weâ€™ve come a long way from olduvai gorge

We’ve come a long wayfrom Olduvai Gorge*

I m p l e m e n t i n g V i s i o n • w w w. w e b p l a n . c o m

N e w C o l l a b o r a t i v eC o m m u n i t i e s

f o r e - B u s i n e s sM a n u f a c t u r i n g

* Olduvai Gorge, a deep river valley inwhat is now Tanzania, is thought by

many anthropologists to be thebirthplace of humanity following the

discovery of a 1.8-million-year-oldHomo Habilis skull in 1968.

2478 whitepaper 10/21/99 1:05 PM Page 2

Ta b l e o f C o n t e n t s1. The e-Business Imperative. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . pg. 2

2. The unbalanced enterprise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . pg. 4

3. The rising cost of inefficient supply chain management . . . . . . . . . . . . . . . . . . . . pg. 5

4. Simple supply chain management isn’t enough anymore . . . . . . . . . . . . . . . . . . . pg. 6

5. The webPLAN vision: eSupply-Chain Communities . . . . . . . . . . . . . . . . . . . . . . . . . pg. 7

6. eSupply-Chain advantages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . pg. 9

7. The webPLAN eSupply-Chain solution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . pg. 9

8. The webPLAN differentiators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . pg. 11

9. Case Study: webPLAN innovates contract electronics manufacturing . . . . . . . pg. 13

10. Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . pg. 16

1

Ta b l e o f C o n t e n t s


T h e e - B u s i n e s s I m p e r a t i v eWin the contract. Deliver the best product possible. Be faster, more efficient, more

reliable and more affordable than your competitor. Grow. Dominate the market. Profit.

Then profit some more.

These goals haven’t changed since Grok set up his stall selling bone and stone tools

to his fellow cavemen. The large manufacturing organizations of today have exactly

the same concerns as their Neolithic predecessor with one very important distinction:

technology. Businesses such as Dell Computer Corp. are able to benefit from 10,000

years of technological advancement – advancement that has zenithed with the

advent of the ultimate business device: the Internet.

Just like today’s manufacturers, Grok would have set up a network of suppliers –

people who would provide useful items that could be turned into marketable

products. Some of these suppliers might have been hunters, while others could have

been rock-hounds or scavengers. In all these cases the supplier would probably have

been out of contact with Grok, who runs the storefront, for many days or weeks. Thus,

when a customer came to Grok requesting a particular tool he would have to wait

until the order could be transmitted to the supplier, for the raw material to be

procured, cleaned up, fashioned into the tool required and, finally, delivered to Grok

for sale to the customer. When complete, this process could take months to run its

course.

Today, customers want highly customized goods, they want them right now and they

want them cheap. If a manufacturer can’t meet these demands the customer can find

another manufacturer with the mere click of a mouse. Simply put, customers have a

veritable smorgasborg of options and don’t have to put up with inefficiency in any

way, shape or form. For the manufacturer, winning in this new marketplace means

taking advantage of all the best tools available, including – and especially – the

Internet.

To most manufacturing organizations, the importance of the Internet is no longer in

question. The ubiquity, power, and cost-effectiveness of a worldwide networking

infrastructure are inherently compelling to almost all companies worldwide.

What’s unclear, however, is how to apply and optimize the power of the Internet and

what role it can and should play in a modern manufacturing process. Manufacturers

are looking to the Internet as a solution that can reduce costs and shorten cycle times

– but is that enough? Are there further advantages waiting to be tapped?

2

"Nearly half of all senior

executives believe the Internet

will reshape the international

marketplace in the next three

years, and 60 percent plan on

electronically connecting to

customers, suppliers and

shareholders within the same

period."

AMR Research,

supply-chain.com, 1999

"e-Business is changing the

Industrial Age models of

customer acquisition,

procurement, pricing and

customer satisfaction, as well

as how we measure the

performance of a corporation."

AMR Research,


T h e e - B u s i n e s s I m p e r a t i v e


For many manufacturers, the strategy has been to leverage the Internet as a

foundation for e-Business – but what is e-Business? Ask 10 experts, and you’ll likely

receive 10 different answers. webPLAN believes that e-business is a business-to-

business (B2B) proposition that combines the more visible and "popular" front-end e-

commerce systems with robust back-end supply chain solutions. Synchronized

properly, these collectively form an e-Business solution that creates a high-velocity,

coordinated inter-enterprise manufacturing process.

