microsoft re-invents its manufacturing supply chain by co ... · sap ariba solutions for direct...

Webinar Series | Insights Talk

Microsoft Re-invents Its

Manufacturing Supply Chain by Co-Innovating with SAP

Ariba and Intrigo

Ali Khaki, Principal PM Manager: Supply Chain Engineering

Keith Baranowski, Global Vice President and General

Manager, Direct Spend Solutions, SAP

Kanth Krishnan, Chief Customer Officer, Intrigo Systems

• Introduction: Speakers

• Ariba solutions for Direct Spend (Keith

Baranowski)

• Intrigo’s Ariba Expertise (Kanth

Krishnan)

• The Microsoft story (Ali Khaki)

• Q&A

© 2017 Intrigo Systems, Inc. 2

Speakers

200+ successful

implementations

globally

250+ highly

experienced

resources

worldwide


Ali Khaki

Chief Customer Officer

Intrigo Systems

Keith Baranowski is the Global Vice President and

General Manager of SAP Ariba’s Direct Spend

Solutions. His responsibilities include building

Ariba’s innovation growth strategy and helping his

clients digitize product development, sourcing and

supply chain collaboration business processes.

Keith has been with SAP for 12 years and held a

number of leadership roles that focused on SAP’s

Supply Chain, Product Lifecycle Management,

Manufacturing and Operations solutions.

Keith Baranowski Principal PM Manager: Supply Chain

Engineering (Order Management, Fulfillment

and Logistics)

Microsoft

Kanth has been a supply-chain practitioner as well as a

consultant. He has even served as a trusted advisor to

several companies, small and large. Kanth comes with a

rich background of 20+ years' experience and has an

enviable track record in designing, deploying and

sustaining technology solutions. He was a respected

member of SAP's first ever Global APO Competency

Center to support the early adoption of APO. Value

engineering, value case realization and creating

sustenance models are his forte.

Ali has a rich background creating and deploying

technology solutions in companies such as

Microsoft and Expedia for 15+ years. This includes

services such as the MSN & Bing Search and as well

as working on Data warehouse and BI solutions. He

has a deep passion for technology and using data

driven solutions to improve the customer

experience. More recently has been involved with

the hardware supply chain working with Suppliers,

CM’s and DTV’s on engineering solutions to deliver

devices such as Surface, Xbox and HoloLens direct

to end Consumers, Retailers and Enterprises.

Kanth Krishnan

Global Vice President and General

Manager, Direct Spend Solutions

SAP

SAP Ariba Solutions for Direct Spend

Decades of Supply Chain Intellectual Property focused on end-to-end,

industry-specific business processes

Industry-Leading Cloud Procurement Platform and

Network, Supplier Onboarding Services

Customer and partner ecosystem provides deep industry expertise

and requirements

Source & Contract Buy & Make Invoice & Pay

Contract Source Design Make Order Request Manage Receive Pay

Plan

Commit Forecast

SAP Ariba Strategic Sourcing Suite

SAP Ariba Supply Chain Collaboration

SAP Ariba Solutions for Direct Spend

Ariba Network and Integration Framework

Supplier, BOM and costing model that links Engineering\R&D, Sourcing\Procurement and

Supply Chain

In-house or multi-tier\outsourced manufacturing with forecasting, quality,

inventory and invoicing collaboration


Transforming Businesses to Digital Enterprises

Enterprise

solutions are

complex,

critical and

costly

Intrigo makes it

simple,

streamlined and

scalable

Black Belts in Digital Supply Chain Solutions

Thought

leaders in

advisory,

implementation

and managed

services

200+ successful

implementations

globally

Fortune 1000

clients across

geographies

250+ highly

experienced

resources

worldwide

Strategic and

deep seated

partnerships with

global leaders

PROCURE

MANUFACTURE ADVISORY

INTEGRATION

SUPPORT

PRODUCTS DIGITAL

Custom in-house

softwares for

seamless business

processes

PLAN

IBP


8

The Intrigo Advantage Accelerating Time to Value Line with Differentiated Services

© 2017 Intrigo Systems, Inc.

Deep

supply

chain

manageme

nt &

industry

expertise

Track record of

delivering value

& successful

projects

Extended

SAP

partnership

End to end

Process

orchestration

& user

centric

design

Harmonization

across various

cloud

applications

Methodology

for rapid

deployments

and change

enablement

Tools &

accelerators

Solution

extensions

Supply Chain Customer Showcase: Microsoft One Device Supply Chain

Mission

Worldview

Strategy

Ambitions

Modern supply chain platform to enable the scale and complexity of Microsoft’s hardware businesses

Supplier Portal (Ariba)

Channel Portal Universal Store

As-is process for supply collaboration

Supportability is typically conducted by meetings and emails

MICROSOFT/CM

Spreadsheet is sent via e-mail

MICROSOFT

Prioritization is primarily conducted by phone

MICROSOFT/CM

Forecast Prioritization Supportability

Disadvantages

What and why is happening

• Inventory reduction

• Capitalize on capturing upside potential to

make more of the products that are selling

• Better balance of Microsoft’s demand and

supply

• Provide customers with a more reliable

order confirmation date and improve the

overall customer experience

• Microsoft is shifting from a forecast

and allocation driven model to

demand driven fulfillment (pull)

model to provide guaranteed

availability of the right product to the

right place before the customer’s

tolerance time.

