Tata –Steel Ideation

Enhancing Supply Chain Visibilty Using Enterprise 2.0

By Aniket SarkarGaurav Johri VGSOM IIT Kharagpur

What is Enterprise 2.0 ?

• It aims to help employees, customers and suppliers collaborate, share, and organize information via Web 2.0 technologies

• What is Web 2.0 ? UGC > Published content

Value Chain Visibility

• Trackability or the ability to “see” the products in transit

• Increase in available data - analyzed to make recommendations

• Strategies to improve and strengthen a supply chain

• 3 out 4 companies in the metals and mining business consider supply chain visibility as the top most criteria to manage SCM

Why is Value Chain Visibility important ?

• How ‘lean’ inventory is and not just rely on ‘Just in time’ supplies

• Overseas suppliers – high uncertainty

• Natural weather turbulences and catastrophes that close down port services

• Enhanced visibility would prepare for any kind of impending situation - leading to better crisis management and giving the firms a competitive advantage above the others.

Current status of Steel Companies

• In general, the B2C segment comprises of about 170-200 wholesale distributors and 5000-6000 retailers

• Enterprise Resource Planning package like SAP to manage the Purchasing, Procurement, Inventory, Logistics, Sales and Cash Management of the products and services.

• ERP is a fully intra-company facility with limited interaction between the suppliers and dealer/ distributors/ retailers of the company

• Visibility is inhibited by the non-availability of adequate business tools that is required for an integrated network

THE IDEA

• A platform that combines the real time interaction offered by a social networking platform and the data processing capabilities of the ERP to manage the supply chain management

• Currently there are various networking tools offered like Facebook inc., Twitter and Google +

• The idea would be to develop the platform which combines the benefits of each and fuse it with the current ERP system.

The IDEA continued..

Why not use the existing Networking platforms?

• The business in the long run would not be dependent on the current social media platforms

• There is low long term reliability on social media platforms

• MySpace

Social Networking Platforms

The IDEA continued..

• Follows a democratic model

• Information in the form of posts, photos and videos can be instantly shared with friends

• Feedback can be given in the form of likes, comments

The IDEA continued..

• Follows a leader-follower model

• Generally used by people with mass following

• Can instantly update, share information in the form of tweets

• 142 character limit to maintain efficiency of the system

The IDEA continued..

• Closed groups can be formed

• Group chats, video conferencing can be conducted on short notice

• Reliable Google infrastructure

The Broad Domains…

Intra Focus..

Extra company Focus.. Based on three specific zones …

Cornerstones …

Contd…

Tackling emergencies

In cases of natural calamities that severely disrupt supply chain by affecting vendors , distributors, logistics providers can give real time “tweets” ( the following concept of twitter) on the platform that shall notify the entire downstream players thereby enhancing Visibilty

Specifications ….

What we assumed ….

• The internet penetration is well above the current 7%• The people in-charge of operating the combined platform have the

adequate training/competency • The platform can also be accessed through smart phones for

suppliers or carrying and forwarding agents on the move• Most importantly the vendor in-charge of programming this platform

has the relevant experience of supply chain management.• To store the tremendous amount of Data that would be generated

through this combined platform it would require the implementation of a system like “APACHE Hadoop” which contains the “job tracker” and “task tracker” applications in its Hadoop cluster.

Implementation Road Map

• Stakeholder touch points and bottle necks in Value chain to be zeroed upon

• Intra company and Extra company applications need to be developed

• Staged roll out of Enterprise 2.0 with new ERP implementations

Implementation Road Map…

• Module specific roll out for existing ERP users

• Extra company applications can be implemented stand alone with proper interface with legacy systems

Cost-Benefit Analysis

• A platform that combines the real time interaction offered by a social networking platform and the data processing capabilities of the ERP to manage the supply chain management.

• Currently there are various social tools offered like Facebook inc., Twitter and Google +.

• The idea would be to develop the platform which combines the benefits of each and fuse it with the current ERP system.

Cost-Benefit Analysis…

• From company perspective

The rise in benefits far exceeds the increased implementation cost

The benefits will be realized within the same time span as for an ERP implementation

• From provider perspective

The costs of Intra-company will exceed Extra-company applications

Joint ventures with established social media platforms can be done to reduce costs

The huge margins of ERP implementation will realize the benefits in short time period

Road blocks….

• Very difficult• Extremely costly and time intensive• Typical: over $10,000,000 and over a year to implement• Companies will have different Web 2.0 requirements• A certain level of understanding between stakeholders and

company for appropriate usage of Web 2.0

Thanking You….