MODERN LIFE OF INFORMATION

SYSTEM TOOLS

ALPER ODABAŞIOĞLU ORCAN ALPAR

ANALYST PROGRAMMER INFORMATION TECHNOLOGIES SPECIALIST
AGENDA

PART I
ENTERPRISE RESOURCE
PLANNING:ERP
SUPPLY CHAIN
MANAGEMENT: SCM
ADVANCED PLANNING AND
SCHEDULING: APS

PART II
SAP APO
ORACLE SCP
MANUGISTICS
I2
ENTERPRISE RESOURCE
PLANNING: ERP

“A packaged business software

system that enables a company to
manage the efficient and effective
use of resources (materials, human
resources, finance, etc.) by
providing a total, integrated solution
for the organization’s information-
processing needs”
 ERP SYSTEMS

ERP systems are seen as optimization and

integration tools of business processes across
the supply chain within and beyond
organizational boundaries, implemented through
modern information management systems

EXTERNAL EXTERNAL
SUPPLIERS CUSTOMERS

EXTERNAL INTERNAL INTERNAL EXTERNAL

SUPPLIERS SUPPLIERS ERP CUSTOMERS CUSTOMERS

EXTERNAL EXTERNAL
SUPPLIERS CUSTOMERS
 ERP EVOLUTION
Wave 5:
Goal: Cross
Inter-enterprise Integration (XRP) enterprise
value

Wave 4:
Goal: Customer value,
Customer-Centric Integration (CRP) effectiveness

Wave 3:
Goal: Firm-wide efficiency,
Enterprise Integration (ERP) cost cutting

Wave 2:
Goal: Capacity Requiremnt Planning
Manufacturing Resources Planning (MRP II) & Simulative Planning Functions

Wave 1:
Goal: Improve/optimize
Material Requirements Planning (MRP) manufacturing efficiency
 ERP BENEFITS

Improving information quality

Reducing costs through retooling
common business functions
Improving responsiveness and time-to-
market through an effectivestructuring of
operations
Renovating old systems and processes
Improving integrity and availability of
data across the business
 ERP MODULES
FI: Financial Accounting
CO: Controlling
SD: Sales & Distribution
MM: Materials Management
Production PP: Production Planning
Planning
Integrated PM: Plant Maintenance
Sales & Logistics QM: Quality Management
Distribution Customer/
(Order Entry) Employee HR: Human Resources
Accounting & AM: Asset Management
Human Financials PS: Project System
Resources WF: Workflow
APO: Advanced Purchase &
Enterprise Architecture Optimization
IS: Industry Solutions
 BEFORE ERP

Orders
Parts
Sends report Customer
Sales Dept. Demographic
Files Customers

Checks for Parts

Calls back “Not in stock”
Accounting “We ordered the parts”
Files

Accounting
Sends report
Invoices
Sends report accounting
Ships parts
Vendor
Warehouse
Order is placed “We Need parts #XX”
with Vendor
Inventory
Purchasing Files
Files “We ordered the parts”
Purchasing
 AFTER ERP

Orders
Parts Inventory Data
If no parts,
order is placed
Customers Sales Dept. through DB Accounting

Financial Data exchange;

Books invoice against PO

Order is submitted
to Purchasing. Database
Purchasing record Books inventory
order in DB against PO

Order is placed
with Vendor

Warehouse
Vendor Purchasing

Ships parts
And invoices accounting
ERP PROGRAMMING
DEVELOPMENT

Master data migration batch

input,
Purchase/production/
maintenance/service order print
out programs and layouts,
Add-on functionality
developments,
Enhancement developments,
Interfacing with external systems
Source code modifications
(repairs)
Query and Reporting,
 SUPPLY CHAIN
MANAGEMENT: SCM

“The management of upstream

and downstream relationships
with suppliers and customers to
deliver superior customer value
at less cost to the supply chain
as a whole.”

MANAGEMENT
SUPPLY CHAIN
MANAGEMENT: SCM

“A network of connected and

interdependent organizations
mutually and co-operatively working
together to control, manage and
improve the flow of materials and
information from supplier to end
users.”

MORE ACCURATE
 SUPPLY CHAIN
MANAGEMENT: SCM

“Supply Chain Management is the

integration of key business
processes from end user through
original suppliers that provides
products, services, and information
that add value for customers and
other stakeholders.”