With e-Business, customers, manufacturers, and suppliers collaborate and transact

business in real time, within secure Internet communities. It’s a vision that combines

customer service and order management with manufacturing and supplier

fulfillment. And it involves interactive strategic collaboration with all trading partners.

We believe that e-Business is rapidly becoming the new requirement for lean, nimble

manufacturing. That’s because it goes far beyond the previous mandate of saving

time and money. An e-Business strategy increases both top line revenue and bottom

line profitability through greater sales margins and increased efficiency. However, a

proper implementation of e-Business strategies requires new systems and processes.

Yesterday’s business models, the ones practiced by Grok and his contemporaries,

won’t cut it. webPLAN believes that companies that fail to adapt to the new world of

manufacturing will disappear the same way – and for the same reasons – as Grok.

Many of today’s manufacturers communicate with their network of suppliers with

phone, fax and voicemail, certainly an improvement over Grok’s methods, but the

world has changed and these are no longer adequate for the task. While orders

languish in your fax trays and critical communications wait in your email and

voicemail boxes, your customers are growing dissatisfied. They know that the

technology is there to provide them with the level of service they want. You know

there’s one thing about the business world that hasn’t changed since Grok sold his

first hide scraper or stone axe. It’s all about survival of fittest, and followers are the

ones most often eaten by predators.

Be the organization that sets the standard.

3

"Organizations with the

courage to adopt an adaptive

and flexible supply chain …

have an opportunity to gain

global economies of scope,

scale and speed. While the

economies of scope will allow

organizations to share

resources across products,

markets and businesses,

economies of scale in the

supply chain make it possible

to lower unit costs and obtain

greater bargaining power.

Economies of speed will allow

quicker reactions to changing

customer needs and improved

supply chain performance that

encompasses supply chain

planning tools."

KPMG,

Ecogistics: A Framework for

Logistics Ecosystem, 1999


T h e U n b a l a n c e d E n t e r p r i s eGiven the explosive growth of the Internet as a new channel for companies to sell to,

and service, their customers, it’s not surprising that we’ve witnessed one of the

industry’s most rapid technology adoption curves. And why not? e-Commerce

systems yield dramatically lower costs per transaction and offer an attractive self-

service proposition to the buyer: 24x7 access and availability from anywhere in the

world.

However, in the virtual frenzy to design and deploy e-commerce systems, major

infrastructure issues are being overlooked. Deployments of the supporting business-

to-business infrastructure on the back end – supply chain management systems

that ensure e-Commerce transactions flow seamlessly from customer to

manufacturer to supplier – lag far behind front-end, virtual storefronts on the

adoption curve.

A solid, glamorous e-commerce front-end must be connected to, and synchronized

with, a real-time, high-velocity supply chain on the back end or the enterprise fails to

capitalize on the investment. If the new e-Business strategy isn’t adopted enterprise-

wide the result is mere window dressing – the operation has the look and feel of a

cyber company, but none of the performance enhancements – at heart it’s still a brick

and mortar endeavor. It can accept orders at Internet speed, but it can’t fill those

orders anywhere near as fast. Thus the enterprise has become unbalanced, and prone

to fulfillment problems, higher costs, late shipments, and unhappy customers.

4

"Effective supply chain

management requires certain

key characteristics such as:

pipeline co-ordination;

seamless flow of inventory;

focus on landed cost to

customer; sharing of

information and risk;

advanced planning based on

a supply chain team

approach; as well as strong

partnerships and alliances."

KPMG,



T h e U n b a l a n c e d E n t e r p r i s e


5

"Few companies want to

compete on price alone, yet

the Internet is forcing

businesses to do so. The only

way to stop the slide into a

constant price war is to stand

out in other ways. The speed,

accuracy, and completeness

with which orders are filled

and delivered is the sustaining

differentiator. To build a

supply chain capable of

operating at such high levels

of performance and efficiency

demands revamping how we

think and operate."

