Overview on i2 Five.Two SCM Solution Suite

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Overview on i2 Five.Two SCM Solution Suite

• Hyun-Woong Jin
• Global Customer Solution Management
• i2 Technologies

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Agenda

• Introduction on i2
• Dynamic Value Chain Management
• SCM Solution Suite
• Implementation Methodology
• Case Study

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i2 Mission

• 75 billion of value for the customers by 2005
• Based on Value creation
• The only company that assesses and monitors the
  values for the customers
• 29.9 billion of value as of 2001

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i2 is the Undisputed Market Leader in SCM
Once again, i2 Technologies is the only vendor
in the Leaders Quadrant.

• i2 maintains its position by exhibiting
  unrivaled vision and delivering deep planning
  solutions tailored to vertical industry
  requirements

Gartner Group Research 2001
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Industry Leaders are i2 Customers Over 80 of
Fortune Top 1000 Companies are i2 Customers
Automotive 9 out of top 10 GM Ford Daimler-
Chrysler Toyota Volkswagen Renault Mitsubuishi Fia
t Honda BMW Hyundai Motors
Chemical 6 out of best 10 du Pont Dow
Chemical Monsanto Oxychem Union
Carbide Sherwin-Williams GE plastic Eastman Rohm
Haas Polimeri
Computer 10 out of top 10 Dell IBM - PSG HP
Apple Compaq NEC Acer Gateway
Micron Toshiba
Semiconductor 15 out of top 16 Intel Samsung
Elec. Texas Instruments Motorola
Toshiba Philips Micron Hynix Advanced Micro-
Devices Amkor Fujitsu IBM National
Semi NEC On Semi STM
Metal 6 out of top 6 Nippon Steel POSCO British
Steel US Steel LTV Timken Steel
Data Networking 5 out of top 5 Cisco Nortel
3COM Nokia Lucent
Yellow i2 Customer
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i2 Korea

• Started on Feb. 1997
• Organization 50 Employees Pre-Sales / Sales /
  Localization / Consulting / GCSM
• Korean Customers

Area Year Company Solutions
SCM 1997 SEC SemiConductor SCP, DP, DF, FP, RL
SCM 1998 Anam Semi. MANDO SKC LG Elec. PC Div. FP FP, RL FP FP, RL
SCM 1999 SEC Display Div/ SEC AMLCD POSCO SCP, DP, DF, FP, ADW, RL SCP, DP, DF, FP, ADW, RL SCP, DP, DF, FP, ADW, RL, PO, TO, TM, PP
SCM 2000 SEC Home Appliance Div. LG Elec. Display Div. LG IC HMC SCP, DP, DF, FP, ADW, RL SCP, DP, DF, FP, ADW, RL SCP, FP, ADW, RL SCP, FP, Sequencer
SCM 2001 Hankook Tire Hynix Dongbu Steel LG Elec. DigitalAppliance FP DF, SCP, FP, ADW, RL FP, RL FP, RL
eBiz 2000 / 2001 / 2002 eNtoB Autoever.com LG Elec. SEC Private Marketplace CRM Private Marketplace SRM Private Marketplace SRM Private Marketplace SRM
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Agenda

• Introduction on i2
• Dynamic Value Chain Management
• SCM Solution Suite
• Implementation Methodology
• Case Study

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Introducing Dynamic Value Chain Management (DVCM)

• It is business philosophy
• Like Total Quality Management was back in 80s
• The main goal is to allow business partners to
  better collaborate with each other to eliminate
  the inefficiencies not only within the companies
  but also between their boundaries to achieve
  mutual benefits
• It embodies workflows, methodology and enabling
  technology (software) to help value chains better
  compete in the marketplace
• In the end, it is value chains that compete
  against each other in the marketplace.

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Velocity the Key WeaponAgainst Variability

• How well you fight variability depends on the
  speed and quality of the following cycle

Speed and quality depend on your internal
n
capability and the cooperation of your customers
and suppliers
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DVCM Basics

• DVCM monitoring characteristics
• The ability differentiate important from
  unimportant
• Track variability within your company and outside
  your company
• Focus on tracking the appropriate variables.
• Forecast and Predictive monitoring.
• DVCM Decision Making Characteristics
• Integrated decision support at the strategic,
  tactical and execution level
• Decision making response at the speed of business
• Constraint driven, multidirectional
  planning/scheduling
• Iterative multi participant planning, supporting
  what-if scenarios
• Event Based Planning to enable realistic
  commitment
• DVCM Execution Characteristics
• Enable multi company transaction/state management
  
• Enable embedded decision-making within an
  execution workflow
• Enable alerts to facilitate monitoring of
  execution to close the DVCM cycle

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Dynamic Value Chain Management Funnel
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ERP vs DVCM

• ERP
• Single division only
• No multi Company processing
• Very slow processing
• Can not scale
• Not open
• Antiquated processes

• DVCM
• Total Company
• Total Value chain
• Realtime processing
• Highly scalable
• Service architecture
• 100 pull system

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Dynamic Value Chain ManagementThe Solution
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Different ways to go to market with i2 Five.Two
solutions
i2 SCM
i2 CRM
i2 SRM
Solution suites
i2 Collaborative Supply Management
i2 Service Management
i2 Transportation, Distribution Logistics
i2 Collaborative Demand Management
i2 Factory Planning Scheduling
Solutions

• Factory Planning
• Scheduling

• Allocation Planning
• Master Planning
• Supply Collab.
• Profit Opt.

