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CPFR (4) Technology
CPFR (4) Technology
CPFR (4) Technology
Henry C. Co
Technology and Operations Management,
California Polytechnic and State University
Cornerstones of CPFR®
Internal Processes
Joint processes
Technology
processes
Technology for secure, reliable
and cost-effective information Internal processes that produce
sharing and communication. and use collaborative
information.
▲ Open System ▲ Working to a Single
▲ Internet Forecast
▲ Application ▲ Common Measures
Development Methods ▲ Planning
▲ Secure Communication ▲ Information Sharing
Technology Internal
processes
Viswanathan, R., “Systematic Collaboration in the Supply Chain Planning, Forecasting, and Replenishment,” available
online from http://www.ise.ufl.edu/Supplychain/done/Day1/Viswanathan/Viswanathan.ppt
Internal Processes
Scalability
Interoperability
Scalability
Support for many trading partners,
involving large numbers of products
Interoperability
Common standards
http://www.cs.hut.fi/~framling/Publications/LRN2001.pdf
Electronic Marketplace, a.k.a.
Exchanges
1. Order matching
2. Requisition and routing approvals
3. Financial settlement of orders
4. Content management
5. Logistics fulfillment services
6. CPFR activities.
Exchanges’ Services
1. Order matching
Catalogue orders –Fix-priced catalogue items
Dynamic pricing – the marketplace matches
orders real-time based on bids and quotes
that come into the marketplace
Auctioning
Request for proposals – detailed
specifications are put online and bids are
consolidated and compared.
1. Requisition and routing approvals –
requests are routed to the right manager
for approval.
2. Financial settlement of orders
Morgan Stanley Dean Witter (2000), The B2B Internet Report. Collaborative Commerce.
Founded by supplier
Transora
(www.transora.com)
CPGmarket.com (www.CPGmarket.com)
Founded by retailers
WorldWide Retail Exchange (
www.worldwideretailexchange.org)
GeneralNetXchange (www.gnx.com)
RETAILER MANUFACTURER
Item Item
Internet
APPLICATION
Table Table
APPLICATION
Inte Inte
Forecast Shared Forecast
r- r-
Table Data Table
face face
Promotions Promotions
Table Table
ITEM RTLR’S MFR.. DELTA TOLERANCE OK?
NUMBER FORECAST FORECAST
Viswanathan, R., “Systematic Collaboration in the Supply Chain Planning, Forecasting, and Replenishment,” available
online from http://www.ise.ufl.edu/Supplychain/done/Day1/Viswanathan/Viswanathan.ppt
Peer to Peer Scenario Architecture
Workstation Retailer
Manufacturer Workstation
Viswanathan, R., “Systematic Collaboration in the Supply Chain Planning, Forecasting, and Replenishment,” available
online from http://www.ise.ufl.edu/Supplychain/done/Day1/Viswanathan/Viswanathan.ppt
Example of Retailer-Supplier Setup
Supplier configures three connections to access
forecast data from three retailers
Each retailer configures the connection to the
supplier, permitting the supplier access to their
forecasting information.
http://www.cs.hut.fi/~framling/Publications/LRN2001.pdf
http://www.cs.hut.fi/~framling/Publications/LRN2001.pdf
Sun
Ultra
Netscape
Netscape Enterprise
Enterprise Web
Web
LiveWire
LiveWire Server
Server 3.0
3.0 Browser
Browser
Informix
Informix 7.2
7.2
HTTP
Server Client
Viswanathan, R., “Systematic Collaboration in the Supply Chain Planning, Forecasting, and Replenishment,” available
online from http://www.ise.ufl.edu/Supplychain/done/Day1/Viswanathan/Viswanathan.ppt
Prototype Process/Functionality
Authenticates users
Stores exceptions data
Allows selective retrieval of data
Displays time-variant data such as supplier
forecast, retailer forecast, POS for 52 weeks
Displays detail time-invariant data such as
On-hand, Fill-rate, store information etc for
a specific forecast
Displays information in both tabular and
graphical form
Displays calendar of events for both sides,
for each item
Shows how a level 1 (corporate)
forecast can be drilled down to DC and
store levels
Shows how a forecast update can take
place interactively
Shows how messages associated with
an exception can be created, stored
and sent.
Next Steps for CPFR and the industry
Refinement and publication of process models
Define/establish prerequisite EDI feeds if non-
existent
Define/establish other feeds (manual initially) -
forecast drivers (promotions, price changes,
replenishment strategies etc)
Define/establish business rules for exception
generation
Develop exception processes based on forecast
comparisons
Define/establish procedures for use of CPFR system
Develop measurements/business cases
Refine technology infrastructure
Introduce security - S/HTTP and/or S/MIME
Investigate use of open data model
Challenges
Organizational readiness
Process confirmation
Integration of supply chain
collaboration tools with backend
applications
data models
architecture (hub-hub, hub-spoke, hub-
web)
Change management
Capabilities Assessment
Process Readiness
Forecasting and Replenishment
Scorecard Solution
Change Management
channel readiness
Technology Readiness
Data availability
Internet Enablement
Electronic Commerce
SAP APO Collaborative
Planning (CP) and CPFR
… Intraorganization Processes
“One number for business planning across all
departments”
Next step
Streamlines
Collaborates
… Interorganization Processes
“One number for supply planning across the entire
supply chain.”
Phone
Mail (slow)
Fax
Consensus-Based Forecasting
Pyramid Forecasting
SAP APO Demand Planning allows you to create
plans for different business goals (strategic
business plan, tactical sales plan, operational
supply chain plan, etc.) and integrates them into
one consensus plan that drives your business.
Joint Business Planning Across Supply Chain
using SAP APO CP’s tools
Planning Books (Internet-compatible demand
planning/supply network planning books in SAP)
Enhanced Macros
8 collaboration tasks
form an iterative cycle
of 4 activities:
Supplier Collaboration
EDI in automotive industry
Suppliers connected to auto
manufacturers by EDI;
Exchange dependent requirements (MRP)
The Web
Low cost
Allows smaller companies to participate