AMR Research,


T h e R i p R l i n g , R i s i n g C o s t o f I n e f f i c i e n tS u p p l y C h a i n M a n a g e m e n t

Today’s typical supply chains are a great step in the right direction. Most often, they are

loosely aligned federations of trusted suppliers who converge on a project-by-project,

order-by-order basis.

Unfortunately, they rely on relatively inefficient means for communication and

collaboration – faxes, e-mails, phone calls. When a customer places an order, the

manufacturer needs to understand its impact on inventory, production, labor and so

forth. That requires consultation with its suppliers – and those suppliers consulting their

suppliers and so on down the chain. With a multi-tiered supply chain, it often takes days

or even weeks to fully analyze the impact of the originating customer’s order. What’s

more, the further you are down the supply chain, the more of a "bullwhip" effect you

endure – which costs you time and money.

While these processes are certainly a dramatic improvement over the methods Grok

employed, today’s business moves at "Internet speed" and outdated methodology

inhibits the pursuit of the vision of a "high velocity" enterprise manufacturer. Today,

collaboration is the new paradigm. What discrete manufacturers need are not suppliers

– but partners who are "in it together" with you and have a similarly important stake in

the outcome of the originating customer’s order.

The difference between these philosophies can be remarkable. Suppose for example,

that an order inquiry comes into your company from an important customer. The order

would require you to purchase inventory from several suppliers and line up some sub-

contracted manufacturers for primary and secondary operations. You check with the first

supplier. That requires them to check down their supply chain and so forth.Your

important customer is waiting days – maybe weeks – for an answer. Or maybe they’re

not waiting at all. Maybe they are simply going to your competitor for a faster, better

answer. Conversely, an e-Business approach allows you to do this groundwork in real

time. No voice-mails go unanswered, no e-mails languish in in-boxes. Now you can get

the answers you need, and get back to your customer with a quote, in a matter of hours.

T h e R i p p l i n g , R i s i n g C o s t o f I n e f f i c i e n t S u p p l y C h a i n M a n a g e m e n t

Source: webPLAN Inc.

CCDistributor

eSCDistributor

eSC

CustomereSC

CustomereSC

SuppliereSC

SuppliereSC

M DD

CC

SS

SS

SS

CMCM SS

SS

SS

CMCM

SS

SS

CCSS

MM

CCMM

SS

MM

SS SS SS

OtherSupplyChains

OtherSupplyChains

CMS

CMD

eSC

======

CustomerManufacturerSupplierContract ManufacturerDistributorwebPLAN eSupply-Chain

ManufacturereSC

ManufacturereSC

M


6

"No SCE system is immune to

e-Business execution

requirements. All functions

will be affected by e-Business,

and the systems supporting

them have to be judged on

how well the can perform in

such a supercharged

environment."

AMR Research,


"Excellence in fulfillment

operations becomes a critical

issue as competition heats up,

and will require the

integration of the entire inter-

enterprise supply chain."

AMR Research,


S i m p l e S u p p l y C h a i n M a n a g e m e n t I s n ’ tE n o u g h A n y m o r e

Today’s SCM solutions – using "fat" client/server platforms – are ill-equipped to

support the rapid e-Business paradigm. They offer a limited set of communications

between manufacturers and suppliers – typically e-mail, static HTML, or EDI transfers.

Some of the other shortcomings/challenges they present include:

• Complexity – First-generation SCM solutions are typically monolithic systems

that require lengthy and expensive implementations.

• Long Implementations – It’s not uncommon for implementations to take as

long as two years.

• Client/Server Architectures – Installation and maintenance of software on

user PCs, hardware investments to support the software, and potential training

issues all arise from client/server deployments.

• Static Data – There’s none of the real-time sharing of manufacturing

information that Web-speed e-Business demands.

• Limited to "Super Users" – Because of their "fat-client" nature and complexity,

SCM implementations are typically limited to power users in various

departments and divisions.

• Expense – First-generation SCM systems are inherently costly to acquire,

deploy, and maintain.

