Supply Chain Solutions Overview

Supply Chain Solutions Overview

Michael EreliSupply Chain Connect, LLCmereli@supplychainconnect.com

Focused on Innovating and Improving the Buying Process Worldwide• Through a unique combination of

– Market information– Industry expertise– E-commerce solutions– Active network of trading partners

• With two primary business lines:– Collaboration Hubs– eNegotiation Solutions

• Backed by strong global presence: – Privately held, founded in 1995– Employees in US, Europe– Serving over 100 companies worldwide, in chemicals,

cable & wire, and other manufacturing industries

Supply Chain Solutions Overview

• Collaboration Hubs– Hosted transaction processing and supporting

supply chain applications:• Order management• Inventory visibility• VMI

• eNegotiation Solutions– Managed Events– Professional services– Trading Center

eNegotiation Solutions

eNegotiation Solutions Provide Efficient and Effective Negotiation

Online eBid – What and When?• Any product, service that is paper biddable with value of more

than $100,000• Item to be auctioned must be clearly and completely described• Buyer has the ability to choose between bidders• Switching cost is substantially below expected benefits• Minimum of two interested bidders• Use in any market condition when you must negotiate

• Event-based transaction model for either simple or very complex electronic reverse (buy) auctions

• Extremely effective for time efficiency, process optimization and liquidity concentration

On-line Bidding facilitates these negotiation characteristics

• Interactive Competition - bidders compete on neutral platform

• Transparent Feedback - all bidders receive unbiased information on the quality of their bids

• Dynamic Bidding - Market dynamics at work• Expressive Bidding permits introduction of

creative offers from bidders into on-line bid format

On-line bid negotiations are successful for many categories of direct and indirect materials and services

Chemicals• Acids, solvents• Pigments• Stabilizers, additives• Commodity resins• Specialty inorganics• Anti-oxidants• Commodity olefins,

feedstocks

Services• Security• Survey• Temp Labor• Janitorial• Printing• Hotel Rooms• Auto Leases

Services• Security• Engineering• Temp Labor• Janitorial• Printing• Hotel Rooms• Auto Leases

Industrial Equipment

• Reactors• Injection Molders• Autoclaves• Tanks

Packaging• Drums, pails, semi-

bulk containers• Metal, Plastic, Fiber• Corrugated

Packaging• Pallets, Wrap

Energy• Electricity• Natural Gas• Coal

On-line bids produce results Cost Reduction/Avoidance: 5-15% depending on commodity Market dynamics determine final price Level playing field for all suppliers- Incumbent supremacy is

challenged by the market Non-price soft factors are assessed quantitatively

Select eNegotiation Customer List

• HB Fuller• Ecolabs• DuPont• Dow• Clariant• Celanese• Basell• BP

• Shell• Rubbermaid• Rohm & Haas• Solutia• Solvay• Tyco Plastics• GE Plastics• Honeywell

Collaboration Hubs

Collaboration hubs maximize efficiency and optimize costs

• Single electronic communications hub to automate exchange of transaction data With customers, suppliers, third party service providers Allow companies to concentrate on core competencies

• Streamlines processes and reduces costs Reduced errors and rework Increased supplier and customer satisfaction Need for costly private connections eliminated Logistics costs cut Improved replenishment decisions based on more timely and accurate

information

Supply Chain Connect CredentialsSCC has deployed over 50 distinct collaboration hubs in the chemical, cable, and other manufacturing industries:

• Including General Cable, Honeywell, Lubrizol, Lyondell, Corning, and Pirelli

• Processing over 30,000 transactions per month

• Supporting over 350 suppliers & buyers connected to hubs

• With offices in US, UK, and Europe

• Integrated with many different ERP and operational systems, including SAP, Oracle, and AS/400 systems

• Using a variety of standards and protocols: CIDX, RosettaNet, AS2, EDI (ANSI X.12), NAED

We have blue chip alliance partners to help deliver overall solutions:

• Packaging: Mondi Packaging

• RFID Hardware: Paxar US

• ERP Integration: Atos-Origin

• Demand Planning: Supply Chain Consultants - Zemeter

• Logistics Optimization: Barloworld - Optimus

Customer benefits are real and measurable

• Inventory & working capital reduction

• Reduction in administration costs and paper processing. Case studies have shown:

• 50% reduction in cost of purchasing

• 75% reduction in time taken to produce and share forecast data

• 45% reduction in time taken to process a purchase order

• Opportunity for headcount reduction

• Less staff needed to send & receive telephone, fax or email orders

• Customers order electronically from all suppliers

Multiple business processes supported• Order Fulfillment

– Order Create through Invoice

• Order Settlement– Invoice through Payment

• Logistics– Load Tender through

Freight Bill

• VMI– Inventory through Invoice

• Collaborative Planning– Forecast through Shipment

How it works• We provide an integration interface into a client's ERP system to extract

order, planning, logistics, inventory, or billing data. This can then be shared between the client and their suppliers. This approach means that the client can continue to use their existing systems, with no training required.

• Our connectivity technology securely routes client data and makes it accessible via a web browser to specified suppliers, with no need for integration.

• For automation of transactions, we also provides capability to integrate into relevant supply chain partners’ systems: via EDI or direct ERP connections.

• Our order management, inventory and demand visibility applications provide web-based tools to review information and receive exception alerts.

• Our systems are fully RFID enabled and can provide full data layer visibility of inventory tracked using RFID technologies.

Flexible Connectivity Alternatives: An Example

SAP R/3

B2B GatewayCollaboration Hub

Web Browser

150 Supply Chain PartnersRaw material suppliersMRO/Indirect suppliers

Logistic providers

ERP

Connection Types:• FTP (Flat File)• FTP (EDIFACT)• AS2 (XML)• AS2 (EDI)• XML (RNIF – RosettaNet)• XML (HTTP Post)• Fax (XML conversion)

Hub/VAN

Current Customer Base and Volume

• Approximately 9 active collaboration hubs, including:– Chemical, Cable, and other industries– Direct and indirect materials– Connecting to over 500 suppliers– Automating order management, logistics, inventory and

production planning processes

• Current production transaction volume is approximately 30,000 transactions per day

Collaboration Hubs – Offering Summary• Order management automation

– Various commonly used processes can all be automated through the collaboration hub as order placement, acknowledgements, advanced shipping notifications, receipts

• Supply Chain Visibility– Sharing critical data and applications with multiple supply chain partners

outside the company’s own firewall• Vendor Managed Inventory & Replenishment Ordering

– By providing inventory, forecast and usage information, suppliers can be confident in taking responsibility for managing supply and inventory, often with the added advantage of reducing overall inventory levels

• Connectivity Hub– Cost efficient and future proof way of integrating large number of supply

chain partners• RFID inventory tracking

– We offer RFID solutions, including event management and sharing of RFID-based inventory data with supply chain partners

We provide a full scope of services to identify and deploy collaboration solutions

• eBusiness Strategic Planning

• Opportunity Assessment

• Customer/Supplier Analysis

• Planning Workshops• Process Redesign and

Improvement• Tool Evaluation and

Selection• Architecture Design

• Custom Development• Supplier/Customer on-

boarding• Supplier/Customer

Training• Project Management• Performance analysis• Testing and

Certification

• Service Level Maintenance

• System enhancements• Problem resolution and

escalation• Ongoing process

improvement and compliance

• Performance measurement and reporting

DesignDesign BuildBuild RunRun