Case 5 Brunswick Corporation Improving Supply-Chain Results

Case 5 : Brunswick Corporation: Improving Supply-Chain Results

951702　彭靜萱 ►What is the business value of SCM systems for Brunswick?

The business value of SCM systems for Brunswick 1. 2. 3. 4. 5. 6. 7. Get the product right Get the distribution right Shrink the period of order to delivery Be the best cost in the industries Raise sales volume Be global Increase the competitive advantage

Get the product right • Introduce the highest quality product with the most innovative technology and design at the best price, faster than the competition.

Get the distribution right • Distribute products through a model that benefits their partners – dealers and distributors – and provides world-class service to customers.

Get the distribution right (cont. ) Some of the efforts include: • By the different distribution channels to extensive marine parts and accessories to customers. • By the ability of developing manufacture and distribution, let the product dispersion right.

Shrink the period of order to delivery • By exactly deal with the needs, supply and the use of product in the right place to decrease the period from order to delivery.

Be the best cost in our industries • Be the best cost manufacturer of products, develop and maintain low-cost manufacturing and continually improve productivity and efficiency.

Raise sales volume • Because decreasing the cost of manufacture and forecast and so on, the price of product will be lower and raise the sales volume.

Be global • To become the best price manufacturer in the product market, they use the abilities which produces from SCM to develops and maintains the process that improves the productivity and raise the efficiency unceasingly.

Increase the competitive advantage • By decreasing the cost and shrink the process of manufacturing product and so on, that can help business increase the competitive advantage.

951623　江小琪 ►Does the business value of SCM depend upon what type of business a company is in? Explain.

Answer • YES! 1. Implementing SCM matches the operational focus of the organization. 2. For manufacturing environments with welldefined final products and parts stand to gain the most profits. • NO! - The services sector would be unlikely to adopt SCM since they lack a manufacturing process at all.

The key to a successful SCM implementation is that it matches the operational focus of the organization. • Use IT integrate Individual enterprises and operating process. – Reduce waste and redundant • Has a data warehouse that holds information such as inventory – SCM can use the information to arrange the operating schedule. • Standard business process

For manufacturing environments with well-defined final products and parts stand to gain the most profits • If there are no well-defined final products and parts stand , it will have (1) uncertainty of demand (such as amount) • Inaccurate demand forecasts cause the accumulation of stock or out of stock (2) the uncertainty of manufacturing (such as yield, machine crashes, transport reliability) • Delivery delay (3)uncertainly of supply • Delivery delay

Example [ Wal-Mart ] • Wal-Mart exclusively used SCM to increase its projected growth rate. – Manage their demand supply in accurate manner

Example [ Wal-Mart ] (cont. ) • RFID – Can reduce the global retail’s labor costs 40 ~ 50%, and reduced the inventory volume of 10 ~ 30%. – Wal-Mart's profit will increase by 38 percent, and its productivity higher than the industry more than 40 percent.

Example [ Wal-Mart ] (cont. ) • Advanced satellite communications network – Get the sales information immediately. – A short number of hours to complete "fill orders - a summary of all branch orders - send orders”. – Benefit • Improve the capacity of inventory replenishment. • Speed up the checking out time and recording of transaction.

Organizations in the services sector would be unlikely to adopt SCM • Because they lack a manufacturing process. • To the service industry , services cannot be inventoried. – So they cannot to forecast the inventory.

Organizations in the services sector would be unlikely to adopt SCM (cont. ) • uncertainty of service quality : – services are created and delivered at the same time. • Service rate and service quality cannot measure and store with digital.

For example • Drivers – Drivers cannot forecast when customers need their service. – Divers cannot use SCM to forecast the revenue at next month.

For example (cont. ) • Barbers – They don’t know when customers want to have the haircut. – They cannot measure the service quality with digital , so that they cannot use SCM to forecast.

951620　陳盈志 ►How does Brunswick’s approach to SCM differ from that of the other companies explored in this chapter? Is one approach superior to all others? Why or why not?

Brunswick • Getting a better grip on the data they generate to control its supply chain.

Brunswick (cont. ) • How to use? - Used informatica corporation’s data integration and business - intelligence tools. - Has a data warehouse that holds information pulled from a wide range of enterprise systems.

Brunswick (cont. ) • Benefit - Can better manage sourcing and procurement across its supply chain.

IBM • IBM created Configure-to-order system for its personal systems division.

IBM (cont. ) • How to use? - A customer in Europe can configure a personal computer on IBM’s website and get real-time availability and order confirmation.