S i m p l e S u p p l y C h a i n M a n a g e m e n t I s n ’ tE n o u g h A n y m o r e

Applications

Users Supported

Process Model

Architecture

Manufacturer’s

Trading Partners

Deployment

ERP

100’s

Fat client, 2-3 tier

Internal

Not apparent

Months/years

Supply Chain

100’s

Inside-out

Transaction Publishing

Months/years

eBusiness

Unlimited

Workflow-based

Outside-in

Real-time Collaboration

Weeks/months

Data and businesslogic driven, Batch

Data, not businesslogic driven

Viewpoint

LegacyPlatform

Web IntrinsicPlatform

Client/ServerPlatform

LegacyPlatform

Web IntrinsicPlatform

Client/ServerPlatform

Static HTML publishing,fat client, 2-3 tier

Thin client,n-tier, open (XML), dynamic, interactive



T h e w e b P L A N V i s i o n : e S u p p l yC h a i n C o m m u n i t i e s

7

"The goal of supply chain

management is to enhance

overall business performance

by coordinating the activities

of supply chain participants

to achieve optimal operating

results."

KPMG,



webPLAN envisions a paradigm that enables all stakeholders in the supply chain to

easily share data, and collaborate on plan development in real time regardless of

geographic location or the platforms being used. Our vision is to help manufacturers

create and implement systems that will allow them to effectively compete in the new

e-Business world. This approach is called the "eSupply-Chain."

• An eSupply-Chain is a collection of integrated Web applications for supply chain

planning with an emphasis on affordable, easy-to-install, easy-to-use solutions

that can automate the entire vertical supply chain.

• eSupply-Chains connect manufacturers, customers, and suppliers – in real time

– over the Internet providing a forum for interactive, collaborative partnerships.

• eSupply-Chains integrate with ERP and CRM software as well as e-commerce,

logistics, and warehouse/fulfillment systems.

In the new e-Business world, competition will shift from the manufacturer vs

manufacturer model we have known in the past, to a system that pits supply chains

against other supply chains, just like sports teams. The fastest, most efficient, most

reliable and most agile team will win and prosper. The losers will shrivel and die.

By utilizing eSupply-Chains, manufacturers embrace suppliers as critical members of

their team and create high-velocity communities of stakeholders that can react

immediately and in synchronized fashion to changes in supply and demand. It’s the

difference between trading partners communicating with static data and business

partners collaborating with live data in real time. Similarly, it can be the difference

between taking the field with a comprehensive playbook, or having no game plan

whatsoever.

In an eSupply-Chain, all stakeholders use the exact same data – no multiple sources,

synchronization, and application integration hurdles. And instead of the usual

"inside-out" focus typical of first-generation SCM, eSupply-Chains operate from an

"outside-in" perspective that fosters easier and more effective collaboration.

Additionally, an eSupply-Chain needs to support complete MRP/ERP heterogeneity.

Each stakeholder may employ a different system but still needs to access the same

data without running into serious – and possibly crippling – compatibility problems.

An eSupply-Chain model tears down the silos that have traditionally separated

stakeholders, opening up the process to never-before seen efficiency.

T h e w e b P L A N V i s i o n : e S u p p l y C h a i n C o m m u n i t i e s


Communicating in a secure Internet community, manufacturers can outsource non-

core operations to subcontractors with confidence and focus on their core

competencies. They can engage customers in real time and participate with them in

accurate forecast and demand planning. In short, they can conduct e-Business.

The future of supply chain management is a true "anyone can play" world where the

cost of entry – which has restricted users to larger companies in the past – is so low

that even Mom and Pop-sized organizations can buy in and benefit from the same

velocity and efficiency as global megacorporations.

The webPLAN model for this universal approach is called Application Service

Provider™ (ASP). Under this model small to mid-sized businesses – organizations that

might find the idea of spending several hundred thousand dollars on software

integration prohibitive – can access a subscription-based Internet site that provides

them with all the same feature functionality on a subscription basis. Meanwhile, large

organizations can outsource their maintenance, administration and infrastructure. All

players win.

