© 2008 Pearson Prentice Hall, Electronic Commerce 2008, Efraim Turban, et al. Chapter 7 E-Supply Chains, Collaborative Commerce, and Corporate Portals

7-2 Learning Objectives 1.Define the e-supply chain and describe its characteristics and components. 2.List supply chain problems and their causes. 3.List solutions to supply chain problems provided by EC. 4.Describe RFID supply chain applications. 5.Define c-commerce and list the major types.

7-3 Learning Objectives 6.Describe collaborative planning and Collaboration, Planning, Forecasting, and Replenishing (CPFR) and list the benefits of each. 7.Discuss integration along the supply chain. 8.Understand corporate portals and their types and roles. 9.Describe e-collaboration tools such as workflow software and groupware.

7-4 E-Supply Chains Definitions and Concepts supply chain The flow of materials, information, money, and services from raw material suppliers through factories and warehouses to the end customers e-supply chain A supply chain that is managed electronically, usually with Web technologies

7-5 E-Supply Chains

7-6 E-Supply Chains Supply Chain Parts Upstream supply chain procurement The process made up of a range of activities by which an organization obtains or gains access to the resources (materials, skills, capabilities, facilities) they require to undertake their core business activities Internal supply chain Downstream supply chain

7-7 E-Supply Chains supply chain management (SCM) A complex process that requires the coordination of many activities so that the shipment of goods and services from supplier right through to customer is done efficiently and effectively for all parties concerned. SCM aims to minimize inventory levels, optimize production and increase throughput, decrease manufacturing time, optimize logistics and distribution, streamline order fulfillment, and overall reduce the costs associated with these activities

7-8 E-Supply Chains e-supply chain management (e-SCM) The collaborative use of technology to improve the operations of supply chain activities as well as the management of supply chains The success of an e-supply chain depends on: The ability of all supply chain partners to view partner collaboration as a strategic asset A well-defined supply chain strategy Information visibility along the entire supply chain Speed, cost, quality, and customer service Integrating the supply chain more tightly

7-9 E-Supply Chains Activities and infrastructure of E-SCM Supply chain replenishment E-procurement Supply chain monitoring and control using RFID Inventory management using wireless devices Collaborative planning Collaborative design and product development E-logistics Use of B2B exchanges and supply webs

7-10 E-Supply Chains e-procurement The use of Web-based technology to support the key procurement processes, including requisitioning, sourcing, contracting, ordering, and payment. E- procurement supports the purchase of both direct and indirect materials and employs several Web-based functions such as online catalogs, contracts, purchase orders, and shipping notices collaborative planning A business practice that combines the business knowledge and forecasts of multiple players along a supply chain to improve the planning and fulfillment of customer demand

7-11 E-Supply Chains Infrastructure for e-SCM Electronic Data Interchange (EDI) Extranets Intranets Corporate portals Workflow systems and tools Groupware and other collaborative tools

7-12 E-Supply Chains Determining the Right Supply Chain Strategy Functional products are staple products that have stable and predictable demand and call for a simple, efficient, low-cost supply chain Innovative products tend to have higher profit margins, volatile demand, and short product life cycles. These products require a supply chain that emphasizes speed, responsiveness, and flexibility rather than low costs

7-13 Supply Chain Problems and Solutions Typical Problems along the Supply Chain With increasing globalization and offshoring, supply chains can be very long and involve many internal and external partners located in different places A lack of logistics infrastructure might prevent the right goods from reaching their destinations on time Quality problems with materials and parts also can contribute to deficiencies in the supply chain bullwhip effect Erratic shifts in orders up and down supply chains

7-14 Supply Chain Problems and Solutions The Need for Information Sharing along the Supply Chain EC Solutions along the Supply Chain Order taking Order fulfillment Electronic payments Managing risk Inventories can be minimized Collaborative commerce

7-15 Key Enabling Supply Chain Technologies: RFID and Rubee radio frequency identification (RFID) Tags that can be attached to or embedded in objects, animals, or humans and use radio waves to communicate with a reader for the purpose of uniquely identifying the object or transmitting data and/or storing information about the object

7-16 Key Enabling Supply Chain Technologies: RFID and Rubee

7-17 Key Enabling Supply Chain Technologies: RFID and Rubee

7-18 Key Enabling Supply Chain Technologies: RFID and Rubee

7-19 Key Enabling Supply Chain Technologies: RFID and Rubee LIMITATIONS OF RFID For small companies, the cost of the system may be too high The restriction of the environments in which RFID tags are easily read Different levels of read accuracy at different points along the supply chain Concerns over customer privacy Agreeing on universal standards Connecting the RFIDs with existing IT systems

7-20 Key Enabling Supply Chain Technologies: RFID and Rubee RuBee Bidirectional, on-demand, peer-to-peer radiating transceiver protocol under development by the Institute of Electrical and Electronics Engineers

