workshop on information society technologies applied to transport and tourism brussels, 23 rd may...
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Workshop on Information Society TechnologiesWorkshop on Information Society TechnologiesApplied to Transport and TourismApplied to Transport and Tourism
Brussels, 23Brussels, 23rdrd May 2000 May 2000
Web Infrastructures for Logistic Networks Web Infrastructures for Logistic Networks
The FLUENT ProjectThe FLUENT Project
Paolo Paganelli Paolo Paganelli
Gruppo Formula S.p.A., ItalyGruppo Formula S.p.A., Italy
2P.Paganelli, Gruppo Formula
ObjectiveObjective
To To designdesign, , implementimplement and and experimentexperiment a new IT solution a new IT solutionfor managing for managing materials flowsmaterials flows,, occurring in a occurring in a logistic logistic networknetwork with multiple plants and co-operating firms. with multiple plants and co-operating firms.
ObjectiveObjective
To To designdesign, , implementimplement and and experimentexperiment a new IT solution a new IT solutionfor managing for managing materials flowsmaterials flows,, occurring in a occurring in a logistic logistic networknetwork with multiple plants and co-operating firms. with multiple plants and co-operating firms.
FLUENT: Flow-oriented Logistics FLUENT: Flow-oriented Logistics Upgrade for Enterprise NeTworksUpgrade for Enterprise NeTworks
Esprit IiM Project 29088Esprit IiM Project 29088 9 months from completion9 months from completion
Focus on Focus on logisticslogistics vs. manufacturing vs. manufacturing NetworkNetwork approach approach
Distributed sitesDistributed sites Multi enterpriseMulti enterprise Heterogeneous information systemsHeterogeneous information systems
3P.Paganelli, Gruppo Formula
Two definitions for Supply ChainTwo definitions for Supply Chain
Supply Chain Management is about Supply Chain Management is about managing the flow of products and managing the flow of products and services and the associated information, services and the associated information, across the whole business system to across the whole business system to maximise value to the end consumer.maximise value to the end consumer.
Price Waterhouse (‘98)Price Waterhouse (‘98)
Supply Chain Management is about Supply Chain Management is about managing the flow of products and managing the flow of products and services and the associated information, services and the associated information, across the whole business system to across the whole business system to maximise value to the end consumer.maximise value to the end consumer.
Price Waterhouse (‘98)Price Waterhouse (‘98)
For a start, the supply “chain” is really not For a start, the supply “chain” is really not a chain at all - it is a complicated a chain at all - it is a complicated webweb of of relationships between demand and supply. relationships between demand and supply. The concurrent and multidimensional The concurrent and multidimensional nature of these relationships creates a nature of these relationships creates a complex fabric woven step by step.complex fabric woven step by step.
Gartner Group (‘98)Gartner Group (‘98)
For a start, the supply “chain” is really not For a start, the supply “chain” is really not a chain at all - it is a complicated a chain at all - it is a complicated webweb of of relationships between demand and supply. relationships between demand and supply. The concurrent and multidimensional The concurrent and multidimensional nature of these relationships creates a nature of these relationships creates a complex fabric woven step by step.complex fabric woven step by step.
Gartner Group (‘98)Gartner Group (‘98)
Linear supply chain(source: SCP vendor)
Interenterprise visibility (source: Gartner Group)
Enterprise
4P.Paganelli, Gruppo Formula
FLUENT visionFLUENT vision Network Network visibilityvisibility
““.. the ability to see processes, events and .. the ability to see processes, events and data throughout the trading partner data throughout the trading partner community.” community.”
““.. the ability to see processes, events and .. the ability to see processes, events and data throughout the trading partner data throughout the trading partner community.” community.”
Across Across enterprise boundariesenterprise boundaries
Network Network velocityvelocity““.. the speed at which products, processes .. the speed at which products, processes and data move through the supply chain.” and data move through the supply chain.” ““.. the speed at which products, processes .. the speed at which products, processes and data move through the supply chain.” and data move through the supply chain.”
Network Network variabilityvariability““.. the ability to manage the unique .. the ability to manage the unique combinations of SCM processes and control combinations of SCM processes and control the infinite permutations of events and the infinite permutations of events and processes as they occur throughout the processes as they occur throughout the supply chain.” supply chain.”
““.. the ability to manage the unique .. the ability to manage the unique combinations of SCM processes and control combinations of SCM processes and control the infinite permutations of events and the infinite permutations of events and processes as they occur throughout the processes as they occur throughout the supply chain.” supply chain.”
“ “ Creating a revenue-enhancing SCM Creating a revenue-enhancing SCM strategy requires enterprises to work toward strategy requires enterprises to work toward the primary definition of collaboration, where the primary definition of collaboration, where enterprises act together for mutual benefit.” enterprises act together for mutual benefit.”
“ “ Creating a revenue-enhancing SCM Creating a revenue-enhancing SCM strategy requires enterprises to work toward strategy requires enterprises to work toward the primary definition of collaboration, where the primary definition of collaboration, where enterprises act together for mutual benefit.” enterprises act together for mutual benefit.”
5P.Paganelli, Gruppo Formula
FLUENT visionFLUENT vision Real-time Real-time collaborationcollaboration
““Throughout the supply chain, closer Throughout the supply chain, closer collaboration is replacing arm’s length collaboration is replacing arm’s length transactions.transactions..” .”
““Throughout the supply chain, closer Throughout the supply chain, closer collaboration is replacing arm’s length collaboration is replacing arm’s length transactions.transactions..” .”