8


Supplier Supplier

SupplierSupplier

SupplierSupplier

Supp

lier

Supp

lier Manufact

urer Manufacturer

DistributorContract

Manufacturer

Cont

ract

Man

ufac

ture

r

ManufacturerDistributor

Man

ufac

ture

r

eSupply-ChaineSupply-ChainTM

Supplier

Contract Manufacturer

Manufacturer

Distributor

Customer

• Information flow is one-way

• Legacy technologies limit collaboration

• Limited to top-tier trading partners

• Reacts slowly to market dynamics

• Limited visibility

• Information flow is omni-directional

• Web enables broad collaboration

• Universal participation

• Rapid response to market dynamics

• Broad, real-time visibility

CustomerCustomers s CustomerCustomers s Customers

Traditional Supply-ChainTraditional Supply-Chain


e S u p p l y - C h a i n A d v a n t a g e s

9

"…the successes of Fortune

500 and smaller companies

committed to a Web model

offer irrefutable proof that e-

Business spikes the

performance curve on the buy

and sell side."

AMR Research,

supply chain.com, 1999

• Web Browser Interface – Cheaper, unlimited users (supply chain for the rest of us)

• Fast Implementation – 60 days, not 24 months

• Synchronized Supply and Demand – React to changes and trends instantly

• Heterogeneous Solution – Partners don’t need same APS engine or applications

to participate

• Integration with ERP and e-Commerce Applications

• A Balanced Enterprise

"Systems built using Web

technologies offer significant

advantages over the green-

screened UNIX systems

common with vendors today."

AMR Research,


T h e w e b P L A N e S u p p l y - C h a i n S o l u t i o n

The webPLAN eSupply-Chain™ suite is a family of solutions that enables customers,

manufacturers, and suppliers to view and update a single, integrated supply chain plan

in real time via Internet technology. The webPLAN eSupply Chain Server – based on

Microsoft Internet Information Server (IIS) technology – hosts a completely tailorable

line of supply chain Web applications that provide the infrastructure your team needs

to play in the new game.

e S u p p l y - C h a i n A d v a n t a g e s

T h e w e b P L A N e S u p p l y - C h a i n S o l u t i o n


Internet Communities

Extranet Browser ClientExtranet Browser Client-Customers-Suppliers-Distributors

Intranet Communities

Intranet Browser ClientIntranet Browser Client

-Manufacturing-Marketing-Management-Sales-Finance

Manufacturer

Internal Windows ClientInternal Windows Client-Engineering-Purchasing-Scheduling-Production-Inventory

webPLAN eSupply-Chain(requires CoRE)

ModulesModules-DemandIT-onPLAN-OrderIT-SupplyIT-webBOOKS

Collaborative Resolution Engine (CoRE)

•Multi-site •Capacity •Service •SupplyAgent

webPLAN APS(requires CoRE)

ModulesModules

Features

-Inventory-Plans-Products-Schedule

Internet

Internet

Features


Customers and suppliers require only a Web browser and an e-mail account to

actively participate in a secure eSupply Chain community.

• OrderIT™ – provides customers with the ability to get real-time order

promising, track their orders on-line and provide mission critical planning and

execution information. Customers can get an accurate snapshot of overall order

performance, drill down to get order-specific detail or add new orders based on

Available to Promise/Capable to Promise (ATP/CTP) information.

• SupplyIT™ – completely integrates your key suppliers into your supply chain,

enabling them to participate effectively towards increasing velocity and

responsiveness and reducing total supply chain inventory, cost and cycle time.

SupplyIT enables suppliers to remotely view supply order details, analyze

multiple fulfillment scenarios, doing detailed "what-if" planning, using the

manufacturer’s actual production schedule, confirm their ability to commit to

the order, and enter shipment details, using only a browser.

• DemandIT™ – A comprehensive demand plan involves input from Sales,

Marketing, Engineering, Production and a host of other sources, including your

customers. DemandIT tears down the silos that have traditionally separated

these groups and provides a forum for demand planning collaboration, where

all input is dynamically consolidated in a single data model, allowing all

stakeholders to easily share data in real time, and make informed decisions.

webPLAN’s unique Flex™ technology acts as a ‘shock absorber’ to cushion

volatility in demand, giving your customers ultimate ordering flexibility while

minimizing your inventory investment, based on policies you define.

