Overcoming Order Fulfillment Challenges in Manufacturing, High-Tech & Retail
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The document discusses the challenges of order fulfillment in manufacturing, high-tech, and retail industries. It finds that managing complex order management systems and multi-channel fulfillment is difficult. Many companies have multiple order capture and fulfillment systems from acquisitions. Meeting customer demand across growing sales channels while controlling costs is a key issue. The document proposes an order orchestration architecture using Oracle Fusion SCM to help companies better integrate systems, gain visibility across inventory, and improve order promising and fulfillment.
Overcoming Order Fulfillment Challenges in Manufacturing, High-Tech & Retail
- 1. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.1 Overcoming Order Fulfillment Challenges in Manufacturing, High-Tech & Retail Brad Kerr Michael Pearcy Senior Director, Oracle Senior Manager, Capgemini
- 2. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.2 Agenda Fulfillment Challenges Order Fulfillment Survey Findings Architecture for Order Orchestration Best Practices Case Studies Q&A
- 3. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.3 Order Fulfillment 2013 Survey Methodology Conducted by Peerless Research Group on behalf of Supply Chain Management Review and Logistics Management. Sponsored by Oracle and Capgemini. Surveyed 589 supply chain executives in manufacturing, high-tech and retail businesses around the globe Summary Findings Managing order management systems and fulfillment processes is becoming more multifaceted and complicated The complexity of order management systems, the ongoing challenge of keeping customers satisfied, adhering to delivery schedules, and combating rising costs are among the major issues companies now face
- 4. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.4 Order Fulfillment Challenges Acquisitions Evolving Business Models Channel Expansion Integration Automation Customer Satisfaction
- 5. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.5 79% of companies have 3 or more order capture and 3 or more order fulfillment systems* * Supply Chain Management Review 2013 Order Fulfillment Survey
- 6. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.6 * Supply Chain Management Review 2013 Order Fulfillment Survey 50% of manufacturers have acquired another company or been acquired in the last three years 45% increased customer demand for multiple channels during last 12 months * Supply Chain Management Review 2013 Order Fulfillment Survey
- 7. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.7 Retailers maintain an average of 4 different types of selling channels Supply Chain Management Review 2013 Order Fulfillment Survey 38% of retailers lack the software capabilities & integration necessary to offer multi-channel fulfillment
- 8. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.8 Only 22% of retailers leverage their store inventory to fulfill online orders Supply Chain Management Review 2013 Order Fulfillment Survey
- 9. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.9 Fulfillment – Melding Planning and Execution Strategic Planning Tactical Planning Operational Planning Execution Feasibility Optimality Fulfillment Order Promising
- 10. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.10 Fulfillment – Melding Planning and Execution Strategic Planning Tactical Planning Operational Planning Execution Fulfillment Order Promising Only 1 in 3 companies feel good about their order promising Source: Oracle / Capgemini
- 11. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.11 Fulfillment – Melding Planning and Execution Strategic Planning Tactical Planning Operational Planning Fulfillment Order Promising Execution Delivery delays and resultant expediting is the largest driver of fulfillment costs Source: Oracle / Capgemini … think that exception handling needs improvement
- 12. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.12 53% of high-tech companies collaborate with partners on demand forecasting Supply Chain Management Review 2013 Order Fulfillment Survey High-tech companies do not meet allocations commitments 50% of the time
- 13. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.13 Web Call Center EDI Internal MobileCatalog Logistics Ware house Partners 3rd Party Finance Orders ,Changes, Cancellations, Status Source Selection, Splitting, Monitoring/Updates Siloed Processes Custom Point Integrations Inconsistent User Experience Monolithic App Deployment Lack of Standards Increased Inventory Slower Time to Market Increased Time to Revenue Decreased Order Accuracy Increased Order Cycle Time Falling Customer Satisfaction Today’s Environment
- 14. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.14 How have companies tried to solve this?
- 15. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.15 Today’s Solution Options Web Call Center Direct Channel Sales Mobile Field Service Orders, Changes, Cancellations, Status Source Selection, Splitting, Monitoring/Updates ERP Ware house Partners Store Finance Middleware Niche Sufficient Technology? Logistics
- 16. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.16 ERP Solution Challenges Limited Flexibility Hard to Integrate Master Data Tight Coupling ERP Web Call Center Direct Channel Sales Mobile Field Service Orders, Changes, Cancellations, Status Source Selection, Splitting, Monitoring/Updates Ware house Partners Store FinanceLogistics
- 17. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.17 Middleware Solution Challenges Middleware Web Call Center Direct Channel Sales Mobile Field Service Orders, Changes, Cancellations, Status Source Selection, Splitting, Monitoring/Updates Ware house Partners Store FinanceLogistics Lack of Objects High $ Implement High $ Maintain Not Order Aware
- 18. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.18 Coding Required Coupled with Legacy Old Tech Platform Proprietary Toolset Niche Web Call Center Direct Channel Sales Mobile Field Service Orders, Changes, Cancellations, Status Source Selection, Splitting, Monitoring/Updates Ware house Partners Store FinanceLogistics Niche Solution Challenges
- 19. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.19 So, what’s the answer?