IBM (cont. ) 1. Places an order in Europe 2. Order travels to IBM’s systems located in world ‧Fulfillment engine ‧E-commerce engine ‧ERP & production management systems ‧Sales reporting system ‧Product database

IBM (cont. ) 3. back to the customer’s browser • Benefit - Can integrate with the data in everywhere. - Customer can get information immediately.

Dell inc. • Installed a industrial–strength B 2 B integration software to integrate 18 different software.

Dell inc. (cont. ) • How to use? - A business customer pulls product information from Dell’s server into the customer’s purchasing system, which creates an electronic requesting.

Dell inc. (cont. ) • Benefit – Reduce order time – Reduce procurement process errors – Reduce the cost of processing each order – Build links to 40 its bigger customers, allowing a customer purchase easily.

Syntellect’s Online Transaction processing • Provide service between customers and cable companies.

Syntellect’s Online Transaction processing (cont. ) • How to use? - Cable TV viewers can select pay-per-view events offered by their cable companies using the phone or the World Wide Web.

Syntellect’s Online Transaction processing (cont. ) 1. The order is captured by syntellect’s interactive voice response system or web server. 2. Transported to syntellect database application server.

Syntellect’s Online Transaction processing (cont. ) 3. Updated sales database, and the approved order is relayed back to the cable companies video server. 4. Cable companies transmits the video to the customers.

Syntellect’s Online Transaction processing (cont. ) • Benefit – Instead of paying for a year and so many views that will not to watch, customer can choose the view he want and pay for it. – Can reduce customer costs. – Can profit Synellect and cable companies.

Baker Tanks • • • Used salesfore. com solution Moved from a paper-based system to a Web-based system. Eliminating the step of transferring information from paper documents to the database.

Baker Tanks (cont. ) • How to use? – Sales all have each PDA. – Every PDA can link to salesforce. com for customer contact information, sales history and anecdotal notes. – Sales can e-mail responses to customers more promptly.

Baker Tanks (cont. ) • Benefit – Communicating better with customers. – Our salespeople have become more productive.

Is one approach superior to all others? why or why not? • Yes – Can better manage sourcing and procurement across its supply chain. • No – Because Brunswick didn’t have a perfect customer-oriented service like other companies.

951736　陳啟天 ►Describe what the “IS/IT” in the real case is all about? ►“supply-chain management system”

What is SCMS? Supply Chain Management aims to manage the entire supply chain in the premise of meet customer, for example, from the procurement, materials management, production, distribution, marketing to consumers.

Goal 1. Reducing overall system operating costs. 2. The cost of shared information. 3. To improve their overall competitive advantage, developed into a large-scale virtual enterprise.

Goal (cont. ) 4. By information technology, make information format standardization, operational efficiency, and eliminate unnecessary complexity of operations, supply operations and timely delivery response to consumer demand.

While functionality in such systems can often be broad – it commonly includes: 1. Customer requirement processing 2. Purchase order processing 3. Inventory management 4. Goods receipt and Warehouse management 5. Supplier Management/Sourcing

What does supply chain management software development now? • Supply chain management software is possibly the most fractured group of software applications on the planet. • No vendor has a complete package that is right for every company • Many companies decide to go with targeted best of breed products instead

951602　王詔弘 ►What are the advantages and disadvantages of the “supply-chain management system” ?

Advantage(1) 1. Reduce the amount of inventory. This is the practice known as just-in-time manufacturing, and it allows companies to reduce the amount of inventory that they keep. 2. Can cut costs substantially. You no longer need to pay to produce and store excess goods.

Advantage(2) 3. For supplier, reducing the uncertain problem about sales and customer demand. 4. Reducing the cost of administration and process integrate.

Advantage(3) 5. Integrate the product and process development 6. Increase sales amount Squeeze out costs and use efficient and effective supply chains to bump up sales

Disadvantage(1) Flexibility A long way to go for many companies and their supply chain partners before that level of supply chain flexibility can be achieved.

Disadvantage(2) Incorrect information Inter-related companies could have the problem of sharing incorrect information due to lack of mutual trust or fear of control.

Disadvantage(3) Congestion of stock To allow other companies take control of their inventory, there may have some risks about the supplier's own inventory to plug downstream.

Disadvantage(4) Wrong estimate EX: “People bought more of the SCM applications than they should have, ” says Steve Banker, an ARC analyst.

