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Betta Struts develops an e-supply chain

Wednesday 9th of May 2012 Presented at Victoria University, Melbourne, Australia Supply Chain Management

Company background
Established in the UK
Metal framing, electrical and mechanical support systems Nation wide and export customers Turnover of 55 million 650 employees

80 suppliers (local and overseas)

Issues
EBIT inferior at Betta board expectations (5,5% per annum compare to 14%)
This low level could be due to problems with customer relations

Issue Analysis by KPMG

- Not able to supply products effectively - Lack of visibility with customers / customer dissatisfaction - Information system does not incorporate real time web access

Restructure

?
FIN
LOG

HR MKT

Supply Chain structure / Monostrut

Silos Vs Integrated company


Disadvantages of Silos
Efforts not focused on real company issues Time and resources wasted Duplication of efforts Negative affects on collaboration Increased likelihood of errors Breakdown of communication Decrease in staff morale Employee de-motivation

Advantages of Integrated supply chain


Entreprise wide information solution with accurate and timely information Information more reliable and faster Streamlining of departments allows resources to be used in other areas

E-supply chain strategy


Strategy of e-supply chain
A competitive advantage Improve all business activity

Different Methods of EC Electronic Communication


EDI (Electronic Data Interchange)
Internet / Extranet Barcodes International electronic communication Others such as fax, Eftpos,

Applications
Methods of EC are only useful when they enable a supply chain application
Lawrence (2002) : Manufacturer direct sale to end user Manufacturer as information controller Distributor as information controller

System implementation
Kulkarni methods (2005) for e-supply chain implementation
Implementation of an ERP
Adoption of collaborative planning and scheduling Electronic linking of customer and supplier

Implementing an ERP is not an easy process


One project manager Close control of project activities

Four stages to evaluate the degree of integration


Disconnected system
Internal and external interfaces Internal integration and limited external integration Multi enterprise integration

Planned realignment

Implement R3

Change Business Culture

One Freight forwarded

APO System

Implement CRM

Implement R3

Change Business Culture

One Freight forwarded

APO System

Implement CRM

Implement R3
Material Management

Production Planning

SAP

Financial Planning

Sales and Distribution

APO

Implement R3

Change Business Culture

One Freight forwarded

APO System

Implement CRM

Restructure organization
Redevelopment of Employees
Functional department into process teams Training new roles and IT Systems Counseling

Results achieved
Improve customer delivery Response time and cost Developed integration

Implement R3

Change Business Culture

One Freight forwarded

APO System

Implement CRM

Improve logistics
14 Hauliers (local) to 1 haulier (national)
Results achieved
Better price and service Easy to access external Information System

Implement R3

Change Business Culture

One Freight forwarded

APO System

Implement CRM

Demand planning
SAP APO Demand Planning Module was Implemented
Statistical and collaborative technique is used. Pilot study on new supply chain is used.

Implement R3

Change Business Culture

One Freight forwarded

APO System

Implement CRM

Demand planning
FORECASTING

Using 24 month Sales Data

REVIEW FORCATING

Done Individually by Branch Manager

S & OP Meeting

Production Plan

ERP SYSTEM

Update

Implement R3

Change Business Culture

One Freight forwarded

APO System

Implement CRM

Results achieved
Progress on the EBIT level return
Customer focus company through a change of business culture Cost of inventory reduced by 30% thanks to demand planning Delivery cost reduced by 22%

What are the recommendations of Betta Struts supply chain vision and why is each important?
Vision => A total framing solution provider with one face to the customer
Align the service model to what the market requires Plan product movement along the supply chain Introduce common data and processes Improve in-bound logistics

Why are these recommendations important?

What status had Betta Struts achieved for each major IS at the end of the case?

To be implemented

CRM

How did Betta Struts ensure that its people and their culture supported the e-supply chain?
Redeployment of employees
From functional departments to process teams With given performance measures Keep the expert in their field

Training provided

Common meeting with different departments represented : IS Manager, Logistic Manager, National Sales Manager

Recommendations
What else could have they done in term of change management?
Include the employee into the change process (focus group) Create a feedback/discussion platform for employee suggestion

Implement SAP CRM module to help them manage customer relationship Ensure the security of their website Others ?

Questions?

Thank you

References
Total Supply Chain Management, Basu, Ron Wright, J. Nevan
http://reader.eblib.com.au.wallaby.vu.edu.au:2048/(S(ccokoc2l orlznpbfxef1u4sk))/Reader.aspx?p=535029&o=158&u=CP%2b9or %2bpqqzB3%2bT9tLT48Q%3d%3d&t=1336087442&h=4A053563128 88419C3E033CB5C5F251D3526DC0E&s=5831655&ut=507&pg=1&r =img&c=-1&pat=n# Supply Chain, Ian Sadler