- 20. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.20 Architecture for Order Orchestration Business Intelligence Enrichment Orchestration Task Services & Interfaces Order Promising Runtime Orchestration Work Area Rule based fulfillment process assignment Declarative data transformation Automated process planning & jeopardy determination Automated change management Rules based dynamic integration Dynamic data transformation Visibility into global supply Profitable to Promise calculation Centralized Order Tracking Visual process analysis Backlog Management
- 21. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.21 BEST PRACTICES & CUSTOMER SUCCESS
- 22. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.22 Focus on creating a consistent customer experience across all channels Invest in a technology platform to enable these changes and to ease the adoption of new business processes Embrace multi-channel fulfillment to up- sell and cross-sell between product lines Best Practices for Manufacturers
- 23. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.23 Leading Aerospace Manufacturer • Address high operating costs due to labor intensive processes • Build efficient processes in an environment with redundant & disparate systems & processes • Increase inventory turns by improving visibility to multiple inventory systems • Resolve issues related to fragmented product data Oracle Fusion SCM: • Fusion Distributed Order Orchestration • Fusion Global Order Promising • Fusion Product Hub • Oracle BPM • Capgemini Challenge Solution Intelligent, touch free order routing Seamless integration with legacy systems via DOO Increased visibility to multiple warehouses using GOP Process driven solution leveraging BPM Consolidated part master files using FPH Results
- 24. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.24 Collaborate with customers on allocation commitments to key customers Enforce these allocation commitments at the time of order execution Integrate these allocations into the promise dates provided to customers Best Practices for Automotive / High-Tech Companies
- 25. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.25 Oracle Fusion SCM: • Fusion Distributed Order Orchestration • Capgemini • Aging and inflexible mainframe systems • Desire for system improvement over course of global rollout • Need for flexible system for quick implementation of new delivery models • Desire to incorporate 3rd party and partner order fulfillment capabilities Challenge Solution Centralized management of order execution process Enables systematic rollout by progressively replacing legacy systems with target solutions Industrializes integration and implementation of new services Enables the establishment of 3rd party delivery models with limited effort Results Leading Automotive Tire Manufacturer
- 26. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.26 Make better use of all inventory assets Consider exploiting in-store inventories as part of a multi-channel fulfillment strategy Best Practices for Retailers
- 27. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.27 •Needed a scalable order orchestration system to help it move from a grocery retail model into a multi-brand business • Flexible order and delivery options Oracle Fusion SCM: • Fusion Distributed Order Orchestration • Fusion Global Order Promising • Capgemini Challenge Solution Leading UK Supermarket Chain Enabled eCommerce orders across brands Provided support for multiple delivery methods (home delivery, in-store & locker pickup) Flexibility to source products from stock or direct ship vendors Results
- 28. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.28 Oracle & Capgemini Deliver BenefitsFeatures • Global view of supply • Proactive exception monitoring/ resolution • Single, consolidated view of order status • Consistent process definition & execution • Highly adaptable, flexible business processes • Available To Promise scenarios • Standards based SOA integration framework & declarative web-based admin • Proactive jeopardy management tools Improved Customer Satisfaction More accurate order promising Faster exception response Single face to customer Faster time to Revenue Reduced fulfillment time Faster time to market for product Optimized fulfillment priorities Lower Cost of Ownership Increased architectural flexibility Decreased costly expediting
- 29. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.29 Questions & Answers
- 30. Copyright © 2013, Oracle and/or its affiliates. All rights reserved.30
Editor's Notes
- #6: Key message: Contributing to the complexities of order management processes are the multiple, disparate order capture and fulfillment systems companies operate. This makes it difficult to see a complete picture but more importantly it prevents companies from having a single view of their customers.
- #22: The way businesses have responded to the change is to apply the same approaches that worked before but with incremental improvements Get into a price war Increase marketing spend on traditional channels Reduce operational and support costs These approaches have lacked the agility, insight and differentiation needed to be sustainable in fluctuating economies and transformational market shifts The Majority of US executives surveyed in the recent 2012 Global Customer Experience Disruptive Study by Okeeffe & Company Stated that they need to update their company core values to include the most appropriate customer experience to all customers And that is why customers are now fighting back. They are leveraging these new trends to their advantage and demanding the brand relationships they were promised C-level US Executives estimate that the potential revenue loss to their organization as the result of not offering a positive, consistent, and brand-relevant customer experience is as high as 21% of their annual revenue YET the biggest obstacles organizations faced in regards to delivering the best possible customer experience was from lack of funding! (2012 Global Customer Experience Disruptive Study: O'Keeffe & Company) Bottom line… Disruptive change, increasing complexity and ineffective execution creates an inability to grow or even sustain your business Not only do you lose the loyal customers you had You hurt your brand which prevents you from getting new customers And cause your employees to be disenchanted and disengaged The reason why businesses are failing is because the necessary transformation is hard, uncomfortable and can be complicated – so they resist and avoid it at their peril.
- #24: Results – Centralized orchestration processes & reduced supply chain lead times Intelligent and automated routing of orders & Decreased order entry & processing errors Web-based parts catalog and customer portal Product De-duplication
- #26: Results – Centralized orchestration processes & reduced supply chain lead times Intelligent and automated routing of orders & Decreased order entry & processing errors Web-based parts catalog and customer portal Product De-duplication