000 components per BOM

• ~400,000 items, 12 month planning horizon

• 200 ASCP and 15 DP users

• 12 factory orgs, 5 SMI orgs, 1 CM org

• 15Gb memory model, end-to-end 12 hrs run

Agilent, Worldwide

SEMICONDUCTOR PRODUCTS GROUP (SPG)

AFTER ORACLE

BEFORE ORACLE BEFORE ORACLE

AFTER ORACLE

TEST and MEASUREMENT, and AUTOMATED TEST GROUP (ACE)

PLANNING BENCHMARK PLANNING BENCHMARK




GrafTech International, Worldwide

HQ in Wilmington, DL, USA

Manufacturer of carbon and graphiteproducts, used in steel and other metalsindustries

$700M revenue

13 manufacturing facilities on 4 continents

Customers in 60 countries


AFTER ORACLE

Benefits

Organization had tremendous challenges keeping up with fastchanging and demanding graphite electrode business climate

Internationalization issues

No metrics to drive decisions to improve profitability

No system supported network design process

Runs worldwide network design optimization using SNO

Multiple simulation scenarios across 13 manufacturing facilitiesworldwide

Improved service levels through lead time reduction

Using storage, transportation, sourcing, operating, and labor costs

• Optimization of entire worldwide supply chain network

• Reduced inventory by 40%

• Reduced lead times by 20%

• Strongly improved resource utilization, globally




Dow Chemical, Worldwide


AFTER ORACLE

Benefits

• Optimization of entire worldwide supply chain network

• Reduced inventory by $350 million

• Reduced carriers from 200 to 12

• Strongly improved resource utilization, globally

HQ in Germany

Manufacturer of chemicals

$28B revenue

7 manufacturing facilities

Customers worldwide

Organization had tremendous challenges keeping up with fastchanging business climate

Inventory levels and logistics costs were proportionally high

No system supported network design process

No production scheduling system

Runs worldwide network design optimization using SNO

Multiple simulation scenarios

Improved service levels through lead time reduction

Using storage, transportation, sourcing, operating, and labor costs

Improved production throughput in all 7 plants




Cervecería Quilmes, Latin AmericaDeveloped regional SNO model to answer critical logistics questions

• Market leader in Argentina, dominates beer markets in LatinAmerica (Uruquay, Paraguay, Bolivia, Chile)

- Quilmes supplies 60% of beer in these markets

- Quilmes bottles 90% of PepsiCo branded sales in Argentina

• Annual revenues $940M

• Consolidated assets of $1.5B




Quilmes Capacity Planning

Sourcing of raw materials?

OW?

Malt?

What?

When?

How much?

What?

When?

How much

Interplant movements?

Deployment of inventories?

When?

How much?

Where from?

Seasonal changes? Interplant

movements?

Increases / divestment ?

Supplier

Brewing Bottling Warehouse

Demand

Brewing Bottling

SupplierDemand

DC

Warehouse.

Demand

Developed regional SNO model to answer critical logistics questions




Quilmes Capacity PlanningDeveloped regional SNO model to answer critical logistics questions

• Quilmes management can evaluate:

- Impact of changes in demand mix - size (specialization and de-specialization of bottling lines)

- Impact of changes in demand mix - brew (specialization and de-specialization of plants)

- Acquisitions: opening and closing of production lines, plants, and DCs

- Responses to demand uncertainty

- Changes in sourcing of critical supplies for a given plant and period

- Integration of processes and acquisition of a supplier or suppliers




How To Get There ?




Start with Unconstrained ASCP

Improve planner productivity

– New productivity enhancing UI

– Planner collaboration

Reduce your planning cycle time frommonths to hours

– Holistic planning

– Improved scalability and performance

Make better decisions faster

– Improved exception resolution

– Improved modeling

Reduce non-value added costs

– Workflow based exceptions

Drive continuous improvement

– Integrated business intelligence

Better MRP solution at low initial cost

MRP APS Common Infrastructure

ASCP

Oracle Applications

(11.0, 11i)

Unconstrained

Foundation for future growthCommon infrastructure




Unconstrained ASCP

Use a single plan to plan your entire supply chain to reduceplanning cycle time

– Simultaneous material and capacity planning

– Plan process and discrete mixed models

– Perform forecast consumption inline

Plan at aggregate level, as well as detailed level in a single plan,with better accuracy

– Time granularity in plan horizon

– Account for yields

Leverage advanced problem solving and analysis tools –

Comprehensive exception management and automation through workflow – Extensive pegging capabilities

Measure plan to target performance – Integrated performance management

Make better decisions leveraging a more comprehensive model




Leverage a stronger foundation for

future growth




1. Improve The Quality Of Your Plans

Improve plan quality

– Automatically recommend alternativesuppliers, components, resources, facilities,and routings

