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Driving Supply Chain Excellence Helping Intel’s Customers Go Faster Stuart Pann Intel Corporation Vice President, Technology and Manufacturing Group, General.

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Presentation on theme: "Driving Supply Chain Excellence Helping Intel’s Customers Go Faster Stuart Pann Intel Corporation Vice President, Technology and Manufacturing Group, General."— Presentation transcript:

1 Driving Supply Chain Excellence Helping Intel’s Customers Go Faster Stuart Pann Intel Corporation Vice President, Technology and Manufacturing Group, General Manager, Customer Fulfillment, Planning and Logistics

2 Microsoft Hi-Tech Summit Oct Extending Intel Architecture … NotebookDesktopServer PLATFORMS Performance Performance/Watt User Valued Features Common Element: The Internet MID Ultra Low Power Sufficient Performance Extreme Integration CE Ultra Low-Cost PC

3 Microsoft Hi-Tech Summit Oct CE (Internet) Mobile Internet Device Ultra Low Cost PC Low Cost PC Common Elements: Run the Internet, Low Power, Low Cost ~$10B Market Opportunity 2011 Unit TAM > 100’s Million Units Source: Intel Forecast

4 Microsoft Hi-Tech Summit Oct OEM/Disti/Retail Supplier’s Supplier Customer’s Customer DistributorFabSort Assembly Test Units DieWafers Units ODMManufacturer Dealerassembly Capital Equipment Supplier Indirect Material Supplier Distributor Intel’s Supply Network

5 Microsoft Hi-Tech Summit Oct OEM/Disti/Retail Supplier’s Supplier Customer’s Customer DistributorFabSort Assembly Test Units DieWafers Units ContractManufacturer OEMFabricator Capital Equipment Supplier Indirect Material Supplier Distributor Intel’s Supply Network 17Fabs 6 Assembly / Test sites 100,000 Products 95,000 Unique Customers 70,000Genuine Intel Dealers 270 New Product Versions

6 Microsoft Hi-Tech Summit Oct RESPONSIVENESS Critical for an Agile Supply Chain and to respond to changing market dynamics

7 Microsoft Hi-Tech Summit Oct Why is Responsiveness Important… Customers overstate orders We try to “shape the demand” We plan to orders Customers change orders We react to last minute changes Inventory costs Stock-out costs Responsiveness F/S & A/T utilization Planning HC S/D Performance The Change Orders The cycle >9 Weeks from shipment % 22% 5%

8 Microsoft Hi-Tech Summit Oct BLUE DOT: ATM Build Signal (Mix of Family/Sku Level) Key decision points in manufacturing F/S A/T Finish ADI/TRDI CW SFGI Hub Boxing site AGGREGATED HUB FORECAST REPLENISHMENT ORDERS **Finish & Ship signal** ~9-16 wks~2 wks1 day~1 wk JUDGED DEMAND + INVENTORY TGTS Signal to start Wafers JD + INVTRY TGTS For Materials & ATM Capacity At Forecast Item level GREEN DOT: CW/SFGI Build Signal (Sku Level) Red DOT: Fab Build Signal (Family Level)

9 Microsoft Hi-Tech Summit Oct Forecast Accuracy is key but hard  Principles of Forecasting – Forecasts are usually wrong – Aggregation improves accuracy – Longer horizons have lower accuracy – The best supply chains have the fastest responsiveness Rome 357 A.D. The Roman Emperor Constantine issued an edict forbidding anyone “to consult a soothsayer, a mathematician or a forecaster… May curiosity to foretell the future be silenced forever”

10 Microsoft Hi-Tech Summit Oct Applying semiconductor manufacturing techniques to the supply chain  Simple and highly visible metrics  Cycle time reduction  Pareto analysis  Yield curves Complemented by investments in tools and people

11 Microsoft Hi-Tech Summit Oct Customer Requests Past Market is short capacity… Current/Future Market is over capacity… What do you want? I can sell what I get… I want volume I want what sold last week… I want flexibility When do you want it?Tell me when I can get it.Today. What does reliability mean? Do what you told me you would do so I can plan Make sure you have what I need tomorrow What does collaboration mean? I have a department dedicated to constrained suppliers I can get what I need from multiple suppliers Past vs. Current/Future: The Market

