Revolutionizing the Supply Chain a Case Study Oracle SUN Lean Transformation

Transcription

1 Revolutionizing the Supply Chain a Case Study Oracle SUN Lean Transformation Stephen Slade, Senior Director, Supply Chain Apps Marketing John Shimp, Program Manager, SUN Operations October 2012 Extreme Makeover Challenges Goals Transformation Footprint Results Lessons Learned 1

2 Manufacturing Challenge Product Value Chain Concept Design Prototype Manufacturing Packaging Warehouse Logistics Channels Customer Moving profitable products to market quickly Differentiation in product design More than just releasing to manufacturing Fulfillment is global and dynamic Innovation includes partners, promotions, users, channels Total Customer Experience, from Order-to-Service is Key Sun Manufacturing Supply Chain ~2010 CHALLENGES 1. Short Delivery Lead Times Supported by Large FGI Large excess and obsolete write-offs Complexity with correct levels Numerous suppliers and distribution centers Can't offer every possible configuration customers self-configure 2. Dispersed, Fragmented Manufacturing Approach 21 Major Final Assembly and Test sites 3. Complex, Expensive 4-tier Distribution Network Supplier > Distribution Center -> Distributor Warehouse -> Reseller 4. Fragmented ERP platform, Linked with Several 3PLs 2

3 Definite Need For Change GOALS 1. High-Quality Competitive, Products, 2. Simplified, Efficient MFG Supply Chain Predictable Lead Times 3. Realize Cost Savings Reduce Excess and Obsolete Inventories Reduce Freight and Warehousing Other Handling Logistics 4. Upgrade ERP/SCM/MFG e-business Suite Apps Extreme Makeover ~2011 ELEMENTS OF TRANSFORMATION 1. Eradicate Inventory, Make Deep Cuts Move to 100% Configured Systems, Build-to-Order Manufacturing Focused Supplier/Supply l Chain model Direct Ship Supplier-to-Customer, eliminate DCs & Channel Stock Global Logistics Capability Predictable, Fixed Lead-Times 2. Modernize the Technology Integrate business processes within Oracle ebs R12 Global Single Instance Implement new Mfg processes across wide range ebs Apps including... GTM, ASCP, S&OP, Collaborative Planning, Demand Flow 3. Continuous Improvement Modify software only where it makes sense for all customers 3

4 Today: 100% Configured Systems From this To this Supply Chain Map ~2010 4

5 Supply Chain Map ~2011 Results: 100% Product Direct Ship From Source-to-Customer Via the most efficient manner possible 5

6 Manufacturing Order Flow Manufacturing Demand Flow Execution Build to Order in 10 days eb S $ 6

7 SUN Application Footprint ~2010 Before Customer Mgmt Marketing Sales Partner Mgmt Master Data Mgmt Oracle Siebel CRM Oracle CRM On Demand Oracle Customer Hub Projects Project Portfolio Mgmt (PPM) Primavera* BI / Enterprise Performance Mgmt Sales & Marketing Finance Service OBIEE Hyperion* Governance, Risk & Compliance Risk Evaluation & Remediation Controls & Policy Compliance Oracle GRC Enterprise Resource Planning Financials Project Accounting HR & Payroll Contracts Order Mgmt / Quoting Procurement ecommerce Advanced Pricing Oracle E-Business Suite G-Log Customer Service (My Oracle Support) Service Request Lifecycle Configuration Mgmt Knowledge & Communities Health Checks & Diagnostics Oracle Siebel CRM Oracle Fusion Middleware Collaboration Web Conferencing Instant Messaging Oracle Beehive Workspaces *In Process Current SUN Application Footprint ~2011+ Customer Mgmt Marketing Sales Partner Mgmt Master Data Mgmt Oracle Siebel CRM Oracle CRM On Demand Oracle Customer Hub Projects Project Portfolio Mgmt (PPM) Primavera* BI / Enterprise Performance Mgmt Sales & Marketing Finance Service OBIEE Hyperion* Governance, Risk & Compliance Risk Evaluation & Remediation Controls & Policy Compliance Oracle GRC Enterprise Resource Planning Finance & HR Order Mgmt / Quoting Financials Goods & Services Project Accounting CTO / Configurator HR & Payroll ecommerce Contracts Advanced Pricing Procurement Indirect Direct Manufacturing Discrete Manufacturing Quality Oracle E-Business Suite Supply Chain Management Value Chain Planning Value Chain Execution Demand Planning Logistics & WMS Supply Planning Global Trade Mgmt Service Parts Planning Field Service Execution Customer Service (MyOracle Support) Service Request Lifecycle Configuration Mgmt Knowledge & Communities Health Checks & Diagnostics Oracle Siebel CRM Oracle Fusion Middleware Collaboration Web Conferencing Instant Messaging Oracle Beehive Workspaces Product Lifecycle Mgmt Product Collaboration Product Cost Mgmt Product Master Data Mgmt CAD Integration Demantra Oracle VCP G-Log / Oracle EBS Agile PLM / PIM Data Hub *In Process Current Post-Sun Migration 7

