Real-time Sales Operations for the pioneers of Flash Memory
SENIOR DIRECTOR – IT
OPERATIONS AND SALES APPLICATIONS
AT SANDISK, WE HAVE BEEN TRANSFORMING DIGITAL STORAGE FOR 27 YEARS. MILLIONS OF PEOPLE AND COUNTLESS ORGANIZATIONS RELY ON OUR SOLUTIONS TO GET MORE FROM THEIR DEVICES AND DATA-CENTERS. OUR INNOVATIONS HAVE HELPED REDUCE THE COST OF FLASH MEMORY BY 50,000 TIMES, WHILE INCREASING CAPACITY BY 30,000 TIMES. THIS CULTURE OF EXCELLENCE PERVADES ACROSS SANDISK AND IS EVIDENT IN OUR SUPPLY CHAIN PRACTICES TOO:
· Our end-to-end vertical integration from silicon sourcing to captive manufacturing to distribution, gives our supply chain an important competitive edge
· We use state-of-the-art techniques like delayed product postponement and multi- echelon planning to optimize our inventory levels
· Our end-customers experience unparalleled service levels – our products are carried by over 300,000 stores, and a wide-network of distributors/VARs take our product to enterprise customers of all sizes
· Our supply chain has won a number of accolades including recognition in the Gartner Supply Chainnovators report.
It is an indisputable fact that short product life cycles have a dominating influence on the design of hi-tech supply chains. We have been no exception to this trend. Many aspects of our supply chain underline the importance we attach to agility – shorter planning cycles, differentiation postponement strategies, and air transport of raw material, WIP & finished products… to name a few.
Because of our focus on agility, we were always acutely aware of the bottlenecks in our operations. The order fulfillment process was one of them. While a vast majority of the orders got processed on time, the few orders that had exceptions exposed the Achilles heel in an otherwise well-oiled process. We are in an extremely competitive industry. In some of our markets, we have to confirm an order within an hour or risk cancellation (and the order going to our competitors). Too much of backlog was also a problem – a situation where we lose sales to competitors because of our inability to keep our distributors/retailers stocked.
The root cause was that the sales operations team had to work from outdated spreadsheets and BI reports. These were a set of reports that would get generated over-night from our SAP ERP and JDA systems. The team had to rely on just that for the whole of next day. Obviously this was insufficient when customers expect responses in a matter of hours or minutes. But there was no solution – the amount of data was too much and the rules/logic related to identifying and prioritizing the problem sales orders were too complex. Transaction systems are not designed for such tasks.
When OpsVeda presented their order fulfillment solution, our initial reaction was to dismiss it as “not-possible”. We expect inflated product claims from vendors. But, even by that standard their claims appeared outlandish. Intelligence into all kinds of sales exceptions and automatic prioritization in real-time appeared unrealistic for our volumes. In our view the available technology was just not there.
But when the problem is serious enough and you have only one potential solution, you are tempted to look at it closely – even if it sounds not possible! In subsequent meetings the OpsVeda team did a demo of the solution with our data, and also explained the underlying technology. The unique manner in which they extract data from transaction systems, their “Process Agnostic Data Store” (PADS) and the underlying SAP HANA in-memory technology gave us the comfort to move forward. SAP HANA figuring significantly in our IT roadmap made it an easier decision.
In just a couple months we were live with the OpsVeda Order Fulfillment solution. The go-live went without a hitch – the data streamed beautifully from all the transactional sources, and the OpsVeda PADS architecture with the HANA database appeared to handle the load effortlessly. The user experience has been great – the gap between a retrograde event getting recorded in the backend system, OpsVeda assessing the impact, and the user being alerted to the prioritized transaction was less than a minute (very often <10s). Finally, the Operations team could address issues proactively.
Making life easy for the sales operations team was only part of the objective of the OpsVeda roll-out. About 3 months after go-live, we did a review of the business benefits the system was delivering. The key ones are mentioned below:
INCREASE IN ON-TIME CONFIRMATION: Previously we used to confirm around 85% of orders the same day. With OpsVeda we have got that figure to 98%.
REDUCTION IN RED-ZONE BACKLOG: The backlog that affects us the most are the cases where the order was either not confirmed within 3 days, or where a hold prevented on-time shipment. These used to be around 10% of our total backlog. Today we see the figure consistently in the 1-2% range.
IMPROVED SALES OPERATIONS PRODUCTIVITY: About 60% of the users say that the system improved their performance by 30% or more along 3 dimensions – improved productivity, ability to prioritize their workday, and ability to serve their customers.
In the past we have had tremendous success in applying analytics towards strategic decision making. But Operations is a different ball-game – traditional tools could not keep up with the volume, variety and velocity. With OpsVeda, powered by SAP HANA, identification, prioritization and corrective prescriptions happen in a “Flash” – as one of our users put it. Perhaps SanDisk being the leader in Flash Memory influenced her language. But nevertheless, we are impressed by the speed of the system. We rolled out the system for sales, logistics and samples management. We believe that many more functions will benefit from the real-time visibility and rapid analysis the system provides, and are already evaluating it for Manufacturing and Supply.