– Generate feasible plans that respect yourmaterial and resource constraints

Make better decisions faster – Cost based optimization: maximize profit,

inventory turns, and customer service

– Out-of-the-box optimization

– Priority based decisions

– Drag-and-drop rescheduling

Improve resource scheduling – Schedule simultaneous resources

– Batch resources

– Minimum transfer quantities

Use constraints and optimization to improve decision making


ASCP

Oracle Applications

(11.0, 11i)

Unconstrained

Constrained

Optimized




2. Expand Your Solution Footprint

Sales and Operations Planning – Balance demand, supply, inventory and budgets

Network Design – Optimize your supply chain network

Demand Planning

– Improve forecast accuracy Inventory Optimization

– Improve service level at lower inventory cost

Global Order Promising – Promise more reliable dates to customers

Collaborative Planning

– Automate inventory replenishment and supplychain collaboration with your trading partners

Production Scheduling – Maximize your production throughput

Start with your most important problem


Oracle Applications(11.0, 11i)

ASCP

Unconstrained

Constrained

Optimized

Demand Planning

Global OrderPromising

CollaborativePlanning

InventoryOptimization


Network Design

ProductionScheduling




Supply Chain and Manufacturing Planning

Collaborative Planning

Demand Planning DP

Inventory Optimization IO

Global Order Promising GOP

CP

ASCP

Sales and OperationsPlanning

Forecast

Customerforecast

Orderforecast

Constrained plans

Supplier capacity

Time-phased safety stocks

Forecast anddemand variability

Supplycommits

Orderforecast

Network Design SNOForecast scenarios

Production Scheduling

Plannedorders

Firm supplyschedule

Sourcingrules

Sourcingrules

Today

Coming

Leverage integration at incremental investment

Integrated, yet Modular

PS

CUSTOMERS

PLANNING PROCESS

SUPPLIERS




Summary




Oracle Advanced PlanningE-Business planning solution: zero latency, real time collaboration

Consensus forecast and

production plan

Supply Planning

Demand Hub & Multi-

dimensional analysis

Automated Exceptions

S&OP Process

Single

holistic plan

Business Intelligence

Sales

Marketing

Mfg.

Manufacturing

PortalPortal

Tier 2

Tier 1

CUSTOMERS SUPPLIERS




Why Oracle!

Integrated planning, execution, and collaboration

Holistic planning and optimization

For planners, not programmers

Integrated performance management

Lowest total cost of ownership




Key Takeaways

Proven and complete planning solution – Many live customers on multiple products, across a wide variety of industries

– Large-scale, complex, worldwide deployments

– For Planners, Not Programmers - Out-of-the-box optimization

– Superior architecture - scalable, database-driven planning; common data model across allengines, shared with execution

Provides significant value – Large reduction in planning cycle time

– Significant reductions of inventory and increase in customer service levels

– Enables customers to implement best practices

Progress at your own pace, transition gradually

– Quickly start with unconstrained planning – Move up to constrained or optimized planning

– Leverage out-of-the-box integration to rapidly extend planning footprint

Low risk, high value transition to a better planning system



INFORMATION AGE APPLICATIONS




Alternative Slides

Shorter version of IO section

A B A h I O i i i




A Better Approach – Inventory Optimization

Increase flexibility and reduce costs by moving inventory away from thecustomer to the point of postponement

Account for demand, supply, and lead-time variability when determining thepoint of postponement and inventory levels

Synchronize inventory levels and policies across the supply chain

Helps you move from a push model to a pull model

Respond quickly to demand and supply fluctuations

SuppliersContractManufacturers

FinalAssembly

CentralDistributionCenters

RegionalDistributionCenters Customers

Old way Push Inventory

New way Postpone Inventory

I P O i i i





Identify right postponement strategy foryour business

– Simulate alternate business scenarios

– Trade off inventory investment with customerservice levels

– Vary service levels by channel, customer, andproduct

Holistic view of the supply chain – Manufacturing and distribution locations

– Customer and supplier locations

Account for all uncertainty and changesin your supply chain

– Demand, supply, manufacturing, and transit leadtimes uncertainty

– New product introductions and product phase-outs

Leverage cutting edge optimization, buthide complexity from users

– Stochastic optimization; risk pooling

Key capabilities

I n v e n t o r y I n v e s t m

e n t

Service Level

10 30 50 75 80 85 90 95 100

Higher Service Level

LowerInventoryCost

WithoutOracle

WithOracle



Reduce inventory

without impactingcustomer service

Simulate multiple scenarios to

find the optimal trade-offbetween cost and service level

Documents

SCM Adv Planning 1