• Forecast Collab.
• Promotions Collab.
• Merchanidise Planning
• Forecasting
• Category Price Opt.
• Markdown Opt.

Business process workflows
Products Supply Collaboration Supply Chain
Planner Merchandise Allocator Replenishment
Planner Demand Fulfillment Inventory Visibility
and Execution Scenario Analyzer
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Agenda

• Introduction on i2
• Dynamic Value Chain Management
• SCM Solution Suite
• Implementation Methodology
• Case Study

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Some Trends in Supply Chain Management
Yesterdays Critical Success Factors
Todays Critical Success Factors

• Pull environment
• Power with Consumers
• Collaborative Planning
• Event driven planning
• Hybrid supply chains
• Made-to-stock, Made-to-order, Configure-to-order
• True understanding of demand shaping factors such
  as pricing, promotions, and product lifecycle
• Collaborative Inventory Management over value
  chain
• VMI, Channel inventories
• Competing supply chains

• Push environment
• Power with Manufacturers
• Enterprise-centric planning
• Fixed time period planning
• Made-to-stock supply chains
• Buffer inventory to safeguard against demand
  variability
• Inventory managed within enterprise or pushed to
  suppliers
• Competing companies

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ERP vs SCM
- ERP is a tool providing Backward Visibility by
automating Account based Transaction. - APS
is a tool providing Forward Visibility by
optimizing the utilization of the resources in
Supply Chain to maximize the customer
satisfaction.
Advanced Planning System
Enterprise Resource Planning

• Transaction processing

• Planning and optimization

• Generating historical reports

• Optimal execution with velocity

• Answers What did we do?

• Answers What should we do?

• Designed for internal company use

• Enables multi-enterprise eCommerce

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Production/Material Planning Process
Only ERP
ERP SCM
BOM
Inventory
Inventory
Routing, Resource
Optimizing Engine
MRP
BOM
Material Plan
Material Plan
Production Plan
Routing, Resource
CRP
ERP
Production Plan
MRP
SCM
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Planning Algorithm

• SCM
• Concurrent Planning (Optimization)
• Simultaneous material and capacity
• Processing
• Bi-directional
• Time phased Yield, Cycle Time, Capacity, routing
  
• Hard and Soft constraints
• Global ATP(Policy based)
• Memory resident

• ERP-Planning
• Sequential Planning (MRP II)
• MPS MRP CRP MPS
• Material ? Capacity ? Material
• Processing
• Uni-directional
• Fixed Yield, Cycle Time, Capacity, routing
• Soft constraints
• Local ATP
• DB work

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SCM Enabler APS

• APS(Advanced Planning System) is used to find the
  optimal solutions given competing
  constraints...

• Return on assets
• Profitability
• Customer service

• Fixed assets
• Capacities
• Inventories
• Lead times
• Labor
• Government requirements
• Supplier capabilities
• Process variability

• Labor productivity
• Overtime
• Premium Freight
• Sales incentives
• Rebates
• Production volume
• Production mix

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APS is Based on Some Simple Concepts...

• Synchronous manufacturing and the theory of
  constraints
• simultaneous consideration of constraints
  (material, capacity, demand, labor, setup, etc.)
• coordinated material release and synchronized
  schedules at each point in the process
• Advanced warning of problems
• Extensive what-if analysis for dealing with
  process disruptions (i.e. downtime, absenteeism,
  late material deliveries, demand mix and volume
  volatility)
• Interactive problem solving and optimization
• Marrying the knowledge of the human planner with
  the speed of the system
• Automatic problem solving and optimization
• leverage existing legacy systems
• Speed
• Sequential Planning ? Concurrent Planning

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What is APS (Advanced Planning System)?
APS involves the effective anticipation market
demand, the optimal positioning of enterprise
resources to meet demand, and the efficient
fulfillment of demand as it is realized.
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SCM Solution Footprint
Forecast and Manage the accurate and reliable
market demand
Make an optimized Supply plan against the given
demand (Product,Material,Capa, Logistics..)
Demand Forecasting
DP
Allocation and Order Promising based on customer
classification
Forecast
Supply Allocation
Forecast Netting
NettedForecast
Allocation Planning
Operational Planning
DF
DF
Order Promising
SCP
FP
FP
Supply Plan/Allocations
DF
Latest Available To Promise
Supply Plan
Order Planning
Production and material replenishment plan per
each line/facility
Order Creation
New Orders, Promise Information
Frozen Plan
SCP
FP
FP
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Demand Planning

• Objective
• Develop an accurate, reliable view of market
  demand based on the understanding how products
  are organized and how they are sold

• Characteristics
• Providing the global visibility.
• Multi-Dimension view
• Multi-Hierarchy view
• Collaboration to make the consensus.
• Statistical Estimation or Simulation
• Pick Best
• Tracking Forecast adjustment

• Benefit
• Improved forecasting accuracy based on consensus.
• Reduction of the inventory

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Master Planning

• Objective
• Generate an optimal supply plan (Global Capacity
  Plan, Product Mix, Material Plan, MPS, Logistics
  Plan) that helps the enterprise to position its
  resources to meet the forecasted demand generated
  by demand planning process

• Characteristics
• Planning Validity and Optimality
• including production, distribution,
  transportation, procurement.
• Planning Velocity
• memory resident architecture to execute the
  planning calculation
• iterative What-if simulation
• considering diverse objective (facility
  utilization, inventory, order promising, etc.)