932641　蘇芷黎 ►How does the “supply-chain management system” change the way new business operate now? (compare it with the traditional / conventional method, if there is any. )

Building the system Traditional way Supply chains are a kludge of systems. Use IS/IT Replace aging homegrown systems that run pieces of their supply chains with state-of-the-art software that incorporates cutting-edge features.

Controlling the system Traditional way Use IS/IT People bought more of the SCM applications than they should have, and folks were burned. Gain control over the various systems in its supply chain by getting a better grip on the data they generate. All supply-chain issues aren't necessarily solved with supply-chain applications. Use data-integration and business-intelligence tools to improve supplychain visibility.

Effect Traditional way Use IS/IT The supply chain has been looked at as a way to manage bottom-line (reduce operating costs), not top-line growth (earn more revenue). They've managed to move supply chain from a back-office operation to a front-line, customeroriented service.

Conclusion ‧Relationship Integration : Squeeze out costs and use efficient and effective supply chains to bump up sales. ‧ Visibility : It can better manage sourcing and procurement across its supply chain.

Conclusion (cont. ) ‧Optimizing revenue : Controlling supply chain can affect both the bottom and top lines.

951755　游皓雯 ►Besides those mentioned in the case, what other ways can a business realize more business benefits from the “supplychain management system” ?

Focus on: the back end of the supply-chain ‧Way Design an integrated database. This database can provide information for all system, include SCM system, at the back end of the supplychain.

Focus on: the back end of the supply-chain (cont. ) ‧Benefits Because all systems are use the same database, it don’t need time to convert data from one database to another, systems can use the data directly. Hence, the data flowing between these systems can be more consistent and timely.

Focus on: the back end of the supply-chain (cont. ) ‧Way Combine SCM system with PRM (Partner Relationship Management) system. PRM system can help business obtain and retain the distribution/transportation partner. Keep good relationship and communication with partners that can strengthen the business’s products and service.

Focus on: the back end of the supply-chain (cont. ) ‧Benefits Long-term cooperation with particular partner would give the quality assurance and don’t need to spend another convert cost. Even more business can ask to decrease the distribution cost.

Focus on: the front end of the supply-chain ‧Way Integrate the information generated from supplychain planning software and CRM system. Supply-chain planning software can decide which products to build based on forecast. CRM system can analyze what the customer like based on the customer’s profile and purchase records. Combine these two information to make forecast and decision more accurate and appropriate.

Focus on: the front end of the supply-chain (cont. ) ‧Benefits More accurate the forecasts and decisions are, the customers will like more the products that businesses build and buy more. So the profit increase.

Focus on: the front end of the supply-chain (cont. ) ‧Way Use the B 2 B (business-to business) integration software. For example, E-procurement can pull product information directly to customer, it creates electronic order. After the order is approved online by the customer, a computer-generated purchase order shoots back to business and supplier.

Focus on: the front end of the supply-chain (cont. ) ‧Benefits It would decrease the process cost. Electronic order can deliver over Internet, so the whole process time can be shortened.

Focus on : supply-chain execution software ‧Way Add a tracking function for transportation management. Customers (retailers or wholesalers) can know where the products have been. Businesses can monitor the transportation of the products on time and correctly.

Focus on : supply-chain execution software (cont. ) ‧Benefits Increasing the dependency of customer and the efficiency of transportation.

951712　朱育慧 ►Do some searches from the Web and provide some historical background about the “supply-chain management system” ?

Supply-chain Management Historical Background： Six major development can be observed in the evolution of supply chain management (SCM). 1. Creation Era 2. Integration Era 3. Globalization Era 4. Specialization Era -- Phase One – Outsourced Manufacturing and Distribution 5. Specialization Era -- Phase Two -- Supply Chain Management as a Service 6. Supply Chain Management 2. 0 (SCM 2. 0)

Supply-chain Management (cont. ) Historical Background： 1. Creation Era： The term supply chain management was first coined by an American industry consultant in the early 1980 s.

Supply-chain Management (cont. ) Historical Background： 2. Integration Era ： This era of supply chain management was highlighted with the development of Electronic Data Interchange (EDI) systems in the 1960 s and developed through the 1990 s by the introduction of Enterprise Resource Planning (ERP) systems.

Supply-chain Management (cont. ) Historical Background： 3. Globalization Era： The third movement of supply chain management development, globalization era, can be characterized by the attention towards global systems of supplier relations and the expansion of supply chain over national boundaries and into other continents.

Supply-chain Management (cont. ) Historical Background： 4. Specialization Era -- Phase One – Outsourced Manufacturing and Distribution： In the 1990 s industries began to focus on “core competencies” and adopted a specialization model.

