This afternoon brought an interesting, “standing room only” panel discussion on the topic of demand driven supply chains lead by Mike Lipton of SAP. He moderated a session with John Flebut, VP of Global Planning of Atmel, and Lisa Aleman, the Director of S&OP at Radisys.
Atmel – The demand driven journey
Atmel, the largest supplier of high-growth touch-sensing technologies, was founded in 1984. They are a $1.8b company with a blue chip customer base.
John discussed the challenges that pushed the company to review their supply chain processes. It started with what you would expect to be great news - the company grew 25% in one year. However, this resulted in a big drop in customer service levels, and eventually a huge increase in days of supply. The company decided to move to a “real time, demand driven approach” which required a common set of processes and enablers such as a common product and customer hierarchy, integrated planning and reporting tools, formal roles and responsibilities, training and sales & operations planning.
John explained how Atmal engaged with SAP and conducted a six week pilot with S&OP powered by Hana. John went on to explain that “SAP loaded over 90% of Atmel data for the pilot, which was amazing”. The scenario showed all data being related and manipulated in a real-time environment. John discussed how Atmel is now moving into the next stage of the project to delivery real time, collaborative and social solution.
Radisys – Responding to demand
Radisys is a leading supplier of embedded wireless infrastructure with $300M in sales. Radisys demand driven journey started when the company decided to outsource all manufacturing in an effort to reduce costs. However, as Lisa pointed out, Radisys “ lost the ability to see and control supply” . Lisa explained that by deploying SAP Response Management by ICON-SCM the company has:
· Reduced forecast cycle from 2.5 weeks to 1 – 1.5 weeks
· Reduced excesses materials
· Reduced customer lead time
· Improve forecast accuracy
· Align sales, operations and financial plan around true supply and demand visibility.
These are two great examples of customer running in a demand driven world. The need for speed in gaining visibility and making fast decisions to maintain a supply to demand balance.
These are two high tech examples, but as Mike Lipton pointed out that SAP is seeing these themes emerging in all industries.
The supply chain of the future truly is demand driven.
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