12 Microsoft Hi-Tech Summit Oct Past vs Future: The Metrics Manufacturing Metrics PastFuture Output Output Max Ramp Max Flexibility: Able to shift among families/SKUs CostsCapitalCapital and Inventory Schedule Metrics Meet “Commit” Flexible Response Inventory Ranges Factory FocusMax Yield Cost of Complexity Cycle Time Max Yield

13 Microsoft Hi-Tech Summit Oct The programs to implement change Say “Yes” Respond to customer requests in 1 business day Commits to Customers Matching Real Orders With Real Demand Customer Planning Reengineering (CPR) Change fulfillment from selling capacity to building what customers will buy. Achieve market standards for availability, responsiveness, service, and staffing as measured by “say yes with less inventory.” Factory Responsiveness Real time scheduling Replenishment Aggressive Inventory Management Computing Infrastructure – Standards, DSS, Integration

14 Microsoft Hi-Tech Summit Oct  Several of our major initiatives need quick End-to- End Business integration with customers, supply chain partners and suppliers.  Huge opportunity to harness richer data and knowledge across the supply chain  Focus Needed –Products that enable quick End-to-End Business Network Integration –Open standards and connectivity across different enterprise systems B2B Collaboration and Connectivity

15 Microsoft Hi-Tech Summit Oct Data Flow Physical Flow Many transactions & data exchanges are manual today Intel PDC Hub Customer   Planners Analysts WH Transfers 2x wkly Manual in SAP Forecast Weekly Via excel Order Daily Via excel Replenishment Signal Manual calcs via excel Manual signal Backlog Hub Inventory Management Manual via excel Inventory Daily Via excel Hubs need to be setup Customer site by site deployments Factories and inventory readiness Factory Demand Inventory As Is

16 Microsoft Hi-Tech Summit Oct Data Flow Physical Flow Transactions & data exchanges automated Intel PDC Hub Customer   Planners Customer Analysts Forecast Weekly via B2B SAP SCM Order Daily Via B2B Replenishment Signal Automated calcs Via SAP SCM Demand Signal Via SAP SCM & DSS Allocations/Assurance Hub Operations Inventory Via B2B into SAP SCM Hubs setup Customers deployed Factories ready Factory Demand To Be Inventory Management 

17 Microsoft Hi-Tech Summit Oct Computing Infrastructure – Coupled with Business Processes Bill of Materials (BOM) Product Data Item & Characteristics Planning Operational Data Product Create & Maintain App TMG Applications Planning Applications TMG Applications Factory & Enterprise Applications Solvers Data Key Attributes: Single point of data entry Single version of the “truth” Common nomenclature Easy access to information High levels of data quality

18 Microsoft Hi-Tech Summit Oct Enterprise Intel Databases AssemblyFabSortTest Distribution Equipment & Materials Suppliers Global Distributed Data Bases Transparent data pipeline across the Supply Chain critical to decision making and agility

19 Microsoft Hi-Tech Summit Oct Intel is a registered trademark of Intel Corporation or its subsidiaries in the United States and other countries. Win/IA Server OS Penetration by Process Technology Mission Critical Computing: Intel Runs on IA Intel Architecture / Microsoft OS backbone well proven to run high volume manufacturing

20 Microsoft Hi-Tech Summit Oct Dashboards Change Control Systems Intel Knowledge Management & Collaboration Strategy based on SharePoint Knowledge capture templates Customized Workflows Navigate content repositories Secure and Searchable Codify User Biz process Embed in internal user orgs Globally distributed Mfg content Specs Others …

21 Microsoft Hi-Tech Summit Oct Enlisting the organization People are the key to success Clear Metrics Transition Change Management Worldwide communication

22 Microsoft Hi-Tech Summit Oct The Results -Improved responsiveness to customer requests -Improved delivery performance -Reduced inventory levels last quarter by 600M$ -Kept headcount flat -And drove organizational health survey scores above Intel averages

23 Microsoft Hi-Tech Summit Oct Changing the way we work The Intel office pilot  Objective: Create new office environments which are more conducive to the way we work –Create open, collaboration and community spaces –More privacy options and closed conference rooms –Get rid of underutilized office space –increase interaction and energy levels

24 Microsoft Hi-Tech Summit Oct Flex Zone

25 Microsoft Hi-Tech Summit Oct Summary  Focus on a few key metrics that can be use to enlist a worldwide organization  Apply techniques from manufacturing to the entire supply chain  Data standards are key to integration and scale  Invest in the people

26 Microsoft Hi-Tech Summit Oct


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