Supply-chain Management (cont. ) Historical Background： 5. Specialization Era -- Phase Two -- Supply Chain Management as a Service： Specialization within the supply chain began in the 1980 s with the inception of transportation brokerages, warehouse management, and non asset based carriers and has matured beyond transportation and logistics into aspects of supply planning, collaboration, execution and performance management.

Supply-chain Management (cont. ) Historical Background： 6. Supply Chain Management 2. 0 (SCM 2. 0)： Building off of globalization and specialization, SCM 2. 0 has been coined to describe both the changes within the supply chain itself as well as the evolution of the processes, methods and tools that manage it in this new era.

Supply-chain Management Now SCM contain two parts： 1. Supply Chain Execution： Address particular segments along the supply chain. Like warehouse management and transportation management. 2. Supply Chain Planning： Helps company decide which products to build and when, based on forecast, orders, capacity, and resource.

951637　楊耀清 ►Describe who else may find the “supplychain management system” useful. Give at least 5 examples. And, why you think so?

Example 1 1. A Taiwan’s OEM printer 2. manufacturer. 2. They cooperate with the world's leading brands of printer manufacturer.

Example 1 [ AVISION ] Background: Since 1991 World famous brand partners (Printer Company): 1. Xerox (Fuji Xerox) 2. Lexmark 3. Fujitsu 4. Pentax

Example 1 [ AVISION ] EFFECTS The company uses the supply chain management to let the response be more rapid and reduce the artificial cost of operation. WHY It helps the company to produce faster, higher quality, and products meet the customers’ need. The company uses the supply It can reduce the error of stock chain management to predictions. promote the data exchange of materials between upstream and downstream firms.

Example 1 (cont. ) [ AVISION ] EFFECTS WHY The company uses the supply chain management to establish the material system of automatic tracing. It can confirm the movement of materials immediately. The Operation System imports the notice system of shipment. It can reduce the follow-up operations.

Example 2 1. The company is the fourth 2. largest supplier of LCD panels 3. in the world.

Example 2 [ Chi Mei Optoelectronics ] Background: Since 1998 Main production : 1. LCD panel 2. Television

Example 2 [ Chi Mei Optoelectronics ] EFFECTS WHY The supply chain management It can share resources between uses the existing data to let different departments. the analysis be more effective. The supply chain management It can reduce the can bring easy-to-understand communication time during the statements and diagrams meeting. between different departments.

Example 2 [ Chi Mei Optoelectronics ] EFFECTS WHY The supply chain It maximizes the benefits. management can reduce the cost of business operation. The supply chain management standardized the communication platform. It can reduce the communication time between different departments.

Example 3 1. The company is Europe’s leading 2. home improvement retail group. 2. They are also the third largest group in the world.

Example 3 [ Kingfisher PLC ] Background: Since 1998 1. With leading market positions in the UK, France, Poland, Turkey and China. 2. Main retail brands like B&Q.

Example 3 [ Kingfisher PLC ] EFFECTS WHY The supply chain It uses the value chain management ensures efficiently. that critical business will not be interrupted. The supply chain management provides the support services around the world. It can integrate all of the information from different companies around the world.

Example 4 1. The company is a manufacturer 2. of digital camera.

Example 4 [ Premier ] Background: Since 1974(main product camera) Premier Technology Group is the foremost provider of joint-design, joint-development, manufacturing, assembly and after-sales services to global Computer, Communication and Consumer-electronics ("3 C") leaders.

Example 4 [ Premier ] EFFECTS WHY The supply chain management It will has a clearly let the exchange of communicate of information between companies and supplier be more rapid. The supply chain management It can avoid the error of let the order process be Emanual operation. order process. The supply chain management It ensure the supply of let the logistics processes be materials be smooth.

Example 5 1. They are one of the world’s leading 2. providers of semiconductor 3. manufacturing services. 2. And they pride themselves as a leader in offering a comprehensive range of advanced IC packaging.

Example 5 [ ASE GROUP ] Background: Since 1984 Advanced Semiconductor Engineering Inc. (ASE Inc. )

Example 5 [ ASE GROUP ] EFFECTS WHY The supply chain management It enhances the competitive rapid establish of links with advantage. suppliers. By using the supply chain It helps the suppliers to expand management, the company the scale of bargain. can share of electronic market. The supply chain management It reduces the cost of provides a good competition procurement effectively. platform between suppliers.