GSCF – GLOBAL SUPPLY CHAIN

FORUM
 SCM PRODUCT LIFE

Making

Buying Moving

Selling Ware
housing

SCM is management of product life from buying,

making, moving, and warehousing to selling
 SCM COLLABORATION

Tactical
Tactical

Demand Optimizing
Collaboration Collaboration
Forecasting product mix on Forecasting
on Forecasting

Matching
Collaboration Capacity Resource Analyzing
demand

Operational
Operational

on Capacity Planning Supply

-supply Planning
Planning Chain

Analyzing Production Demand Shipping Inventory

Supply Planning Management Optimization Planning
Chain

Status Management Shippment

Transcctional
Collaboration
Transcctional

on Resource Tracking
Planning
Shop Floor Warehousing Ordering
Inventory Order &
Control Management Administration
Tracking Shipments
 SUCCESSFUL SCM

Market Saturation Driven: Focusing on generating high

profit margins through strong brands, marketing and
distribution.
Operationally Agile: Configuring assets and operations
to react nimbly to emerging consumer trends along lines
of product category or geographic region.
Freshness Oriented: Concentraing on earning a
premium by providing the consumer with product that is
fresher than competitive offerings.
 SUCCESSFUL SCM

Consumer Customizer: Using mass customization to

build and maintained close relationships with end
consumers through direct sales.
Logistics Optimizer: Emphasing a balance of supply
chain efficiency and effectiveness.
Trade Focused: Prioritizing “low price, best value” for
the consumer (as with logistics optimizer strategy but
focusing less on brand than on dedicated service to trade
customers).
 ADVANCE PLANNING AND
SCHEDULING: APS

Encompasses a range of tools

and techniques within a
software system that has
applications in manufacturing
and logistics. It analyses the
implications of alternative
decisions, highlights problems
and consequences, and
generates optimal plans and
schedules for transfer to
execution tools.
APS FEATURES

Combines finite capacity

scheduling and memory-
resident fast planning
Determines a plan that
considers all demand needs
and supply limitations
(feasible plan)
Optimizes the plan, based
on mathematical modeling
techniques
Recommends a best overall
solution that considers both
material and resource
availability
APS FUNCTIONALITIES
APS ERP ARCHITECTURE
APS DEMAND PLANNING
 APS PRODUCTION PLANNING
FEATURES

Combines finite capacity scheduling

and memory-resident fast planning
Plans simultaneous material
requirements and schedules capacity
at operation level for the short-term
horizon
Takes order sequences into account
Optimizes machine schedules
(sequences, lead times)
Transfers the planning results to
execution system
APS PRODUCTION PLANNING
METHODS
 APS ERP DIFFERENCES

The assumption that the supply

lead times are known constants
and do not vary with flow and
workload,
The system requires with fixed
processes or routings, ignoring
alternative routing that could be
used,
The sequencing logic prioritises
orders only by period or date
when other options such as load
levelling or minimal tool changes
may be preferred
APS ERP DIFFERENCES

All work is loaded under

assumption of infinite capacity
when in reality, working capacity is
always constrained by time and
resources available,
The process of schedule
regeneration takes considerable
time to calculate, review and
process the recommended actions.
This leads to regenerate material
requirements on a once per
monthly basis, when industry is
seeking daily changes to be
passed down the supply chain.
 APS SCM SOFTWARES

SAP - Advanced Planner and Optimizer (APO)

Oracle - Supply Chain Planning (SCP)
Manugistics
i2
 SAP ADVANCED PLANNER AND
OPTIMIZER: APO

Developed by SAP AG
Runs on a separate dedicated server.
Used as planning system
SAP APO SCREENSHOT
 SAP APO COMPONENTS

Demand Planning
Supply Network Planning
Production Planning and
Detailed Scheduling
Transportation Planning and Vehicle Scheduling
Global ATP
Multi Level Supply and Demand Matching
 SAP APO COMPONENTS

Demand Planning:
Generating the forecast of
market demand.

Supply Network Planning:

Takes the data from DP and
tries to allocate them over the
network defined.
 SAP APO COMPONENTS

Production Planning and Detailed

Scheduling:
(PP/DS) produces detailed plan of the SNP
resulted plan and plans multi-site
production.