• This will apply to all SKUs that

Microsoft sells from each location

WHAT WHY

To-be process for supply collaboration

CM reviews and commits to Forecast

CM

MS Planner performs planning in Simulation enviroment

MICROSOFT

MS transmits forecast to Vendor

MICROSOFT/CM

Planning in

Simulation

Environment

CM systems

to ingest

forecast

CM to

Commit

to Forecast

Benefits

• Better traceability with automated waterfall reporting

• Discussion focused around exceptions

• High automated process

• Scalable to multi-tier

• Better visibility of consignments parts to CM as same process is being leveraged

• Color coding to denote priority

Review

plan

Variances

CM reviews and commits to Forecast

MICROSOFT/CM

SAP solution and benefits overview

Plan

Sourcing Manager Supply Planner Production Planner

Ariba Supplier Information and Performance Management

Ariba Collaborative Supply Chain

SAP IBP Sales & Operations Planning

SAP IBP Supply & Response Ariba Collaborative Sourcing

Ariba Contract Management

SAP IBP Supply Chain Control Tower

Integrate, automate & connected planning, scheduling and order management – reduce touches

Improve launch of new products: update systems to enable rapid onboarding for new products

Build in supply chain flexibility – shift from forecast and allocation driven model (push) to demand driven fulfillment (pull)

Harmonize reporting environment, train users, implement dashboards

Source Make Deliver

Customer Services Representative

Collaborative processes supported by Ariba Collaborative Supply Chain

A

1a: Manufacturing Visibility – Inventory

1b: Manufacturing Visibility – Purchase Order

1c: Manufacturing Visibility: Manufacturing Order

Receive FG Forecast

Send Forecast Commit

ODM (Contract Manufacturer) Component Supplier (Tier2/3)

Receive Subcontract Purchase Order

Receive Delivery for Customer Information

Goods Receipt

Send drop ship ASN copy to Tier (n-1) / Copy to MSFT

1. Create/Change PO (Standard/Subcon)

2. Receive PO Confirmation

3. Capture Manufacturing Order status on PO

4. Send SD Outbound Delivery reflecting the PO(BTS vs BTO)

5. Inbound Delivery (Real Time)

Shipment arrived at Port(FMV)

Shipment Received at DTV(FMV)

6. Inventory movement update message (Movement 344)

7. Goods Receipt (101/107/109)

Receive Standard PO

1. Receive and Create Production, PO & Inventory(Consigned).

2. Update Inventory in ECC to Vendor consigned stock

3. Net Requirements Plan (Both FG &Consigned parts)

4. Receive Forecast Response (Generate Constrained Plan)

Microsoft APO-Planning

ECC-Execution

Send PO confirmation

Receive Consigned Material Forecast

Send Forecast Commit

Send PO confirmation

Inventory Movement at Batch number.

TMC

Manufacturing visibility: Production Order

1

2a

2b

Forecast Collaboration: Forecast Visibility (Finished Goods)

Forecast Collaboration: Forecast Visibility (Components)

3a

3b

Forecast Collaboration: Forecast Commit (Finished Goods)

Forecast Collaboration: Forecast Commit (Components)

4a

4b

Subcontract Purchase Order (Create/Change/Cancel)

Component Purchase Order

Subcontract Purchase Order Confirmation

5a

Standard Purchase Order Confirmation

4c

5b

Advance Shipment Notification

6a

6b

Create ASN 7

Shipment Milestone Status Notification (Track & Trace)

8

9*

Goods Receipt to MSFT from Tier (N-1) Supplier

Outbound Delivery Order

Advance Shipment Notification

Inventory Movement

Goods Receipt Notification

10b

Copy Advance Shipment Notification to FMV

6c

Production Order (Status) with PO reference

Production Order Status with PO reference

5c

4d

Receive Copy PO for Tier(n-1) Supplier & FMV

TMC

Copy Advance Shipment Notification to FMV

6d

10a

6e

Load Plan from FMV

4e Send Copy PO to FMV

Copy PO to FMV

Logistics

Future Process

Component Purchase Order Copy

Advance Shipment Notification Copy

6f

Live

APO/IBP**

TBD

Out of Scope

A

RIB

A

AR

IBA

Co

mp

on

ent P

urch

ase Ord

er Co

py (4d

)

Component Purchase Order Copy (4d)

Advance Shipment Notification Copy (6f)