8 SUN ebs R12 High Level Milestones Hillsboro, OR, Manufacturing MES Implementation 8

9 Program Agenda Our Business Model Transition to Oracle s Latest EBS MES Changes Keys to Successful Transition Looking Forward SUN s Business Model Internal Hardware Manufacturing Assemble, Test 17 Products Engr d Solutions, Storage: Exadata, Exalogic, SPARC SuperCluster High End Data Center Servers Build to Order, 100% ATO Fixed Lead Time, Unconstrained Plan 50% Temporary Work Force 3 rd Party Logistics/Shipper Flat BOM 9

10 Transition to Oracle s Latest EBS 10.7 to R12 (Character mode to GUI) 12 month Project, Big Bang Approach Vanilla Implementation, Serialization at Point of Use CRP s and UAT s 3 rd Party Shop Floor Tool Oracle MES PN Formatting non intelligent Unique routers standard router Replace spreadsheets with BI reports, APEX apps EOL custom applications MES Changes Partner with Product Development and IT Changes Reduce Screens, Mouse Clicks Cut Transaction Volume Mass Move Express Transact Components MES Exceptions Order Fulfillment Workbench (APEX) SO & Job details in one view 10

11 Keys to Successful Transition Hindsight is 20/20 Dedicate resources from Business Early access to Test environment Read the Manuals Partner with IT Conf Room Pilots/User Acceptance Test 1,2 Focus training on Day in the life Invest in training and resources Develop local experts Looking Forward Opportunities Forward Scheduling Based on Material Availability and Resources Rapid Planning to replace ASCP Work with Product Dev to enhance MES Competencies Clock in/clock out BOM Attachments Zero Spreadsheets 11

12 Conclusion: Lessons Learned Lean Transformation can be achieved in 1 year Requires strong executive commitment on direction, timescales, minimize customizations Focus and mobilization across the organization Big Bang system implementation aids velocity Integration of People, Process and Technology Supply chain process more tightly integrated than ever before Training people on process and policy Good measurement system is an ongoing requirement Sun Manufacturing Transformation Extreme Makeover in 12 Months ROI 16.7% reduced lead times 9.8% headcount reduction 63.2% reduced excess, obsolete inventory 24% reduced freight & warehousing 9.7% reduced inventory Competitive, 100% Configured systems, built to order Focused supply chain model 100% Direct Ship to customer Global logistics capabilities Predictable, fixed lead times Consistent supply chain, product Data Improved Quality & higher Service Levels Globalization & Standardization of processes Greater Agility to respond to Change 12

13 Revolutionizing the Supply Chain Case Study Oracle SUN Lean Transformation Stephen Slade, Senior Director, Supply Chain Apps Marketing John Shimp, Program Manager, SUN Operations October