SCMN 77007706 Demand Fulfillment

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SCMN 7700/7706Demand Fulfillment Segment
07 PEC Case Overview
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Point Electronics Logistics Opportunity Analysis

• In this case, you will use formal and ad hoc
  analytical techniques to examine the logistics
  data of a real (but disguised) company.
• The data is provided in MS Access files which you
  can manipulate, rearrange, summarize, and present
  as you see fit. You will also use Excel,
  Powerpoint, and Word in the course of the
  project.
• Your goals are to
• Understand system characteristics and costs
• Evaluate logistics performance
• Identify opportunities to improve service and
  reduce expenses

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PEC Electronics Corporation (PEC) is a world
leading distributor of electronics and high tech
products serving consumer and business markets.
Introduction
- Point Electronics -

• Annual sales revenue of 3.3 billion in 200x.
• Products grouped into seven Business Classes
• Business Products, Consumer Business Products,
  and Consumer Electronics account for the majority
  of sales volume.
• Primary DCs located in Los Angeles, Dallas,
  Memphis, Chicago, Mahwah NJ, and Atlanta.

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Introduction
Point Electronics Corporation Map of Key
Points in U.S.
Seattle
Chicago
Mahwah
Memphis
Los Angeles
Atlanta
Dallas
Miami
Facilities in Miami and Seattle are primarily
import/export gateways, although there is some
customer delivery from from these facilities.
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PEC is finding it increasingly difficult to
cost-effectively meet customer demandsso they
have requested assistance from Accenture to help
PEC develop effectiveness supply chains.
Current Situation
- Opportunities at PEC -

• Opportunity to improve efficiency and
  effectiveness of supply chain. Costs are
  escalating in face of increasingly demanding
  customers
• Competitors are offering improved services
  through new distribution channels
• PEC believes there is an opportunity to reduce
  costs through optimizing the number and location
  of DCs and rebalancing assignment of customers to
  DCs.
• Also need to examine inventory positioning and
  carrying costs, and inbound logistics movements
  from suppliers.

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PEC is not a supply chain leader in the
electronics industry. You must help PEC
coordinate internal activities before they are
able to build supply chain relationships.
Current Situation
- Evolution of Supply Chain Capabilities -
Supply Chain Synchronization
Dell
External Collaboration
Sony
Internal Integration
PEC
TIME AND EFFORT

• The most challenging aspect of this whole
  (SCM) process is not so much building the
  external linkages to the partners, but rather
  overcoming obstacles within the organization.
• Bernard J.
  LaLonde. Ph.D.
• Supply Chain Management Review

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To meet this challenge you will conduct part of
the PE Consulting Project which follows a six
step approach.
Logistics Analysis Project
Approach
1. Project Initiation
2. DataCollection
3. Profile Current Supply Chain Operations Costs
4. Identify Alternative Options for Supply Chain
Configuration
5. Analyze Alternatives and Select Best
6. Recommendations/ Implementation
Planning
Project Scope
Footnote placeholder. If not needed, do not
delete, but change pen color to white.
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The project is well underwaydata collection is
complete. We now need to prepare a profile of
current supply chain operations and costs.
Project Status
- Supply Chain Profile and Deliverables -

• Your work will lay the foundation for later steps
  in the supply chain configuration engagement.
• It is critical that you obtain client management
  buy-in to the numbers (operational and financial)
  so that your firm can proceed with supply chain
  modeling work.
• You should identify quick hit opportunities to
  improve performance and reduce costs (please
  develop basic estimates for both) and benchmark
  performance against best practices.

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The client has provided us with Access files for
August 2003 in the following areas
The Assignment
- Supply Chain Analysis Areas -

• Demand
• Transportation
• Inventory
• Supplier

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Activities to be analyzed

• Inventory
• Inventory carrying cost
• Inventory condition
• - Inventory velocity turnover, days on hand
• - ICC Savings Opportunity
• Supply
• - Order cycle time
• - Fill Rates
• - Product Quality
• - Problem suppliers
• - Leverage Purchasing
• - Value Analysis

• Customer Demand
• - Order cycle time
• Fill Rate percentage
• Perfect orders
• Customer segmentation
• Transportation
• - Type of move
• - Modes used
• - On-time performance
• - Problem shipment analysis
• - Service territory comparison

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PEC Project - Analysis Process
How to attack the data mining and analysis
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Analysis Process - How to Generate Information

• Metrics ('me-trix)A standard of measurement
• Key Performance Indicator (KPI)
• KPIs help an organization define and measure
  progress toward organizational goals. KPIs are
  quantifiable measurements, agreed to beforehand,
  that reflect the critical success factors of an
  organization.
• Data Mining
• Data mining is the process of data selection,
  exploration and building models using vast data
  stores to uncover previously unknown patterns.

Data mining is about finding all the Ah ha's.'
You can do a query against a data warehouse and
get a lot of information back. Data mining means
having the wherewithal to analyze what the data
is telling you. That's the great thing about data
mining. You are looking for things you wouldn't
know without it. Sue Bross, VP and Technology
Testing Manager JP Morgan Chase and Co
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To meet this challenge you will conduct part of
the PE Consulting Project which follows a six
step approach.
Logistics Analysis Project
Approach
1. Project Initiation
2. DataCollection
3. Profile Current Supply Chain Operations Costs
4. Identify Alternative Options for Supply Chain
Configuration
5. Analyze Alternatives and Select Best
6. Recommendations/ Implementation
Planning
Project Scope
Footnote placeholder. If not needed, do not
delete, but change pen color to white.
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Data Mining Review the database structure and
content
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Data Mining - Crunch the numbers and create
awareness
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Analysis- Develop insights into PECs situation
and make recommendations
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Analysis Format your team will complete an
analysis for each functional area

• For each of the primary questions
• Respond to the question based on your data
  mining.
• Discuss the major findings from your data mining
  and what the results lead you to interpret.
• Recommend strategies or solutions for addressing
  PECs problems
• Describe the expected outcome or impact of your
  proposed solutions
• Also, address the three summary questions at the
  end of the report.

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PEC Executive Briefing

• The last requirement for the project is to
  develop a report for your clients at Point
  Electronics Corporation.
• Create an executive report which describes
• The work that you have done
• The current Point supply chain
• Performance levels in each function studied
• Recommendations for improvement with discussion
  of anticipated benefits
• Answer the questions posed by the CEO of Point
  Electronics Corp.
• See the instructions for more details regarding
  this activity.

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Files that youll need for each part of the
project

• Functional Area Data Mining Instructions
  (PowerPoint Presentation)
• Functional Area Database (Access)
• Functional Area Data Mining Template (Excel)
• Functional Area Analysis Workbook (Word)
• All necessary files can be found on my website
• www.business.auburn.edu/gibsobj