7-21 Key Enabling Supply Chain Technologies: RFID and Rubee

7-22 Collaborative Commerce collaborative commerce (c-commerce) The use of digital technologies that enable companies to collaboratively plan, design, develop, manage, and research products, services, and innovative EC applications collaboration hub The central point of control for an e-market. A single c-hub, representing one e-market owner, can host multiple collaboration spaces (c-spaces) in which trading partners use c-enablers to exchange data with the c-hub

7-23 Collaborative Commerce

7-24 Collaborative Commerce

7-25 Collaborative Commerce grid computing A form of distributed computing that involves coordinating and sharing computing, application, data, storage, or network resources across dynamic and geographically dispersed organizations service-oriented architecture (SOA) An architectural concept that defines the use of services to support a variety of business needs. In SOA, existing IT assets (called services) are reused and reconnected rather than the more time consuming and costly reinvention of new systems

7-26 Collaborative Commerce Representative Examples of E-Collaboration vendor-managed inventory (VMI) The practice of retailers’ making suppliers responsible for determining when to order and how much to order Information sharing between retailers and suppliers Retailer–supplier collaboration Lower transportation and inventory costs and reduced stockouts Reduction of design cycle time Reduction of product development time

7-27 Collaborative Commerce

7-28 Collaborative Commerce Barriers to C-Commerce Most organizations have achieved only moderate levels of collaboration because of: A lack of internal integration, standards, and networks Security and privacy concerns, and distrust over who has access to and control of information stored in a partner’s database Internal resistance to information sharing and to new approaches A lack of internal skills to conduct c-commerce

7-29 Collaborative Planning, CPFR, and Collaborative Design collaborative planning, forecasting, and replenishment (CPFR) Project in which suppliers and retailers collaborate in their planning and demand forecasting to optimize flow of materials along the supply chain

7-30 Collaborative Planning, CPFR, and Collaborative Design

7-31 Collaborative Planning, CPFR, and Collaborative Design

7-32 Collaborative Planning, CPFR, and Collaborative Design advanced planning and scheduling (APS) systems Programs that use algorithms to identify optimal solutions to complex planning problems that are bound by constraints

7-33 Collaborative Planning, CPFR, and Collaborative Design

7-34 Collaborative Planning, CPFR, and Collaborative Design product lifecycle management (PLM) Business strategy that enables manufacturers to control and share product-related data as part of product design and development efforts

7-35 Supply Chain Integration How Information Systems Are Integrated Internal integration includes connecting applications with databases and with each other and connecting customer-facing applications (front end) with order fulfillment and the functional information systems (back end) Integration with business partners connects an organization’s systems with those of its external business partners

7-36 Supply Chain Integration Web Services An architecture enabling assembly of distributed applications from software services and tying them together Integration along the Extended Supply Chain Information integration along the extended supply chain—all the way from raw material to the customer’s door

7-37 Corporate (Enterprise) Portals corporate (enterprise) portal A gateway for entering a corporate Web site, enabling communication, collaboration, and access to company information

7-38 Corporate (Enterprise) Portals Types of Corporate Portals Types of generic portals Portals for suppliers and other partners Customer portals Employee portals Executive and supervisor portal mobile portals Portals accessible via mobile devices, especially cell phones and PDAs

7-39 Corporate (Enterprise) Portals The Functionalities of Portals information portals Portals that store data and enable users to navigate and query these data collaborative portals Portals that allow collaboration

7-40 Corporate (Enterprise) Portals

7-41 Corporate (Enterprise) Portals Justifying Portals Portals offer benefits that are difficult to quantify Developing Portals Many vendors offer tools for building corporate portals as well as hosting services

7-42 Collaboration-Enabling Tools: From Workflow to Groupware Workflow Technologies and Applications workflow The movement of information as it flows through the sequence of steps that make up an organization’s work procedures workflow systems Business process automation tools that place system controls in the hands of user departments to automate information processing tasks workflow management The automation of workflows, so that documents, information, and tasks are passed from one participant to the next in the steps of an organization’s business process

7-43 Collaboration-Enabling Tools: From Workflow to Groupware Types of Workflow Applications Collaborative workflow Production workflow Administrative workflow The benefits of workflow management systems include: Cycle time reduction Productivity gains Improved process control Improved quality of services Lower staff training costs Lower management costs Improved user satisfaction More effective collaboration and knowledge sharing

7-44 Collaboration-Enabling Tools: From Workflow to Groupware groupware Software products that use networks to support collaboration among groups of people who share a common task or goal Synchronous versus Asynchronous Products

7-45 Collaboration-Enabling Tools: From Workflow to Groupware Electronic Meeting Systems virtual meetings Online meetings whose members are in different locations, even in different countries group decision support system (GDSS) An interactive computer-based system that facilitates the solution of semistructured and unstructured problems by a group of decision makers

7-46 Collaboration-Enabling Tools: From Workflow to Groupware Electronic Teleconferencing teleconferencing The use of electronic communication that allows two or more people at different locations to have a simultaneous conference