• onPLAN™ – A powerful analysis and reporting tool, onPLAN provides tactical

and strategic managers with at-a-glance information on company and total

supply chain health. Key Performance Indicators (KPIs) show historical

performance against critical metrics, identifying important trends. Built-in On-

line Analytical Processing (OLAP) technology allows users to view plans in

multiple dimensions and slice-and-dice or drill down to get at the underlying

data. onPLAN provides the critical business intelligence that enables you to

make the right decisions at the right time.

10

"The e-Business model will

become the performance

standard of the supply chain."

AMR Research,


"Internet commerce makes the

customer the center of all e-

Business activities. The

customer can view, compare,

and price competing products

in one session."

AMR Research,



T h e w e b P L A N D i f f e r e n t i a t o r s

11

"Customers want to buy

products anytime, anywhere,

cheap and fast, and

fulfillment processes must be

structured to meet the

demanding requirements."

AMR Research,


• webPLAN ties the supply chain back to the plant with the Industry’s most

sophisticated, collaborative Advanced Planning and Scheduling (APS) engine,

giving stakeholders a clear view of what’s happening both inside the plant and

with the suppliers and customers outside the plant.

• webPLAN enables detailed "what-if" simulations using your ERP/MRP data.

• webPLAN offers an n-tier native web distributed architecture, meaning it is

completely scalable to any number of application and data servers (n-tier) and

that it is truly interactive rather than being limited to a one-way "push"

approach like web-publishing.

• Unlike many systems that are written for UNIX and ported to Windows NT,

webPLAN is designed from the ground up to take full advantage of the 32-Bit

NT operating system

• webPLAN offers low total cost of ownership and easy, inexpensive access for all

players – the gateway is a mere Web browser.

• Broad user deployment – any number of users can collaborate on the same

plans and schedules, regardless of departmental, functional or business

boundaries. (i.e. You don’t have to be a master scheduler of materials planner to

benefit from webPLAN.)

• Open COM Interface – Component Object Model (COM) is a Microsoft standard

which allows virtually all common programming languages (C++, VB, Java etc.)

and many applications (Excel, Access) to easily access the webPLAN engine

• webPLAN offers a truly seamless collaborative planning system that streamlines

the entire supply chain management process, starting with demand planning,

including online ordering and order management and wrapping up with on-

time deliveries and a happy customer.

• webPLAN offers strong vertical-specific functionality, meaning it can focus its

efforts on understanding the unique needs of customers in targeted industries.

T h e w e b P L A N D i f f e r e n t i a t o r s


• webPLAN’s Windows spreadsheet-style interface is intuitive in the

manufacturing world where MS Excel spreadsheets are the standard.

• XML Interoperability : eXtensible Markup Language is an extremely flexible

information exchange protocol for the Internet that allows disparate systems to

communicate – something that is particularly important in e-Business (e.g.

webPLAN can talk to i2)

• webPLAN’s single data model removes silos around stakeholder groups and

facilitates apples-to-apples comparison and planning.

• webPLAN offers true heterogeneity to the process. It doesn’t matter what

systems are in use by disparate stakeholders, or where they are geographically,

webPLAN puts everyone on the same page, with the same data.

• webPLAN's versioned database technology supports virtually unlimited

concurrent planning simulations. Users can generate and compare any number

of ‘sandbox’ plans.

• Everyone is included in the benefits of dynamic SCM thanks to webPLAN’s

Application Service Provider (ASP) approach. To create an "Instant Supply Chain"

users need only to access a website (webPLAN’s ASP hub) and start using the

software – which is hosted somewhere else. This pay-per-use model makes

traditionally expensive capabilities available to small and mid-sized businesses

for negligible infrastructure cost (a web browser-equipped machine is all you

need).

12


C a s e S t u d y : w e b P L A N I n n o v a t e sC o n t r a c t E l e c t r o n i c s M a n u f a c t u r i n g

13

For contract electronics manufacturers, competing in the new millenium is all aboutharnessing the power of the internet and becoming a cyber-manufacturer

In a world where the competition can make exactly the same product you can, your

differentiators are going to come from the speed, efficiency and reliability with which

you can deliver that product. By adopting an e-Business approach and turning its

supply chain into a strategic weapon one particular manufacturer has already

embarked on the process of becoming a silicon superpower.

