fy09 commercial planning - scm keith ip scm applications solutions consulting
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FY09 Commercial Planning - SCMKeith IpSCM Applications Solutions Consulting
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Agenda
• Where we are• Competition• Where we should go• Recommendations
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Product Solutions Management TeamProduct Solutions Management TeamHCMHCM SCMSCM CRMCRM
SCSSCS
John Hui(32)
MikeHodgson
(45)
??(64)
ShravMalkani
(60)
Sally Li
(59)
DavidBarkess
(54)
FMSFMS ACE / ARCHACE / ARCH
Prod MgtProd Mgt
Matt Van Rensburg
(7)
Jeff OlsonJeff Olson
ANZANZ Kristy DurstonKristy Durston KP LokeKP Loke Wayne HoughtonWayne Houghton Chris DownieChris Downie Adam KrebetAdam Krebet
ASEANASEAN Jackie GohJackie Goh Christo SardjonoChristo Sardjono Lisa tayLisa tay TBHTBH Alvin LeungAlvin Leung
INDIAINDIA Suryanaran. IyerSuryanaran. Iyer Sujit SahuSujit Sahu Samik RoySamik Roy Aditya Bhattachar.Aditya Bhattachar. Anurag DubeyAnurag Dubey
G.CHINAG.CHINA(Yu Sicheng)(Yu Sicheng)
Oliver ChenOliver Chen Keith IpKeith Ip Binggin HuangBinggin Huang Joyce TanJoyce Tan Charles ZhangCharles Zhang
KOREAKOREA HyeSoo ChoHyeSoo Cho KangHyoug LeeKangHyoug Lee Seong HwanSeong Hwan Young Hoon KimYoung Hoon Kim JinYeun ParkJinYeun Park
IndustryIndustrySpecialistSpecialist
Paul Paul PengPeng
?
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FY09 GC SCM SC Organization ChartKeith Ip (HK)
Direcotr, SCM Products SolutionsGreater China
1 + 4 (Mgr) + 16 (SC)Total: 21 inclusive
Hung-Chang Fu (TW)SCM SC Director
TaiwanAPSHT
Alex Tseng (TW)SCM SC Mgr
APSHT
Jonah Tsai (TW)Principal SC
OTM, ALMLSP, Utility, Chemical
Alvon Cheng (TW)Snr SC
APS, Demantra, PSHT
Virginia Wu (TW)Principal SC
ODM, Agile PLMHT
David Hsu (TW)Snr SC
Discrete MFG, Costing, SchedulingHT, Industrial MFG, GEH
Daniel Gao (SH)SCM SC MgrCentral China
PO, ALM, EDGE, PIMEPC, Auto, CPG, Telco
Andy Chen (SH)Principal SC
APS, Discrete MFGHT, CPG
Feng Lin (SH)Snr SC
Process MFGMetal, CPG (Process)
TBH
TBH (FY09)
TBH (FY09)
Jon Li (BJ)SCM SC MgrNorth China
ALMUtility, Asset Intensive
Kevin Zhang (BJ)Principal SC
ALM, PO, INVGEH, Asset Intensive
Byron Li (BJ)Snr SC
Discrete MFG, Agile PLMA&D, HT
Lucy Cui (BJ)Principal SC
Process MFG, DemantraProcess, CPG, Telco
Vivian He (BJ)Snr SC
Demantra, SNO, OTMCPG, Chemical, LSP
Gary Li (ShenYang)Snr SC
ERPGrowth Cities
TBH (FY09)
Rex Ma (HK)Snr SC
ALM, POGEH, T&T
Mike Luk (HK)Snr SC
Agile PLM, Process MFG, PIMF&B, HT
Frank Tang (HK & SH)Principal SC
OTMLSP, Corporate Shippers
TBH (FY09)
Owen Tang (GZ)Principal SC
ALM, PO, Process MFGAsset Intensive, T&T, CPG
Chris Zhang (GZ)Snr SC
APS, Agile PLMHT
TBH (FY09)
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Now (from IDC)
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Now and FutureIDC Apps Prediction for PRC
0.000
500.000
1000.000
1500.000
2000.000
2500.000
2006
2007
2008
2009
2010
2011
2012
TIME
RE
V (
US
Mil
) Product Supply ChainApplications
ERM Applications
CRM Applications
17% CAGR
20% CAGR20% CAGR
15% CAGR15% CAGR
20% CAGR20% CAGR
Assuming Oracle expects 30+% growth……
Gen more demand, win more over SAP, in areas where they suck, Penetrate more in Growth Cities
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What SAP did when entering China?• Enter China in 1991, SAP China established
in 1995, Key wins of Lenovo and Haier in 1998
• Lighthouse Accounts – Invest in working with leading companies by industries (Investing in Sinopec for 3-4 years without any rev before signing a 10M deal)
• Heavily invest in partners – Granting 30% margin to partners
• Create Strong Eco-system in key industries – Oil & Gas, Chemical, Tobacco, Traditional Mfg, Metal, Auto, etc…
• Strong Partner Eco-system• Build up the Brand of Industry Solutions
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SAP Today• A large pool of install base of upsell add-on license• Enough funding for other smaller companies as well as dropping
price when competing against us• Leverage their brand to sell more ERP
• With our brand legacy, it takes time for learning curve in order to penetrate into SAP install base
• SAP is building their specialization teams (PLM, SRM, EPM)• SAP is pushing their +1 Minimize Oracle’s Differntiators • Time Window is closing
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ERP Landscape in China – Winning ERP with EDGE/Industry Solutions
Time
Ad
op
tio
n
MNC
Hi Tec
h
Mid
Siz
e
(loca
l FIN
)
BanksEm
ergin
g
Indust
ries
Govern
men
t
SASAC
Mid
Mar
ket
ERP
+
EDGE / Industry Solutions ERP Replacement
EDGE / Industry Solutions
SAP IB
Opportunity for CMRL
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Oracle’s Strength• The Oracle brand
• Acquisition strategy / Best of breed solutions• Leading “+1” solution differentiators (Agile, AutoVue, Stellent,