7-47 Collaboration-Enabling Tools: From Workflow to Groupware video teleconference Virtual meeting in which participants in one location can see participants at other locations on a large screen or a desktop computer data conferencing Virtual meeting in which geographically- dispersed groups work on documents together and exchange computer files during videoconferences

7-48 Collaboration-Enabling Tools: From Workflow to Groupware Voice-over-IP (VoIP) Communication systems that transmit voice calls over Internet Protocol–based networks Interactive whiteboards screen-sharing software Software that enables group members, even in different locations, to work on the same document, which is shown on the PC screen of each participant

7-49 Collaboration-Enabling Tools: From Workflow to Groupware Instant video Integration and groupware suites Lotus Notes/Domino Microsoft NetMeeting Novell GroupWise

7-50 Impact of E-Commerce on Supply Chain Management A production supply chain refers to the flow of physical goods and associated information from the source to the consumer. Key supply chain activities include:Production planning Purchasing Materials management Distribution Customer service Sales forecasting

7-51 Impact of E-Commerce on Supply Chain Management Electronic commerce and the Internet are fundamentally changing the nature of supply chains, and redefining how consumers learn about, select, purchase, and use products and services. The result has been the emergence of new business- to business supply chains that are consumer-focused rather than product- focused. They also provide customized products and services. E-commerce impacts supply chain management in a variety of keyways. These include: Cost efficiency: E-commerce allows transportation companies of all sizes to exchange cargo documents electronically over the Internet. E-commerce enables shippers, freight forwarders and trucking firms to streamline document handling without the monetary and time investment required by the traditional document delivery systems. By using e-commerce, companies can reduce costs, improve data accuracy, streamline business processes, accelerate business cycles, and enhance customer service. Ocean carriers and their trading partners can exchange bill of lading instructions, freight invoices, container status messages, motor carrier shipment instructions, and other documents with increased accuracy and efficiency by eliminating the need to re-key or reformat documents. The only tools needed to take advantage of this solution are a personal computer and an Internet browser.

7-52 Impact of E-Commerce on Supply Chain Management Changes in the distribution system: E-commerce will give businesses more flexibility in managing the increasingly complex movement of products and information between businesses, their suppliers and customers. E-commerce will close the link between customers and distribution centers. Customers can manage the increasingly complex movement of products and information through the supply chain. Ø Customer orientation: E-commerce is a vital link in the support of logistics and transportation services for both internal and external customers. E-commerce will help companies deliver better services to their customers, accelerate the growth of the e- commerce initiatives that are critical to their business, and lower their operating costs. Using the Internet for e-commerce will allow customers to access rate information, place delivery orders, track shipments and pay freight bills. E-commerce makes it easier for customers to do business with companies: Anything that simplifies the process of arranging transportation services will help build companies' business and enhance shareholder value. By making more information available about the commercial side of companies, businesses will make their web site a place where customers will not only get detailed information about the services the company offers, but also where they can actually conduct business with the company. Ultimately, web sites can provide a universal, self-service system for customers. Shippers can order any service and access the information they need to conduct business with transportation companies exclusively online. E-commerce functions are taking companies a substantial step forward by providing customers with a faster and easier way to do business with them.

7-53 Impact of E-Commerce on Supply Chain Management Ø Shipment tracking : E-commerce will allow users to establish an account and obtain real-time information about cargo shipments. They may also create and submit bills of lading, place a cargo order, analyze charges, submit a freight claim, and carry out many other functions. In addition, e-commerce allows customers to track shipments down to the individual product and perform other supply chain management and decision support functions. The application uses encryption technology to secure business transactions. Ø Shipping notice: E-commerce can help automate the receiving process by electronically transmitting a packing list ahead of the shipment. It also allows companies to record the relevant details of each pallet, parcel, and item being shipped. Ø Freight auditing: This will ensure that each freight bill is efficiently reviewed for accuracy. The result is a greatly reduced risk of overpayment, and the elimination of countless hours of paperwork, or the need for a third-party auditing firm. By intercepting duplicate billings and incorrect charges, a significant percent of shipping costs will be recovered. In addition, carrier comparison and assignment allows for instant access to a database containing the latest rates, discounts, and allowances for most major carriers, thus eliminating the need for unwieldy charts and tables. Ø Shipping Documentation and Labeling: There will be less need for manual intervention because standard bills of lading, shipping labels, and carrier manifests will be automatically produced; this includes even the specialized export documentation required for overseas shipments. Paperwork is significantly reduced and the shipping department will therefore be more efficient. Ø Online Shipping Inquiry: This gives instant shipping information access to anyone in the company, from any location. Parcel shipments can be tracked and proof of delivery quickly confirmed. A customer's transportation costs and performance can be analyzed, thus helping the customer negotiate rates and improve service.

7-54 Managerial Issues 1.How difficult is it to introduce e- collaboration? 2.How much can be shared with business partners? Can they be trusted? 3.Who is in charge of our portal and intranet content? 4.Who will design the corporate portal? 5.Should we conduct virtual meetings?

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