Markham ON-based SMTC Inc. has always been at the leading edge of innovation, both

technologically and in terms of process, as demonstrated by the company’s visionary

Team Oriented Production System (TOPS) approach to managing high volume or high

mix manufacturing needs, customer by customer. SMTC’s approach to supply chain

management (SCM) is equally forward thinking.

Following the coup of winning business from Dell Computer Corp, SMTC realized that

in order to keep up with the e-Commerce-pioneering computer maker it would have to

adopt an e-Business approach to business to business (B2B) processes, in essence

becoming a cyber manufacturer. That meant enhancing the value-added services that

differentiate SMTC from all the other contract manufacturers. SMTC management

determined that making the leap to dynamic utilization of the Web for SCM was the

best route to accomplish that goal.

In order make that leap, SMTC committed to re-engineering its supply chain paradigm

to fully take advantage of the Internet technologies that are destined to change every

business model on the planet.

Earlier this year, after testing five competitive products from well-known vendors

claiming to offer electronic SCM solutions, SMTC became the first company to

implement webPLAN’s eSupply-Chain‘ solution across the breadth of its operations. The

implementation, valued at $2 million, has established a global SMTC e-Business trading

community, where manufacturing plants, customers and suppliers separated by

thousands of miles, can collaborate and transact business in real-time, over the web.

"webPLAN eSupply-Chain is the cornerstone of our new millennium business model,"

said Phil Woodard, SMTC's Senior VP, Enterprise Development & Integration. "These web

applications enable us to truly collaborate up and down our supply chain, from our

customers through to our suppliers. They also link management of our global

operations, reduce our execution times, increase customer service levels and rapidly

grow our business, as we contribute to the growth of our customer's business. It's an e-

business strategy based on a traditional 'win/win' philosophy."

Who is SMTC?

SMTC is a leading provider of

electronic manufacturing

services, with operations in

the Americas, Europe and

Asia. The company supports

the needs of a diversified OEM

customer base, which includes

computer, networking, office

products, telecommunications

and industrial

instrumentation applications.

Services include turnkey

material management, PCB

assembly, system level

configuration, build to order

and order

fulfillment/warranty repair.

SMTC has a wide range of test

and engineering resources at

all of its sites including

functional, RF, ICT, X-Ray, burn-

in/ESS and system test.

Manufacturing sites are

located in Austin - TX,

Charlotte - NC, Denver - CO,

Toronto - Canada, San Jose -

CA, Cork - Ireland, Chihuahua

- Mexico, and Boston - MA.

-- From the SMTC website

(www.smtc.com)

C a s e S t u d y : w e b P L A N I n n o v a t e s C o n t r a c tE l e c t r o n i c s M a n u f a c t u r i n g


eSupply-Chain changes the landscapeThe webPLAN eSupply-Chain suite enables customers, suppliers and manufacturers

to actively participate in an integrated supply chain community. Through a secure

collaborative server, customers have 24 X 7 visibility of their order and even the

capability of doing their own "what if" simulations. Similarly, suppliers are plugged in

to the current requirements for their components and are able to react to new orders,

or changes in orders, at web-speed. Costly inventory buffers can be eliminated as

everyone in the chain transforms from an assemble-to-forecast model, to a more

agile, reactive and efficient assemble-to-order model.

This means that suppliers and customers can tap into SMTC’s manufacturing systems

in real-time via a simple browser to initiate demand, track the status of orders,

conduct "what if" scenarios, and respond to changes in demand. If Dell or another

customer unexpectedly increases the size of an order, for example, the system will

automatically alert suppliers to the change and allow them to respond with best-case

scenarios for meeting the increased demand. At the same time, SMTC and the

customer will be kept in the loop. The whole process will help SMTC transition its

manufacturing operations to a more efficient build-to-order process while

simultaneously improving the company’s ability to meet the requirements of Dell and

other customers.

Additionally, the customer's direct involvement in the manufacturing process via the

web fosters never-before-seen customer service levels and trust. Similarly, the real-

time participation of suppliers eliminates the need for SMTC to carry costly supply

and inventory buffers as safeguards against supply chain delays.

This is true supply chain collaboration from one end to the other, and this is exactly

the kind of e-business solution that SMTC sees facilitating its growth going forward.