Demantra, Projects portfolio, EPM, MDM, etc.)
• Talented People
12 1212
Shift to Value Chain Orientation
Administrative InfrastructureHR
Su
pp
ort
ing
Acti
vit
ies
Su
pp
ort
ing
Acti
vit
ies
Valu
e C
reati
ng
A
cti
vit
ies
Valu
e C
reati
ng
A
cti
vit
ies
INNOVATIONINNOVATIONSUPPLIER RELATIONSHIP MGTSUPPLIER RELATIONSHIP MGT
Demand Chain
Demand Chain
Supply ChainSupply ChainDesign ChainDesign Chain
Design Chain Design Chain
Supply Chain Supply Chain Demand Chain Demand Chain
Convergence of Chains - Demand, Supply, Design Multi-enterprise – Collaboration, Orchestration, Flexible Information-Centric – Visibility, Predictive, Real-time
Convergence of Chains - Demand, Supply, Design Multi-enterprise – Collaboration, Orchestration, Flexible Information-Centric – Visibility, Predictive, Real-time
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How the new R12.1 products compliment this strategy
• Advanced Planning Command Center• Elevates supply chain planning information to a business decision making
level by combining cross-domain planning analytics within the context of business scenarios
• Manufacturing Operations Center• Delivers an integrated view of manufacturing status and performance by
combining ERP and real-time plant floor information, and using this for extensible analytics
• Demand Signal Repository• Creates a shared and unified view of real-time demand information between
parties in the value chain to drive closed-loop decision making• Service Parts Planning
• Enables a responsive service supply chain and increases the profitability of after market service, helping OEM’s extend their value chain
• Deal Management• Optimizes the effect of price-driven demand shaping
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Service Supply Chain
Regional DCsServicetechnicians
Central DC
Repair depot
Customers
Supplier (Repair)
Supplier (New Buy)
On-hand Consigned
Repaired In repair
Material flow of good spares
Material flow of defective spares
Must manage both forward and reversed material flows
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Service Industry
• Service is becoming a main profit driver even in manufacturing companies• Desire to move from cost center to profit center• Service parts have much higher margin than finished goods
• Service as a competitive differentiator - Better customer retention• Finished goods have become commoditized
• Hi-Tech, Travel/Transportation & Aerospace & Defense (A&D) have unique requirements in terms of complex parts planning
• Repairs are being outsourced• Rotables and serialization present planning complexities
• Interplay between parts planning and execution increasingly becoming important
• Logistics Service Provider (LSP) is a growing market especially with ‘End to End’ providers
• Significant amounts of money tied up in spares inventories• Initiatives to reduce inventories while maintaining / improving service
Trends
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• Centralized• Few locations• Few products• Planners manage few
products• Shorter lead times• Few suppliers • Sales forecast• Deterministic• Build or buy supply
• Decentralized• Many locations• Many service parts• Planners manage many parts• Longer lead times• Many suppliers• Myriad of demands• Probabilistic• Move, repair, or new buy
Why Service requires different approaches and systems
MANUFACTURING SERVICE
Two Different Worlds
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• Forecasting• High SKU counts, low volume• Intermittent demand• Product life cycle events
• New product introductions• End of part life / service life, supersession
• Inventory, replenishment, and distribution planning• Dynamic redistribution of inventory as customer demand shifts• Returns: part condition• Part supersession and complex part chains• Aggressive service level agreements and budgets
• Service level and response time key in balancing inventory• Trade off service levels and budget
Service IndustryChallenges in managing the service supply chain
Oracle’s Service Parts Planning Solution
Available with 12.FP: Demantra, SPP, GOP, CP, IO, SNO
• SPP – Service Parts Planning within Advanced Planning Suite• Key features supported:
• Demand planning and replenishment / distribution from a single Workbench• Returns / repairs / reverse logistics / dual sourcing of new buy & repair• Part condition, supersession, failure rates, repair lead time, and criticality
support• Auto-release new buy and repair recommendations to Spares Management and
Depot Repair
• Key environments:• Works well for customers that are dealing more with complex reverse logistics
and repair processes
• Solution modeling for “part conditions” not required:• Use same part numbers to represent “good” and “bad” parts (part condition
supported)
The better news: we’ll have an even better solution available soon !