"Just as Esperanto has failed to become the "Just as Esperanto has failed to become the universal language, we believe universal universal language, we believe universal data semantics and process models for data semantics and process models for business will remain a fantasy.."business will remain a fantasy.."
"Just as Esperanto has failed to become the "Just as Esperanto has failed to become the universal language, we believe universal universal language, we believe universal data semantics and process models for data semantics and process models for business will remain a fantasy.."business will remain a fantasy.."
IntegrateIntegrate but but not overlapnot overlap with ERP with ERP
““(a SCM producer)(a SCM producer) larger challenge continues larger challenge continues to be its lack of a clearly differentiated to be its lack of a clearly differentiated message vs. Enterprise Resource Planning message vs. Enterprise Resource Planning vendors targeting the SCP market.” vendors targeting the SCP market.”
““(a SCM producer)(a SCM producer) larger challenge continues larger challenge continues to be its lack of a clearly differentiated to be its lack of a clearly differentiated message vs. Enterprise Resource Planning message vs. Enterprise Resource Planning vendors targeting the SCP market.” vendors targeting the SCP market.”
ConnectConnect nodes, nodes, notnot assimilateassimilate them them
6P.Paganelli, Gruppo Formula
SCM today: evolving goalsSCM today: evolving goals
“Agile” SCM = SCP + SCE
7P.Paganelli, Gruppo Formula
SCM today: SCM today: Largely incomplete functional Largely incomplete functional coveragecoverage
SCP / APS:i2, Manugistics, Adexa, ..
ERP world-class:SAP (APO), JDE (Numetrix), ..
FLUENT
8P.Paganelli, Gruppo Formula
9P.Paganelli, Gruppo Formula
SCP vs. SCESCP vs. SCE
10P.Paganelli, Gruppo Formula
Supply Chain Inventory Visibility: Supply Chain Inventory Visibility: An unfulfilled promiseAn unfulfilled promise
11P.Paganelli, Gruppo Formula
E-commerce impact on business: E-commerce impact on business: SCM is not an optionSCM is not an option
Real-time intranet/extranet communications
12P.Paganelli, Gruppo Formula
FLUENT FLUENT functionsfunctions
Non-ERPLogistic execution
Local ERP
Local ERP Local ERP
SCM data
Node Planning Node Planning & Execution& Execution
Supply Supply Chain Chain PlanningPlanning
Forecasting & Forecasting & Performance Performance MeasurementMeasurement
Net
wor
k
Supply Supply ChainChainVisibility & Visibility & ExecutionExecution
ERP Interface Data interchange across
heterogeneous systems Based on the XML standard Scriptable transformation logic
Network Execution Demand evasion cycle Alert system for
exceptions notification Workflow-based
Network Visibility Real-time access to different
nodes data Data normalisation and
conversion across nodes (codes, units, ..)
Clear data ownership and visibility rules
Network Modelling Configurable links (push/pull,
visibility, ordering rules,..) Different viewpoints on the
net (by node, product, channel, …)
SCM = An integrated environment for sharing data, communicating events and
taking decisions in a network of independent logistics units
SCMProcesses
PlanningPlanning
Planning
Supply Chain Links
Forecast
Forecast Forecast
XML
13P.Paganelli, Gruppo Formula
Legacy Logistics
Local ERP
Local ERP Local ERP
SCM data
Net
wor
k
XML
Supply Chain Links
SCMProcesses
PlanningPlanning
Planning
Forecast
Forecast
FLUENT FLUENT ExtranetExtranet
Manufacturing Cooperation On-line delivery plan management Order change/release cycle Notification of order
status/exceptions
Co-Managed Inventory Visibility of planned and
actual demand at any node Allocation of planned
production Replenishment cycle
Virtual Stock Management Warehouses/distributors
network Collection of customers
demand Consolidation and corss-
docking
Application scenariosApplication scenarios
14P.Paganelli, Gruppo Formula
Example: Co-managed InventoryExample: Co-managed Inventory
Visibility
Visibility,
Execution
Visibility,Execution
Visibility,ExecutionPlanning
Manufactureror distributor
ERP1
Wholesaler
Wholesaler
Subsidiary Custom.
Custom.
Custom.
Custom.
Custom.
Custom.
ERP3
ERP2
Demand
Production,Inventory,
Movements
Stock levels,Custom. orders
Availability,Order status,
Shipments
Orders
Availability,Shipments status
15P.Paganelli, Gruppo Formula
Example: Co-managed InventoryExample: Co-managed Inventory
Visibility,
Execution
Manufactureror distributor
Wholesaler
Wholesaler
Subsidiary Custom.
Custom.
Custom.
Custom.
Custom.
Custom.
Verify availability
Publish order status
PublishDemand
16P.Paganelli, Gruppo Formula
Visibility,
Execution
Manufactureror distributor
Wholesaler
Wholesaler
Subsidiary Custom.
Custom.
Custom.
Custom.
Custom.
Custom.
AdvantagesAdvantages
On-line access to SCM data• From every point of the
network• According to existing links and
rights• Aggregated on more nodes • In the viewing node format
or in the original format
Inter-company processes• Notification of demand• Orders negotiation• Alerts in the execution phase• Workflow automation
Decentralised system• Each node is responsible for
(pays for) its own data• Preservation of existing local
standards (product codes, units, currency,..)
Interface to existing systems
• Different ERPs (Formula,SAP,Baan ..)• Legacy systems and other tools • Transport-independent (XML)• Calling conventions independent• Scriptable conversion logic
Thank you for your Thank you for your attentionattention