"This is the true realization of all the visionary talk around supply chain optimization

we have all heard for the last 5 years," says Mark Gordon, Vice President, Supply Chain

Optimization, SMTC. "webPLAN provides the tools to manage multi-site operations

efficiently by providing real-time requirements information and multiple scenario

demand simulation capability. webPLAN’s e-Business suite enables us to

collaboratively accomplish these processes with our customers and suppliers and to

effectively manage our customers’ supply chains in real-time, on the Web."

Applications based on industry standard technology eliminates access impedimentsThe cost of entry for clients is a standard browser, and the solution is easy to use, and

it deploys in just 60 days. The eSupply-Chain Server is based on Microsoft Internet

Information Server technology, and hosts a family of eSupply-Chain web applications.

These applications can be tailored to suit customer specific e-commerce business

practices, using the Microsoft COM-based webPLAN Open Framework.

14


Rapid implementation means rapid ROIFollowing a successful pilot at its Markham, Ontario facility, SMTC deployed the

webPLAN eSupply-Chain suite to five sites in just nine weeks. The eSupply-Chain

applications were tailored to include SMTC’s traditional business processes, which

expedited implementation at its other facilities.

SMTC is using webPLAN to produce weekly material reports and to automate weekly

inventory replenishment and material planning processes. Master planning is also

conducted in webPLAN, and MRP execution is being transitioned to webPLAN.

Additionally, SMTC is in the process of launching a Supplier Managed Inventory

program that will relieve the management efforts required in inventory procurement

by enabling suppliers to self-service through automation. SMTC will manage every

aspect of the order fulfillment process, from demand planning to material execution

on the Internet.

webPLAN a critical part of the new paradigmWith eSupply-Chain up and running, SMTC and its trading partners immediately

started to realize the benefits promised by dynamic management of the supply

chain. In addition to the added efficiency, every link in the chain has become more

responsive and profitable than their brick and mortar competitors.

"It’s about more than just managing the customer’s requirements. It’s about

managing our relationships with them," said Gordon. SMTC is now completely

transparent to its customers, as they can check the status of their orders and conduct

demand simulations on the SMTC Web site with their only cost of entry being a

browser. "It’s easy to say that you want to keep your customer happy, but that can be

a really difficult thing to accomplish. It takes more than just sticking to your quotes

and meeting your delivery deadlines. webPLAN enables us to give our customers

24 X 7 access to the information that demonstrates their success is what drives us."

Having a clear vision is criticalSMTC’s eSupply-Chain initiative was prompted by a clear strategic vision. "We want to

put a web enabled process in place to manage every customer supply chain. We

believe that in the future all Supply Chains will be Internet based and by being first

we, along with our Customers, will design how the processes will work. In effect, we

will determine the rules of how the game gets played," says Gordon, who offers the

following advice to manufacturers who haven’t already adopted an e-Business

strategy. "Start now or you are destined to play catch up forever."

15


It’s no secret that success in the new e-Business world requires new thinking on the

part of the competitors. If he were alive today, even Grok would know that he had to

adapt to continue to live. In Grok’s day the competition was just as fierce – thankfully

for us – he adapted to all of the sudden changes that came his way for without his

ability to learn quickly and adapt he would have wound up as food for Saber Toothed

Tigers and none of us would be here.

But the threat doesn’t end there. That same threat, the promise of extinction, faces

every single business going forward into the digital age. webPLAN understands this

and created a suite of products that helps its customers adapt to this brave new

world. The question now is, how many will adapt, and how many will become fodder.

16

C o n c l u s i o n sC o n c l u s i o n s


I m p l e m e n t i n g V i s i o n • w w w. w e b p l a n . c o mOttawa 350 Palladium Drive, Ottawa, Ontario K2V 1A8 Tel: (613) 592-5780, Fax: (613) 592-0584Chicago 1755 S. Naperville Road - Suite 100, Chicago, Illinois 60187 Tel: (630) 510-3258, Fax: (630) 510-3181

Copyright © 1999 webPLAN Inc. All rights reserved. webPLAN and the webPLAN logo are trademarks of webPLAN Inc.Printed in Canada. This whitepaper was prepared by webPLAN Inc.


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