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Coming in 12.FP – Service Parts Planning
• Global parts inventory visibility across all service organizations
• Out-of-the-box integration with Oracle Spares Management and Oracle Depot Repair
• Release depot repair orders, reschedules, and transfers
• Release spares management new buy purchase orders, repair orders, and transfers
Out-of-the-box integration with Spares Management and Depot Repair
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Service Parts Planning SolutionSelling into various Industries
• Distribution Only / High Volumes• Requires forecasting and distribution / replenishment• Support dealer network
• Challenges• Forecasting
• High SKU counts, low volume, intermittent / seasonal• Forecasting at the Dealer level
• Inventory, replenishment, and distribution planning• Distribution to dealer network to address sporadic / erratic ordering
patterns• Part supersession
• Position TODAY: Demantra, ASCP-DRP, GOP• No reverse logistics / repair element; Dealers modeled as Orgs
• Where we’ve won: General Parts
Service Industry ChallengesAutomotive / Distribution-only
• Aftermarket spares support for customer equipment• Returns / Repairs / Reverse Logistics
• Dual sourcing of new and repair
• Challenges• Forecasting
• High SKU counts, low volume, failure rates – install base• Inventory, replenishment, and distribution planning
• Dynamic redistribution of inventory as customer demand shifts• Returns: part condition, part supersession and complex part chains• Aggressive service level agreements and budgets / trade offs
• Position TODAY: Demantra, ASCP-DRP, GOP• Model good and bad parts as different items.
• Where we’ve won:
Service Industry ChallengesHeavy Equipment / Industrial Manufacturing
• Aftermarket spares support for customer equipment• Returns / Repairs / Reverse Logistics
• Dual sourcing of new and repair
• Challenges• Forecasting
• Very short product life cycles
• Inventory, replenishment, and distribution planning• Part supersession, returns, part conditions, complex part chains• Aggressive service level agreements and budgets / trade offs
• Position TODAY: Demantra, ASCP-DRP, GOP• Model good and bad parts as different items
• Where we’ve won:
Service Industry ChallengesHigh Technology
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Current Competitors• SAP
• APO• Recently released a service parts specific solution - unproven• Partnership with MCA
• Servigistics• Good presence and slick product• Good marketing• Strong in distribution, reverse logistics, repair forecasting
• MCA (Morris Cohen Associates)• Strong in Aerospace and Defense• Good algorithms and approach
• Baxter Planning Systems• Outsourcing / hosted model for SPP and SCP• Not aggressive in marketplace / weak presence• Conference room pilot / consulting approach
• Xelus / Click Commerce• Acquired twice in past few years, uncertain future• Current customers being replaced by Servigistics and others
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Market Review
SAP = Caution
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Sample Service Parts Planning Customers
Industrial
Manufacturing
Travel & Transportation
A&D
Hi tech
United Space
Alliance
Siberian Airlines
Aircraft Engines
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Manufacturing Manufacturing
Comms & UtilitiesComms & Utilities
Aerospace & DefenseAerospace & Defense
Hi TechHi Tech
A Few Service Management Customers …
AutomotiveAutomotive
Office Equipment Office Equipment
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Oracle Service Parts PlanningAdditional Information
• Deployment and Integrations• Part of Oracle APS and can be deployed as follows:
• Separate APS 12.1 instance - fully integrated with EBS R12 and EBS R11i10*• Standalone - integrated with other ERPs through legacy integration* • Single instance - combined EBS+APS instance, when EBS 12.1 is available
later this year• Availability:
• GA now as a part of R12.1 APS Feature Pack – deployable on a separate APS 12.1 instance
• Controlled Availability process in effect to help track initial sales• Pricing:
• $1750/$M of Cost of Goods Sold (COGS)• More Information:
• www.oracle.com• apps.oraclecorp.com• www-apps.us.oracle.com/aps
* - Available soon