Value Chain Analysis and Sales Logistics

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Value Chain Analysis and Sales Logistics

• R/3 Text Chapters 4 5

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Strategic Significance (1)

• Value Chain, the companys activities are
  divided into the technologically and economically
  distinct activities that the company performs in
  doing business
• Value Activities, are nine generic activities
  (split in two categories primary and support)
  which value is the amount that buyers are willing
  to pay for a product or service
• Primary activities are those involved in the
  physical creation of the product or service
• Support activities provide the inputs and
  infrastructure that allow the primary activity to
  take place

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The Value Chain
Firm Infrastructure
Human Resources Management
Technology Development
Procurement
Inbound Logistics
Operations
Outbound Logistics
Sales Marketing
Service
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Primary VC Activities

• Inbound logistics
• inventory control, vehicle scheduling, returns to
  supplier, etc.
• Outbound logistics
• collecting, order processing, delivery, etc.
• Operations
• machining, packaging, assembly, etc.
• Marketing sales
• advertising, promotion, quoting
• Service
• installation, repair, training

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VC Support Activities

• Procurement
• Technology development
• Human resource management
• Firm infrastructure

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Transforming the Value Chain (2)
Office Automation
Firm Infrastructure
Work Force Planning Systems
Human Resources Management
Technology Development
CAD
Procurement
EDI
Inbound Logistics
Operations
Outbound Logistics
Sales Marketing
Service
Automated Warehousing
Computerized ordering
Equip. Maintenance
Computer-Controlled Machine
Automated Shipment Scheduling
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Mapping R/3 Text to VC
Chapter 8 and 12
External Accounting/Treasury Mgt
Chapter 9
Human Resources Management
Controlling
Chapter 10
Procurement
Chapter 7
Inbound Logistics
Operations
Outbound Logistics
Sales Marketing
Service
Chapter 5
Chapter 5
Chap 11 and 13
Chapter 6 and 7
Chapter 5
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Strategic Significance (2)

• A companys value chain is a system of
  interdependent activities
• A value chain for a company in a particular
  industry is embedded in a larger stream of
  activities that it is called Value System
• Linkage among activities not only connect value
  activities inside a company but also create
  interdependence between its value chain and those
  of its suppliers and channels

Firm VC
Channel VC
Buyer VC
Supplier VC
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Porters Five Forces Model
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Individual Company VC

• Every company activity can be categorized into
  primary or support activity
• start with generic VC and subdivide into discrete
  activities
• categorize those activities that contribute best
  to a firms competitive advantage
• can compare company VC to industry VC

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R/3 and the VC

• Allows company to restructure activities on VC
• Business reference scenarios are structured
  around primary and support VC activities
• Text is organized around VC activities
• See VC examples
• copier machine, AMCC, Dell computer

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Standard Order Handling Scenario

• Mailing campaign
• Monitor sales activity
• Possible customer inquiry
• Customer RFQ processing
• Order entry

• Delivery processing
• Goods issue processing
• Billing
• Possible rebate processing

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VC for Direct Sale to Industrial Customer
Customer Outline Agreement
Sales Support
Sales inquiry/ Quotation proc
Quality Managment
Shipping
Transportation
Sales Order
Warehouse Management
Credit Management
Customer Rebate Processing
Billing
Information System
Personnel selection
Foreign Trade
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Standard Order Handling Scenario (1)
Cust mail Campaign to Be carried out
Mailing Campaign processing

Customer Inquires about products
Sales activity Is agreed upon
Sales activity Is to be prepared
Direct mail Campaign Is sent
Customer RFQ processing
Sales Activity processing
Inquiry Items rejectec
Quotation Reason occurred
Quotation to Be created From inquiry
Quotation to Be created From contract
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Standard Order Handling Scenario (2)
Customer Quotation Processing
Quotation Items are rejected
Stand Order w/o Quote ref received
Quotation Is Valid
Quotation Is sent
Stand. Order w/ref to quote received
Framework Agreement Is Agreed w/ref
Framework Agreement is To be created
Standard Order Processing
Framework Agreement Processing
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Standard Order Handling Scenario (3)
Rejection Notice sent to customer
Sales Requirements created
Order Confirmation sent
Order is released
Make-to Order Production
Cash Management
Production For Lot Size
Repetitive Manufacturing
Delivery Processing
Process Manufacturing
Delivery Cannot be created
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Standard Order Handling Scenario (4)
Delivery is Relevant For billing
Delivery is Relevant for shipment
Material For quality Check is available
Shipping papers Are created/ transmitted
Delivery is Not relevant For shipment
Transportation Planning
Shipment Is determined
Quality Management
Transportation processing
COGLAS GmbH - Logistics Solutions
Goods issue Processing for Stock material
Goods issue Is posted
Shipping Notification generated
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Standard Order Handling Scenario (5)
Billing
Billing doc Is released For billing
Export papers Are created/ sent
Billing doc Is sent
Profitability Analysis w/ Flex. Stand costing
Cash Management
Profitability Analysis w/ Overhead cost
Profitability Analysis w/ Allocation costing
Profitability Analysis w/ Static stand costing
Customer processing
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More Complex Sales Scenarios

• Contract handling agreements
• Third party order handling
• Customer consignment handling

• Cash orders
• Rush orders
• Make-to-order
• Returns handling

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Buy/Sell Overview

• Select catalog item

• Send Purchase Order

• Create Sales Order

XML
XML
IDoc
IDoc
B/C

• Pick
• Pack
• Ship

• Goods Receipt
• ERS
• A/P

• Receive Order Confirmation

• Create Purchase Order Confirmation

• EFT Payment

• Create Purchase Order

• Access Marketplace via BBP

BBP
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Lets Try Some XML!