Ad

vance Sh

ipm

ent N

otificatio

n C

op

y

Ariba Network

Tier 2/3 Suppliers

(via Ariba Portal or B2B)

Microsoft

APO

ECC

Native Outbound

Transactions

cXML

Native Intbound

Transactions

cXML

2b. Receive Consigned Material Forecast

3b. Send Forecast Commit

4b. Receive Standard PO

5b. Send PO confirmation

6b. Send ASN

Tier n-1 Supplier / CM

4d. Copy of PO

6f. Copy of ASN

10b. Goods Receipt

Ariba T2/T3 Supplier Orchestration

Implementation timeline Ariba Collaborative Supply Chain

May Release 5/13

AN May Release

AN Gateway Release 5/13


SP10 3/12


April Release 4/15

March Release 3/18

Contract Manufacturer Testing

Forecast 2.0 4/14

CSC 4.0 5/12

AN April Release

Feb Release 2/12

AN Feb Release AN Jan Release

Nov Release 11/15

SP9 12/11


CSC 3.0 2/20

Nov Release Workshops

Feb Release Workshops

May Release Workshops

May Release Workshops

Nov Release Workshops

Dec Release 12/11

Sprint 3: 03/11 - 03/25

Sprint 2: 02/26 – 03/11

Sprint 1: 02/15 – 02/22

Sprint 4: 03/28 - 04/04

Component

Supplier Testing

SEPT NOV JAN OCT DEC MAR FEB APR MAY

February Release

• Manufacturing Planning Visibility via new standard message

• Sub Con PO, Sub Con OC, Sub Con Cancel Order

• Component PO, Component OC, Component Cancel Order

• Advance Shipment Notification

• Component Goods Receipt

• Forecast

• Forecast Commit

• PO Confirmation Exception Process via ABAP Report

• Native Integration to ECC

• Manufacturing Execution Visibility via Component Consumption Request

One Device Supply Chain (1DSC) Timeline

Status: Ariba Supplier Collaboration:

Risks and Insights:

Highlights of key prioritized Ariba Collaborative Supply Chain requirements by Microsoft and SAP Ariba teams:

Functional (forecast application improvements, planner dashboards, IBP Integration)

Scalability (50K+ orders/hour)

Reliability and monitoring: (reprocessing of stuck orders, monitoring API)

Status:

Ariba Network is the backbone for Xbox and Surface line of products supply chain

As of 3/17/17: 46 enabled suppliers out of which 35 transacting suppliers transmitting 118K+ of purchase orders worth $3.5Bil+

Microsoft Planning Team quote: ”Today we successfully received automated (via Ariba) supportability from the supplier which took ~5 mins to approve, updated PREQS and create PO’s (vs. 1-2 hours leveraging the previous process)”

Scorecard: Efficiency and Speed Gains:

Supplier Supportability process improvement: 90%+ (1-2hrs to ~5min)

Planner’s Efficiency improvement: 95%+ (order follow-ups/expediting reduced from 1-2 days to 1-2 hours)

Supplier On-Boarding time improvement: 75% (on-boarding time reduced from 3-4 months to 3-4 weeks)

Principles:

Design Partnership - Microsoft and SAP Ariba teams

working as one

Tight coordination and alignment of product

and infrastructure deliverables aligned with

business outcomes

Product teams directly interacting with each

other with maximum transparency

Co-Innovation Partnership Close collaboration and rapid product and process innovation

Roadmap and Future Opportunities at Microsoft Ariba Supply Chain Collaboration

Q1/2017* Q2/Q3 2017* (subject to planning and joint prioritization)

Future* (subject to proposals)

Scalability/Reliability/Monitoring:

Resending of Copy Documents from AN

Scalability - Enhanced AN infrastructure to handle higher Document throughput

Large Document Support in AN

Enhanced information in error notifications (for Failed on Arrival Error Types)

Product Innovation - Forecast and Order Application Improvements:

Planner Code Filters in Order Conformation Download Screen

Program Code Filters in Forecast Screen

Scalability/Reliability/Monitoring: Scalability - Enhanced AN infrastructure

to handle higher document throughput High Season 2017

Integration

Build Plan Integration with IBP Standardized Solution Manager

Integration

Product Innovation - Forecast and Order Application Improvements: Build Plan Report Dashboard Improvements Order Confirmation Approval

Technology Partnership Azure Bot Service Chatbot Office 365 service adoption in Ariba’s

application and architecture

Product Innovation Transportation and Logistics collaboration Customer Collaboration Quality Collaboration Excel-based planning views

Integration S/4 HANA Scenarios Supply Risk scenarios

Incubation Blockchain scenarios – Provenance scenarios -

product counterfeit prevention Internet of Things – integration with Asset

Networks or Manufacturing shop floor systems

Spot logistics services – integration with on-line logistics service provider networks

* FUTURE PLANS:

Subject to change


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