Transportation Planning and Vehicle

Scheduling:
(TP/VS) enables the transportation planner
to efficiently plan the available capacity of
vehicles with the goals of planning more
efficient loading capacity and lowering costs
 SAP APO COMPONENTS
Global Available to Promise (GATP):
Global ATP can be used in heterogeneous
system landscapes to provide necessary
information

Multi Level Supply and Demand

Matching:
Matching a large set of prioritized
customer demands and forecasts to a set
of supplies while taking into account the
current production capacities and
transportation capabilities
 ORACLE SUPPLY CHAIN
PLANNING: SCP

Supply chain management tools beside the ERP

systems.
Allow modelling the facilities and lanes
connecting the facilities.
Allow recording estimations of demand and
seeing how that demand would play through the
distribution network.
SCP COMPONENTS

Supply Chain Planning,

Oracle Demand Planning
Oracle Master Scheduling
Supply Chain Execution,
Oracle Advanced Supply
Chain Planning
 SCP COMPONENTS

Demand Planning:
(ODP) generates demand forecasts
that form the basis of plans from long-
term strategic business plans to
forecasts that feed the master
production schedule.

Oracle Master Scheduling

Is an anticipated shipment schedule; it
is the statement of demand, which is
recognized for a particular planning
run.
 SCP COMPONENTS

Supply Chain Execution:

“Backbone” of a business closely
follow the planning processes and
cannot afford to lag behind.

Oracle Advanced Supply Chain

Planning:
Provides planning across the entire
supply chain in a single planning run.
Just like MRP, it provides the options
of constraint-based and optimized
planning.
 MANUGISTICS

Designed to address the supply chain

management processes.
Help manage the many facets of a supply chain
from strategic network design to operational
planning.
Runs on separate server
MANUGISTICS COMPONENTS

Sales and Operations

Planning,
Order Management,
Manufacturing Planning
and Scheduling,
Procurement
Management.
 MANUGISTICS COMPONENTS

Sales and Operations Planning:

(S&OP) solution is designed to help
companies maximize customer
satisfaction and meet profitability
goals by achieving an optimal balance
of demand and supply.

Order Management:
Consolidates orders into a single
interface for submission, tracking,
routing, fulfillment, and status queries.
 MANUGISTICS COMPONENTS

Manufacturing Planning and

Scheduling:
Engines designed to meet the specific
needs of different manufacturing
environments and that function together
seamlessly with the business goals.

Procurement Management:
Help companies consolidate purchase
order management, no matter the number
of existing purchasing applications, to
help realize savings from economies of
scale.
 I2

Runs on a separate dedicated server and has

an open architecture known as Supply Chain
Operating Services (SCOS) connects multiple
legacy, ERP, and transportation systems in real
time.
i2 Six has integration capability with other core
functions housed in enterprises’ supply chain
and ERP applications.
I2 COMPONENTS

Fulfillment Optimization,
Logistics Optimization,
Production Optimization,
Spend Optimization.
 I2 COMPONENTS

Fulfillment Optimization:
The integration of planning and
execution including distributed
order management, inventory
management and supply chain
event management.

Logistics Optimization:
Tries to optimize logistics
processes while delivering
products on time and on budget.
 I2 COMPONENTS

Production Optimization:
Predicts demand and plan supply to
meet that demand, designs and
validates a supply chain strategy
before deployment, monitors and
manages their customer demand with
channels and customers.

Spend Optimization:
For rationalizing all parts and
materials that will be bought.
CONCLUSION

ERP
Transaction Oriented Design
Great Planning Capabilities
Separate Constraints Consideration
Long Duration of Queries

SCM
Simulateous Consideration of
Constraints
Easy to Get Answers
Many Visible Enhancement
Provides More Functionality
 FUTURE WORK

Data Consistency Problem

between ERP and SCM
I2 – SAP ALE (Application
Link Enabling)
SIS (Specialized Integration
Software) - CrossWorlds Inc.

Rapid Convergence between

ERP and SCM
 REFERENCES

A Process Change-Oriented Model for ERP Application, Majed Al-Mashari

Cut Costs, Realize Potential with SAP SI’s SCM Approach, SAP White
Paper
ERP vs SCM: What's the difference, ERP Fans White Paper
ERP and APS Applications for Operations Management, Juha Salmi
Enhancing ERP-Architectures for Business Networking, Roland Klueber,
Rainer Alt
SCM Infodays @ SAP Denmark, Dirk Treusch
Advanced Planning and Scheduling (APS) and Extension Systems,
Infotech
E-Business Application Software, Dr. Anol Bhattacherjee
ERP/MRP II – Replace or Enhance, Charles J. Murgiano,
The Impact of ERP on Supply Chain Management, Henk A. Akkermans,
Paul Bogerd, Enver Yucesan
Distributed Decision Making in Supply Chain Management, Christoph
Schneeweiss
Program Related White Papers, SAP – ORACLE – MANUGISTICS – I2
QUESTIONS & ANSWERS

THAN
YOUR
ATTENTION