SCM software in semiconductor

SACE 2017

Yue LI

SCM software in semiconductor

• Supply Chain Management

• Supply Chain Management Software

• Supply Chain Management Software in semiconductor

• Example of Supply Chain Planning

• A few trends for Supply Chain Planning

Supply chain management

• Logistics (comes from the late 19th century)

• Supply chain management (1982, Keith Oliver)

• In the mid-1990s until late 1990s, SCM is practiced in management

• Supply chain management 2.0 (SCM 2.0)

Bullwhip effect

Beer games: business simulation game to understand the distribution side dynamics of a multi-echelon supply chain

Bullwhip effect is a distribution channel phenomenon in which forecasts yield supply chain inefficiencies.

Supply Chain Management-Award Best Production Industry Supply Chain

• 2009 Henkel Laundry & Home Care • 2010 BMW Motorrad • 2011 BASF • 2012 Infineon Technologies • 2013 ADVA Optical Networking • 2014 GF Piping Systems • 2015 Nokia Networks • 2016 Peri • 2017 Gries Deco Company (DEPOT)

Reinhard Ploss, Kurt Gruber and Hans Ehm receiving the award.

Supply Chain Management Software classification

SCM software can be divided into two types › Supply Chain Planning (SCP) applications

– Planning applications have an effective solution to determine the best way to fill an order

– APS (Advanced Planning and Scheduling)

› Supply Chain Execution (SCE) applications – Execution applications involve tracking of the physical status of goods, the

management of materials, and financial information involving all parties – Include Warehouse Management Systems (WMS) and Transportation

Management Systems (TMS)

• SCP is the most important sub-sector of SCM software (33% of market share) $3 bn

• Sourcing and Procurement $2.8 bn

Structure of the software modules covering the SCP-Matrix (Meyr 2002)

Pla

nn

ing

ho

riz

on

Supply chain process

supply planning

Red marked Planning Modules are most used in companies

Planning and Control System of a Semiconductor Supply Chain

Source: Dagstuhl, 2016

Magic Quadrant for Supply Chain Planning System of Record (SOR)

SAP APO › Performance improvement and better

analytics through the use of Hana › SAP APO maintenance until 2025 › SAP IBP is used as supplement

JDA › Strong vision for how to take SCP solutions

forward to meet the functional needs of end users

› Lower rated in the area of the operations criterion

Source: Gartner 2015

Top 10 SCM Software Vendors and Market Forecast 2015-2020

Source: Appsruntheworld, 2016

$1.4 billion

Top 20 supply chain software suppliers, 2016

› $ mio.

APS in Semiconductor Industry

• Three major players in the semiconductor industry are: SAP, JDA and Oracle

• Semiconductor supply chain is characterized by long cycle time, steep ramps and short product life cycles

Big4 APS vendors for Semiconductor Industry › IBM › JDA › Oracle › SAP

Source: Stadtler et al., 2014

Influence factors for supply chain planners in decision making

SCP

Outputs

Stock status Production target Demand ATP (for customer order)

Tools

Inputs

static Master data (CT, yield, CPW, lot/package size, Capa, …) Bottleneck dynamic Order/Forecast/Stock Inventory/WIP Delivery Planning rules Priority Parameter

KPI Delivery performance Factory utilizations Demand lateness Inventory coverage

Decision making

Tools requirement • UI friendly • Recommended solutions • Routine tasks automation • Function for exception handling

Supply chain planner • Experience • Knowledge • Characteristics (risk

averse)

Input • Data quality • Data consistency • Data availability • Data format

How many can be produced? How many demand is requested?

Master Planning algorithms Demand Priorities Impact

Lowest

Priority

Highest

Priority

1. Orders

2. Forecasts

3. Stocks

Demand are netted based on these priorities

Order confirmations are based on first come first serve basis

Netting by Netting-Rules

W9 W10 Orders from SAP

W9 W10 FC from SPL-UI

Nett

ed

Nett

ed

Nett

ed

Nett

ed

W9 W10

W9 W10 Stocks from SPL-UI

W9 W10 W11 W12

New order in W11 will replace the FC

Further order in W11 will replace FC and stock targets

Capa

Before & After comparison with SCP

Master Planning reports

Overview on demand lateness

Providing inventory coverage and development on all stocking points

Detailed load information on all capacity constraints

Overview on factory utilizations or loading of world wide technologies.

For fast reaction on changes in demand or supply, daily actualized data are available.

A few trends for Supply chain planning

Supply Chain Planning

Planning is moving to the Cloud

Marriage of Planning and Analytics

SCM & Industry 4.0

There isn‘t much relation between SCM and Industry 4.0

thank you for your attention and any question?