Leveraging Network Collaboration for Accurate Clear-to-Build decisions

Patni Computer Systems Sapphire , Orlando May 17, 2010

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Agenda

Introduction and Key Business Drivers for CTB Solution Features Deployment Road Map Why Patni

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Introduction and Key Business Drivers for CTB

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Economic volatility is highlighting new challenges to my Business

Top CEO Issues nCan I align the Production of my Finished Goods to fluctuating Market Demand ? nOn which dates in the future could there be a disruption to our customer fulfillment ? nCan I simulate varying Finished Goods Demand to check my responsiveness ? nCan I have a dashboard that continuously monitors levels of future Finished Goods fulfillments ? n

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Need to ramp up / down to match changing market demand

Extending supply chains aimed at reducing costs and to penetrate new markets has resulted in complex Supply Networks and reduced agility to match demand swings

Extended Supply Chains

Implications nLonger lead times nCoordinate across continents nSupplier networks may not be able to ramp up instantaneously to changing Demand nPin point exact root cause for fulfillment issues not easy
n

Fluctuating Demand
Implications nDifficult to see to what extent Customer Demand can be fulfilled nNo easy tool to simulate supply plans in an outsourced manufacturing scenario nNot sure of which critical component need urgent attention

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S&OP Capabilities - High-Tech Industry Concerns

Significant gaps in determining trade-offs in Supply chain and Implications of a constrained supply plan

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Performance Metrics Sample High Tech Company

Performance Results Key Metrics
Type Metric Company Peer Group P1 Peer Group P2

Potential Benefits: Value of Closing the Gap to Peer Group P1

Gap to Q1
Q1 93.4 92.9 77.9 82.8 1.5 2.9 2.8 25.4 33.7 28.3 34.5

(n= 20)
Avg. % Customer Fulfillment Rate % of Spend Managed Strategically Direct Direct Indirect Services % of Maverick Spend Direct Indirect Services % Spend Sourced via eAuctions Direct Indirect Services FTEs per Billion of Total Spend (Overall) 88.0 70.0 25.0 80.0 5.0 10.0 10.0 15.0 5.0 50.0 208.3 90.8 76.2 32.4 42.6 4.9 12.9 9.9 14.5 6.0 * 147.7 Q1 96.1 98.3 60.0 78.6 1.1 1.6 3.6 56.7 16.7 * 62.1

(n= 87)
Avg. 88.2 68.5 48.9 48.0 8.6 15.5 13.4 6.3 8.3 6.9 113.9

Gap to Average

Effectiveness: CFR Revenue Impact (% increase)

Effectiveness Effectiveness

8.1

2.8
Efficiency: FTE Saving per billion of total spend (in millions)

Efficiency Efficiency

14.6

6.1
% of Time Spent on Transactional Activities 40.0 52.6 34.1 54.7 30.3

Ranking:

Below Average

Between Average and First Quartile

First Quartile

Outlier

Note: Color commentary based on the Peer Group P1 benchmarks unless benchmarks are not available for Peer P1 * Indicates benchmarks not available due to inadequate number of data points for given KPI
Key Observations

Source -SAP Value Engineering

Company could do better demand supply match , material availability management . This would reduce out of stock situations and improve CFR On the efficiency front, automating key processes through supplier collaboration may help optimize the FTE allocation and reduce procurement function cost

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Solution Features

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Clear to Build Dashboard Know your Fulfillment Capability

Components Supplied to Manufacturers for Finished Goods Ramping up Demand seen in the next few months, Can I build to fulfill Demand ?
Brand owner

Need feedback on ability to scale up to Demand

Assembly sites in an outsourced location

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A dashboard on Customer demand fulfillment possibilities

Clear to Build Dashboard To what extent can I fulfill

Quick information on impact of demand variation on supply capability of CMs/ Suppliers Leverage SAP SNC for component stock availability at CM / Supplier location Detailed visibility of constrained components represented geographically Available in xCelsius and WebDynpro formats

Dashboard to provide visibility of demand versus committed supply across entire supply network

Leverage SAP APO CTM engine for material constrained planning and availability check (MRP Sim

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Product Architecture

I UG

Clear to Build Solution

Stock

BOM

Demand Receipts

SNC Supply Network Inventory

APO CTM Engine Advanced Planning and Optimization

Integration to SAP APO for running SNP simulations

Leverages SAPs Supplier Network Collaboration solution to view component inventory at CM location

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ECC

Understand Current Demand Supply Match

Enter Selections and select Go

Double click location product to simulate demand change in next screen

Review and Forecast and Can- Build data

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Simulate Quick MRP with revised Demand Data

1. Modify Demand

2. Confirm and simulate quick CTM results

Output

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Results review with xCelsius version - Graphical View

Shortage Location

Review BOM

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Competition Feature Analysis CTB Dashboard

Feature Comparison
Key Factors: Simulate Clear-to-build FG goods with gating component list
1 2 3 4 5 6 7 8 9 Quick MRP Seamless SAP integration Real time Demand Data Geographical Shortage representation Comprehensive usage of APO planning parameters Flexibility to support ERP upgrade Constrained based Planning Ease of Use Ease of Deployment

CTB Solution
Available Yes Available Available Available Available Available Easier to Operate Plug-n-Play

Competition
Available Not Available Not Available Not Available Not available Not Available Not Available Easier to Operate Complex Config. Multiple setups

Custom Dev.
Available Not Available Not Available Not Available Not available Not Available Available Easier to Operate Complex Config. Multiple setups

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15

Key Benefits of the CTB Solution

Capability
Manage ability to fulfill Demand Simulate Demand Swings Minimize future SC glitches Reduce lost opportunities and stock out penalties

Benefits
Measure ability to fulfill demand of different Finished Goods Simulate the ability to fulfill Demand for Finished Goods in the future with different ramp up scenarios. View potential glitches in the SC Demand ramp up capability. Reduce possible penalties due to stock outs.

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Deployment Road Map

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4 Step Approach for Solution Deployment

Expert Virtual Roundtable : Initial conference with customer to

Step 1

understand Network visibility and available to promise needs, current landscape and challenges

Complementary Value Assessment Workshop: Consulting offer to

Step 2

assess a) Inventory process and Functions (b) Potential Immediate cost savings opportunities (c) Solution options (d) Cost benefit analysis

Proof of Concept : Configure Clear to Build Dashboard Solution in Patnis

Step 3

sand box system using customer data & scenarios. Review detailed deployment road map

& Signoff of

Value Based Implementation: Key features include fixed price Deployment

Step 4

Contract, SCM solution and Integrated Capable to Build

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