• Benefit
• Improved Profitability
• Improved Facility Efficiency
• Reduced WIP

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Demand Fulfillment

• Objective
• Provide fast, accurate, and reliable delivery
  date response to customer orders, and to manage
  this activity in a profitable way.

• Characteristics
• Dynamic Order Fulfillment
• promise on a dynamic, real-time supply plan
• Various Model for Customer/Product Allocation
• customer/product based allocation to manage the
  order in a profitable way
• Forecast Netting
• prioritizing demands for the optimal allocation

• Benefit
• Improved Order Promising Capability
• Improved Customer Service

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Production Planning / Scheduling

• Objective
• Provide PCT for each order and the detailed
  schedule for each facilities by considering all
  the constraints on facilities, tools, materials.

• Characteristics
• Generating a plan considering multiple
  constraints.
• Facility Capacity, Tool, Order Priority,
  Alternate Material, Batch, etc.
• Scheduling
• Issuing Work Order
• Daily, Shift, Facility
• Considering Setup time
• Sequence dependent setup time
• What-if Simulation

• Benefit
• Improved Facility Efficiency
• Prompt response on Changed Order
• Reduced Cycle time
• Reduced WIP

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Average Quantified Benefits Range of SCM
(Industry General)
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Agenda

• Introduction on i2
• Dynamic Value Chain Management
• SCM Solution Suite
• Implementation Methodology
• Case Study

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New innovation methodology

• Tinkering Approach
• Transforming Approach

To-Be Process Design
Visioning
Solution Package Selection
Project Implementation
Process Consulting Firms Involvement
Solution Providers Involvement
To-Be Process Design
Visioning
Project Implementation
Solution Package Selection
Process Consulting Firms Involvement
Solution/Concept Providers Involvement
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i2 Implementation MethodologyTMPM (Trade Matrix
Project Methodology)

• Establish implementation strategy through Value
  Assessment (VA) or Strategic Opportunity
  Assessment (SOA)
• Presents As-Is analysis and implementation road
  map
• Presents implementation benefit analysis (by
  specific value)
• Phase implementation strategy by Business Release
  Methodology
• Break down implementation project into manageable
  phases which are called Business Release (BR)
  36 months
• Each BR defines clear Business Target (ex
  inventory reduction)
• Rapid implementation strategy which focuses on
  realization of specific business value-return
• Use of Template
• Provides industry specific SCM solution template
• Best Practice, Test Plan, Data, and Documents
• Reduces implementation period

Business Release Activities
VA / SOA
Mobilize
Design
Develop
Accept
Go Live
SIA
Less than 6 Months
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i2s Approach to Integration

• Through its 9000 customer implementations, i2
  has built a good understanding of various aspects
  associated with integration.
• i2 has come up with a framework that integrates
  not only i2 internal systems such as SCM, CRM and
  SRM but also external systems such as ERP and
  Legacy systems.
• Integration needs to be flexible and should allow
• Specification of the workflow steps to follow
• Configuration at each stage in the workflow based
  on specific business needs
• Integration needs to be extensible
• Objective is not only to deliver fully integrated
  solutions of i2 products covering SCM, CRM and
  SRM, but also to provide a solution to integrate
  seamlessly with other packaged applications and
  legacy infrastructure
• The goal is to adopt an integration approach and
  architecture for integrating diverse systems that
  will become an integration advantage to customers

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Common Integration Services

• CIS Framework is an i2 abstraction on top of many
  underlying integration platforms (such as
  webMethods, Informatica)
• It is a set of services enabling enterprise
  applications to participate in integrated
  environment
• List of services communication, logging,
  monitoring, data transformation, workflow design
  runtime, single sign-on, etc.
• Complete integration framework to interact with
  any i2 product or 3rd party system.
• It is specifying common meta-data format used to
  simplify TMAPI based collaboration.

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i2 Integration Architecture
Role based Common User Interface
OMx
IMx
ERP Sub-system (SAP)
Legacy Sub-system (OS390)
Design Source Sub-system SRM
Customer Management Sub-system CRM
Planning Sub-system SCM


Transactional Platform
Explore
ODS
Work flow
ETL-Bulk Data Transfer (back) Bus
Enterprise Messaging (front) Bus
Common Integration Services
Firewall
Public Internet
Exchanges
Hosted Services Content FreightMatrix
TMOCN
Trading Partners
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Agenda

• Introduction on i2
• Dynamic Value Chain Management
• SCM Solution Suite
• Implementation Methodology
• Case Study